XML 128 R12.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Discontinued Operations
 12 Months Ended
Dec. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations
Note 5. Discontinued Operations
In November 2017, we concluded that the sale of CRM represented a strategic shift in our business that would have a major effect on future operations and financial results. Accordingly, the operating results of CRM are classified as discontinued operations on our consolidated statements of income (loss) for all the periods presented in this Annual Report on Form 10-K.
We completed the CRM Sale on April 30, 2018 to MicroPort Cardiac Rhythm B.V. and MicroPort Scientific Corporation for total cash proceeds of $195.9 million, less cash transferred of $9.2 million, subject to a closing working capital adjustment that could result in a negative adjustment of up to $10.0 million in addition to $14.9 million recorded within accrued liabilities and other at December 31, 2019. In conjunction with the sale, we entered into transition services agreements to provide certain support services generally for up to twelve months from the closing date of the sale. The services include, among others, accounting, information technology, human resources, quality assurance, regulatory affairs, supply chain, clinical affairs and customer support. During the year ended December 31, 2019 and December 31, 2018 we recognized income of $0.9 million and $2.8 million, respectively, for providing these services. Income recognized related to the transition services agreements is recorded as a reduction to the related expenses in the associated expense line items on our consolidated statements of income (loss).
The following table represents the financial results of CRM presented as net income (loss) from discontinued operations, net of tax on our consolidated statements of income (loss) (in thousands):
 
 
Year Ended December 31,
 
 
2019
 
2018
 
2017
Revenues
 
$
—

 
$
77,366

 
$
245,171

Costs and expenses:
 
 
 
 
 
 
Cost of sales
 
(43
)
 
28,028

 
92,609

Selling, general and administrative expenses
 
(161
)
 
43,382

 
105,831

Research and development
 
(161
)
 
16,592

 
37,936

Merger and integration expenses
 
—

 
—

 
22

Restructuring expenses
 
—

 
651

 
(1,617
)
Amortization of intangibles
 
—

 
—

 
12,737

Impairment of tangible and intangible assets
 
—

 
—

 
93,574

Revaluation gain on assets and liabilities held for sale
 
—

 
(1,213
)
 
—

Loss on sale of CRM
 
—

 
214

 
—

Operating income (loss) from discontinued operations
 
365

 
(10,288
)
 
(95,921
)
Foreign exchange and other gains (losses)
 
—

 
102

 
(381
)
Income (loss) from discontinued operations, before tax
 
365

 
(10,186
)
 
(96,302
)
Income tax benefit
 
—

 
(460
)
 
(21,635
)
Losses from equity method investments
 
—

 
(1,211
)
 
(4,887
)
Net income (loss) from discontinued operations
 
$
365

 
$
(10,937
)
 
$
(79,554
)

Cash flows attributable to our discontinued operations are included on our consolidated statements of cash flows. For the years ended December 31, 2018 and December 31, 2017, CRM’s capital expenditures were $1.0 million and $6.1 million, respectively, and stock-based compensation expense was $2.0 million and $1.4 million, respectively. For the year ended December 31, 2017, CRM’s depreciation and amortization was $18.3 million. Income tax benefit for the year ended December 31, 2017 includes a $15.3 million tax benefit recognized on the impairment of CRM.