Business Segment Reporting

Prior to May 2018, the Company managed its business operations through three strategic reportable business segments: Packaged Fresh Vegetables, Food Export, and Biomaterials. These segments were based upon the information reported to the Chief Executive Officer, who is the chief operating decision maker (“CODM”). However, in May 2018, the Company discontinued its Food Export business segment. As a result, the Company met the requirements of ASC 205-20 and ASC 360 to report the results of the Food Export business segment as discontinued operations. The operating results for the Food Export business segment, for the twelve months ended May 27, 2018 and May 28, 2017, have been reclassified to discontinued operations and are no longer reported as a separate segment.

Beginning in fiscal year 2019, the Company realigned the management of its business and started using three strategic reportable business segments: the Curation Foods segment, the Lifecore segment, and the Other segment (previously known as Natural Foods, Biomaterials, and Other segments until the third quarter of fiscal 2019 when the Company completed the rebranding of its natural food business by announcing the new name Curation Foods. See Note 1 - Organization, Basis of Presentation, and Summary of Significant Accounting Policies for more information).

The Company decided to discontinue its Now Planting business during the fourth quarter of fiscal year 2019. As a result, the operating results for the Now Planting business are presented as a discontinued operations in the Company's accompanying Consolidated Financial Statements and the financial results for fiscal years 2019 have been reclassified to present the Now Planting business as a discontinued operation.

Curation Foods business includes (i) four natural food brands, including the Company’s two existing brands, Eat Smart and O Olive Oil & Vinegar, as well as two new brands, Yucatan and Cabo Fresh acquired by the Company through the acquisition of Yucatan Foods during the third quarter of fiscal 2019 (see the Note 2 - Acquisitions for more details on this transaction), and (ii) BreatheWay® activities. The Curation Foods segment includes activities to market and pack specialty packaged whole and fresh-cut fruit and vegetables, the majority of which incorporate the BreatheWay specialty packaging for the retail grocery, club store and food services industry and are sold primarily under the Eat Smart brand and various private labels. The Curation Foods segment also includes sales of BreatheWay packaging to partners for fruit and vegetable products, sales of olive oils and wine vinegars under the O brand, and sales of avocado products under the recently acquired brands Yucatan and Cabo Fresh.

The Lifecore segment sells products utilizing hyaluronan, a naturally occurring polysaccharide that is widely distributed in the extracellular matrix of connective tissues in both animals and humans, and non-HA products for medical use primarily in the Ophthalmic, Orthopedic and other markets.

The Other segment includes corporate general and administrative expenses, non-Curation Foods and non-Lifecore interest income and income tax expenses.

All of the Company's assets are located within the United States of America except for the production facility in Mexico, which was acquired by the Company as a result of the Yucatan Foods acquisition. The following table presents our property and equipment, net by geographic region (in millions):



	Year Ended
Property and equipment, net	May 26, 2019		May 27, 2018
United States	$	186.3	$	159.6
Mexico	13.7		—
Total property and equipment, net	$	200.0	$	159.6

The Company’s international sales by geography are based on the billing address of the customer and were as follows (in millions):



	Year Ended
	May 26, 2019		May 27, 2018		May 28, 2017
Canada	$	83.6	$	78.0	$	69.3
Belgium	$	15.1	$	17.2	$	21.0
Ireland	$	5.0	$	4.1	$	4.0
All Other Countries	$	5.1	$	3.6	$	4.6

Operations by segment consisted of the following (in thousands):



Year Ended May 26, 2019	Curation Foods (1)			Lifecore		Other (2)			Total
Net sales	$	481,686		$	75,873	$	—		$	557,559
Gross profit	49,305			31,698		—			81,003
Net income (loss) from continuing operations	(6,229		)	12,070		(3,719		)	2,122
Identifiable assets	367,352			145,558		6,181			519,091
Depreciation and amortization	10,360			4,140		730			15,230
Capital expenditures	30,583			12,965		1,186			44,734
Dividend income	1,650			—		—			1,650
Interest income	112			—		33			145
Interest expense, net	3,278			—		1,952			5,230
Income tax (benefit) expense	(1,373		)	4,024		(1,133		)	1,518

Year Ended May 27, 2018
Net sales	$	458,800		$	65,427	$	—		$	524,227
Gross profit	49,770			28,568		—			78,338
Net income (loss) from continuing operations	17,010			11,631		(2,880		)	25,761
Identifiable assets (3)	264,067			129,342		11,294			404,703
Depreciation and amortization	8,196			3,679		537			12,412
Capital expenditures	13,052			16,454		4,084			33,590
Dividend income	1,650			—		—			1,650
Interest income	93			—		118			211
Interest expense, net	1,554			—		396			1,950
Income tax (benefit) expense	(9,748		)	2,638		(2,253		)	(9,363		)

Year Ended May 28, 2017
Net sales	$	410,384		$	59,392	$	—		$	469,776
Gross profit	52,457			26,755		—			79,212
Net income (loss) from continuing operations	2,410			10,228		(2,503		)	10,135
Identifiable assets (3)	219,739			104,492		34,377			358,608
Depreciation and amortization	7,312			3,054		311			10,677
Capital expenditures	11,476			11,169		358			23,003
Dividend income	1,650			—		—			1,650
Interest income	16			—		—			16
Interest expense, net	674			13		1,139			1,826
Income tax expense	823			2,938		279			4,040

(1) The Curation segment operating results for the year ended May 26, 2019 reflect the reclassification of the Now Planting brand to discontinued operations.

(2) The Other segment operating results for the year ended May 26, 2019, May 27, 2018, and May 28, 2017 have been restated to reflect the reclassification of the Now Planting brand and the Food Export segment to discontinued operations, and the reclassification of O operating results from the Other segment to the Curation Foods segment.

(3) Assets of discontinued operations are included in Other for the years ended May 27, 2018 and May 28, 2017.