Nutrisystem 2010 Annual Report Download - page 30

December 31,
2010 2009 2008 2007 2006
Balance Sheet Data:
Cash, cash equivalents and marketable securities .... $ 41,219 $ 62,522 $ 38,309 $ 42,448 $ 80,278
Working capital .............................. 74,020 103,341 78,448 103,349 134,049
Total assets .................................. 149,953 170,787 159,471 198,560 197,867
Borrowings under credit facility ................. 30,000 ————
Non-current liabilities ......................... 5,313 1,550 1,298 1,006 831
Stockholders’ equity ........................... 74,976 128,963 115,825 141,502 145,302
(a) In June 2009, we abandoned our interest in Zero Technologies, LLC (“Zero Water”) as management
determined that the business was no longer aligned with our current strategic direction. An equity and
impairment loss of $4,000 was recorded during 2009 to write-off the remaining investment. During 2008,
we recorded an equity loss of $2,975 for our share of Zero Water’s loss and the amortization expense for the
difference between the cost and the underlying equity in net assets of Zero Water at the investment date.
Additionally, we recorded an impairment charge of $6,483 during 2008 to reduce the carrying value of the
equity investment to its estimated fair value. The impairment charge primarily resulted from lower-than-
expected operating results and projections of future performance coupled with the current non-strategic
business direction of Zero Water and the overall general economic decline which indicated that the full
carrying value of the equity investment was not recoverable. See the discussion contained in Note 7 of the
Notes to the Consolidated Financial Statements.
(b) In the first quarter of 2010, we committed to a plan to sell the business operations conducted by our
subsidiary, Nutrisystem Fresh, Inc. (“NuKitchen”), as it was no longer aligned with the business direction of
the Company. NuKitchen has been treated as a discontinued operation. During the third quarter of 2010, this
business was shut down as we were unsuccessful in locating a buyer. Accordingly, the operating results of
this discontinued operation have been presented separately from continuing operations for all periods
presented. The loss on discontinued operations during 2010 was primarily from operations. During the
fourth quarter of 2009, an impairment charge of $4,541 was recorded in connection with the NuKitchen
acquisition. This charge consisted of $2,717 of goodwill and $1,824 of identifiable intangible assets. See the
discussion contained in Note 12 of the Notes to the Consolidated Financial Statements.
(c) In the fourth quarter of 2007, we committed to a plan to sell our subsidiary Slim and Tone LLC (“Slim and
Tone”). This subsidiary has been treated as a discontinued operation. Accordingly, the operating results of
this discontinued operation have been presented separately from continuing operations and are included in
loss on discontinued operation, net of income tax in the accompanying consolidated statements of
operations for all periods presented. In 2007, we recorded a pre-tax loss on disposal of $1,256, consisting of
an impairment of goodwill and intangibles of $1,156 and a pre-tax loss of $100. See the discussion
contained in Note 12 of the Notes to the Consolidated Financial Statements.
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