Information On Business Segments

3 Months Ended

Mar. 31, 2020

17. Information on Business Segments

The Company has three operating business segments each of which is comprised of different geographic regions. The Company's three segments are as follows:



Operating Segment	Geography	Primary Brands	Primary Products
ACCO Brands North America	United States and Canada	Five Star^®, Quartet^®, AT-A-GLANCE^®, GBC^®, Swingline^®, Kensington^®, Mead^®, and Hilroy^®	School notebooks, planners, dry erase boards, storage and organization products (3-ring binders), stapling, punching, laminating, binding products, and computer accessories

ACCO Brands EMEA	Europe, Middle East and Africa	Leitz^®, Rapid^®, Esselte^®, Kensington^®, Rexel^® GBC^®, NOBO^®, and Derwent^®	Storage and organization products (lever-arch binders, sheet protectors, indexes), stapling, punching, laminating, shredding, do-it-yourself tools, dry erase boards, writing instruments and computer accessories

ACCO Brands International	Australia/N.Z., Latin America and Asia-Pacific	Tilibra^®, GBC^®, Barrilito^®, Foroni^®, Marbig^®, Kensington^®, Artline^®, Wilson Jones^®,Quartet^®, Spirax^®, and Rexel^®Australia/N.Z. only	School notebooks, planners, dry erase boards, storage and organization products (binders, sheet protectors and indexes), stapling, punching, laminating, shredding, writing instruments, janitorial supplies and computer accessories

Each business segment designs, markets, sources, manufactures and sells recognized consumer and other end-user demanded branded products used in businesses, schools and homes. Product designs are tailored to end-user preferences in each geographic region, and where possible, leverage common engineering, design, and sourcing.

Our product categories include storage and organization; stapling; punching; laminating, shredding and binding machines; dry erase boards; notebooks; calendars; computer accessories; and do-it-yourself tools, among others. Our portfolio includes both globally and regionally recognized brands. The revenue in North America and International segments includes significant sales of consumer products that have very important, seasonal selling periods related to back-to-school and calendar year-end. For North America and Mexico, back-to-school straddles the second and third quarters, and for Southern hemisphere it takes place in the fourth and first quarter. We expect sales of consumer products to become a greater percentage of our revenue because demand for consumer back-to-school products is growing faster than demand for most business-related and calendar products.

Customers

We distribute our products through a wide variety of retail and commercial channels to ensure that they are readily and conveniently available for purchase by consumers and other end-users, wherever they prefer to shop. These channels include mass retailers; e-tailers; discount, drug/grocery and variety chains; warehouse clubs; hardware and specialty stores; independent office product dealers; office superstores; wholesalers; and contract stationers. We also sell directly to commercial and consumer end-users through our e-commerce sites and our direct sales organization.

Net sales by business segment for the three months ended March 31, 2020 and 2019 were as follows:



	Three Months Ended March 31,
(in millions)	2020		2019
ACCO Brands North America	$	167.8	$	160.4
ACCO Brands EMEA	127.5		146.5
ACCO Brands International	88.8		87.0
Net sales	$	384.1	$	393.9

Operating income by business segment for the three months ended March 31, 2020 and 2019 was as follows:



	Three Months Ended March 31,
(in millions)	2020			2019
ACCO Brands North America	$	7.6		$	6.8
ACCO Brands EMEA	12.0			15.9
ACCO Brands International	5.9			5.6
Segment operating income	25.5			28.3
Corporate	(8.1		)	(10.4		)
Operating income⁽¹⁾	17.4			17.9
Interest expense	8.6			10.4
Interest income	(0.3		)	(0.9		)
Non-operating pension income	(1.5		)	(1.4		)
Other income, net	(0.5		)	(0.2		)
Income before income tax	$	11.1		$	10.0

(1)

Operating income as presented in the segment table above is defined as i) net sales; ii) less cost of products sold; iii) less selling, general and administrative expenses; iv) less amortization of intangibles; and v) less restructuring charges.