Nautilus 2008 Annual Report Download - page 72

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Table of Contents
16. DISCONTINUED OPERATIONS
In the fourth quarter of 2007, management committed to a plan to sell the operations of our fitness apparel division, which operated under the
trade name Pearl Izumi. On April 18, 2008 the Company completed its sale of Pearl Izumi. All assets, liabilities and results of operations
associated with Pearl Izumi’s activities are presented in the consolidated financial statements as discontinued operations.
Revenues, income (loss) before income taxes, income tax expense (benefit) and income (loss) generated from the discontinued Pearl Izumi
operations were as follows:
In 2008 and 2007 income (loss) from discontinued operations included impairment losses of $1.3 million and $13.2 million, respectively,
associated with the valuation of Pearl Izumi’s assets prior to the completion of the sale.
The provision for income tax expense for discontinued operations was $2.1 million, in 2007, based on a pretax loss of $7.7 million. Pearl Izumi
had taxable income in 2007, as the loss from discontinued operations included $13.2 million in impairment charges which are not deductible for
tax purposes.
Assets and liabilities for the discontinued operations were zero at December 31, 2008 and as follows at December 31, 2007:
68
Years Ended December 31,
(In thousands)
2008
2007
2006
Revenue
$
27,616
$
67,172
$
63,024
Income (loss) before income taxes
3,016
(7,743
)
6,653
Income tax expense
605
2,058
2,473
Income (loss) from discontinued operations
$
2,411
$
(9,801
)
$
4,180
(In thousands)
2007
Assets:
Current assets
$
28,660
Property and equipment, net
1,411
Goodwill
19,743
Intangible and other assets
23,957
$
73,771
Liabilities:
Current liabilities
$
5,332
Current portion of long
-
term debt
447
Long
-
term debt excluding current portion
3,797
Noncurrent deferred tax liabilities
6,291
$
15,867