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SEGMENT INFORMATION
 9 Months Ended
Oct. 04, 2014
SEGMENT INFORMATION  
SEGMENT INFORMATION

9. SEGMENT INFORMATION

 

The Company’s reportable operating segments are comprised of North America wholesale, Europe wholesale, Asia Pacific wholesale and Direct to consumer. The North America wholesale, Europe wholesale and Asia Pacific wholesale reportable segments do not include activities related to the Direct to consumer segment. The North America wholesale segment primarily includes sales to wholesale or distributor customers based in Canada, Mexico, the United States and countries in South America. The Europe wholesale segment primarily includes sales to wholesale or distributor customers based in European countries, the Middle East and Africa. The Asia Pacific wholesale segment primarily includes sales to wholesale or distributor customers based in Australia, China (including the Company’s assembly and procurement operations), India, Indonesia, Japan, Malaysia, New Zealand, Singapore, South Korea, Taiwan and Thailand. The Direct to consumer segment includes Company-owned retail stores, e-commerce activities and catalog costs. Each reportable operating segment provides similar products and services.

 

The Company evaluates the performance of its reportable segments based on net sales and operating income. Net sales for geographic segments are generally based on the location of the customers. Operating income for each segment includes net sales to third-parties, related cost of sales and operating expenses directly attributable to the segment. General corporate expenses, including certain administrative, legal, accounting, technology support costs, equity compensation costs, payroll costs attributable to executive management and amounts related to intercompany eliminations are not allocated to the various segments. Intercompany sales of products between segments are referred to as intersegment items. Intercompany profit attributable to the Company’s factory operations is included in the Asia Pacific wholesale and Europe wholesale segments in accordance with the geographic location of the factories. These intercompany factory profits are eliminated in consolidation.

 

Summary information by operating segment was as follows (in thousands):

 

 

 

For the 13 Weeks Ended

 

For the 13 Weeks Ended

 

 

 

October 4, 2014

 

September 28, 2013

 

 

 

Net Sales

 

Operating 
Income

 

Net Sales

 

Operating 
Income

 

 

 

 

 

 

 

 

 

 

 

North America wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

$

319,088

 

$

72,441

 

$

300,707

 

$

76,689

 

Intersegment

 

57,843

 

 

 

54,318

 

 

 

Europe wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

242,201

 

73,701

 

209,507

 

56,180

 

Intersegment

 

57,186

 

 

 

51,888

 

 

 

Asia Pacific wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

116,654

 

32,761

 

104,835

 

36,046

 

Intersegment

 

331,569

 

 

 

287,100

 

 

 

Direct to consumer

 

216,539

 

22,174

 

195,347

 

18,567

 

Intersegment items

 

(446,598

)

 

 

(393,306

)

 

 

Corporate

 

 

 

(46,144

)

 

 

(46,450

)

Consolidated

 

$

894,482

 

$

154,933

 

$

810,396

 

$

141,032

 

 

 

 

For the 40 Weeks Ended

 

For the 39 Weeks Ended

 

 

 

October 4, 2014

 

September 28, 2013

 

 

 

Net Sales

 

Operating 
Income

 

Net Sales

 

Operating 
Income

 

 

 

 

 

 

 

 

 

 

 

North America wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

$

857,107

 

$

176,232

 

$

816,565

 

$

203,418

 

Intersegment

 

148,812

 

 

 

149,280

 

 

 

Europe wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

650,241

 

169,423

 

554,171

 

131,178

 

Intersegment

 

156,776

 

 

 

131,289

 

 

 

Asia Pacific wholesale:

 

 

 

 

 

 

 

 

 

External customers

 

325,945

 

95,389

 

287,798

 

94,069

 

Intersegment

 

827,853

 

 

 

742,190

 

 

 

Direct to consumer

 

611,553

 

48,206

 

539,010

 

41,784

 

Intersegment items

 

(1,133,441

)

 

 

(1,022,759

)

 

 

Corporate

 

 

 

(144,861

)

 

 

(128,148

)

Consolidated

 

$

2,444,846

 

$

344,389

 

$

2,197,544

 

$

342,301

 

 

The following tables reflect net sales for each class of similar products in the periods presented (in thousands, except percentage data):

 

 

 

For the 13 Weeks Ended
October 4, 2014

 

For the 13 Weeks Ended
September 28, 2013

 

 

 

Net Sales

 

Percentage of
Total

 

Net Sales

 

Percentage of
Total

 

 

 

 

 

 

 

 

 

 

 

Watches

 

$

696,291

 

77.8

%

$

619,087

 

76.4

%

Leathers

 

107,954

 

12.1

 

114,692

 

14.1

 

Jewelry

 

70,718

 

7.9

 

57,320

 

7.1

 

Other

 

19,519

 

2.2

 

19,297

 

2.4

 

Total

 

$

894,482

 

100.0

%

$

810,396

 

100.0

%

 

 

 

For the 40 Weeks Ended
October 4, 2014

 

For the 39 Weeks Ended
September 28, 2013

 

 

 

Net Sales

 

Percentage of
Total

 

Net Sales

 

Percentage of
Total

 

 

 

 

 

 

 

 

 

 

 

Watches

 

$

1,908,887

 

78.1

%

$

1,679,329

 

76.4

%

Leathers

 

295,001

 

12.1

 

309,228

 

14.1

 

Jewelry

 

183,419

 

7.5

 

146,677

 

6.7

 

Other

 

57,539

 

2.3

 

62,310

 

2.8

 

Total

 

$

2,444,846

 

100.0

%

$

2,197,544

 

100.0

%