Annual report pursuant to Section 13 and 15(d)

Discontinued Operations and Held for Sale

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Discontinued Operations and Held for Sale
 12 Months Ended
Dec. 31, 2023
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations and Held for Sale Discontinued Operations and Held for Sale
Sale of Final Mile

On December 20, 2023, the Company completed the sale of the Final Mile business for estimated total cash consideration of $260,916. As a result, the assets and liabilities of Final Mile have been presented separately under the captions “Current assets held for sale,” “Noncurrent assets held for sale,” “Current liabilities held for sale” and “Noncurrent liabilities held for sale” in the Consolidated Balance Sheets as of December 31, 2022. The results of operations of Final Mile, as well as the gain realized on the sale of $155,829, have been presented under the caption “Income from discontinued operations, net of tax” in the Consolidated Statements of Comprehensive Income for the years ended December 31, 2023, 2022 and 2021.

Sale of Pool

As previously disclosed, on April 23, 2020, the Company made a decision to divest of Pool and the sale was completed on February 12, 2021. As a result, the results of Pool were classified to “Loss from discontinued operations, net of tax” in the Consolidated Statements of Comprehensive Income for the year ended December 31, 2021. Certain corporate overhead and other costs previously allocated to Pool for segment reporting purposes did not qualify for classification within discontinued operation and were allocated to continuing operations. These costs were classified to the eliminations column in the segment reconciliation in Note 12, Segment Reporting.

On February 12, 2021, the Company completed the sale of the Pool business for $8,000 in cash and up to a $12,000 earn-out based on earnings before interest, taxes, depreciation and amortization. The sale agreement for Pool included an earn-out based on the achievement of certain earnings before interest, taxes, depreciation and amortization attainment over an eleven-month period, beginning February 1, 2021. The estimated fair value of the earn-out asset on the date of sale was $6,967. The fair value was based on the estimated eleven-month period of the earnings before interest, taxes, depreciation and amortization and was calculated using a Monte Carlo simulation model.

Subsequent to the date of sale, the Company recognized any increases in the carrying value of the earn-out asset when the change was realized and evaluated the earn-out asset for impairment at each reporting period. The financial performance of the Pool business significantly deteriorated during the third quarter of 2021. As a result, an evaluation of the earn-out asset for impairment was completed, which included a review of revised forecasts, updated strategic operating decisions and current market conditions. The revised forecasts indicated an impairment of the entire earn-out asset was necessary. A non-cash charge of $6,967 was recorded as an “Impairment charge” in the summarized discontinued operation financial information for the year ended December 31, 2021.

Transition Services Agreement

On February 12, 2021, the Company entered into a Transition Services Agreement (“TSA”) with TOG FAS Holdings LLC, the buyer of the Pool business. Under the TSA, the Company performed certain services on an interim basis in order to facilitate the orderly transition of the Pool business. The effective date of the TSA was February 12, 2021 and remained in effect until the date all services were completed, but no more than six months following the effective date. The TSA provided the right to extend the term of the TSA with no limit on the number of the mutually agreed upon extensions. In exchange for the services performed by the Company under the TSA, the Company received a monthly service charge. For the year ended December 31, 2021, the Company recognized $747, in “Other operating expenses” in the Consolidated Statements of Comprehensive Income, for the services performed under the TSA. The TSA ended in October 2021 when all services were completed.
Summarized Held for Sale and Discontinued Operation Financial Information
A summary of the carrying amounts of major classes of assets and liabilities, which are included in assets and liabilities held for sale in the Consolidated Balance Sheets, is as follows:
  December 31, 2022
Assets
Current assets:  
Accounts receivable, less allowance of $29 in 2022
 $ 32,799 
Prepaid expenses 5 
Other current assets 2,138 
Total current assets held for sale $ 34,942 
Property and equipment, net of accumulated depreciation and amortization of $2,524
 $ 2,751 
Operating lease right-of-use assets 10,768 
Goodwill 48,197 
Other acquired intangibles, net of accumulated amortization of $12,332 in 2022
 39,219 
Other assets 92 
Total noncurrent assets held for sale $ 101,027 
Liabilities  
Current liabilities:  
Accounts payable $ 4,507 
Accrued expenses 4,373 
Other current liabilities 13 
Current portion of debt and finance lease obligations 128 
Current portion of operating lease liabilities 4,840 
Total current liabilities held for sale $ 13,861 
Finance lease obligations, less current portion $ 133 
Operating lease liabilities, less current portion 5,962 
Total noncurrent liabilities held for sale $ 6,095 
A summary of the results of operations classified as a discontinued operations, net of tax, in the Consolidated Statements of Comprehensive Income for the years ended December 31, 2023, 2022 and 2021 is as follows:
  Year Ended
  December 31, 2023 December 31, 2022 December 31, 2021
Operating revenue $ 273,873  $ 293,769  $ 292,976 
Operating expenses:    
Purchased transportation 158,233  176,137  171,035 
Salaries, wages and employee benefits 51,304  45,211  49,101 
Operating leases 12,325  11,804  13,685 
Depreciation and amortization 5,212  4,834  4,586 
Insurance and claims 2,586  2,281  3,706 
Fuel expense 305  627  1,057 
Other operating expenses 36,842  34,490  37,946 
Impairment charge —  —  6,967 
Total operating expenses 266,807  275,384  288,083 
Income from discontinued operations 7,066  18,385  4,893 
Gain (loss) on sale of business 155,829  —  (2,860)
Income from discontinued operations before income taxes 162,895  18,385  2,033 
Income tax expense 38,347  4,608  3,053 
Income (loss) from discontinued operations, net of tax $ 124,548  $ 13,777  $ (1,020)