Black & Decker 2015 Annual Report Download - page 114

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100
payments relative to these sites are expected to be $7.8 million in 2016, $4.7 million in 2017, $2.0 million in 2018, $1.9 million
in 2019, $2.0 million in 2020, and $15.2 million thereafter.
The amount recorded for identified contingent liabilities is based on estimates. Amounts recorded are reviewed periodically and
adjusted to reflect additional technical and legal information that becomes available. Actual costs to be incurred in future
periods may vary from the estimates, given the inherent uncertainties in evaluating certain exposures. Subject to the
imprecision in estimating future contingent liability costs, the Company does not expect that any sum it may have to pay in
connection with these matters in excess of the amounts recorded will have a materially adverse effect on its financial position,
results of operations or liquidity.
T. DISCONTINUED OPERATIONS
In the fourth quarter of 2014, the Company classified the Security segment’s Spain and Italy operations (“Security Spain and
Italy”) as held for sale based on management's intention to sell these businesses. As a result of this decision, the Company
recorded a pre-tax impairment loss of $60.7 million in 2014 to remeasure the disposal group at estimated fair value less costs to
sell. In July 2015, the Company completed the sale of these businesses resulting in an insignificant incremental loss.
During 2013, the Company classified two small businesses within the Security and Industrial segments as held for sale based
on management's intention to sell these businesses. As a result of this decision, the Company recorded pre-tax impairment
losses of $22.2 million in 2013 in order to remeasure these businesses at estimated fair value less costs to sell. Both of these
businesses were sold in 2014 resulting in an insignificant incremental loss.
In December 2012, the Company sold its HHI business, including the residential portion of Tong Lung, to Spectrum Brands
Holdings, Inc. ("Spectrum") for approximately $1.4 billion in cash. The purchase and sale agreement stipulated that the sale
occur in a First and Second Closing. The First Closing, which excluded the residential portion of the Tong Lung business,
occurred on December 17, 2012 and resulted in an after-tax gain of $358.9 million. The Second Closing, in which the
residential portion of the Tong Lung business was sold for $93.5 million in cash, occurred on April 8, 2013 and resulted in an
after-tax gain of $4.7 million.
As a result of these actions, the above businesses have been reported as discontinued operations in the Company's Consolidated
Financial Statements. The consolidated balance sheet as of January 3, 2015 aggregates amounts associated with discontinued
operations as described above. Summarized results of discontinued operations are presented in the following table:
(Millions of Dollars) 2015 2014 2013
Net Sales.................................................................................................. $ 39.4 $ 118.4 $ 150.1
Loss from discontinued operations before income taxes ........................ $(19.3)$(104.0) $ (43.0)
Income tax expense (benefit) on discontinued operations ...................... 0.8 (7.7)(13.3)
Net loss from discontinued operations .................................................... $(20.1)$(96.3) $ (29.7)
During 2013, the Company completed the 2012 income tax return filings which included the final calculations of the tax gain
on the HHI sale which took place in 2012. As a result of these tax return filings, the Company recorded an income tax benefit
of approximately $19.1 million within discontinued operations related to finalization of the taxable gain on the HHI sale.
Changes to the original tax gain were driven primarily by the determination of the final purchase price allocation and the
finalization of the U.S. tax basis calculation, both of which were finalized during the year.
As of January 3, 2015, assets and liabilities held for sale relating to Security Spain and Italy totaled $29.5 million and $23.4
million, respectively. There were no assets or liabilities held for sale as of January 2, 2016.