NOTE I – BUSINESS SEGMENTS

The Company operates in three reportable business segments: U.S. Wholesale, International and Retail Direct. The U.S. Wholesale segment is the Company’s primary domestic business that designs, markets and distributes its products to retailers and distributors. The International segment consists of certain business operations conducted outside the U.S. The Retail Direct segment is where the Company markets and sells a limited selection of its products directly to consumers through its Pfaltzgraff, Mikasa, Fred and Friends, Built NY and Lifetime Sterling internet websites.

The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. While the three segments distribute similar products, the segments are distinct due to the different methods the Company uses to sell, market and distribute the products. Management evaluates the performance of the U.S. Wholesale, International and Retail Direct segments based on net sales and income (loss) from operations. 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.


	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	(in thousands)
Net sales
U.S. Wholesale	$	94,770		$	92,738		$	182,162		$	175,006
International		19,365			21,560			40,593			45,233
Retail Direct		3,258			3,752			7,994			8,736

Total net sales	$	117,393		$	118,050		$	230,749		$	228,975

Loss from operations
U.S. Wholesale	$	3,712		$	3,268		$	5,947		$	1,479
International		(3,743	)		(382	)		(4,900	)		13
Retail Direct		(277	)		6			(161	)		43
Unallocated corporate expenses		(2,833	)		(3,180	)		(5,901	)		(7,038	)

Loss from operations	$	(3,141	)	$	(288	)	$	(5,015	)	$	(5,503	)

Depreciation and amortization
U.S. Wholesale	$	2,301		$	2,272		$	4,603		$	4,451
International		1,014			1,270			1,965			2,540
Retail Direct		33			36			66			71

Total depreciation and amortization	$	3,348		$	3,578		$	6,634		$	7,062


	June 30,		December 31,
	2017		2016
	(in thousands)
Assets
U.S. Wholesale	$	283,942	$	287,313
International		93,946		95,698
Retail Direct		426		501
Unallocated/ Corporate/ Other		16,868		16,342

Total assets	$	395,182	$	399,854