DISCONTINUED OPERATIONS

In March 2018, the Company’s Board of Directors approved a plan to sell all of the operations of the HPPC and Empire operating segments, which are reported in the aggregate as the Hain Pure Protein reportable segment (“Hain Pure Protein”). Collectively, these dispositions represent a strategic shift that will have a major impact on the Company’s operations and financial results and have been accounted for as discontinued operations. The Company is actively marketing the sale of Hain Pure Protein, and a sale is anticipated to occur within the next twelve months.

The Company is presenting the operating results and cash flows of Hain Pure Protein within discontinued operations in the current and prior periods. The assets and liabilities of Hain Pure Protein are presented as assets and liabilities of discontinued operations in the Consolidated Balance Sheets for all periods presented.

The following table presents the major classes of Hain Pure Protein’s line items constituting the “Net (loss) income from discontinued operations, net of tax” in our Consolidated Statements of Income:



	Three Months Ended March 31,						Nine Months Ended March 31,
	2018			2017			2018			2017
Net sales	$	118,198		$	117,765		$	396,227		$	387,413
Cost of sales	113,629			113,575			373,122			371,293
Gross profit	4,569			4,190			23,105			16,120
Selling, general and administrative expense	5,888			6,407			14,458			15,074
Other expense	805			377			3,258			1,163
Net (loss) income from discontinued operations before income taxes	(2,124		)	(2,594		)	5,389			(117		)
Provision (benefit) for income taxes	10,431			(1,098		)	12,738			(189		)
Net (loss) income from discontinued operations, net of tax	$	(12,555	)	$	(1,496	)	$	(7,349	)	$	72

Included above within provision (benefit) for income taxes for the three and nine months ended March 31, 2018 is a $10,703 deferred tax liability related to Hain Pure Protein being classified as held for sale. Refer to Note 10, Income Taxes for further discussion.

Assets and liabilities of discontinued operations presented in the Consolidated Balance Sheets as of March 31, 2018 and June 30, 2017 are included in the following table:



	March 31,		June 30,
Assets	2018		2017
Cash and cash equivalents	$	6,634	$	9,937
Accounts receivable, less allowance for doubtful accounts	24,908		22,671
Inventories	99,782		85,313
Prepaid expenses and other current assets	5,883		5,866
Total current assets*			123,787
Property, plant and equipment, net	81,477		78,645
Goodwill	41,089		41,089
Trademarks and other intangible assets, net	51,029		52,040
Other assets	4,399		3,330
Total noncurrent assets of discontinued operations*			175,104
Total assets of discontinued operations	$	315,201	$	298,891

Liabilities
Accounts payable	$	30,966	$	35,943
Accrued expenses and other current liabilities	5,084		2,005
Deferred tax liabilities	25,863		—
Total current liabilities of discontinued operations*			37,948
Deferred tax liabilities	—		23,129
Other noncurrent liabilities	28		193
Total noncurrent liabilities of discontinued operations*			23,322
Total liabilities of discontinued operations	$	61,941	$	61,270

* The assets and liabilities of Hain Pure Protein are classified as current on the March 31, 2018 Consolidated Balance Sheet because it is probable that the sale will occur within the next twelve months.

As a result of the planned dispositions, the Company assessed the fair value of its assets held for sale and determined that these assets were not impaired at March 31, 2018.