Dispositions and Special Charges

3 Months Ended

Mar. 31, 2018

Discontinued Operations and Disposal Groups [Abstract]

Dispositions and Special Charges

Dispositions and Special Charges

The Company’s discontinued operations include the results of the SARL Businesses sold in March 2017 and the NATG business sold in December 2015 (See Note 1). 

In the first quarter of 2018 the Company recorded discontinued operations special charges related to the wind down of the SARL Businesses of $0.1 million for legal and professional fees. These charges required or will require the use of cash. The Company expects that total additional charges related to the wind down of the SARL businesses will be less than $1.0 million.

The Company's NATG discontinued operations received $0.7 million in restitution receipts from a former executive of NATG in the first quarter of 2018, reversed lease reserves of approximately $0.2 million related to their leased facilities and recorded legal and professional fees, related to the ongoing restitution proceedings, of $0.1 million. The Company expects that total additional charges related to the sale of the NATG business after this quarter will be between $1.0 million and $2.0 million and that these charges will be presented in discontinued operations. Additional costs may be incurred in NATG for outstanding leased facilities as they are settled or sublet (see Note 1). Most of these anticipated costs will require the use of cash. Amounts that are unpaid at March 31, 2018 are recorded in Accrued expenses and other current liabilities and Other liabilities (long term) in the accompanying condensed consolidated balance sheets.

Below is a summary of the impact on net sales, net income (loss) and net income (loss) per share from discontinued operations for the three month periods ended March 31, 2018 and 2017. A reconciliation of pretax income (loss) of Discontinued operations to the Net Income (loss) of discontinued operations is as follows (in millions):

	Three Months Ended March 31,
	2018			2017
Net sales	$	0.0		$	117.0
Cost of sales	0.0			102.9
Gross profit	0.0			14.1
Selling, distribution & administrative expenses	0.4			18.6
Special charges	(0.7		)	23.9
Operating income (loss) from discontinued operations	0.3			(28.4		)
Interest and other (income) expenses, net	(0.2		)	0.3
Income (loss) from discontinued operations before income taxes	0.5			(28.7		)
Provision for income taxes	0.1			0.1
Net income (loss) from discontinued operations	$	0.4		$	(28.8	)
Net income (loss) per share – basic and diluted	$	0.01		$	(0.78	)

Total special charges incurred in the first quarter of 2017, totaled approximately $23.9 million. The combined loss on the sale of the SARL Businesses totaled $23.3 million, which included an $8.2 million loss on the sale of net assets, $14.4 million of translation adjustments, and $0.7 million of legal, professional and other costs. In addition, NATG discontinued operations incurred approximately $0.3 million of special charges primarily related to updating our future lease cash flows and $0.3 million related to the ongoing restitution proceedings against certain former NATG executives.

The following table details liabilities related to the sold NATG segment’s leases and other costs and liabilities that remain from the sold Misco Germany business as of March 31, 2018 (in millions):

	ETG – Lease liabilities and other costs		NATG – Lease liabilities and other exit costs			Total
Balance January 1, 2018	$	1.2	$	19.0		$	20.2
Charged to expense (income)	0.0		(0.2		)	(0.2		)
Paid or otherwise settled	0.0		(5.1		)	(5.1		)
Balance March 31, 2018	$	1.2	$	13.7		$	14.9

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