Discontinued Operations

3 Months Ended

Mar. 31, 2017

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

2. Discontinued Operations

During the Current Quarter, our Board of Directors approved a plan to sell the businesses underlying our Entertainment segment.  On May 9, 2017, we signed a definitive agreement to sell these businesses for $345 million in cash, subject to a customary working capital adjustment.  Subject to customary closing conditions, we expect to close this transaction between the end of the second quarter and the beginning of the third quarter of the year ending December 31, 2017.  We have classified the results of our Entertainment segment as discontinued operations in our condensed consolidated statement of operations for all periods presented.  Additionally, the assets and liabilities associated with the discontinued operations are classified as held for sale in our condensed consolidated balance sheets.  The assets and liabilities as of March 31, 2017 and December 31, 2016 are classified as current in our condensed consolidated balance sheet as we expect to close the sale of the Entertainment segment within one year of such date.

The financial results of our Entertainment segment through March 31, 2017 are presented as income from discontinued operations, net of income taxes, in our condensed consolidated statement of operations.  The following table presents financial results of the Entertainment segment for the Current Quarter and the three months ended March 31, 2016 (“Prior Year Quarter”):

	Three Months Ended March 31,
	2017			2016
	(unaudited)
Licensing revenue	$	27,461		$	26,956
Selling, general and administrative expenses		17,850			18,888
Depreciation and amortization		185			132
Operating income		9,426			7,936
Other expenses (income):
Interest expense		6,122			1,692
Interest income		(99	)		(183	)
Loss on extinguishment of debt		15,737			—
Foreign currency translation loss (gain)		143			(810	)
Other expenses – net		21,903			699
Income (loss) from operations of discontinued operations    before income taxes		(12,477	)		7,237
Provision (benefit) for income taxes		(5,098	)		1,772
Net income (loss) from discontinued operations		(7,379	)		5,465
Less: Net income attributable to non-controlling interest from    discontinued operations		1,303			1,478
Income (loss) from discontinued operations, net of income    taxes	$	(8,682	)	$	3,987

Upon consummation of the sale of the Entertainment segment, the cash proceeds therefrom will be utilized by the Company to make mandatory principal prepayments on both its Senior Secured Notes and Senior Secured Term Loan (as well as a corresponding prepayment premium).  As a result and in accordance with ASC 205-20-45-6, for the Current Quarter and Prior Year Quarter, the Company has allocated interest expense of $6.1 million (which includes $0.6 million of amortization of the original issue discount on the Senior Secured Term Loan) and $1.6 million, respectively, from continuing operations to discontinued operations.  Additionally, for the Current Quarter, the Company has allocated the prepayment premium of $15.7 million related to the Senior Secured Term Loan from continuing operations to discontinued operations on the Company’s condensed consolidated statement of operations – refer to Note 6 for further details.

The following table presents the aggregate carrying amounts of the classes of held for sale assets and liabilities as of March 31, 2017 and December 31, 2016:

	March 31, 2017		December 31, 2016
	(unaudited)
Carrying amounts of assets included as part of    discontinued operations
Cash and cash equivalents	$	15,403	$	12,297
Accounts receivable, net		19,880		20,811
Other assets – current		1,507		598
Property and equipment		2,550		2,664
Other assets		6,917		8,505
Trademarks and other intangibles, net		204,307		204,348
Investments and joint ventures		90		90
Goodwill		53,029		53,029
Total assets classified as held for sale in the condensed    consolidated balance sheet	$	303,683	$	302,342
Carrying amounts of liabilities included as part of    discontinued operations
Accounts payable and accrued expenses	$	9,997	$	11,760
Deferred revenue		12,947		11,767
Other liabilities		4,112		5,056
Total Liabilities classified as held for sale in the condensed    consolidated balance sheet	$	27,056	$	28,583

The following table presents cash flow of the Entertainment segment during the Current Quarter and Prior Year Quarter:

	Three Months Ended March 31,
	2017			2016
Net cash provided by (used in) discontinued operating    activities	$	(1,352	)	$	15,573
Net cash provided by (used in) discontinued investing    activities	$	(31	)	$	102
Net cash used in discontinued financing activities	$	—		$	—