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SEGMENT REPORTING | 12 Months Ended
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Mar. 31, 2019
SEGMENT REPORTING [Abstract] |
SEGMENT REPORTING |
16. | SEGMENT REPORTING
The Company’s segment information is presented in accordance with a “management approach,” which designates the internal reporting used by the chief operating decision-maker (“CODM”) for deciding how to allocate resources and for assessing performance. Our CODM is our Chief Executive Officer and President. Our CODM conducts our operations through two operating segments, our technology segment and our financing segment. Our technology segment includes sales of information technology products, third-party software, third-party maintenance, advanced professional and managed services and our proprietary software to commercial, state and local governments, and government contractors. Our financing segment consists of the financing of IT equipment, software and related services to commercial, state and local governments, and government contractors. Our CODM uses several measures to allocate resources and assess performance. Our reported measure is earnings before taxes. Our reportable segment information was as follows (in thousands):
|  | Fiscal Year Ended |
|  | March 31, 2019 |  |  | March 31, 2018 |  |  | March 31, 2017 |
|  | Technology |  |  | Financing |  |  | Total |  |  | Technology |  |  | Financing |  |  | Total |  |  | Technology |  |  | Financing |  |  | Total |
Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Product |  | $ | 1,180,042 |  |  | $ | 43,153 |  |  | $ | 1,223,195 |  |  | $ | 1,243,270 |  |  | $ | 46,037 |  |  | $ | 1,289,307 |  |  | $ | 1,197,503 |  |  | $ | 36,841 |  |  | $ | 1,234,344 |
Service |  |  | 149,478 |  |  |  | - |  |  |  | 149,478 |  |  |  | 129,495 |  |  |  | - |  |  |  | 129,495 |  |  |  | 97,434 |  |  |  | - |  |  |  | 97,434 |
Net sales |  |  | 1,329,520 |  |  |  | 43,153 |  |  |  | 1,372,673 |  |  |  | 1,372,765 |  |  |  | 46,037 |  |  |  | 1,418,802 |  |  |  | 1,294,937 |  |  |  | 36,841 |  |  | $ | 1,331,778 |
Cost of Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Product |  |  | 945,037 |  |  |  | 7,427 |  |  |  | 952,464 |  |  |  | 1,013,748 |  |  |  | 9,842 |  |  |  | 1,023,590 |  |  |  | 971,648 |  |  |  | 6,831 |  |  |  | 978,479 |
Service |  |  | 89,821 |  |  |  | - |  |  |  | 89,821 |  |  |  | 71,730 |  |  |  | - |  |  |  | 71,730 |  |  |  | 53,540 |  |  |  | - |  |  |  | 53,540 |
Cost of sales |  |  | 1,034,858 |  |  |  | 7,427 |  |  |  | 1,042,285 |  |  |  | 1,085,478 |  |  |  | 9,842 |  |  |  | 1,095,320 |  |  |  | 1,025,188 |  |  |  | 6,831 |  |  |  | 1,032,019 |
Gross Profit |  |  | 294,662 |  |  |  | 35,726 |  |  |  | 330,388 |  |  |  | 287,288 |  |  |  | 36,195 |  |  |  | 323,482 |  |  |  | 269,749 |  |  |  | 30,010 |  |  |  | 299,759 |
Selling, general, and administrative |  |  | 226,112 |  |  |  | 10,970 |  |  |  | 237,082 |  |  |  | 214,980 |  |  |  | 13,147 |  |  |  | 228,127 |  |  |  | 193,594 |  |  |  | 11,638 |  |  |  | 205,232 |
Depreciation and amortization |  |  | 11,812 |  |  |  | 12 |  |  |  | 11,824 |  |  |  | 9,918 |  |  |  | 3 |  |  |  | 9,921 |  |  |  | 7,243 |  |  |  | 9 |  |  |  | 7,252 |
Interest and financing costs |  |  | - |  |  |  | 1,948 |  |  |  | 1,948 |  |  |  | - |  |  |  | 1,195 |  |  |  | 1,195 |  |  |  | - |  |  |  | 1,543 |  |  |  | 1,543 |
Operating expenses |  |  | 237,924 |  |  |  | 12,930 |  |  |  | 250,854 |  |  |  | 224,898 |  |  |  | 14,345 |  |  |  | 239,243 |  |  |  | 200,837 |  |  |  | 13,190 |  |  |  | 214,027 |
Operating income |  |  | 56,738 |  |  |  | 22,796 |  |  |  | 79,534 |  |  |  | 62,389 |  |  |  | 21,850 |  |  |  | 84,239 |  |  |  | 68,912 |  |  |  | 16,820 |  |  |  | 85,732 |
Other income (expense) |  |  |  |  |  |  |  |  |  |  | 6,696 |  |  |  |  |  |  |  |  |  |  |  | (348 | ) |  |  |  |  |  |  |  |  |  |  | 380 |
Earnings before tax |  |  |  |  |  |  |  |  |  | $ | 86,230 |  |  |  |  |  |  |  |  |  |  | $ | 83,891 |  |  |  |  |  |  |  |  |  |  | $ | 86,112 |
Net Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Contracts with customers |  | $ | 1,308,405 |  |  | $ | 3,577 |  |  | $ | 1,311,982 |  |  | $ | 1,356,225 |  |  | $ | 13,732 |  |  | $ | 1,369,957 |  |  | $ | 1,261,078 |  |  | $ | 7,355 |  |  | $ | 1,268,433 |
Financing and other |  |  | 21,115 |  |  |  | 39,576 |  |  |  | 60,691 |  |  |  | 16,540 |  |  |  | 32,305 |  |  |  | 48,845 |  |  |  | 33,859 |  |  |  | 29,486 |  |  |  | 63,345 |
Net sales |  | $ | 1,329,520 |  |  | $ | 43,153 |  |  | $ | 1,372,673 |  |  | $ | 1,372,765 |  |  | $ | 46,037 |  |  | $ | 1,418,802 |  |  | $ | 1,294,937 |  |  | $ | 36,841 |  |  | $ | 1,331,778 |
Selected Financial Data - Statement of Cash Flow |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  | $ | 12,661 |  |  | $ | 5,978 |  |  | $ | 18,639 |  |  | $ | 10,461 |  |  | $ | 5,366 |  |  | $ | 15,827 |  |  | $ | 7,365 |  |  | $ | 4,366 |  |  | $ | 11,731 |
Purchases of property, equipment and operating lease equipment |  | $ | 6,042 |  |  | $ | 5,587 |  |  | $ | 11,629 |  |  | $ | 5,353 |  |  | $ | 2,237 |  |  | $ | 7,590 |  |  | $ | 3,356 |  |  | $ | 6,202 |  |  | $ | 9,558 |
Selected Financial Data - Balance Sheet |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total assets |  | $ | 607,998 |  |  | $ | 178,200 |  |  | $ | 786,198 |  |  | $ | 537,776 |  |  | $ | 217,695 |  |  | $ | 755,471 |  |  | $ | 533,560 |  |  | $ | 208,160 |  |  | $ | 741,720 |
Technology Segment Disaggregation of Revenue We analyze net sales for our technology segment by customer end market and by vendor, as opposed to discrete product and service categories, which are summarized below (in thousands):
|  | Fiscal Year Ended March 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Customer end market: |  |  |  |  |  |  |  |  |
Technology |  | $ | 293,362 |  |  | $ | 330,241 |  |  | $ | 302,097 |
Telecom, Media & Entertainment |  |  | 175,260 |  |  |  | 194,292 |  |  |  | 195,237 |
Financial Services |  |  | 202,074 |  |  |  | 201,712 |  |  |  | 166,179 |
SLED |  |  | 223,330 |  |  |  | 234,141 |  |  |  | 266,070 |
Healthcare |  |  | 193,754 |  |  |  | 189,889 |  |  |  | 143,154 |
All others |  |  | 241,740 |  |  |  | 222,490 |  |  |  | 220,200 |
Net sales |  |  | 1,329,520 |  |  |  | 1,372,765 |  |  |  | 1,294,937 |
Financing and other |  |  | (21,115 | ) |  |  | (16,540 | ) |  |  | (33,859 | )
Revenue from contracts with customers |  | $ | 1,308,405 |  |  | $ | 1,356,225 |  |  | $ | 1,261,078 |
|  | Fiscal Year Ended March 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Vendor |  |  |  |  |  |  |  |  |
Cisco Systems |  | $ | 556,182 |  |  | $ | 582,419 |  |  | $ | 604,111 |
NetApp |  |  | 48,858 |  |  |  | 54,821 |  |  |  | 69,096 |
HP Inc. & HPE |  |  | 74,348 |  |  |  | 86,675 |  |  |  | 77,977 |
Dell / EMC |  |  | 61,284 |  |  |  | 54,294 |  |  |  | 56,124 |
Arista Networks |  |  | 57,850 |  |  |  | 52,521 |  |  |  | 13,757 |
Juniper |  |  | 48,943 |  |  |  | 44,623 |  |  |  | 67,924 |
All others |  |  | 482,055 |  |  |  | 497,412 |  |  |  | 405,948 |
Net sales |  |  | 1,329,520 |  |  |  | 1,372,765 |  |  |  | 1,294,937 |
Financing and other |  |  | (21,115 | ) |  |  | (16,540 | ) |  |  | (33,859 | )
Revenue from contracts with customers |  | $ | 1,308,405 |  |  | $ | 1,356,225 |  |  | $ | 1,261,078 |
Financing Segment Disaggregation of Revenue We analyze our revenues within our financing segment based on the nature of the arrangement, and our revenues from contracts with customers consist of proceeds from the sale of off-lease equipment. The geographic information for the years ended March 31, 2019, 2018 and 2017 was as follows (in thousands):
|  | Year Ended March 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Net sales: |  |  |  |  |  |  |  |  |
U.S. |  | $ | 1,284,482 |  |  | $ | 1,349,254 |  |  | $ | 1,296,094 |
Non U.S. |  |  | 88,191 |  |  |  | 69,548 |  |  |  | 35,684 |
Total |  | $ | 1,372,673 |  |  | $ | 1,418,802 |  |  | $ | 1,331,778 |
|  | As of March 31, |
|  | 2019 |  |  | 2018 |
Long-lived tangible assets: |  |  |  |  |  |
U.S. |  | $ | 32,570 |  |  | $ | 24,445 |
Non U.S. |  |  | 1,156 |  |  |  | 494 |
Total |  | $ | 33,726 |  |  | $ | 24,939 |
Our long-lived tangible assets include property and equipment-net, operating leases-net, and equipment that has been returned to us at the termination of the lease. For the year ended March 31, 2018 and 2017, sales to a large technology company were approximately 12% and 13% of net sales, respectively, all of which related to our technology segment. No single customer accounted for more than 10% of net sales for the year ended March 31, 2019.

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- 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
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