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Business Segments, Geographic Data, and Sales by Major Customers
 3 Months Ended
Mar. 31, 2017
Business Segments, Geographic Data, and Sales by Major Customers
Note 2 — Business Segments, Geographic Data, and Sales by Major Customers

The Company is a worldwide producer and marketer of children’s toys and other consumer products, principally engaged in the design, development, production, marketing and distribution of its diverse portfolio of products. The Company has aligned its operating segments into three segments that reflect the management and operation of the business. The Company’s segments are (i) U.S. and Canada, (ii) International, and (iii) Halloween.

The U.S. and Canada segment includes action figures, vehicles, play sets, plush products, dolls, electronic products, construction toys, infant and pre-school toys, role play and everyday costume play, foot to floor ride-on vehicles, wagons, novelty toys, seasonal and outdoor products, kids’ indoor and outdoor furniture, and pet treats and related products, primarily within the United States and Canada.

Within the International segment, the Company markets and sells its toy products in markets outside of the U.S. and Canada, primarily in the European, Asia Pacific, and Latin and South American regions.

Within the Halloween segment, the Company markets and sells Halloween costumes and accessories and everyday costume play products, primarily in the U.S. and Canada.

Segment performance is measured at the operating income level. All sales are made to external customers and general corporate expenses have been attributed to the various segments based upon relative sales volumes. Segment assets are primarily comprised of accounts receivable and inventories, net of applicable reserves and allowances, goodwill and other assets. Certain assets which are not tracked by operating segment and/or that benefit multiple operating segments have been allocated on the same basis.

Results are not necessarily those which would be achieved if each segment was an unaffiliated business enterprise. Information by segment and a reconciliation to reported amounts for the three months ended March 31, 2017 and 2016 and as of March 31, 2017 and December 31, 2016 are as follows (in thousands):

 
  
Three Months Ended
March 31,
  
   
2017
    
2016
  
Net Sales
            
U.S. and Canada
  
$
70,912
    
$
72,202
  
International
    
19,942
      
20,168
  
Halloween
    
3,651
      
3,439
  
   
$
94,505
    
$
95,809
  
 
   
Three Months Ended
March 31,
  
   
2017
    
2016
  
Loss from Operations
            
U.S. and Canada
  
$
(7,876
)
  
$
(8,553
)
International
    
(1,772
)
    
(2,161
)
Halloween
    
(6,076
)
    
(3,102
)
   
$
(15,724
)
  
$
(13,816
)
 
 
   
Three Months Ended
March 31,
  
   
2017
    
2016
  
Depreciation and Amortization Expense
            
U.S. and Canada
  
$
3,374
    
$
3,070
  
International
    
898
      
852
  
Halloween
    
108
      
114
  
   
$
4,380
    
$
4,036
  
 
 
   
March 31,
2017
    
December 31,
2016
  
Assets
            
U.S. and Canada
  
$
246,206
    
$
306,895
  
International
    
99,464
      
119,560
  
Halloween
    
30,671
      
37,848
  
   
$
376,341
    
$
464,303
  

The following tables present information about the Company by geographic area as of March 31, 2017 and December 31, 2016 and for the three months ended March 31, 2017 and 2016 (in thousands):

   
March 31,
2017
    
December 31,
2016
  
Long-lived Assets
            
China
  
$
15,764
    
$
15,710
  
United States
    
6,347
      
6,587
  
Hong Kong
    
506
      
544
  
   
$
22,617
    
$
22,841
  
 
 
   
Three Months Ended
March 31,
  
   
2017
    
2016
  
Net Sales by Customer Area
            
United States
  
$
69,560
    
$
70,968
  
Europe
    
12,560
      
12,755
  
Canada
    
4,444
      
4,650
  
Hong Kong
    
219
      
339
  
Other
    
7,722
      
7,097
  
   
$
94,505
    
$
95,809
  
 
Major Customers

Net sales to major customers for the three months ended March 31, 2017 and 2016 were as follows (in thousands, except for percentages):

   
Three Months Ended March 31,
  
   
2017
    
2016
  
   
Amount
    
Percentage of
Net Sales
    
Amount
    
Percentage of
Net Sales
  
Wal-Mart
  
$
23,252
      
24.6
%
  
$
27,747
      
28.9
%
Target
    
12,659
      
13.4
      
8,334
      
8.7
  
Toys 'R' Us
    
7,711
      
8.2
      
8,122
      
8.5
  
   
$
43,622
      
46.2
%
  
$
44,203
      
46.1
%

At March 31, 2017 and December 31, 2016, the Company’s three largest customers accounted for approximately 46.3% and 35.8%, respectively, of net accounts receivable. The concentration of the Company’s business with a relatively small number of customers may expose the Company to material adverse effects if one or more of its large customers were to experience financial difficulty. The Company performs ongoing credit evaluations of its top customers and maintains an allowance for potential credit losses.