Express Scripts 2014 Annual Report Download - page 72

Express Scripts 2014 Annual Report
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Sale of EAV.InDecember2012,wesoldourEAVlineofbusiness,whichprimarilyprovidedhomedelivery
pharmacyservicesinGermanyandrecognizedagainonthesaleofthisbusiness,netofthesaleofitsassets,whichtotaled$3.7
million.Thegainisincludedinthe“Netlossfromdiscontinuedoperations,netoftax”lineitemintheaccompanying
consolidatedstatementofoperationsfortheyearendedDecember31,2012.Priortobeingclassifiedasadiscontinued
operation,EAVwasincludedinourOtherBusinessOperationssegment.
In2012,theCompanydetermineditwasnecessarytoreassesscarryingvaluesofEAV’sassetsandliabilitiesbased
onachangeinbusinessenvironmentrelatedtoanadversecourtrulingbytheGermanhighcourtinAugust2012andthe
expecteddisposalofEAVasaresultoftheruling(Level2).Basedontheassessment,werecordedimpairmentcharges
associatedwiththislineofbusinesstotaling$11.5milliontoreflectthewrite-downof$2.0millionofgoodwilland$9.5
millionofintangibleassets.Thesechargesareincludedinthe“Netlossfromdiscontinuedoperations,netoftax”lineitemin
theaccompanyingconsolidatedstatementofoperationsfortheyearendedDecember31,2012.
Sale of Liberty.InDecember2012,wesoldourLibertylineofbusiness,whichwasincludedwithinourOther
BusinessOperationssegment.LibertysellsdiabetestestingsuppliesandislocatedinPortSt.Lucie,Florida.Followingthesale,
ExpressScriptsworkedasaback-endpharmacysupplierforportionsoftheLibertybusiness.Therefore,theCompanyretained
certaincashflowsassociatedwithLibertyfollowingthesalewhichprecludedclassificationofthisbusinessasadiscontinued
operation.During2012,werecognizedagainonthesaleofthisbusiness,netofthesaleofitsassets,whichtotaled$0.5
million.ThegainisincludedintheSG&Alineitemintheaccompanyingconsolidatedstatementofoperationsfortheyear
endedDecember31,2012.
In2012,asaresultofourplantodisposeofLiberty,animpairmentchargetotaling$23.0millionwasrecorded
againstintangibleassets.Thefairvaluewasdeterminedutilizingthecontractedsalespriceofthebusiness(Level2).This
chargeisincludedintheSG&Alineitemintheaccompanyingconsolidatedstatementofoperationsfortheyearended
December31,2012.Thewrite-downwascomprisedofimpairmentstocustomerrelationshipswithacarryingvalueof$24.2
millionandtradenameswithacarryingvalueof$6.6million.
FromthedateofMergerthroughthedateofdisposal,Liberty’srevenuetotaled$323.9millionandoperatingloss
totaled$32.3million.
Sale of CYC.InSeptember2012,wesoldourCYClineofbusiness,whichwasincludedwithinourOtherBusiness
Operationssegmentandrecognizedagainonthesaleofthisbusiness,netofthesaleofitsassets,whichtotaled$14.3million.
ThegainisincludedintheSG&Alineitemintheaccompanyingconsolidatedstatementofoperationsfortheyearended
December31,2012.During2013,certainworkingcapitalbalancesweresettled,resultingina$3.5milliongain.Thegainis
includedintheSG&AlineitemintheaccompanyingconsolidatedstatementofoperationsfortheyearendedDecember31,
2013.
WedeterminedtheresultsofoperationsforCYCfor2012wereimmaterialtobothconsolidatedandsegment
resultsofoperations,andwehave,therefore,notpresentedtheseresultsseparatelyasdiscontinuedoperations.Operating
income,includingthegainassociatedwiththesale,totaled$14.7millionfortheyearendedDecember31,2012.
Disposition of Europe.During2012,wedeterminedourEuropeanoperations,whichwereincludedwithinour
OtherBusinessOperationssegment,werenolongercoretoourfutureoperationsandcommittedtoaplantodisposeofthis
business.Asaresult,thisbusinesswasclassifiedasdiscontinuedasofDecember31,2012.OurEuropeanoperationsprimarily
consistedofclinicalandspecialtypharmacymanagementservices.During2014,ourEuropeanoperationsweresubstantially
shutdown.
Selected financial information. Theresultsofoperationsforouracuteinfusiontherapieslineofbusiness,various
portionsofUBC,asdefinedabove,EAVandourEuropeanoperationsarereportedasdiscontinuedoperationsforallperiods
presentedintheaccompanyingconsolidatedstatementofoperations.Assuch,resultsofoperationsfortheyearsended
December31,2013and2012reflecttheseoperationsasdiscontinued.Additionally,forallperiodspresented,cashflowsofour
discontinuedoperationsaresegregatedinouraccompanyingconsolidatedstatementofcashflows.Finally,assetsandliabilities
ofthesebusinessesheldaresegregatedinouraccompanyingconsolidatedbalancessheetasofDecember31,2013.Asof
December31,2013,totalassetsofdiscontinuedoperationswere$31.0millionandtotalliabilitiesofdiscontinuedoperations
were$1.4million.
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