2. Discontinued Operations

Our Contractor-Owned, Contractor-Operated (“COCO”) business completed certain contracts in the second quarter of fiscal 2018. As the aircraft supporting these contracts were not placed on new contracts, combined with the continued decline in operational tempo within the U.S. Department of Defense (“DoD”) and an excess supply of aircraft assets in the market, we determined there was an impairment triggering event and tested the recoverability of our COCO assets. As a result, we recognized impairment and other charges of $54.2 million in the second quarter of fiscal 2018. The fair value of the aircraft and related assets was based on available market data for similar assets.

During the third quarter of fiscal 2018, we decided to pursue the sale of our COCO business previously included in our Expeditionary Services segment. Due to this strategic shift, the assets, liabilities, and results of operations of our COCO business have been reported as discontinued operations for all periods presented. Goodwill was allocated to this business based on its relative fair value to the reporting unit. The fair value of the reporting unit was determined based on a combination of the expected net proceeds upon sale and a discounted cash flow analysis. As the fair value of the COCO business was below its carrying value, a goodwill impairment charge of $9.8 million, representing the estimated loss on disposal, was recorded in the third quarter of fiscal 2018.

On March 15, 2019, we signed an agreement to sell certain contracts and assets of our COCO business. We expect the sale to close before the end of calendar 2019. In conjunction with this agreement and other expected asset sales, we recognized an impairment charge in discontinued operations of $74.1 million during the third quarter of fiscal 2019 reflecting the expected net proceeds to be received upon the completion of the sale transactions.

Discontinued operations also includes the results of our former metal machining operation, which was shutdown in the first quarter of fiscal 2017.

No amounts for general corporate overhead or interest expense were allocated to discontinued operations during the periods presented. Unless otherwise noted, amounts and disclosures throughout these Notes to Consolidated Financial Statements relate to our continuing operations.

Operating results for discontinued operations were comprised of the following:


	For the Year Ended May 31,
	2019		2018		2017
Sales	$	95.8	$	96.3	$	176.9
Cost of sales		(106.1)		(101.4)		(165.1)
Asset impairments		(74.1)		(65.2)		—
Selling, general and administrative expenses		(12.1)		(11.8)		(16.1)
Operating loss from discontinued operations		(96.5)		(82.1)		(4.3)
Provision for income taxes (benefit)		(19.9)		(24.0)		(8.8)
Income (Loss) from discontinued operations	$	(76.6)	$	(58.1)	$	4.5

During the fourth quarter of fiscal 2017, we recognized an income tax benefit in discontinued operations of $6.7 million for an effective settlement of a previously reserved tax position.

The carrying amounts of the major classes of assets and liabilities for our discontinued operations are as follows:


	May 31,		May 31,
	2019		2018
Accounts receivable, net	$	16.2	$	14.7
Inventory, rotable assets, and equipment		7.5		106.1
Other assets		5.5		4.2
Assets of discontinued operations	$	29.2	$	125.0
Liabilities of discontinued operations	$	29.2	$	25.0