Discontinued Operations

9 Months Ended

Sep. 30, 2013

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

4. Discontinued Operations

Management evaluates Dover’s businesses periodically for their strategic fit within Dover’s operations. Accordingly, in the fourth quarter of 2012, the Company announced its intention to divest certain non-core businesses within the Printing & Identification segment serving the electronic assembly and test markets, consistent with its long-term focus on strengthening its portfolio and reducing its exposure to cyclical markets. Management expects to sell these businesses in the fourth quarter of 2013 or early 2014. As a result, the Company has reclassified the operations, cash flows, and related assets and liabilities of these businesses, DEK International and Everett Charles Technologies ("ECT"), to discontinued operations for all periods presented.

Summarized results of the Company’s discontinued operations are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Revenue	$	106,974		$	111,174		$	309,900		$	338,337
(Loss) gain on sale and impairments, net of tax	—			(634		)	(18,668		)	1,226
Earnings from operations before taxes	7,531			11,531			26,108			29,693
Benefit from (provision for) income taxes	(2,069		)	(3,181		)	46,733			(4,604		)
Earnings from operations, net of tax	5,462			8,350			72,841			25,089
Earnings from discontinued operations, net of tax	$	5,462		$	7,716		$	54,173		$	26,315

Earnings from discontinued operations of $5,462 and $54,173 for the three and nine months ended September 30, 2013, respectively, reflect net earnings from operations generated by those businesses discontinued in 2012, as well as various expense and accrual adjustments relating to other discontinued operations. The tax benefit for the three and nine months ended September 30, 2013 includes $1,971 and $54,425, respectively, of discrete tax benefits principally related to the conclusion of certain federal, state and international tax audits.

In 2013, in connection with a change in goodwill reporting units within discontinued operations resulting from the Company's expected manner of disposing of its electronic test and assembly businesses, the Company was required to allocate goodwill to these individual reporting units based upon relative current fair values. This process resulted in a benefit of $25,520 in the discontinued operations deferred income tax provision for the nine months ended September 30, 2013 as a result of the elimination of certain deferred tax liabilities. The Company recorded a goodwill impairment charge of $54,532 ($44,188 after tax) for the nine months ended September 30, 2013 in connection with the anticipated sale of these businesses. This charge was a write-down of the carrying value to fair value, based on the current estimated sales price. The Company expects to complete the sale of these businesses in the fourth quarter of 2013 or early 2014.

Earnings from discontinued operations of $7,716 and $26,315 for the three and nine months ended September 30, 2012, respectively, primarily reflect net earnings from operations of DEK and ECT, as well as adjustments to sale proceeds for businesses sold in prior years.

Assets and liabilities of discontinued operations are summarized below:

	September 30, 2013		December 31, 2012
Assets of Discontinued Operations
Accounts receivable	$	78,272	$	63,229
Inventories, net	54,170		51,252
Prepaid and other current assets	15,348		10,263
Total current assets	147,790		124,744
Property, plant and equipment, net	35,778		31,935
Goodwill and intangible assets, net	186,597		238,657
Other assets and deferred charges	5,335		2,209
Total assets	$	375,500	$	397,545
Liabilities of Discontinued Operations
Accounts payable	$	28,822	$	22,613
Other current liabilities	35,037		34,592
Total current liabilities	63,859		57,205
Deferred income taxes	27,898		64,853
Other liabilities	41,673		86,900
Total liabilities	$	133,430	$	208,958

At September 30, 2013 and December 31, 2012, the assets and liabilities of discontinued operations relate primarily to the two businesses reclassified to held for sale in the fourth quarter of 2012, coupled with tax-related accruals and unrecognized benefits, as well as other accruals for compensation, legal, environmental, and warranty contingencies, none of which are individually significant, relating to businesses that were sold in prior years.