Quarterly report pursuant to Section 13 or 15(d)

Note 12 - Segment Information

v3.8.0.1
Note 12 - Segment Information
 3 Months Ended
Sep. 30, 2017
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]
(
12
)
Segment Information
 
Our wholesale and retail operating segments represent strategic business areas of our vertically integrated enterprise that operate separately and provide their own distinctive services. This vertical structure enables us to offer our complete line of home furnishings and accents more effectively while controlling quality and cost. We evaluate performance of the respective segments based upon revenues and operating income. Inter-segment transactions result, primarily, from the wholesale sale of inventory to the retail segment, including the related profit margin.
 
As of
September 30, 2017,
the Company operated
150
design centers (our retail segment) and our independent retailers operated
156
design centers. Our wholesale segment net sales include sales to our retail segment, which are eliminated in consolidation, sales to our independent retailers and unaffliated
third
parties. Our retail segment net sales accounted for
78%
of our consolidated net sales in the
first
quarter of fiscal
2018.
Our wholesale segment net sales accounted for
22%
.
Information for the
three
months ended
September 30, 2017
and
2016
is provided below (in thousands):
 
   
Three months ended
  
   
September 30,
  
   
2017
    
2016
  
Case Goods
    
33
 %    
32
 %
Upholstered Products
    
50
 %    
52
 %
Home Accents and Other
    
17
 %    
16
 %
     
100
 %    
100
 %
 
The proportion of retail segment sales by these product lines for the
three
months ended
September 30, 2017
and
2016
is provided as follows:
 
   
Three months ended
  
   
September 30,
  
   
2017
    
2016
  
Case Goods
    
31
 %    
30
 %
Upholstered Products
    
47
 %    
49
 %
Home Accents and Other
    
22
 %    
21
 %
     
100
 %    
100
 %
 
Segment information for the
three
months ended
September 30, 2017
and
2016
is provided below (in thousands):
 
   
Three months ended
  
   
September 30,
  
   
2017
    
2016
  
Net sales:
  
 
 
 
  
 
 
 
Wholesale segment
   $
111,587
     $
114,564
  
Retail segment
    
141,575
     $
152,255
  
Elimination of inter-company sales
    
(71,860
 )    
(73,532
 )
Consolidated Total
   $
181,302
     $
193,287
  
                 
Operating income:
  
 
 
 
  
 
 
 
Wholesale segment
   $
13,462
     $
16,491
  
Retail segment
    
(2,773
 )    
1,023
  
Adjustment of inter-company profit (1)
    
860
      
823
  
Consolidated Total
   $
11,549
     $
18,337
  
                 
Depreciation & Amortization:
  
 
 
 
  
 
 
 
Wholesale segment
   $
1,987
     $
1,910
  
Retail segment
    
3,099
      
3,089
  
Consolidated Total
   $
5,086
     $
4,999
  
                 
Capital expenditures:
  
 
 
 
  
 
 
 
Wholesale segment
   $
751
     $
3,639
  
Retail segment
    
1,902
      
3,801
  
Acquisitions
    
-
      
-
  
Consolidated Total
   $
2,653
     $
7,440
  
 
   
September 30,
    
June 30,
  
   
2017
    
2017
  
Total Assets:
  
 
 
 
  
 
 
 
Wholesale segment
   $
274,318
     $
279,364
  
Retail segment
    
319,426
      
319,341
  
Inventory profit elimination (2)
    
(29,318
 )    
(30,483
 )
Consolidated Total
   $
564,426
     $
568,222
  
 
(
1
)
Represents the change in wholesale profit contained in the retail segment inventory at the end of the period.
(
2
)
Represents the wholesale profit contained in the retail segment inventory that has
not
yet been realized. These profits are realized when the related inventory is sold.