Discontinued Operations

3 Months Ended

Sep. 28, 2013

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

There has been no discontinued operation activity in the first quarter of 2014.

On December 19, 2012, the company signed an agreement to sell its Australian bakery business to McCain Foods Limited. The results of this business were previously reported as the Australian Bakery business segment. Also included in the transaction were the license rights to certain intellectual property used by the Australia bakery business in the Asia-Pacific region. In February 2013, the company completed the sale of its Australian Bakery business. Using foreign currency exchange rates on the date of the transaction, the company received cash proceeds of $85 million and reported an after tax gain on disposition of $42 million.

The results of the Australian bakery business are classified as discontinued operations and are presented as discontinued operations in the condensed consolidated statements of income for all periods presented. The disposition of the Australian bakery business was completed prior to the end of fiscal 2013, and, as such, there are no operating results or cash flows related to this discontinued operation in 2014.

The following is a summary of the operating results of the company’s discontinued operations for the first quarter of 2013:

	First Quarter 2013
(In millions)	Net Sales		Pretax Income		Net Income
Australian Bakery	$	37	$	3	$	2

The disposition of the businesses had been completed prior to the end of fiscal 2012. The gain on sale of discontinued operations reported in fiscal 2013 represents the impact of a final purchase price adjustment related to the North American fresh bakery disposition and gain related to the disposition of two manufacturing facilities related to the North American foodservice beverage operations. The following is a summary of the gain on sale of the company’s discontinued operations for the first quarter of 2013:

	First Quarter 2013
(In millions)	Pretax Gain on Sale		Tax Expense			After Tax Gain
North American Fresh Bakery	$	1	$	—		$	1
North American Foodservice Beverage	2		(1		)	1
Total	$	3	$	(1	)	$	2

The cash flows related to the discontinued operations for the first quarter of 2013 are summarized in the table below:

	Quarter Ended
(In millions) – Increase / (Decrease)	September 29, 2012
Cash flow from operating activities	$	11
Cash flow from investing activities	7
Cash flow used in financing activities	(10		)
Increase in net cash of discontinued operations	8
Cash and cash equivalents at beginning of year	—
Cash and cash equivalents at end of period	$	8

The cash used in financing activities primarily represents the net transfers of cash with the corporate office. The net assets of the discontinued operations assumed that the cash of those businesses has been retained as a corporate asset.