Sale of In-Store Marketing Business and Presentation as Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2023

Sale of In-Store Marketing Business and Presentation as Discontinued Operations

Summary of gain on sale of buiness

Sale price	$	3,500,000
Carrying value of assets sold, less liablities		(247,000	)
Transaction costs not previously expensed		(209,000	)
Gain on sale of In-Store Marketing Business	$	3,044,000

Summary of balance sheet adjustments

	December 31,
	2022
Current Assets:
Accounts receivable	$	5,557,000
Inventories		29,000
Prepaid production costs		535,000
Other prepaid expense		50,000
Current assets related to discontinued operations	$	6,171,000
Other Assets:
Property and equipment, net	$	71,000
Operating lease right-of-use assets		144,000
Non-current assets related to discontinued operations	$	215,000
Current Liabilities:
Accounts payable	$	2,515,000
Sales tax		717,000
Accrued liabilities		1,003,000
Current portion of operating lease liabilities		4,000
Deferred revenue		2,427,000
Current liabilities related to discontinued operations	$	6,666,000
Long-Term Liabilities:
Operating lease liabilities	$	140,000
Non-current liabilities related to discontinued operations	$	140,000

Summary of operations adjustments

	Three Months Ended						Nine Months Ended
	September 30						September 30
	2023			2022			2023		2022
Net services revenues	$	1,976,000		$	4,869,000		$	21,018,000	$	14,271,000
Cost of services		1,568,000			4,031,000			16,067,000		11,737,000
Gross Profit		408,000			838,000			4,951,000		2,534,000
Operating Expenses:
Selling		410,000			294,000			1,135,000		926,000
Marketing		210,000			249,000			806,000		787,000
General and administrative		142,000			268,000			642,000		647,000
Total Operating Expenses		762,000			811,000			2,583,000		2,360,000
Gain from litigation settlement, net		—			12,000,000			—		12,000,000
Operating Income (Loss)		(354,000	)		12,027,000			2,368,000		12,174,000
Other income		21,000			17,000			54,000		45,000
(Loss) income from discontinued operations before income taxes		(333,000	)		12,044,000			2,422,000		12,219,000
Income tax benefit		—			(191,000	)		—		(173,000	)
(Loss) income from discontinued operations, net of tax	$	(333,000	)	$	12,235,000		$	2,422,000	$	12,392,000
Gain from sale of discontinued operations before income taxes		3,044,000			—			3,044,000		—
Income tax expense		74,000			—			74,000		—
Gain from sale of discontinued operations, net of tax	$	2,970,000		$	—		$	2,970,000	$	—