Income Tax Provision (Benefit).  Our effective income tax rate was a benefit of 3.72% in 2018. The benefit relates to certain federal and state credits and also includes a benefit for the reduction of certain indefinite lived assets not covered by our valuation allowance. In 2018 we increased our valuation allowance by $4 million related to our net deferred tax asset and specific state net operating loss and state credit carryforwards. On December 22, 2017, the President signed the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act, among other things, lowered the U.S. corporate income tax rate from 35% to 21% effective January 1, 2018. The income tax expense for 2017 was $7.5 million, which included a charge of $1.4 million related to the re-measurement of certain net deferred tax assets using the lower U.S. corporate income tax rate and a charge of $6.4 million to increase our valuation allowance related to our net deferred tax asset. The majority of the increase in the valuation allowance is related to the revised treatment of net operating losses under the Tax Act. Absent the impact of the Tax Act, our effective income tax benefit rate for 2017 would have been 36.4%. Net Loss.  Continuing operations reflected a loss of $21.5 million, or $1.36 per diluted share in 2018, compared with a loss from continuing operations of $9.3 million, or $0.59 per diluted share in 2017. Our discontinued operations reflected an income of $95 thousand, or $0.01 per diluted share in 2018 compared with a loss of $233 thousand, or $0.01 per diluted share in 2017. Including discontinued operations, we had a net loss of $21.4 million, or $1.35 per diluted share, in 2018 compared with a net loss of $9.6 million, or $0.60 per diluted share, in 2017. Our fiscal year ended December 30, 2017 had 52 weeks and fiscal year ended December 31, 2016 had 53 weeks. Discussions below related to percentage changes in net sales for the annual periods have been adjusted to reflect the comparable number of weeks and are qualified with the term “net sales as adjusted”. For comparative purposes, we define "net sales as adjusted" as net sales less the last week of sales in a 53 week fiscal year. We believe “net sales as adjusted” will assist our financial statement users in obtaining comparable data between the reporting periods. (See reconciliation of net sales to net sales as adjusted in the table below.) Fiscal Year Ended December 30, 2017 Compared with Fiscal Year Ended December 31, 2016 Fiscal Year Ended (amounts in thousands) December 30, 2017 % of Net Sales December 31, 2016 % of Net Sales Increase (Decrease) % Change Net sales $ 412,462 100.0  % $ 397,453 100.0  % $ 15,009 3.8  % Cost of sales 311,249 75.5 % 302,028 76.0 % 9,221 3.1 % Gross profit 101,213 24.5  % 95,425 24.0  % 5,788 6.1  % Selling and administrative expenses 96,171 23.3 % 96,983 24.4 % (812) (0.8)% Other operating expense, net 441 0.1  % 401 0.1  % 40 10.0  % Facility consolidation and severance expenses, net 636 0.2 % 1,456 0.4 % (820) (56.3)% Operating income (loss) 3,965 0.9  % (3,415 ) (0.9 )% 7,380 (216.1 )% Interest expense 5,739 1.4 % 5,392 1.4 % 347 6.4 % Other expense, net 39 —  % 22 —  % 17 77.3  % Loss before taxes (1,813) (0.5)% (8,829) (2.3)% 7,016 (79.5)% Income tax provision (benefit) 7,509 1.8  % (3,622 ) (0.9 )% 11,131 (307.3 )% Loss from continuing operations (9,322) (2.3)% (5,207) (1.4)% (4,115) 79.0 % Loss from discontinued operations (233 ) (0.1 )% (131 ) —  % (102 ) 77.9  % Income on disposal of discontinued operations — — % 60 — % (60) — % Net loss $ (9,555 ) (2.4 )% $ (5,278 ) (1.4 )% $ (4,277 ) 81.0  % Table of Contents 21