Valhi Inc. reported a pre-tax gain of $58.4 million in the first quarter of 2018 on its sale of Waste Control Specialists, according to the Dallas-based holding company’s latest earnings report.
That was good for a net of $38.2 million, $0.11 per diluted share, after income taxes, Valhi said in its 10-Q filing with the U.S. Securities and Exchange Commission. The gain is included within Valhi’s discontinued operations line item.
The gain was recorded “because the carrying value of the liabilities of the business assumed by the purchaser exceeded the carrying value of the assets sold in large part due to the long-lived asset impairment of $170.6 million recognized in the second quarter of 2017 with respect to our Waste Management Segment,” the 10-Q says.
On Jan. 26, Valhi finalized the sale of Waste Control Specialists to J.F. Lehman & Co. The private equity firm is now owner of a 1,338-acre complex in Andrews County, Texas, for disposal of low-level radioactive waste and other waste types.
In the 10-Q, Valhi noted that Waste Control Specialists – which represented the entirety of its waste management business – had for years been a money loser due to challenges in producing “sufficient recurring disposal volumes.” The sale to J.F. Lehman should allow the company to focus on its other, higher-returning business lines: chemicals, component products, and real estate management.
Valhi made $100,000 in unspecified capital expenditures for its waste management business in the first quarter.
Company-wide for the quarter, Valhi reported $51.7 million in net income, $0.15 per diluted share. That represented a major spike from $14.4 million, $0.04 per diluted share, in the same period of 2017, largely due to increased strength in the chemicals business.
