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Note 10 - Operating Segment Information | 9 Months Ended
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Sep. 30, 2022
Notes to Financial Statements |
Segment Reporting Disclosure [Text Block] | N OTE 10 – Operating Segment Information: As described in Note 1, effective in the second quarter of 2022, the Company realigned its reportable segments to correspond with changes to its organizational responsibilities, management structure and operating model. We have reclassified prior period segment disclosures to conform to the current period presentation. As a result of the change, the Company manages and reports the following segments: Branded Products segment: Primarily through our signature marketing brands BAMKO® and HPI®, we produce and sell customized merchandising solutions, promotional products and branded uniform programs. Branded products are sold to customers in a wide range of industries, including retail, hotel, food service, entertainment, tech, transportation and other industries. The segment currently has sales offices in the United States, Brazil and Canada, with support services in China and India. Healthcare Apparel segment: Primarily through our signature marketing brands Fashion Seal Healthcare® and WonderWink®, we manufacture (through third parties or our own facilities) and sell a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient gowns. This segment sells healthcare service apparel to healthcare laundries, dealers, distributors and retailers primarily in the United States. Contact Centers: Through multiple The Office Gurus® entities, including our subsidiaries in El Salvador, Belize, Jamaica, Dominican Republic and the United States (collectively, “TOG”), we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers. Intersegment eliminations include the elimination of revenues and costs from services provided by the Contact Centers segment to the Company’s two other segments. Such costs are recognized as selling and administrative expenses in the Branded Products and Healthcare Apparel segments. Income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment are presented within Other in the tables below. The Company evaluates the performance of each operating segment based on several factors of which the primary financial measures are net sales and income before taxes on income. The following tables set forth financial information related to the Company’s operating segments (in thousands):
|  | Branded Products |  |  | Healthcare Apparel |  |  | Contact Centers |  |  | Intersegment Eliminations |  |  | Other |  |  | Total |
As of and For the Three Months Ended September 30, 2022: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net sales |  | $ | 86,769 |  |  | $ | 30,039 |  |  | $ | 23,363 |  |  | $ | (1,468 | ) |  | $ | - |  |  | $ | 138,703 |
Cost of goods sold |  |  | 60,600 |  |  |  | 18,609 |  |  |  | 9,453 |  |  |  | (596 | ) |  |  | - |  |  |  | 88,066 |
Gross margin |  |  | 26,169 |  |  |  | 11,430 |  |  |  | 13,910 |  |  |  | (872 | ) |  |  | - |  |  |  | 50,637 |
Selling and administrative expenses |  |  | 22,257 |  |  |  | 10,161 |  |  |  | 9,520 |  |  |  | (872 | ) |  |  | 2,749 |  |  |  | 43,815 |
Goodwill impairment charge |  |  | 21,460 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 21,460 |
Other periodic pension cost |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 528 |  |  |  | 528 |
Interest expense |  |  | 87 |  |  |  | 32 |  |  |  | - |  |  |  | - |  |  |  | 1,675 |  |  |  | 1,794 |
Income (loss) before taxes on income |  | $ | (17,635 | ) |  | $ | 1,237 |  |  | $ | 4,390 |  |  | $ | - |  |  | $ | (4,952 | ) |  | $ | (16,960 | )
Depreciation and amortization |  | $ | 1,724 |  |  | $ | 973 |  |  | $ | 653 |  |  | $ | - |  |  | $ | 51 |  |  | $ | 3,401 |
Capital expenditures |  | $ | 2,062 |  |  | $ | 498 |  |  | $ | 1,622 |  |  | $ | - |  |  | $ | - |  |  | $ | 4,182 |
Total assets |  | $ | 224,854 |  |  | $ | 160,919 |  |  | $ | 44,519 |  |  | $ | - |  |  | $ | 37,015 |  |  | $ | 467,307 |
|  | Branded Products |  |  | Healthcare Apparel |  |  | Contact Centers |  |  | Intersegment Eliminations |  |  | Other |  |  | Total |
As of and For the Three Months Ended September 30, 2021: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net sales |  | $ | 71,651 |  |  | $ | 35,482 |  |  | $ | 18,040 |  |  | $ | (1,847 | ) |  | $ | - |  |  | $ | 123,326 |
Cost of goods sold |  |  | 49,914 |  |  |  | 20,886 |  |  |  | 7,555 |  |  |  | (843 | ) |  |  | - |  |  |  | 77,512 |
Gross margin |  |  | 21,737 |  |  |  | 14,596 |  |  |  | 10,485 |  |  |  | (1,004 | ) |  |  | - |  |  |  | 45,814 |
Selling and administrative expenses |  |  | 16,860 |  |  |  | 8,984 |  |  |  | 6,576 |  |  |  | (1,004 | ) |  |  | 3,643 |  |  |  | 35,059 |
Other periodic pension cost |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 459 |  |  |  | 459 |
Interest expense |  |  | 11 |  |  |  | 18 |  |  |  | - |  |  |  | - |  |  |  | 291 |  |  |  | 320 |
Income (loss) before taxes on income |  | $ | 4,866 |  |  | $ | 5,594 |  |  | $ | 3,909 |  |  | $ | - |  |  | $ | (4,393 | ) |  | $ | 9,976 |
Depreciation and amortization |  | $ | 1,131 |  |  | $ | 797 |  |  | $ | 398 |  |  | $ | - |  |  | $ | 20 |  |  | $ | 2,346 |
Capital expenditures |  | $ | 1,017 |  |  | $ | 379 |  |  | $ | 1,733 |  |  | $ | - |  |  | $ | - |  |  | $ | 3,129 |
Total assets |  | $ | 205,268 |  |  | $ | 164,748 |  |  | $ | 28,062 |  |  | $ | - |  |  | $ | 24,451 |  |  | $ | 422,529 |
|  | Branded Products |  |  | Healthcare Apparel |  |  | Contact Centers |  |  | Intersegment Eliminations |  |  | Other |  |  | Total |
As of and For the Nine Months Ended September 30, 2022: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net sales |  | $ | 285,891 |  |  | $ | 86,895 |  |  | $ | 62,803 |  |  | $ | (5,371 | ) |  | $ | - |  |  | $ | 430,218 |
Cost of goods sold |  |  | 202,422 |  |  |  | 56,066 |  |  |  | 25,438 |  |  |  | (2,259 | ) |  |  | - |  |  |  | 281,667 |
Gross margin |  |  | 83,469 |  |  |  | 30,829 |  |  |  | 37,365 |  |  |  | (3,112 | ) |  |  | - |  |  |  | 148,551 |
Selling and administrative expenses |  |  | 67,818 |  |  |  | 30,049 |  |  |  | 24,294 |  |  |  | (3,112 | ) |  |  | 12,949 |  |  |  | 131,998 |
Goodwill impairment charge |  |  | 25,595 |  |  |  | 20,323 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 45,918 |
Intangible assets impairment charge |  |  | 5,581 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 5,581 |
Other periodic pension cost |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,584 |  |  |  | 1,584 |
Interest expense |  |  | 205 |  |  |  | 84 |  |  |  | - |  |  |  | - |  |  |  | 2,387 |  |  |  | 2,676 |
Income (loss) before taxes on income |  | $ | (15,730 | ) |  | $ | (19,627 | ) |  | $ | 13,071 |  |  | $ | - |  |  | $ | (16,920 | ) |  | $ | (39,206 | )
Depreciation and amortization |  | $ | 4,696 |  |  | $ | 2,942 |  |  | $ | 1,697 |  |  | $ | - |  |  | $ | 169 |  |  | $ | 9,504 |
Capital expenditures |  | $ | 5,006 |  |  | $ | 1,748 |  |  | $ | 4,393 |  |  | $ | - |  |  | $ | 74 |  |  | $ | 11,221 |
Total assets |  | $ | 224,854 |  |  | $ | 160,919 |  |  | $ | 44,519 |  |  | $ | - |  |  | $ | 37,015 |  |  | $ | 467,307 |
|  | Branded Products |  |  | Healthcare Apparel |  |  | Contact Centers |  |  | Intersegment Eliminations |  |  | Other |  |  | Total |
As of and For the Nine Months Ended September 30, 2021: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net sales |  | $ | 244,664 |  |  | $ | 108,782 |  |  | $ | 46,723 |  |  | $ | (5,209 | ) |  | $ | - |  |  | $ | 394,960 |
Cost of goods sold |  |  | 169,307 |  |  |  | 66,696 |  |  |  | 19,233 |  |  |  | (2,291 | ) |  |  | - |  |  |  | 252,945 |
Gross margin |  |  | 75,357 |  |  |  | 42,086 |  |  |  | 27,490 |  |  |  | (2,918 | ) |  |  | - |  |  |  | 142,015 |
Selling and administrative expenses |  |  | 50,179 |  |  |  | 26,165 |  |  |  | 16,860 |  |  |  | (2,918 | ) |  |  | 13,790 |  |  |  | 104,076 |
Other periodic pension cost |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,328 |  |  |  | 1,328 |
Pension plan termination charge |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 6,945 |  |  |  | 6,945 |
Interest expense |  |  | 63 |  |  |  | 136 |  |  |  | - |  |  |  | - |  |  |  | 726 |  |  |  | 925 |
Income (loss) before taxes on income |  | $ | 25,115 |  |  | $ | 15,785 |  |  | $ | 10,630 |  |  | $ | - |  |  | $ | (22,789 | ) |  | $ | 28,741 |
Depreciation and amortization |  | $ | 3,078 |  |  | $ | 2,545 |  |  | $ | 1,014 |  |  | $ | - |  |  | $ | 82 |  |  | $ | 6,719 |
Capital expenditures |  | $ | 6,926 |  |  | $ | 4,680 |  |  | $ | 2,849 |  |  | $ | - |  |  | $ | - |  |  | $ | 14,455 |
Total assets |  | $ | 205,268 |  |  | $ | 164,748 |  |  | $ | 28,062 |  |  | $ | - |  |  | $ | 24,451 |  |  | $ | 422,529 |

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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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&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 https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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