Discontinued Operations

9 Months Ended

Sep. 30, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

On September 30, 2013, the Company completed the sale of certain assets comprising its Portamedic service line. The Portamedic service line is accounted for as a discontinued operation in this Report. During 2014, the Company sold certain assets comprising the Heritage Labs and Hooper Holmes Services business to Clinical Reference Laboratory, Inc. ("CRL"). The assets sold to CRL qualified as assets held for sale in April 2014. The operating results of these businesses are also segregated and reported as discontinued operations in this Report.

Following the sale of the Portamedic service line, the Company reassessed its segment reporting. Beginning in the fourth quarter of 2013, the Company began reporting financial results in three segments: Health and Wellness (health risk assessments including biometric screenings), Heritage Labs (laboratory testing) and Hooper Holmes Services (health information services). Following the sale of Heritage Labs and Hooper Holmes Services in the third quarter of 2014, the Company reverted to one reporting segment, Health and Wellness. The continuing operations and the Heritage Labs, Hooper Holmes Services and Portamedic discontinued segments had customers and suppliers in common. The continuing and discontinued operations also shared certain selling, general and administrative services. As a result, the Company does not have reliable information for the historical impact of Heritage Labs and Hooper Holmes Services on our cash flows for the three and nine month periods ended September 30, 2014.

The following table summarizes the major classes of line items constituting the pretax results of operations of Heritage Labs and Hooper Holmes Services for the three and nine month periods ended September 30, 2014, which are reported as a component of discontinued operations in the consolidated statement of operations. There was no significant activity in discontinued operations during the three and nine month periods ended September 30, 2015. There was no income tax recorded in discontinued operations for Heritage Labs and Hooper Holmes Services for any period presented.

	Three Months Ended			Nine Months Ended
(in thousands)	September 30, 2014			September 30, 2014
Revenues
Heritage Labs	$	405		$	4,122
Hooper Holmes Services	$	1,694		$	7,289
Total revenue	$	2,099		$	11,411
Cost of Sales
Heritage Labs	$	529		$	3,511
Hooper Holmes Services	$	1,367		$	6,245
Total cost of sales	$	1,896		$	9,756
Selling, General & Administrative Expenses
Heritage Labs	$	179		$	462
Hooper Holmes Services	$	975		$	2,657
Tail coverage insurance expense	$	1,390		$	1,390
Total selling, general & administrative expenses	$	2,544		$	4,509
(Loss) income from Discontinued Operations
Heritage Labs	$	(302	)	$	150
Hooper Holmes Services	$	(649	)	$	(1,614	)
Tail coverage insurance expense	$	(1,390	)	$	(1,390	)
Total loss from discontinued operations	$	(2,341	)	$	(2,854	)
Reconciliation to statement of operations:
Portamedic discontinued operations and other	$	(398	)	$	(467	)
Loss on sale of subsidiaries, net of adjustments	$	1,354		$	1,204
Loss from discontinued operations	$	(1,385	)	$	(2,117	)

Operating cash flow from discontinued operations during the nine month period endedSeptember 30, 2014, was $0.5 million. Changes in working capital from discontinued operations during the nine month period endedSeptember 30, 2014, was $0.6 million. The Company recorded non-cash operating charges for depreciation and bad debt expense of $0.3 million and a non-cash operating charge of $1.0 million for the remaining operating lease payments associated with the discontinued Hooper Holmes Services operations. There were no other significant investing or financing activities from discontinued operations during the nine month period endedSeptember 30, 2014. The determination of operating cash flow from discontinued operations for the nine month period endedSeptember 30, 2014, includes a degree of management judgment and estimates. The Company has not allocated any general corporate overhead to discontinued operations.

The Company had receivables recorded that are due from the buyer of its Portamedic service line in connection with a transition service agreement between the parties. The Company settled all receivables due from the buyer of its Portamedic business lineon September 30, 2015, for $0.23 million, resulting in a loss in discontinued operations of $0.1 million.