Annual report pursuant to Section 13 and 15(d)

Note 4 - Discontinued Operations

Note 4 - Discontinued Operations
12 Months Ended
Jan. 31, 2024
Notes to Financial Statements  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

(4) Discontinued Operations


On August 15, 2022, we completed a Stock Purchase Agreement (the “Purchase Agreement”), by and among Skillsoft, Skillsoft (US) Corporation (“Seller”), Amber Holding Inc. (“SumTotal”), and Cornerstone OnDemand, Inc. (“Buyer”), pursuant to which, subject to the certain terms and conditions contained therein, Seller sold, and Buyer purchased, all of Seller’s right, title and interest in and to one hundred percent (100%) of the outstanding shares of capital stock of SumTotal. Net proceeds from the sale were $174.9 million, after final working capital adjustments in April 2023.


In connection with the sale, the parties to the Purchase Agreement entered into certain other agreements, including a transition services agreement pursuant to which each of Seller and Buyer agreed to provide the other party with certain transition services for a limited period following the closing.


The Company determined the sale of the SumTotal business met the criteria to be classified as discontinued operations, and its assets and liabilities held for sale, as of June 12, 2022. Accordingly, the Company classified the assets and liabilities of the discontinued operations as held for sale in its consolidated balance sheets at the lower of carrying amount or fair value less cost to sell. The presentation of the assets and liabilities in comparative periods retained their previous classification as current or long-term. No losses were recognized when the discontinued operations' assets and liabilities were transitioned to held for sale, and depreciation and amortization ceased on such assets. The operating results of SumTotal are reported as discontinued operations, for all periods presented, as the disposition reflected a strategic shift that had a major effect on the Company’s operations and financial results.


The financial results of SumTotal are presented as Income from discontinued operations, net of tax in our consolidated statements of operations. The following presents financial results of SumTotal for all periods presented in our condensed consolidated statements of operations (in thousands):


    Fiscal 2023     Fiscal 2022  
    Successor     Successor     Predecessor  







February 1, 2022 to


June 12, 2021 to


February 1, 2021


January 31, 2023


January 31, 2022


to June 11, 2021




Total revenues

  $ 60,706     $ 75,911     $ 37,142  

Operating expenses:


Costs of revenues

    19,027       25,688       13,838  

Content and software development

    12,246       16,114       9,072  

Selling and marketing

    11,507       13,116       7,539  

General and administrative

    730       1,164       746  

Amortization of intangible assets

    6,345       6,873       4,410  

Acquisition and integration related costs

    1,609       607       297  


    42       121       (127 )

Total operating expenses

    51,506       63,683       35,775  

Operating income from discontinued operations

    9,200       12,228       1,367  

Other income (expense), net

    2,681       31       (326 )

Interest income

    12       18       4  

Interest expense

    (1,443 )     (1,176 )     (57 )

Income (loss) from discontinued operations before income taxes

    10,450       11,101       988  

Provision for (benefit from) income taxes

    1,967       (839 )     (187 )

Net income (loss) from discontinued operations

  $ 8,483     $ 11,940     $ 1,175  


In addition, the amounts described in other footnotes within these consolidated financial statements have been updated to reflect the amounts applicable to continuing operations, unless otherwise noted.