|
10. Discontinued Operations
During the quarter ended June 30, 2011, management committed to a plan to sell certain assets and the operations of our Springbox unit since it was not deemed to be part of our core business going forward. As a result, the Springbox assets and operating results have been reclassified to discontinued operations in the accompanying consolidated balance sheets and statements of operations.
On June 1, 2012, we sold the principal assets and operations of our Springbox unit for $0.1 million in cash and a percentage of the revenues collected from the business for three years after the closing date. We have estimated the fair value of the future revenue sharing arrangement at $0.8 million. In addition, the buyer has assumed our obligations under existing customer contracts. The loss on the sale of the Springbox unit is calculated as follows (in thousands):
|
Consideration received: |
|
|
|
|
Cash |
|
$ |
100 |
|
|
Fair value of future revenue sharing |
|
768 |
|
|
Total |
|
868 |
|
|
|
|
|
|
|
Assets sold: |
|
|
|
|
Cash |
|
259 |
|
|
Receivables and other current assets |
|
843 |
|
|
Property and equipment |
|
350 |
|
|
Intangible assets |
|
416 |
|
|
Total |
|
1,868 |
|
|
|
|
|
|
|
Loss on sale of discontinued operation before income taxes |
|
(1,000 |
) |
|
Benefit for income taxes |
|
400 |
|
|
|
|
|
|
|
Loss on sale of discontinued operation, net of tax |
|
$ |
(600 |
) |
Operating results of discontinued operations for the three and six months ended June 30, 2012 and 2011 are as follows (in thousands):
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
|
|
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
|
Revenues |
|
$ |
654 |
|
$ |
1,032 |
|
$ |
1,585 |
|
$ |
2,247 |
|
|
Cost of revenues |
|
677 |
|
1,092 |
|
1,677 |
|
2,199 |
|
|
Depreciation and amortization |
|
— |
|
188 |
|
— |
|
374 |
|
|
Other operating expenses |
|
292 |
|
227 |
|
708 |
|
497 |
|
|
Loss before income taxes |
|
(315 |
) |
(475 |
) |
(800 |
) |
(823 |
) |
|
Benefit for income taxes |
|
126 |
|
190 |
|
320 |
|
329 |
|
|
Loss from discontinued operations |
|
(189 |
) |
(285 |
) |
(480 |
) |
(494 |
) |
|
Loss on sale of discontinued operations, net of tax |
|
(600 |
) |
— |
|
(600 |
) |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
$ |
(789 |
) |
$ |
(285 |
) |
$ |
(1,080 |
) |
$ |
(494 |
) | |