Note 3. – Discontinued Operations

All of the businesses discussed in the note below are reported as discontinued operations and the condensed consolidated financial statements for all prior periods have been adjusted to reflect this presentation.

Results for all of the businesses included in discontinued operations are presented in the following table:


	Three Months Ended March 31,						Nine Months Ended March 31,
	2018			2017			2018			2017
Net Revenues:
Chestatee Hospital	$	0		$	0		$	0		$	2,369
Other Sold Hospitals		77			(68	)		71			(288	)

	$	77		$	(68	)	$	71		$	2,081

Earnings (Loss) before income taxes:
Chestatee Hospital	$	0		$	(104	)	$	(38	)	$	83
Other Sold Hospitals		61			(69	)		45			(304	)
Life sciences and engineering		(36	)		(37	)		(108	)		(112	)
Gain (Loss) on sale of Chestatee Hospital		(9	)		0			(9	)		7,270

Earnings (Loss) before income taxes		16			(210	)		(110	)		6,937
Income tax expense		0			(75	)		0			2,650

Earnings (Loss) from discontinued operations	$	16		$	(135	)	$	(110	)	$	4,287

Chestatee Hospital – On August 19, 2016, Southern Health Corporation of Dahlonega, Inc., (“Chestatee”), a wholly owned subsidiary of the Company, sold substantially all of the assets and certain liabilities of Chestatee Regional Hospital in Dahlonega, Georgia through an asset purchase agreement for $15,000 subject to adjustment for the book value of certain assets and certain liabilities assumed at the sale date. The pre-tax gain on sale of $7,270 is subject to adjustment for various purchase price adjustments. A purchase price adjustment of $328 is due to the Company from the hospital buyer as a post-closing adjustment to the purchase price as confirmed by a binding decision of an independent accountant rendered pursuant to the purchase agreement. Chestatee retained certain liabilities, including certain employee related liabilities and certain Medicare and Medicaid liabilities, relating to the period it owned and operated the hospital. A portion of the net proceeds was used for the repayment of debt.

Other Sold Hospitals – Subsidiaries of the Company sold substantially all of the assets of three hospitals (“Other Sold Hospitals”) during the period July 2, 2012 to December 31, 2014. The earnings (loss) before income taxes of the Other Sold Hospitals results primarily from prior year Medicare and Medicaid cost report settlements.

Life Sciences and Engineering Segment – SunLink retained a defined benefit retirement plan which covered substantially all of the employees of this segment when the segment was sold in fiscal 1998. Effective February 28, 1997, the plan was amended to freeze participant benefits and close the plan to new participants. Pension expense and related tax benefit or expense is reflected in the results of operations for this segment for the three and nine months ended March 31, 2018 and 2017.

The components of pension expense for the three and nine months ended March 31, 2018 and 2017, respectively, were as follows:


	Three Months Ended March 31,						Nine Months Ended March 31,
	2018			2017			2018			2017
Interest Cost	$	14		$	13		$	42		$	39
Expected return on assets		(9	)		(8	)		(27	)		(24	)
Amortization of prior service cost		31			32			93			97

Net pension expense	$	36		$	37		$	108		$	112

SunLink contributed $105 to the plan in the nine months ended March 31, 2018 and expects to contribute an additional $35 during the last fiscal quarter of the fiscal year ending June 30, 2018.