NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
Aug. 25, 2019
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Lamb Weston Holdings, Inc. (“we,” “us,” “our,” the “Company,” or “Lamb Weston”), along with its joint venture partners, is a leading global producer, distributor, and marketer of value-added frozen potato products and is headquartered in Eagle, Idaho. We have four reportable segments: Global, Foodservice, Retail, and Other. See Note 15, Segments, for additional information on our reportable segments. Basis of Presentation The unaudited quarterly Consolidated Financial Statements present the financial results of Lamb Weston for the thirteen weeks ended August 25, 2019 and August 26, 2018, and have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America. The financial statements are unaudited but include all adjustments (consisting only of normal recurring adjustments) that management considers necessary for a fair presentation of such financial statements. The preparation of financial statements involves the use of estimates and accruals. Actual results may vary from those estimates. Results for interim periods should not be considered indicative of results for our full fiscal year, which ends the last Sunday in May. These quarterly financial statements and condensed notes should be read together with the combined and consolidated financial statements and notes in our Annual Report on Form 10-K for the fiscal year ended May 26, 2019 (the “Form 10-K”), which we filed with the Securities and Exchange Commission on July 25, 2019. Certain amounts in the prior period consolidated financial statements have been reclassified to conform with the current period presentation. Revenue from Contracts with Customers Generally, we recognize revenue on a point in time basis when the customer takes title to the goods and assumes the risks, rewards, or control of the goods. For customized products, we recognize revenue as the products are produced and we have a purchase order providing a legally enforceable right to payment for the goods. New and Recently Issued Accounting Standards Accounting Standards Adopted Effective May 27, 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, Leases, and its related amendments, collectively known as Accounting Standards Codification (“ASC”) Topic 842, Leases, (“ASC 842”) using the modified retrospective transition method, which among other things, allows us to elect an optional transition method to apply the new lease standard through a cumulative effect adjustment in the period of adoption. The new guidance requires both classifications of leases, operating and finance, to be recognized on the balance sheet. The new guidance also results in a change in the naming convention for leases historically classified as capital leases. Under the new guidance, these leases are now referred to as finance leases. We adopted the guidance by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application and as a result did not recast prior periods presented in the Consolidated Financial Statements. We elected to adopt certain of the optional practical expedients, including electing to not reassess lease classification, initial direct costs of existing leases, or whether existing contracts contain a lease. In addition, we elected to account for each contract’s lease and non-lease components as a single lease component. The adoption of the new standard resulted in the recognition of operating lease assets of $154.1 million and operating lease liabilities of $155.5 million. Included in the measurement of the new operating lease assets is the reclassification of certain balances, including those historically recorded as deferred rent. The adoption also resulted in a cumulative effect transitional adjustment of $26.6 million ($20.5 million, net of tax) to increase retained earnings, as a result of the elimination of a deferred gain related to a sale leaseback and the elimination of $38.7 million of property, plant and equipment and $65.3 million of lease financing obligations also related to a sale leaseback. The adoption did not have a material impact on our results of operations or cash flows. See Note 6, Leases, for more information. Accounting Standards Not Yet Adopted In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-14, Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans. This update amends ASC 715 to remove disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures, and adds disclosure requirements identified as relevant to defined benefit pension and other postretirement plans. The ASU’s changes related to disclosures are part of the FASB’s disclosure framework project. This guidance is effective for our fiscal 2022 (beginning May 31, 2021) with early adoption permitted. The adoption of this standard is not expected to have a significant impact on our financial statements. There were no other accounting standards recently issued that had or are expected to have a material impact on our financial statements.

NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Aug. 25, 2019

NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Lamb Weston Holdings, Inc. (“we,” “us,” “our,” the “Company,” or “Lamb Weston”), along with its joint venture partners, is a leading global producer, distributor, and marketer of value-added frozen potato products and is headquartered in Eagle, Idaho. We have four reportable segments: Global, Foodservice, Retail, and Other. See Note 15, Segments, for additional information on our reportable segments.

Basis of Presentation

The unaudited quarterly Consolidated Financial Statements present the financial results of Lamb Weston for the thirteen weeks ended August 25, 2019 and August 26, 2018, and have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America. The financial statements are unaudited but include all adjustments (consisting only of normal recurring adjustments) that management considers necessary for a fair presentation of such financial statements. The preparation of financial statements involves the use of estimates and accruals. Actual results may vary from those estimates. Results for interim periods should not be considered indicative of results for our full fiscal year, which ends the last Sunday in May. These quarterly financial statements and condensed notes should be read together with the combined and consolidated financial statements and notes in our Annual Report on Form 10-K for the fiscal year ended May 26, 2019 (the “Form 10-K”), which we filed with the Securities and Exchange Commission on July 25, 2019.

Certain amounts in the prior period consolidated financial statements have been reclassified to conform with the current period presentation.

Revenue from Contracts with Customers

Generally, we recognize revenue on a point in time basis when the customer takes title to the goods and assumes the risks, rewards, or control of the goods. For customized products, we recognize revenue as the products are produced and we have a purchase order providing a legally enforceable right to payment for the goods.

New and Recently Issued Accounting Standards

Accounting Standards Adopted

Effective May 27, 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, Leases, and its related amendments, collectively known as Accounting Standards Codification (“ASC”) Topic 842, Leases, (“ASC 842”) using the modified retrospective transition method, which among other things, allows us to elect an optional transition method to apply the new lease standard through a cumulative effect adjustment in the period of adoption. The new guidance requires both classifications of leases, operating and finance, to be recognized on the balance sheet. The new guidance also results in a change in the naming convention for leases historically classified as capital leases. Under the new guidance, these leases are now referred to as finance leases.

We adopted the guidance by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application and as a result did not recast prior periods presented in the Consolidated Financial Statements. We elected to adopt certain of the optional practical expedients, including electing to not reassess lease classification, initial direct costs of existing leases, or whether existing contracts contain a lease. In addition, we elected to account for each contract’s lease and non-lease components as a single lease component.

The adoption of the new standard resulted in the recognition of operating lease assets of $154.1 million and operating lease liabilities of $155.5 million. Included in the measurement of the new operating lease assets is the reclassification of certain balances, including those historically recorded as deferred rent. The adoption also resulted in a cumulative effect transitional adjustment of $26.6 million ($20.5 million, net of tax) to increase retained earnings, as a

result of the elimination of a deferred gain related to a sale leaseback and the elimination of $38.7 million of property, plant and equipment and $65.3 million of lease financing obligations also related to a sale leaseback. The adoption did not have a material impact on our results of operations or cash flows. See Note 6, Leases, for more information.

Accounting Standards Not Yet Adopted

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-14, Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans. This update amends ASC 715 to remove disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures, and adds disclosure requirements identified as relevant to defined benefit pension and other postretirement plans. The ASU’s changes related to disclosures are part of the FASB’s disclosure framework project. This guidance is effective for our fiscal 2022 (beginning May 31, 2021) with early adoption permitted. The adoption of this standard is not expected to have a significant impact on our financial statements.

There were no other accounting standards recently issued that had or are expected to have a material impact on our financial statements.