During the fourth quarter of fiscal 2018, we announced that we are pursuing the sale of certain corporate owned and operated retail operations consisting of Farm Fresh, Shop ‘n Save, and Shop ‘n Save East. The results of operations, financial position and cash flows of these banners have been presented as discontinued operations and the related assets and liabilities have been reclassified as held-for-sale for all periods presented. These three retail banners were previously separate components included in our Retail reporting segment. In addition, discontinued operations includes the results of operations and cash flows attributed to the assets and liabilities of the Save-A-Lot business.

On September 17, 2018, we announced we had entered into a definitive agreement to sell 19 of our 36 St. Louis-based Shop ‘n Save stores, 15 in-store pharmacies, one stand-alone pharmacy, four fuel centers and all remaining prescription files to Schnuck Markets, Inc. (“Schnucks”). In addition to the cash consideration we expect to receive, Schnucks has agreed to assume the multi-employer pension obligations related to the Shop ‘n Save stores it has agreed to acquire, which we estimated the fair value to be $24. The transaction is expected to be completed by the end of October 2018, subject to customary closing conditions. In the event we cannot identify one or more buyers for the remaining Shop ‘n Save stores, they may be closed later this year. In addition, we entered into a supply agreement to serve as the primary supplier to nine Schnucks stores across northern Illinois, Iowa and Wisconsin. As our St. Louis distribution center predominantly serves Shop ‘n Save stores, we expect to close this distribution center later this year following the completion of the transaction and any sales or closures of remaining Shop ‘n Save stores. We expect to incur a loss on sale of approximately $12 that will be recorded in the third quarter of fiscal 2019 based solely on the cash consideration received; however, we will also no longer have primary responsibility for the assumed off-balance sheet multiemployer pension obligations.

During the second quarter of fiscal 2019, we closed 13 of our 21 Shop ‘n Save East stores. We are continuing to pursue the sale of the remaining eight Shop ‘n Save East stores.

During the first quarter of fiscal 2019, we completed the sale of 21 of our 38 Farm Fresh stores to three different retailers: Harris Teeter, Kroger Mid-Atlantic Division, and Food Lion, and we completed the sale of the Farm Fresh pharmacy assets, for a total of $53. We recorded an income tax provision on the sale of the 21 stores and pharmacy assets of $1. During the second quarter of fiscal 2019, we completed the sale of five additional Farm Fresh stores to Wholesale customers through lease assignments and subleases. The remaining stores were closed in the fiscal 2019 year-to-date.

Operating results of discontinued operations are summarized below:



	Second Quarter Ended						Year-To-Date Ended
	September 8, 2018 (12 weeks)			September 9, 2017 (12 weeks)			September 8, 2018 (28 weeks)			September 9, 2017 (28 weeks)
Net sales	$	189		$	351		$	539		$	838
Cost of sales	147			263			414			630
Gross profit	42			88			125			208
Selling and administrative expenses	47			124			159			239
Gain on sales	(2		)	—			(39		)	—
Operating (loss) earnings	(3		)	(36		)	5			(31		)
Interest expense, net	1			1			1			1
(Loss) earnings from discontinued operations before income taxes	(4		)	(37		)	4			(32		)
Income tax (benefit) provision	(1		)	(13		)	1			(11		)
(Loss) income from discontinued operations, net of tax	$	(3	)	$	(24	)	$	3		$	(21	)

The carrying amounts of major classes of assets and liabilities that were classified as held-for-sale on the Condensed Consolidated Balance Sheets were as follows:



	September 8, 2018		February 24, 2018
Current assets
Cash and cash equivalents	$	4	$	7
Receivables, net	5		8
Inventories, net	51		109
Other current assets	3		6
Total current assets of discontinued operations	63		130
Long-term assets
Property, plant and equipment, net	54		74
Intangible assets, net	—		1
Deferred tax assets	8		8
Other assets	1		1
Total long-term assets of discontinued operations	63		84
Total assets of discontinued operations	$	126	$	214

Current liabilities
Accounts payable	$	31	$	51
Accrued vacation, compensation and benefits	18		20
Current maturities of capital lease obligations	2		2
Other current liabilities	11		9
Total current liabilities of discontinued operations	62		82
Long-term liabilities
Long-term capital lease obligations	13		14
Other long-term liabilities	1		3
Total long-term liabilities of discontinued operations	14		17
Total liabilities of discontinued operations	76		99
Net assets of discontinued operations	$	50	$	115