Discontinued Operations of Barnes & Noble Education

6 Months Ended

Oct. 31, 2015

Discontinued Operations of Barnes & Noble Education

3. Discontinued Operations of Barnes & Noble Education

The Company has recognized the separation of B&N Education in accordance with Accounting Standards Codification (ASC) No. 205-20, Discontinued Operations. As such, the historical results of Barnes & Noble Education have been adjusted to include separation-related costs and exclude corporate allocations with B&N Retail and have been classified as discontinued operations in all periods presented.

Discontinued operations in the 13 weeks ended October 31, 2015 primarily consists of investment banking fees (as it directly relates to the Spin-Off) and separation–related costs. The 13 weeks ended November 1, 2014 includes pre-spin B&N Education results, separation-related costs and excludes corporate allocation adjustments with B&N Retail.

Discontinued operations in the 26 weeks ended October 31, 2015 primarily consists of pre-spin B&N Education results, investment banking fees (as it directly relates to the Spin-Off), separation–related costs and excludes corporate allocation adjustments with B&N Retail. The 26 weeks ended November 1, 2014 includes pre-spin B&N Education results, separation-related costs and excludes corporate allocation adjustments with B&N Retail.

The following unaudited financial information presents the discontinued operations for the 13 weeks and 26 weeks ended October 31, 2015 and November 1, 2014.

	13 weeks ended					26 weeks ended
	October 31, 2015			November 1, 2014		October 31, 2015			November 1, 2014
Sales	$	—			751,276	$	238,983			977,370
Cost of sales and occupancy		—			577,120		186,697			755,124
Gross profit		—			174,156		52,286			222,246
Selling and administrative expenses		8,289			94,153		94,933			173,561
Depreciation and amortization		—			12,508		13,100			25,052
Operating profit (loss) from discontinued operations		(8,289	)		67,495		(55,747	)		23,633
Interest expense, net and amortization of deferred financing fees		—			14		3			19
Income (loss) before taxes from discontinued operations		(8,289	)		67,481		(55,750	)		23,614
Income taxes		3,734			50,074		(16,604	)		36,679
Net income (loss) from discontinued operations	$	(12,023	)		17,407	$	(39,146	)		(13,065	)

The following unaudited table presents the aggregate carrying amounts of the classes of assets and liabilities of discontinued operations:

	November 1, 2014		May 2, 2015
Carrying amounts of assets included as part of discontinued operations:
Cash and cash equivalents	$	252,916		59,714
Receivables, net		81,978		38,311
Merchandise inventories, net		340,513		297,425
Prepaid expenses and other current assets		87,296		52,176
Short-term deferred taxes		24,022		24,992
Total current assets		786,725		472,618
Property and equipment:
Buildings and leasehold improvements		145,845		149,065
Fixtures and equipment		325,329		335,404
		471,174		484,469
Less accumulated depreciation and amortization		366,915		376,911
Net property and equipment		104,259		107,558
Goodwill		274,070		274,070
Intangible assets, net		203,316		198,190
Other noncurrent assets		36,092		39,883
Total assets classified as discontinued operations in the consolidated balance sheet	$	1,404,462		1,092,319
Carrying amounts of liabilities included as part of discontinued operations:
Accounts payable	$	422,900		170,490
Accrued liabilities		122,420		133,123
Total current liabilities		545,320		303,613
Long-term deferred taxes		70,210		66,916
Other long-term liabilities		60,995		34,093
Total liabilities classified as discontinued operations in the consolidated balance sheet	$	676,525		404,622