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Note 19 - Segment Information | 12 Months Ended
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Jun. 30, 2020
Notes to Financial Statements |
Segment Reporting Disclosure [Text Block] |
( 19 ) | Segment Information
Operating segments are defined as (i) components of an enterprise that engage in business activities from which they may earn revenue and incur expense, (ii) have operating results that are regularly reviewed by the enterprise's chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance, and (iii) for which discrete financial information is available. Our Chief Executive Officer is our chief operating decision maker (“CODM”) and reviews financial information at the operating segment level and is responsible for making decisions about resources allocated amongst the operating segments based on actual results. Our operating segments are aligned with how the Company, including our CODM, manages the business. As such, our reportable operating segments are the Wholesale segment and the Retail segment. 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. The accounting policies of the operating segments are the same as those described in Note 3, Summary of Significant Accounting Policies . We account for intersegment revenue transactions between our segments consistent with independent third -party transactions, that is, at current market prices. As a result, the manufacturing profit related to sales to our retail segment is included within our wholesale segment. Operating income realized on intersegment revenue transactions is therefore generally consistent with the operating income realized on our revenue from independent third -party transactions. Segment operating income is based on profit or loss from operations before interest expense, interest income, other expense, net and income taxes. Sales are attributed to countries on the basis of the customer's location. As of June 30, 2020, the Company operated 144 design centers (our retail segment) and our independent retailers operated 160 design centers. Our wholesale segment net sales include sales to our retail segment, which are eliminated in consolidation, and sales to our independent retailers and other third parties. Our retail segment net sales accounted for 78.5% of our consolidated net sales in fiscal 2020. Our wholesale segment net sales accounted for the remaining 21.5%. Our ten largest customers were all within our wholesale segment and represent 15.4% of our consolidated net sales in fiscal 2020. These customers are the GSA and nine independent retailers. Information for each of the last three fiscal years ended June 30 is provided below (in thousands):
|  | 2020 |  |  | 2019 |  |  | 2018 |
Net sales |  |  |  |  |  |  |  |  |  |  |  |
Wholesale segment |  | $ | 337,948 |  |  | $ | 441,551 |  |  | $ | 475,731 |
Retail segment |  |  | 462,800 |  |  |  | 589,829 |  |  |  | 587,502 |
Elimination of intercompany sales |  |  | (210,911 | ) |  |  | (284,696 | ) |  |  | (296,449 | )
Consolidated Total |  | $ | 589,837 |  |  | $ | 746,684 |  |  | $ | 766,784 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  |  |
Wholesale segment |  | $ | 33,106 |  |  | $ | 42,481 |  |  | $ | 48,499 |
Retail segment |  |  | (21,414 | ) |  |  | (10,529 | ) |  |  | (1,738 | )
Adjustment of intercompany profit (a) |  |  | 2,952 |  |  |  | 1,995 |  |  |  | 2,106 |
Operating income |  |  | 14,644 |  |  |  | 33,947 |  |  |  | 48,867 |
Interest (expense), net of interest income |  |  | (455 | ) |  |  | (87 | ) |  |  | 200 |
Consolidated Total |  | $ | 14,189 |  |  | $ | 33,860 |  |  | $ | 49,067 |
Depreciation and amortization |  |  |  |  |  |  |  |  |  |  |  |
Wholesale segment |  | $ | 7,107 |  |  | $ | 7,560 |  |  | $ | 7,752 |
Retail segment |  |  | 9,752 |  |  |  | 11,970 |  |  |  | 12,079 |
Consolidated Total |  | $ | 16,859 |  |  | $ | 19,530 |  |  | $ | 19,831 |
Capital expenditures |  |  |  |  |  |  |  |  |  |  |  |
Wholesale segment |  | $ | 7,454 |  |  | $ | 3,340 |  |  | $ | 4,286 |
Retail segment |  |  | 8,255 |  |  |  | 5,780 |  |  |  | 8,200 |
Consolidated Total |  | $ | 15,709 |  |  | $ | 9,120 |  |  | $ | 12,486 |
(a) | Represents the change in wholesale profit contained in the retail segment inventory at the end of the period.
|  | June 30, |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Total Assets |  |  |  |  |  |  |  |  |  |  |  |
Wholesale segment |  | $ | 255,011 |  |  | $ | 237,354 |  |  | $ | 241,616 |
Retail segment |  |  | 390,635 |  |  |  | 299,125 |  |  |  | 317,590 |
Inventory profit elimination (a) |  |  | (22,857 | ) |  |  | (26,128 | ) |  |  | (28,773 | )
Consolidated Total |  | $ | 622,789 |  |  | $ | 510,351 |  |  | $ | 530,433 |
(a) | 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.
Geographic Information Our international net sales are comprised of our wholesale segment sales to independent retailers and our retail segment sales to customers through our Company-operated design centers. The number of international design centers and the related net sales as a percentage of our consolidated net sales are shown in the following tables.
|  | Fiscal Year Ended June 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Independent retailer design centers |  |  | 125 |  |  |  | 118 |  |  |  | 104 |
Company-operated design centers |  |  | 6 |  |  |  | 6 |  |  |  | 6 |
Total international design centers |  |  | 131 |  |  |  | 124 |  |  |  | 110 |
% of total design centers international |  |  | 43.1 | % |  |  | 41.1 | % |  |  | 37.2 | %
% of consolidated net sales |  |  | 5.7 | % |  |  | 6.8 | % |  |  | 10.2 | %
Sales by Country |  | 2020 |  |  | 2019 |  |  | 2018 |
United States |  |  | 94.3 | % |  |  | 93.2 | % |  |  | 89.8 | %
All Others |  |  | 5.7 | % |  |  | 6.8 | % |  |  | 10.2 | %
The following table sets forth long-lived assets by geographic area at June 30 ( in thousands):
|  | 2020 |  |  | 2019 |  |  | 2018 |
United States |  | $ | 319,012 |  |  | $ | 218,034 |  |  | $ | 239,567 |
Mexico |  |  | 14,474 |  |  |  | 18,144 |  |  |  | 18,323 |
Honduras |  |  | 8,049 |  |  |  | 8,057 |  |  |  | 8,637 |
Canada |  |  | 4,485 |  |  |  | 1,011 |  |  |  | 1,376 |
Total long-lived assets (1) |  | $ | 346,020 |  |  | $ | 245,246 |  |  | $ | 267,903 |
( 1 ) | Long-lived assets consist of net property, plant and equipment and operating lease right-of-use assets and exclude goodwill, intangible assets, deferred income taxes and other assets.

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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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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