JanOne Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Variable Interest Entity

Variable Interest Entity

6 Months Ended

Jun. 28, 2014

The financial position and results of operations of AAP are consolidated in our financial statements based on our conclusion that AAP is a variable interest entity due to our contribution in excess of 50% of the total equity, subordinated debt and other forms of financial support. We have a controlling financial interest in AAP through our contractual agreement with GE, which is material to AAP, and we have provided substantially all of the financial support to fund the operations of AAP since its inception. The financial position and results of operations for AAP are reported in our recycling segment.

The following table summarizes the assets and liabilities of AAP as of June 28, 2014, and December 28, 2013:



	June 28, 2014		December 28, 2013
Assets
Current assets	$	975	$	1,099
Property and equipment, net	9,136		8,713
Other assets	131		137
Total Assets	$	10,242	$	9,949
Liabilities
Accounts payable	$	624	$	861
Accrued expenses	186		202
Current maturities of long-term debt obligations	871		797
Long-term debt obligations, net of current maturities	4,101		3,796
Other liabilities (a)	379		469
Total Liabilities	$	6,161	$	6,125

(a) Other liabilities represent loans between ARCA and AAP that are eliminated in consolidation.

The following table summarizes the operating results of AAP for the three and six months ended June 28, 2014, and June 29, 2013:



	Three Months Ended						Six Months Ended
	June 28, 2014			June 29, 2013			June 28, 2014		June 29, 2013
Revenues	$	2,628		$	2,667		$	5,452	$	5,244
Gross profit	546			434			1,436		750
Operating income (loss)	51			(6		)	393		(59		)
Net income (loss)	(17		)	(83		)	257		(193		)