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Note 15 - Segment Information
 9 Months Ended
Mar. 31, 2021
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

(15)

Segment Information

 

Our operating segments are aligned with how the Company, including our chief operating decision maker, 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. Inter-segment transactions result, primarily, from the wholesale sale of inventory to the retail segment, including the related profit margin.

 

As of March 31, 2021, 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 79.8% of our consolidated net sales for the nine months ended March 31, 2021, compared to 78.7% a year ago. Our wholesale segment net sales accounted for the remaining 20.2% during fiscal 2021.

 

Segment information is provided below (in thousands):

 

  

Three months ended

  

Nine months ended

 
  

March 31,

  

March 31,

 
  

2021

  

2020

  

2021

  

2020

 

Net sales

                

Wholesale segment

 $107,820  $93,139  $306,704  $286,357 

Retail segment

  141,396   115,698   404,295   392,065 

Elimination of intercompany sales

  (72,254)  (59,063)  (204,153)  (180,153)

Consolidated total

 $176,962  $149,774  $506,846  $498,269 
                 

Income before income taxes

                

Wholesale segment

 $14,508  $8,936  $40,366  $31,594 

Retail segment

  4,962   (8,772)  16,854   (7,343)

Elimination of intercompany profit (a)

  (483)  (918)  (3,997)  2,840 

Operating income

  18,987   (754)  53,223   27,091 

Other income (expense), including interest, net

  6   213   (811)  295 

Consolidated total

 $18,993  $(541) $52,412  $27,386 
                 

Depreciation and amortization

                

Wholesale segment

 $1,744  $1,748  $5,091  $5,388 

Retail segment

  2,470   2,667   7,268   7,457 

Consolidated total

 $4,214  $4,415  $12,359  $12,845 
                 

Capital expenditures

                

Wholesale segment

 $1,491  $3,027  $4,615  $5,338 

Retail segment

  2,973   1,443   5,727   7,119 

Consolidated total

 $4,464  $4,470  $10,342  $12,457 

 

 

(a)

Represents the change in wholesale profit contained in the retail segment inventory at the end of the period.

 

(in thousands)

 

March 31,

  

June 30,

 

Total Assets

 

2021

  

2020

 

Wholesale segment

 $297,946  $255,011 

Retail segment

  416,971   390,635 

Inventory profit elimination (a)

  (27,371)  (22,857)

Consolidated total

 $687,546  $622,789 

 

 

(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.