Discontinued Operations

9 Months Ended

Sep. 30, 2023

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

DISCONTINUED OPERATIONS

In March 2022, the Company sold its 50% equity interest in two joint ventures that produce I-joists for $59 million, resulting in a pre-tax gain associated with the sale of $39 million recorded in the year ended December 31, 2022 within Income from discontinued operations, net of income taxes in the Condensed Consolidated Statements of Income.

On August 1, 2022, the Company completed the sale of the assets related to the EWP segment. As a result of the sale, the Company received $217 million in gross cash proceeds after taking into account working capital adjustments. The Company paid $12 million in direct transaction costs, resulting in net proceeds of $205 million. During the year ended December 31, 2022, the Company recorded a pre-tax gain of approximately $118 million within Income from discontinued operations, net of income taxes in the Condensed Consolidated Statements of Income.

Upon closing, the Company entered into a transition services agreement with the purchaser of the assets, pursuant to which the Company agreed to support the various activities of the EWP segment, which concluded during the three months ended March 31, 2023.

The Company has classified the results of its EWP segment as discontinued operations in its Condensed Consolidated Statements of Income for the prior period presented. The following table presents the financial results of the EWP segment for the three and nine months ended September 30, 2022 (dollar amounts in millions):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022		2022
Net sales	$	67	$	455
Cost of sales	(54)		(352)
Gross profit	13		103
Selling, general, and administrative expenses	(2)		(12)
Income from operations of discontinued operations	12		91
Gain on disposal before income taxes	118		158
Income from discontinued operations before income taxes	130		249
Provision for income taxes	(33)		(53)
Income from discontinued operations, net of income taxes	$	97	$	196

The following summarizes the total cash provided by operations and total cash provided by investing activities related to the EWP segment and included in the Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 (dollar amounts in millions):

Net cash provided by discontinued operating activities	$	18
Net cash provided by discontinued investing activities	$	258

Net cash provided by discontinued investing activities for the nine months ended September 30, 2022, includes $59 million of proceeds from the sale of our 50% equity interest in two joint ventures that produce I-joists and $202 million of net proceeds from the sale of the EWP segment assets.