XML 29 R14.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Segment Information | 6 Months Ended
--- | ---
Aug. 04, 2018
Segment Reporting [Abstract] |
Segment Information | Segment Information The Company’s businesses are grouped into five reportable segments for management and internal financial reporting purposes: Americas Retail, Americas Wholesale, Europe, Asia and Licensing. The Company’s Americas Retail, Americas Wholesale, Europe and Licensing reportable segments are the same as their respective operating segments. Certain components of the Company’s Asia operating segment are separate operating segments based on region, which have been aggregated into the Asia reportable segment for disclosure purposes. Management evaluates segment performance based primarily on revenues and earnings (loss) from operations before corporate performance-based compensation costs, net gains (losses) from lease terminations, asset impairment charges and restructuring charges, if any. The Company believes this segment reporting reflects how its business segments are managed and how each segment’s performance is evaluated by the Company’s chief operating decision maker to assess performance and make resource allocation decisions. The Americas Retail segment includes the Company’s retail and e-commerce operations in North and Central America and the Company’s retail operations in South America. The Americas Wholesale segment includes the Company’s wholesale operations in the Americas. The Europe segment includes the Company’s retail, e-commerce and wholesale operations in Europe and the Middle East. The Asia segment includes the Company’s retail, e-commerce and wholesale operations in Asia and the Pacific. The Licensing segment includes the worldwide licensing operations of the Company. The business segment operating results exclude corporate overhead costs, which consist of shared costs of the organization, net gains (losses) on lease terminations, asset impairment charges and restructuring charges. Corporate overhead costs are presented separately and generally include, among other things, the following unallocated corporate costs: accounting and finance, executive compensation, corporate performance-based compensation, facilities, global advertising and marketing, human resources, information technology and legal. Net revenue and earnings (loss) from operations are summarized as follows for the three and six months ended August 4, 2018 and July 29, 2017 (in thousands):
| Three Months Ended |  | Six Months Ended
| Aug 4, 2018 |  | Jul 29, 2017 |  | Aug 4, 2018 |  | Jul 29, 2017
Net revenue: |  |  |  |  |  |  |  |  |
Americas Retail | $ | 197,125 |  |  | $ | 201,188 |  |  | $ | 368,465 |  |  | $ | 374,882 |
Americas Wholesale | 34,253 |  |  | 32,658 |  |  | 74,932 |  |  | 68,515 |
Europe | 311,998 |  |  | 255,215 |  |  | 517,433 |  |  | 420,603 |
Asia | 82,786 |  |  | 62,733 |  |  | 166,837 |  |  | 126,114 |
Licensing (1) (2) | 19,709 |  |  | 16,498 |  |  | 39,493 |  |  | 32,523 |
Total net revenue (1) (2) | $ | 645,871 |  |  | $ | 568,292 |  |  | $ | 1,167,160 |  |  | $ | 1,022,637 |
Earnings (loss) from operations: |  |  |  |  |  |  |  |  |
Americas Retail (2) (3) (4) | $ | 5,582 |  |  | $ | (3,555 | ) |  | $ | (98 | ) |  | $ | (25,136 | )
Americas Wholesale (2) (3) (4) | 5,325 |  |  | 5,238 |  |  | 11,351 |  |  | 12,221 |
Europe (3) (4) (5) | 30,531 |  |  | 30,058 |  |  | 10,198 |  |  | 29,052 |
Asia (3) (4) | 1,634 |  |  | 2,441 |  |  | 5,699 |  |  | 2,780 |
Licensing (2) (3) (4) | 17,437 |  |  | 14,389 |  |  | 34,923 |  |  | 27,850 |
Total segment earnings from operations (2) (3) (5) | 60,509 |  |  | 48,571 |  |  | 62,073 |  |  | 46,767 |
Corporate overhead (2) (3) (5) | (25,647 | ) |  | (23,551 | ) |  | (51,492 | ) |  | (43,960 | )
Net gains on lease terminations (3) (6) | — |  |  | — |  |  | 152 |  |  | — |
Asset impairment charges (3) (7) | (2,981 | ) |  | (1,233 | ) |  | (3,740 | ) |  | (3,995 | )
Total earnings (loss) from operations (2) (5) | $ | 31,881 |  |  | $ | 23,787 |  |  | $ | 6,993 |  |  | $ | (1,188 | )
__________________________________
(1) | During the fourth quarter of fiscal 2018, the Company reclassified net royalties received on the Company’s inventory purchases of licensed product from net revenue to cost of product sales to reflect its treatment as a reduction of the cost of such licensed product. Accordingly, net revenue for the three and six months ended July 29, 2017 has been adjusted to conform to the current period presentation. This reclassification had no impact on previously reported earnings (loss) from operations.
(2) | During the first quarter of fiscal 2019, the Company adopted a comprehensive new revenue recognition standard using a modified retrospective method that does not restate prior periods to be comparable to the current period presentation. The adoption of this guidance primarily impacted the presentation of advertising contributions received from the Company’s licensees and the related advertising expenditures incurred by the Company. The adoption of this guidance resulted in an increase in net royalty revenue within the Company’s Licensing segment of $2.1 million, as well as an increase in SG&A expenses in our Americas Retail, Americas Wholesale and Licensing segments as well as corporate overhead of $0.5 million, $0.2 million, $0.2 million and $0.5 million, respectively, during the three months ended August 4, 2018 compared to the same prior-year period. The net favorable impact on earnings from operations was approximately $0.6 million during the three months ended August 4, 2018 compared to the same prior-year period. During the six months ended August 4, 2018, the adoption of this guidance resulted in an increase in net royalty revenue within the Company’s Licensing segment of $4.4 million, as well as an increase in SG&A expenses in our Americas Retail, Americas Wholesale and Licensing segments as well as corporate overhead of $2.3 million, $0.9 million, $0.4 million and $1.1 million, respectively, during the six months ended August 4, 2018 compared to the same prior-year period. The net unfavorable impact on earnings from operations was approximately $0.4 million during the six months ended August 4, 2018 compared to the same prior-year period. Refer to Note 1 for more information regarding the impact from the adoption of this new standard.
(3) | During the third quarter of fiscal 2018, segment results were adjusted to exclude corporate performance-based compensation costs, net gains (losses) on lease terminations and asset impairment charges due to the fact that these items are no longer included in the segment results provided to the Company’s chief operating decision maker in order to allocate resources and assess performance. Accordingly, segment results have been adjusted for the three and six months ended July 29, 2017 to conform to the current period presentation.
(4) | During the first quarter of fiscal 2019, the Company changed the segment accountability for funds received from licensees on the Company’s purchases of its licensed products. These amounts were treated as a reduction of cost of product sales within the Licensing segment but now are considered in the results of the segments that control the respective purchases for purposes of segment performance evaluation. Accordingly, segment results for the three and six months ended July 29, 2017 have been adjusted to conform to the current period presentation.
(5) | During the first quarter of fiscal 2019, the Company adopted new authoritative guidance which requires that the non-service components of net periodic defined benefit pension cost be presented outside of earnings (loss) from operations. Accordingly, earnings (loss) from operations and segment results for the three and six months ended July 29, 2017 have been adjusted to conform to the current period presentation.
(6) | During the six months ended August 4, 2018, the Company recorded net gains on lease terminations related primarily to the early termination of certain lease agreements in North America. The net gains on lease terminations were recorded during the three months ended May 5, 2018. Refer to Note 1 for more information regarding the net gains on lease terminations.
(7) | During each of the periods presented, the Company recognized asset impairment charges for certain retail locations resulting from under-performance and expected store closures. Refer to Note 14 for more information regarding these asset impairment charges.
The table below presents information regarding geographic areas in which the Company operated. Net revenue is classified primarily based on the country where the Company’s customer is located (in thousands):
| Three Months Ended |  | Six Months Ended
| Aug 4, 2018 |  | Jul 29, 2017 |  | Aug 4, 2018 |  | Jul 29, 2017
Net revenue: |  |  |  |  |  |  |  |  |
U.S. | $ | 176,064 |  |  | $ | 174,991 |  |  | $ | 338,434 |  |  | $ | 337,171 |
Italy | 89,380 |  |  | 81,196 |  |  | 148,286 |  |  | 128,394 |
Canada | 45,822 |  |  | 49,130 |  |  | 86,335 |  |  | 89,524 |
South Korea | 35,996 |  |  | 34,283 |  |  | 74,083 |  |  | 72,838 |
Other foreign countries | 298,609 |  |  | 228,692 |  |  | 520,022 |  |  | 394,710 |
Total net revenue | $ | 645,871 |  |  | $ | 568,292 |  |  | $ | 1,167,160 |  |  | $ | 1,022,637 |
Due to the seasonal nature of the Company’s business segments, the above net revenue and operating results are not necessarily indicative of the results that may be expected for the full fiscal year.

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://www.xbrl.org/2003/role/presentationRef -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