Ceasing manufacturing operations in Robbinsville...
From the 10k for period ending 12/31/2014
"Over the past three years we have invested approximately $9.0 million in the modernization of our manufacturing facility in Robbinsville, North Carolina to enable us to be competitive as a domestic producer of this product."
Meanwhile, the PP&E line of the balance sheet shows a roughly $2.5 million dollar increase in its carrying value since 12/31/2011, so that was $9 million well spent.
What do you suppose an accurate market price is for that plant if the plan is to sell it, which is what it sounds like they intend to do? (Currently PP&E is $20.1 million)
The Young American brand itself may have some value if they can find a buyer.
Doesn't sound like there will be any finished goods inventory write-offs, raw materials was at $2 million at year end. WIP at $.82 million.
I imagine there will be significant restructuring charges associated with "ceasing manufacturing operations in Robbinsville", and possible a significant hit to tangible book value, but you can only pour money into a bottomless pit for so long.
I would have preferred YA be a success, but given it clearly wasn't, I'm glad they've decided to cut losses and focus on the profitable Stanley line.
I guess the key question in mind was why did they think that a US manufacturing plant for YA would be a good investment? They decided to outsource their Stanley line of furniture a long time ago for good reasons I would guess. The logic behind this YA investment escapes me.