Discontinued Operations

9 Months Ended

Nov. 01, 2014

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

On April 24, 2014, the Company committed to a plan to wind down the operations of its Arden B brand (the "Plan") due to the long-term financial under-performance of the business. As of August 2, 2014, the Company operated 51 Arden B stores. During the Company's third quarter, 30 of the Arden B stores became Wet Seal Plus stores, and 18 of the Arden B stores became Wet Seal stores, one of the Arden B stores continues to operate under the Arden B name, but has been transitioned to carry Wet Seal product, and the 2 remaining stores closed in August 2014. The Company closed down the Arden B website in the third fiscal quarter of 2014.

The Company evaluated the applicable accounting guidance for discontinued operations due to the wind down of the Arden B operations and concluded that the Arden B segment should be reported as discontinued operations. Arden B cash flows have ceased as of November 1, 2014, the end of the third quarter. The Company will not have any significant continuing involvement with the Arden B segment, and therefore, the Arden B segment has met the conditions to be reported as a discontinued operation beginning in the third quarter of fiscal 2014. The Company maintains its intellectual property rights in the Arden B brand and affiliated trademarks and is exploring opportunities to preserve or monetize those rights. Financial information for the 13 and 39 weeks ended November 1, 2014, and November 2, 2013 has been adjusted for the presentation of discontinued operations.

The operating results of discontinued operations for Arden B included in the accompanying condensed consolidated statements of operations are as follows:

	13 Weeks Ended						39 Weeks Ended
	November 1, 2014			November 2, 2013			November 1, 2014			November 2, 2013
Net Sales	$	441		$	12,786		$	26,314		$	47,113
Income (loss) before income taxes	77			(2,427		)	(5,501		)	(1,379		)
(Benefit) provision for income taxes	(4		)	1			10			12
Income (loss) from discontinued operations	$	81		$	(2,428	)	$	(5,511	)	$	(1,391	)

The income (loss) from discontinued operations for the 13 and 39 weeks ended November 1, 2014 and November 2, 2013, include asset impairments of none, $3.3 million, $0.3 million and $0.8 million, respectively. The asset impairment of $3.3 million for the 39 weeks ended November 1, 2014 included $0.4 million of impairments for the Arden B website. Upon ceasing these operations, the Company transitioned most of the Arden B store employees to Wet Seal and Wet Seal Plus stores.