Discontinued Operations

6 Months Ended

Jun. 30, 2011

Discontinued Operations

Discontinued Operations

15.  DISCONTINUED OPERATIONS

On March 10, 2011, the Company sold the stock of the United Steel Products business (USP) for cash proceeds of $59,029,000 including a working capital adjustment.The divestiture of USP allowed the Company to allocate capital resources to businesses with strong market leadership positions and growth potential.The Company recognized a pre-tax gain of $14,022,000 from the transaction.

On February 1, 2010, the Company sold the majority of the assets of the Processed Metal Products business.The assets were sold for $29,164,000, net of a working capital adjustment of $936,000.This transaction finalized the Company's exit from the steel processing business and established the Company solely as a manufacturer and distributor of products for building markets.The Company incurred an after-tax loss of $19,451,000 from the transaction, net of an $11,424,000 tax benefit for the six months ended June 30, 2010.The Company did not sell certain real estate held by the Processed Metal Products business and the receivables generated from the operation of the business prior to its sale.Subsequent to February 1, 2010, the Company collected these receivables net of uncollectible amounts.As of June 30, 2011 and December 31, 2010, the remaining property, plant, and equipment were classified as assets of discontinued operations on the consolidated balance sheet.These assets were held for sale as of June 30, 2011 and December 31, 2010 and are reflected at the lesser of their carrying values or fair values less cost to sell.

The results of operations for USP and the Processed Metal Products business have been classified as discontinued operations in the consolidated financial statements for all periods presented.  The Company allocates interest to its discontinued operations in accordance with FASB ASC Subtopic 205-20, "Presentation of Financial Statements – Discontinued Operations".

Components of the loss from discontinued operations, including the interest allocated to discontinued operations, for the three and six months ended June 30 are as follows (in thousands):

		Three Months Ended June 30,				Six Months Ended June 30,
		2011		2010		2011		2010
Net sales	$	-	$	14,847	$	9,057	$	42,276
Operating expenses		(78)		(12,823)		(8,920)		(39,004)
Gain (loss) on sale of business		1,029		(238)		14,022		(30,875)
Interest expense allocation		-		(327)		(262)		(1,023)
Income (loss) from discontinued operations      before taxes	$	951	$	1,459	$	13,897	$	(28,626)