Discontinued Operations

On August 30, 2018, we announced plans to pursue the divestiture of businesses within two operating segments: our international biscuits and snacks operating segment, which includes Arnott’s, Kelsen and our operations in Indonesia, Malaysia, Hong Kong and Japan; and the Campbell Fresh operating segment, which includes Bolthouse Farms, Garden Fresh Gourmet and the U.S. refrigerated soup business.

On February 25, 2019, we sold our U.S refrigerated soup business and on April 25, 2019, we sold our Garden Fresh Gourmet business. Proceeds were approximately $55, subject to customary purchase price adjustments. On April 12, 2019, we signed a definitive agreement for the sale of Bolthouse Farms to an affiliate of Butterfly Equity for $510, subject to customary purchase price adjustments. We expect to complete the sale in the fourth quarter of 2019. Beginning in the third quarter of 2019, we have reflected the results of these businesses as discontinued operations in the Consolidated Statements of Earnings for all periods presented.

Results of discontinued operations were as follows:



	Three Months Ended						Nine Months Ended
	April 28, 2019			April 29, 2018			April 28, 2019			April 29, 2018
Net sales	$	210		$	247		$	666		$	723

Impairment charges	$	—		$	619		$	360		$	694

Earnings (loss) before taxes from operations	$	7		$	(633	)	$	(361	)	$	(720	)
Taxes on earnings from operations	7			(167		)	(82		)	(197		)
Loss on sale of businesses / costs associated with selling the businesses	(24		)	—			(31		)	—
Tax impact of loss on sale / costs associated with selling the businesses	23			—			21			—
Loss from discontinued operations	$	(47	)	$	(466	)	$	(331	)	$	(523	)

In the second quarter of 2019, we performed interim impairment assessments on the intangible and tangible assets of the businesses. We revised our future outlook for earnings and cash flows for each of these businesses as the divestiture process progressed and we received initial indications of value. Within Bolthouse Farms carrot and carrot ingredients, we recorded impairment charges of $18 on the trademark, $40 on customer relationships, $15 on technology and $104 on plant assets. Within Bolthouse Farms refrigerated beverages and salad dressings, we recorded impairment charges of $74 on the trademark, $22 on customer relationships, and $9 on plant assets. On Garden Fresh Gourmet, we recorded impairment charges of $23 on the trademark, $39 on customer relationships, and $2 on plant assets. In the first quarter of 2019, we recorded an impairment charge of $14 on the U.S refrigerated soup plant assets.

In the third quarter of 2019, we incurred pre-tax expenses of $24 associated with the sale process of the businesses in Campbell Fresh, including losses on the sale of the U.S. refrigerated soup business and Garden Fresh Gourmet of $15. Year-to-date in 2019, we incurred pre-tax expenses of $31 associated with the sale process of the businesses, including losses on the sale of the U.S. refrigerated soup business and Garden Fresh Gourmet of $18. In addition, due to the pending sale of Bolthouse Farms, we recorded tax expense of $29 in the three- and nine-month periods ended April 28, 2019, as deferred tax assets are not realizable.

The assets and liabilities of Bolthouse Farms have been reflected as assets and liabilities of discontinued operations as of April 28, 2019, and July 29, 2018. In addition, the assets and liabilities of the Garden Fresh Gourmet business and our U.S refrigerated soup business, which were sold in the current-year quarter, have been reflected as assets and liabilities of discontinued operations as of July 29, 2018.



	April 28, 2019		July 29, 2018
Cash	$	4	$	8
Accounts receivable, net	77		84
Inventories	137		161
Other current assets	2		3
Current assets	$	220	$	256

Plant assets, net of depreciation	$	199	$	413
Other intangible assets, net of amortization	143		381
Other assets	4		4
Total assets	$	566	$	1,054

Payable to suppliers and others	$	57	$	79
Accrued liabilities	43		39
Current liabilities	$	100	$	118

Deferred taxes	$	—	$	(1	)
Other liabilities	4		5
Total liabilities	$	104	$	122

The depreciation and amortization, capital expenditures, sale proceeds and significant operating noncash items of discontinued operations were as follows:



	Nine Months Ended
	April 28, 2019		April 29, 2018
Cash flows from discontinued operating activities:
Impairment charges	$	360	$	694
Depreciation and amortization	44		55
Loss on sale of businesses	18		—

Cash flows from discontinued investing activities:
Capital expenditures	$	20	$	28
Sale of businesses, net of cash divested	54		—

We will provide certain transition services to support the divested businesses.