Investment in Affiliates

12 Months Ended

Jun. 01, 2019

Investments in and Advances to Affiliates, Schedule of Investments [Abstract]

Investment in Unconsolidated Entities

The Company has several investments in unconsolidated entities that are accounted for using the equity method of accounting. Red River Valley Egg Farm, LLC ("Red River") operates a cage-free shell egg production complex near Bogota, Texas. Specialty Eggs, LLC ("Specialty Eggs") owns the Egg-Land's Best franchise for most of Georgia and South Carolina, as well as a portion of western North Carolina and eastern Alabama. Southwest Specialty Eggs, LLC ("Southwest Specialty Eggs") owns the Egg-Land's Best franchise for Arizona, southern California and Clark County, Nevada (including Las Vegas). As of June 1, 2019, the Company owns 50% of each of Red River, Specialty Eggs, and Southwest Specialty Eggs. Equity method investments are included in “Investments in unconsolidated entities” in the accompanying Consolidated Balance Sheets and totaled $60.7 million and $64.2 million at June 1, 2019 and at June 2, 2018, respectively.

Equity in income of unconsolidated entities of $4.8 million, $3.5 million, and $1.4 million from these entities has been included in the Consolidated Statements of Operations for fiscal 2019, 2018, and 2017, respectively.

The condensed consolidated financial information for the Company's unconsolidated joint ventures was as follows (in thousands):



	For the fiscal year ended
	June 1, 2019		June 2, 2018		June 3, 2017
Net sales	$	112,396	$	107,705	$	86,072
Net income	9,490		7,071		2,804
Total assets	128,470		134,056		131,871
Total liabilities	7,600		5,859		6,543
Total equity	120,870		128,197		125,328

The Company is a member of Eggland’s Best, Inc. (“EB”), which is a cooperative. At June 1, 2019 and June 2, 2018, “Other long-term assets” as shown on the Company’s Consolidated Balance Sheet includes the cost of the Company’s investment in EB plus any qualified written allocations. The Company cannot exert significant influence over EB’s operating and financial activities; therefore, the Company accounts for this investment using the cost method. The carrying value of this investment at June 1, 2019 and June 2, 2018 was $2.6 million and $2.6 million, respectively.

The Company regularly transacts business with its cost and equity method affiliates. The following relates to the Company’s transactions with these unconsolidated affiliates (in thousands):

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	For the fiscal year ended
	June 1, 2019		June 2, 2018		June 3, 2017
Sales to affiliates	$	58,093	$	59,295	$	59,073
Purchases from affiliates	81,685		81,043		73,713
Dividends from affiliates	8,300		4,664		6,581



	June 1, 2019		June 2, 2018
Accounts receivable from affiliates	$	4,307	$	4,603
Accounts payable to affiliates	3,324		3,525