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BUSINESS SEGMENTS
 12 Months Ended
Dec. 31, 2011
BUSINESS SEGMENTS

NOTE J — BUSINESS SEGMENTS

Segment information

The Company operates in two reportable business segments: the Wholesale segment, the Company’s primary business segment, in which the Company designs, markets and distributes products to retailers and distributors, and the Retail Direct segment, in which the Company markets and sells a limited selection of its products directly to consumers through its Pfaltzgraff®, Mikasa®, Housewares™ Deals and Lifetime Sterling™ Internet websites. The operating results of Creative Tops since the date of acquisition are included within the Wholesale segment.

The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. While both segments distribute similar products, the segments have been distinct due to the different methods the Company uses to sell, market and distribute the products. Management evaluated the performance of the Wholesale and Retail Direct segments based on net sales and income (loss) from operations through December 31, 2011. Such measures give recognition to specifically identifiable operating costs such as cost of sales, distribution expenses and selling, general and administrative expenses. Certain general and administrative expenses, such as senior executive salaries and benefits, stock compensation, director fees and accounting, legal and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. Assets in each segment consist of assets used in its operations and acquired intangible assets. Assets in the unallocated corporate category consist of cash and tax related assets that are not allocated to the segments.

 

     Year Ended December 31,  
     2011     2010     2009  
     (in thousands)  

Net sales:

       

Wholesale

    $ 421,119      $ 413,809      $ 389,078   

Retail Direct

      23,299        29,362        25,962   
  

 

 

    

 

 

    

 

 

  

Total net sales

    $ 444,418      $ 443,171      $ 415,040   
  

 

 

    

 

 

    

 

 

  

Income (loss) from operations:

       

Wholesale (1)

    $ 38,410      $ 42,997      $ 30,581   

Retail Direct (2)

      (524 )      (1,018 )      (3,637 ) 

Unallocated corporate expenses

      (13,302 )      (12,196 )      (11,335 ) 
  

 

 

    

 

 

    

 

 

  

Total income (loss) from operations

    $ 24,584      $ 29,783      $ 15,609   
  

 

 

    

 

 

    

 

 

  

Depreciation and amortization:

       

Wholesale

    $ 8,183      $ 9,719      $ 11,252   

Retail Direct

      214        91        220   
  

 

 

    

 

 

    

 

 

  

Total depreciation and amortization

    $ 8,397      $ 9,810      $ 11,472   
  

 

 

    

 

 

    

 

 

  
     Year Ended December 31,  
     2011      2010      2009  
     (in thousands)  

Assets:

         

Wholesale

    $ 317,435       $ 271,670       $ 273,589   

Retail Direct

      813         1,441         2,452   

Unallocated/ corporate/ other

      497         4,475         682   
  

 

 

     

 

 

     

 

 

  

Total assets

    $ 318,745       $ 277,586       $ 276,723   
  

 

 

     

 

 

     

 

 

  

Capital expenditures:

         

Wholesale

    $ 4,730       $ 2,541       $ 1,684   

Retail Direct

      229         323         660   
  

 

 

     

 

 

     

 

 

  

Total capital expenditures

    $ 4,959       $ 2,864       $ 2,344   
  

 

 

     

 

 

     

 

 

  

Notes:

 

(1) In 2009, income from operations for the Wholesale segment included $600,000 for restructuring and impairment expenses. See Note M.
(2) In 2009, loss from operations for the Retail Direct segment includes $2.0 million of restructuring and non-cash fixed asset impairment charges. See Note M.

Product category information – net sales

The following table sets forth net sales by the major product categories included within the Company’s Wholesale operating segment:

 

     Year Ended December 31,  
     2011      2010      2009  
     (in thousands)  

Category:

         

Kitchenware

    $ 215,707       $ 208,491       $ 199,567   

Tabletop

      134,652         123,432         113,479   

Home Solutions

      64,099         81,886         76,032   

Creative Tops

      6,661         —           —     
  

 

 

     

 

 

     

 

 

  

Total

    $ 421,119       $ 413,809       $ 389,078   
  

 

 

     

 

 

     

 

 

  

The product categories, which incorporate a change to establish a Home Solutions products category and the additional revenue source from Creative Tops in 2011, reflect a refined alignment of the products into the sources of revenue which the Company analyzes. The revenue source categories disclosed in the prior years have been reclassified to conform to current year presentation for comparative purposes.

Geographical information

The following table sets forth net sales and long-lived assets by the major geographic locations (in thousands):

 

     Year ended
December 31,
2011		  

Net sales:

   

United States

    $ 426,405   

International

      18,013   
  

 

 

  

Total

    $ 444,418   
  

 

 

  

Long-lived assets at period-end:

   

United States

    $ 118,803   

International

      1,145   
  

 

 

  

Total

    $ 119,948