Discontinued Operations, Assets Held for Sale and Sale of Assets

9 Months Ended

Sep. 27, 2014

Discontinued Operations, Assets Held for Sale and Sale of Assets

Discontinued Operations, Assets Held for Sale and Sale of Assets

Note 2.  Discontinued Operations, Assets Held for Sale and Sale of Assets

Discontinued Operations

In July 2013, we completed the sale of our former OCP and DES businesses and entered into an amendment to the purchase agreement, which, among other things, increased the target net working capital amount and amended provisions related to employee matters and indemnification.  We continue to be subject to certain indemnification provisions under the terms of the purchase agreement.  In addition, the tax liability associated with the sale is subject to completion of tax return filings in the jurisdictions in which our former OCP and DES businesses operated.

The results of these discontinued operations and loss on sale were as follows:

	Three Months Ended						Nine Months Ended
(In millions)	September 27, 2014			September 28, 2013			September 27, 2014			September 28, 2013
Net sales	$	–		$	–		$	–		$	380.5
Income (loss) before taxes, including divestiture-related and restructuring costs	$	–		$	4.1		$	–		$	(10.6	)
Provision for (benefit from) income taxes	–			(2.9		)	–			.8
Income (loss) from discontinued operations, net of tax before loss on sale	–			1.2			–			(9.8		)
(Loss) gain on sale before taxes	(.4		)	52.2			(3.0		)	52.2
Tax provision on sale	(.3		)	(68.9		)	–			(68.9		)
Loss from discontinued operations, net of tax	$	(.7	)	$	(15.5	)	$	(3.0	)	$	(26.5	)

During the nine months ended September 27, 2014, loss from discontinued operations, net of tax, included costs related to the resolution of certain post-closing adjustments, including completion of the final purchase price allocation in the third quarter of 2014.

During the nine months ended September 28, 2013, loss from discontinued operations, net of tax, included a net gain on curtailment and settlement associated with certain U.S. pension plans.  Refer to Note 6, “Pension and Other Postretirement Benefits,” for furtherinformation. The income tax provision included in the net loss on sale in both the third quarter and first nine months of 2013 reflects tax versus book basis differences, primarily associated with goodwill.

Net sales from continuing operations to discontinued operations were $.8 million and $44.8 million for the three and nine months ended September 28, 2013, respectively. These sales have been included in “Net sales” in the unaudited Consolidated Statements of Income.

Assets Held for Sale and Sale of Assets

We classified certain properties and equipment that we are in the process of selling as “held for sale” in the unaudited Condensed Consolidated Balance Sheets at September 27, 2014 and December 28, 2013.

In September 2014, we sold properties in Framingham, Massachusetts used primarily as the former headquarters of our Retail Branding and Information Solutions business for $3.3 million, recognizing a pre-tax gain of $1.9 million.  In April 2013, we sold the property and equipment of our former corporate headquarters in Pasadena, California for approximately $20 million, recognizing a pre-tax gain of $10.9 million. These gains were recorded in “Other expense, net” in the unaudited Consolidated Statements of Income.