Tyson Foods 2000 Annual Report Download - page 38

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TYSON FOODS, INC. 2000 ANNUAL REPORT
NOTE 3: DISPOSITIONS
On July 17, 1999, the Company completed the sale of the
assets of Tyson Seafood Group in two separate transactions.
Under the terms of the agreements, the Company received
proceeds of approximately $165 million, which was used to
reduce indebtedness, and subsequently collected receivables
totaling approximately $16 million. The Company recognized
a pretax loss of approximately $19 million on the sale of the
seafood assets.
Effective December 31, 1998, the Company sold Willow
Brook Foods, its integrated turkey production and processing
business, and its Albert Lea, Minn., processing facility which
primarily produced sausages, lunch and deli meats. In addi-
tion, on December 31, 1998, the Company sold its National
Egg Products Company operations in Social Circle, Ga. These
facilities were sold for amounts that approximated their
carrying values. These operations were acquired as part of the
Hudson Acquisition.
NOTE 4: IMPAIRMENT AND OTHER CHARGES
In the fourth quarter of fiscal 1999, the Company recorded
a pretax charge totaling $35 million related to the antici-
pated loss on the sale and closure of the Pork Group assets.
In the first quarter of fiscal 2000, the Company ceased nego-
tiations for the sale of the Pork Group. Additionally, in the
fourth quarter of fiscal 1999, the Company recorded pretax
charges totaling $23 million for impairment of property and
equipment and write-down of related excess of investments
over net assets acquired of Mallard’s Food Products.
In the fourth quarter of fiscal 1998, as a result of
the Company’s restructuring plan, pretax charges totaling
$215 million were recorded. These charges were classified in
the Consolidated Statements of Income as $142 million asset
impairment and other charges, $48 million in selling expenses,
$21 million in cost of sales and $4 million in other expense.
NOTE 5: ALLOWANCE FOR DOUBTFUL ACCOUNTS
On January 31, 2000, AmeriServe Food Distribution, Inc.
(AmeriServe), a significant distributor of products to fast food
and casual dining restaurant chains, filed for reorganization
in Delaware under Chapter 11 of the federal Bankruptcy
Code. The Company is a major supplier to several
AmeriServe customers. In the second quarter of fiscal 2000,
the Company recorded a $24 million bad debt reserve to fully
reserve the AmeriServe receivable. At September 30, 2000,
and October 2, 1999, allowance for doubtful accounts,
excluding the AmeriServe writeoff, was $17 million and
$22 million, respectively.
36