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Note 10 - Discontinued Operations
6 Months Ended
Aug. 26, 2018
Notes to Financial Statements  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
1
0
DISCONTINUED OPERATIONS
 
On
July 25, 2018,
the Company entered into a definitive agreement to sell its Electronics Business for
$145,000
in cash.  The Company expects this transaction to be completed in the
fourth
quarter of the
2019
fiscal year.
 
The Company has classified the operating results of its Electronics Business, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statement of Operations.
 
The following table shows the summary operating results of the discontinued operations:
 
   
13 Weeks Ended (Unaudited)
   
26 Weeks Ended (Unaudited)
 
                         
   
August 26,
   
August 27,
   
August 26,
   
August 27,
 
   
2018
   
2017
   
2018
   
2017
 
                                 
Net sales
  $
17,843
    $
18,481
    $
38,552
    $
37,172
 
Cost of sales
   
13,884
     
14,512
     
28,937
     
29,178
 
Gross profit
 
 
3,959
   
 
3,969
   
 
9,615
   
 
7,994
 
Selling, general and administrative expenses
   
2,448
     
2,203
     
5,046
     
4,115
 
Restructuring charges
   
454
     
2,902
     
757
     
4,638
 
Earnings (loss) from discontinued operations before income taxes
 
 
1,057
   
 
(1,136
)
 
 
3,812
   
 
(759
)
Income tax (benefit) provision
   
181
     
(797
)    
584
     
(1,742
)
Net earnings (loss) from discontinued operations
 
$
876
   
$
(339
)
 
$
3,228
   
$
983
 
 
The following table shows the summary assets and liabilities of the discontinued operations:
 
   
August 26,
2018
   
February 25,
2018*
 
   
(unaudited)
   
 
 
 
Carrying Amount of Major Classes of Assets Included as Part of Discontinued Operations:
 
 
 
 
 
 
 
 
Accounts Receivable, Net
  $
13,081
    $
12,801
 
Inventories
   
8,717
     
7,201
 
Fixed Assets, Net
   
6,190
     
6,727
 
Prepaid Expenses and Other Current Assets
   
826
     
646
 
Total Major Assets Included as Part of Discontinued Operations
 
 
28,814
   
 
27,375
 
                 
Other Assets
   
5,216
     
5,072
 
Total Assets Included as Part of Discontinued Operations
 
$
34,030
   
$
32,447
 
                 
Carrying Amount of Major Classes of Liabilities Included as Part of Discontinued Operations:
 
 
 
 
 
 
 
 
Accounts Payable
  $
2,736
    $
2,200
 
Accrued Liabilities
   
4,200
     
4,360
 
Deferred Income Taxes
   
618
     
618
 
Income Taxes Payable
   
1,234
     
1,364
 
Total Major Liabilities Included as Part of Discontinued Operations
 
 
8,788
   
 
8,542
 
                 
Other Liabilities
   
228
     
229
 
Total Liabilities Included as Part of Discontinued Operations
 
$
9,016
   
$
8,771
 
 
* These amounts have not been audited, but are derived from the audited financial statements.
 
During the
2018
fiscal year, the Company consolidated its Nelco Products, Inc. Business Unit located in Fullerton, California and its Neltec, Inc. Business Unit located in Tempe, Arizona. The Company estimates the remaining pre-tax charge in connection with the consolidation to be approximately
$1,020,
which the Company expects to incur primarily during the fiscal year ending
February 28, 2021.
 
The restructuring expenses were
$117
and
$169
 during the
13
-week and
26
-week periods ended
August 26, 2018,
respectively, and
$2,813
and
$4,063
during the
13
-week and
26
-week periods ended
August 27, 2017,
respectively.
 
The following table sets forth the charges and accruals related to the consolidation:
 
   
Accrual
May 27,
2018
   
Current
Period
Charges
   
Cash
Payments
   
Non-Cash
Charges
   
Accrual
August 26,
2018
   
Total
Expense
Accrued to
Date
   
Total
Expected
Costs
 
Facility Lease Costs
  $
1,965
    $
51
    $
(181
)   $
-
    $
1,835
    $
2,800
    $
2,800
 
Severance Costs
   
-
     
-
     
-
     
-
     
-
     
1,081
     
1,081
 
Equipment Removal
   
-
     
-
     
-
     
-
     
-
     
-
     
700
 
Other
   
-
     
66
     
(66
)    
-
     
-
     
717
     
919
 
Total Restructuring Charges
 
$
1,965
   
$
117
   
$
(247
)
 
$
-
   
$
1,835
   
$
4,598
   
$
5,500
 
 
 
The Company recorded additional restructuring charges of
$77
and
$208
during the
13
-week and
26
-week periods ended
August 26, 2018,
respectively, and
$89
and
$200
during the
13
-week and
26
-week periods ended
August 27, 2017,
respectively, related to the closure in the
2009
fiscal year of the Company’s New England Laminates Co., Inc. Business Unit located in Newburgh, New York. The New England Laminates Co., Inc. building in Newburgh, New York is held for sale. In the
2004
fiscal year, the Company reduced the book value of the building to zero, and the Company intends to sell it during the
2019
fiscal year.