XML 45 R27.htm IDEA: XBRL DOCUMENT
v3.19.1

Segment Information | 12 Months Ended
--- | ---
Mar. 30, 2019
Segment Reporting [Abstract] |
Segment Information | Segment Information Prior to the fourth quarter of Fiscal 2019, the Company organized its business into four operating and reportable segments - MK Retail, MK Wholesale, MK Licensing and Jimmy Choo. As a result of the acquisition of Versace, effective beginning in the fourth quarter of Fiscal 2019, the Company realigned its operating and reportable segments according to the new structure of its business. As a result, the Company now operates its business through three operating segments—Versace, Jimmy Choo and Michael Kors, which are based on its business activities and organization. The reportable segments are segments of the Company for which separate financial information is available and for which operating results are evaluated regularly by the Company’s chief operating decision maker (“CODM”) in deciding how to allocate resources, as well as in assessing performance. The primary key performance indicators are revenue and operating income for each segment. The Company’s reportable segments represent components of the business that offer similar merchandise, customer experience and sales/marketing strategies. The Company’s three reportable segments are as follows:
• | Versace — segment includes revenue generated through the sale of Versace luxury ready-to-wear, accessories, footwear and home furnishings through directly operated Versace boutiques throughout North America (United States and Canada), EMEA and certain parts of Asia, as well as through Versace outlet stores and e-commerce sites. In addition, revenue is generated through wholesale sales to distribution partners (including geographic licensing arrangements that allow third parties to use the Versace trademarks in connection with retail and/or wholesale sales of Versace branded products in specific geographic regions), multi-brand department stores and specialty stores worldwide, as well as through product license agreements in connection with the manufacturing and sale of jeans, fragrances, watches, jewelry and eyewear.
• | Jimmy Choo — segment includes revenue generated through the sale of Jimmy Choo luxury footwear, handbags and small leather goods through directly operated Jimmy Choo stores throughout the Americas, EMEA and certain parts of Asia, through its e-commerce sites, as well as through wholesale sales of luxury goods to distribution partners (including geographic licensing arrangements that allow third parties to use the Jimmy Choo trademarks in connection with retail and/or wholesale sales of Jimmy Choo branded products in specific geographic regions), multi-brand department stores and specialty stores worldwide. In addition, revenue is generated through product licensing agreements, which allow third parties to use the Jimmy Choo brand name and trademarks in connection with the manufacturing and sale of fragrances, sunglasses and eyewear.
• | Michael Kors — segment includes revenue generated through the sale of Michael Kors products through four primary Michael Kors retail store formats: “Collection” stores, “Lifestyle” stores (including concessions), outlet stores and e-commerce, through which the Company sells Michael Kors products, as well as licensed products bearing the Michael Kors name, directly to the end consumer throughout the Americas (U.S., Canada and Latin America, excluding Brazil), Europe and certain parts of Asia. The Michael Kors e-commerce business includes e-commerce sites in the U.S., Canada, certain parts of Europe, China, Japan and South Korea. The Company also sells Michael Kors products directly to department stores, primarily located across the Americas and Europe, to specialty stores and travel retail shops in the Americas, Europe and Asia, and to its geographic licensees in certain parts of EMEA (Europe, Middle East and Africa), Asia and Brazil. In addition, revenue is generated through product and geographic licensing arrangements, which allow third parties to use the Michael Kors brand name and trademarks in connection with the manufacturing and sale of products, including watches, jewelry, fragrances and eyewear.
In addition to these reportable segments, the Company has certain corporate costs that are not directly attributable to its brands and, therefore, are not allocated to segments. Such costs primarily include certain administrative, corporate occupancy, and information systems expenses, including enterprise resource planning system implementation costs. In addition, certain other costs are not allocated to segments, including restructuring and other charges (including transaction and transition costs related to the Company’s recent acquisitions) and impairment costs. The new segment structure is consistent with how the Company’s CODM plans and allocates resources, manages the business and assesses performance. All prior period segment information has been recast to reflect the realignment of the Company’s segment reporting structure on a comparable basis. All intercompany revenues are eliminated in consolidation and are not reviewed when evaluating segment performance. The following table presents the key performance information of the Company’s reportable segments (in millions):
|  | Fiscal Years Ended
|  | March 30, 2019 |  | March 31, 2018 |  | April 1, 2017
Total revenue: |  |  |  |  |
| Versace | $ | 137 |  |  | $ | — |  |  | $ | — |
| Jimmy Choo | 590 |  |  | 223 |  |  | — |
| Michael Kors | 4,511 |  |  | 4,496 |  |  | 4,494 |
Total revenue | $ | 5,238 |  |  | $ | 4,719 |  |  | $ | 4,494 |
Income from operations: |  |  |  |  |
| Versace | $ | (11 | ) |  | $ | — |  |  | $ | — |
| Jimmy Choo | 20 |  |  | (4 | ) |  | — |
| Michael Kors | 964 |  |  | 975 |  |  | 979 |
Total segment income from operations | 973 |  |  | 971 |  |  | 979 |
Less: | Corporate expenses | (93 | ) |  | (87 | ) |  | (79 | )
| Restructuring and other charges | (124 | ) |  | (102 | ) |  | (11 | )
| Impairment of long-lived assets | (21 | ) |  | (33 | ) |  | (199 | )
Total income from operations | $ | 735 |  |  | $ | 749 |  |  | $ | 690 |
Depreciation and amortization expense for each segment are as follows (in millions):
| Fiscal Years Ended
| March 30, 2019 |  | March 31, 2018 |  | April 1, 2017
Depreciation and amortization(1): |  |  |  |  |
Versace | $ | 9 |  |  | $ | — |  |  | $ | — |
Jimmy Choo | 34 |  |  | 13 |  |  | — |
Michael Kors | 182 |  |  | 195 |  |  | 220 |
Total depreciation and amortization | $ | 225 |  |  | $ | 208 |  |  | $ | 220 |
(1) | Excluded from the above table are impairment charges, which are detailed in the below table and in Note 7, Note 8 and Note 13.
The Company does not have identifiable assets separated by segment. See Note 8 to the accompanying consolidated financial statements for the Company’s goodwill by reportable segment. Total revenue (based on country of origin) and long-lived assets by geographic location are as follows (in millions):
| Fiscal Years Ended
| March 30, 2019 |  | March 31, 2018 |  | April 1, 2017
Revenue: |  |  |  |  |
The Americas (U.S., Canada and Latin America)(1) | $ | 3,182 |  |  | $ | 3,033 |  |  | $ | 3,141 |
EMEA | 1,279 |  |  | 1,093 |  |  | 944 |
Asia | 777 |  |  | 593 |  |  | 409 |
Total revenue | $ | 5,238 |  |  | $ | 4,719 |  |  | $ | 4,494 |
| As of
| March 30, 2019 |  | March 31, 2018 |  | April 1, 2017
Long-lived assets: |  |  |  |  |
The Americas (U.S., Canada and Latin America)(1) | $ | 319 |  |  | $ | 328 |  |  | $ | 356 |
EMEA | 2,123 |  |  | 1,050 |  |  | 198 |
Asia | 466 |  |  | 441 |  |  | 456 |
Total Long-lived assets: | $ | 2,908 |  |  | $ | 1,819 |  |  | $ | 1,010 |
(1) | Net revenues earned in the U.S. during Fiscal 2019, Fiscal 2018, and Fiscal 2017 were $2.972 billion, $2.818 billion and $2.935 billion, respectively. Long-lived assets located in the U.S. as of March 30, 2019 and March 31, 2018 were $296 million and $303 million, respectively.
Total revenue by major product category are as follows (in millions):
| Fiscal Years Ended
| March 30, 2019 |  | % of Total |  | March 31, 2018 |  | % of Total |  | April 1, 2017 |  | % of Total
Accessories | $ | 3,139 |  |  | 59.9% |  | $ | 3,057 |  |  | 64.8 | % |  | $ | 3,062 |  |  | 68.1 | %
Footwear | 1,023 |  |  | 19.5% |  | 657 |  |  | 13.9 | % |  | 462 |  |  | 10.3 | %
Apparel | 698 |  |  | 13.3% |  | 605 |  |  | 12.8 | % |  | 543 |  |  | 12.1 | %
Licensed product | 218 |  |  | 4.2% |  | 250 |  |  | 5.3 | % |  | 281 |  |  | 6.3 | %
Licensing revenue | 156 |  |  | 3.0% |  | 150 |  |  | 3.2 | % |  | 146 |  |  | 3.2 | %
Home | 4 |  |  | 0.1% |  | — |  |  | — | % |  | — |  |  | — | %
Total Revenue | $ | 5,238 |  |  |  |  | $ | 4,719 |  |  |  |  | $ | 4,494 |  |  |

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration