American Biltrite to exit wood business
American Biltrite's second quarter results will include $8.5 million in non-cash charges reducing the carrying values of fixed assets, inventories, deferred tax assets, and other current assets to amounts expected to be realized through the disposition. The company expects these charges will represent the substantial majority of the expenses to exit this business.
Future expenses in connection with the disposition, which will be reported as losses on discontinued operations, are currently anticipated to be approximately $2 million. The company anticipates the disposition of Janus, net of future expenses, will generate between $3 million and $5 million in cash.
Roger S. Marcus, chairman of the board, commented that American Biltrite's decision to dispose of the Janus business will permit the company to concentrate our capital and management resources on its other operations.
"The combination of downward pricing pressures in the market and higher costs for raw lumber have resulted in continuing operating losses for Janus, and we do not believe that it would be in American Biltrite's best interests to continue funding those losses or invest further capital to try to grow sales beyond the break-even point," he said.
Unless the business is sold, operations will be expected to cease in October, he added.