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SEGMENT INFORMATION | 12 Months Ended
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Apr. 29, 2018
Segment Reporting [Abstract] |
SEGMENT INFORMATION |
18. | SEGMENT INFORMATION
The company’s operations are classified into two business segments: mattress fabrics and upholstery fabrics. The mattress fabrics segment manufacturers, sources, and sells fabrics and mattress covers to bedding manufacturers. The upholstery fabrics segment manufacturers, sources, and sells fabrics primarily to residential and commercial furniture manufacturers. Net sales denominated in U.S. dollars accounted for 90%, 92% and 93% of total consolidated net sales in fiscal 2018, 2017, and 2016, respectively. International sales accounted for 23% of net sales in fiscal 2018 and 22% of net sales in fiscal years 2017 and 2016, and are summarized by geographic area as follows:
(dollars in thousands) |  | 2018 |  |  | 2017 |  |  | 2016 |
north america (excluding USA) (1) |  | $ | 27,844 |  |  |  | 29,995 |  |  |  | 31,667 |
far east and asia (2) |  |  | 40,671 |  |  |  | 34,695 |  |  |  | 31,927 |
all other areas |  |  | 5,681 |  |  |  | 3,618 |  |  |  | 4,336 |
|  | $ | 74,196 |  |  |  | 68,308 |  |  |  | 67,930 |
(1) | Of this amount, $21.9 million, $22.3 million, and $24.2 million are attributable to shipments to Mexico in fiscal 2018, 2017, and 2016, respectively.
(2) | Of this amount $32.6 million, $26.6 million, and $23.1 million are attributable to shipments to China in fiscal 2018, 2017, and 2016, respectively.
Sales are attributed to individual countries based upon location that the company ships its products to for delivery to customers. The company evaluates the operating performance of its segments based upon income from operations before certain unallocated corporate expenses, and other non-recurring items. Cost of sales in both segments include costs to manufacture or source our products, including costs such as raw material and finished goods purchases, direct and indirect labor, overhead and incoming freight charges. Unallocated corporate expenses primarily represent compensation and benefits for certain executive officers, all costs related to being a public company, and other miscellaneous expenses. Segment assets include assets used in operations of each segment and primarily consist of accounts receivable, inventories, and property, plant, and equipment. The mattress fabrics segment also includes in segment assets, goodwill, an investment in an unconsolidated joint venture, a non-compete agreement and customer relationships associated with an acquisition. The upholstery fabrics segment also includes in segment assets goodwill, customer relationships, and tradename associated with the acquisition of Read Window Products, LLC. (see note 2 for further details). Statements of operations for the company’s operating segments are as follows:
(dollars in thousands) |  | 2018 |  |  | 2017 |  |  | 2016 |
net sales: |  |  |  |  |  |  |  |  |  |  |  |
upholstery fabrics |  | $ | 131,128 |  |  |  | 118,739 |  |  |  | 126,441 |
mattress fabrics |  |  | 192,597 |  |  |  | 190,805 |  |  |  | 186,419 |
|  | $ | 323,725 |  |  |  | 309,544 |  |  |  | 312,860 |
gross profit: |  |  |  |  |  |  |  |  |  |  |  |
upholstery fabrics |  | $ | 25,836 |  |  |  | 26,170 |  |  |  | 26,393 |
mattress fabrics |  |  | 38,797 |  |  |  | 43,065 |  |  |  | 38,718 |
|  | $ | 64,633 |  |  |  | 69,235 |  |  |  | 65,111 |
(dollars in thousands) |  | 2018 |  |  | 2017 |  |  | 2016 |
selling, general, and administrative expenses: |  |  |  |  |  |  |  |  |  |  |  |
upholstery fabrics |  | $ | 14,881 |  |  |  | 15,079 |  |  |  | 15,094 |
mattress fabrics |  |  | 12,935 |  |  |  | 13,685 |  |  |  | 12,223 |
unallocated corporate |  |  | 9,356 |  |  |  | 10,393 |  |  |  | 9,456 |
total selling, general, and administrative expenses |  | $ | 37,172 |  |  |  | 39,157 |  |  |  | 36,773 |
Income from operations: |  |  |  |  |  |  |  |  |  |  |  |
upholstery fabrics |  | $ | 10,956 |  |  |  | 11,091 |  |  |  | 11,298 |
mattress fabrics |  |  | 25,861 |  |  |  | 29,380 |  |  |  | 26,496 |
total segment income from operations |  |  | 36,817 |  |  |  | 40,471 |  |  |  | 37,794 |
unallocated corporate expenses |  |  | (9,356 | ) |  |  | (10,393 | ) |  |  | (9,456 | )
total income from operations |  |  | 27,461 |  |  |  | 30,078 |  |  |  | 28,338 |
interest expense |  |  | (94 | ) |  |  | — |  |  |  | — |
interest income |  |  | 534 |  |  |  | 299 |  |  |  | 176 |
other expense |  |  | (1,018 | ) |  |  | (681 | ) |  |  | (616 | )
income before income taxes |  | $ | 26,883 |  |  |  | 29,696 |  |  |  | 27,898 |
One customer within the upholstery fabrics segment represented 12%, 11%, and 13% of consolidated net sales in fiscal 2018, 2017 and 2016, respectively. One customer within the mattress fabrics segment represented 13% of consolidated net sales in fiscal 2018, 2017, and 2016, respectively. One customer within the upholstery fabrics segment accounted for 13% of the net accounts receivable balance as of April 29, 2018 and no customers within the upholstery fabrics segment accounted for 10% or more of net accounts receivable as of April 30, 2017. Two customers within the mattress fabrics segment accounted for 20% and 22% of the net accounts receivable balance as of April 29, 2018 and April 30, 2017, respectively. The hourly employees at our manufacturing facility in Canada (approximately 12% of our workforce) are represented by a local, unaffiliated union. The collective bargaining agreement for these employees expires on February 1, 2020. We are not aware of any efforts to organize any more of our employees, and we believe our relations with our employees are good. Balance sheet information for the company’s operating segments follow:
(dollars in thousands) |  | 2018 |  |  | 2017 |  |  | 2016 |
segment assets |  |  |  |  |  |  |  |  |  |  |  |
mattress fabrics |  |  |  |  |  |  |  |  |  |  |  |
current assets (1) |  | $ | 43,935 |  |  |  | 47,038 |  |  |  | 43,472 |
non-compete agreements, net |  |  | 753 |  |  |  | 828 |  |  |  | 903 |
customer relationships |  |  | 613 |  |  |  | 664 |  |  |  | 715 |
goodwill |  |  | 11,462 |  |  |  | 11,462 |  |  |  | 11,462 |
investment in unconsolidated joint venture |  |  | 1,501 |  |  |  | 1,106 |  |  |  | — |
property, plant, and equipment |  |  | 48,797 | (2) |  |  | 48,916 | (3) |  |  | 37,480 | (4)
total mattress fabrics assets |  | $ | 107,061 |  |  |  | 110,014 |  |  |  | 94,032 |
upholstery fabrics |  |  |  |  |  |  |  |  |  |  |  |
current assets (1) |  | $ | 35,826 |  |  |  | 29,021 |  |  |  | 26,540 |
customer relationships |  |  | 2,226 |  |  |  | — |  |  |  | — |
tradename |  |  | 683 |  |  |  | — |  |  |  | — |
goodwill |  |  | 2,107 |  |  |  | — |  |  |  | — |
property, plant, and equipment |  |  | 2,445 | (5) |  |  | 1,879 | (6) |  |  | 1,564 | (7)
total upholstery fabrics assets |  | $ | 43,287 |  |  |  | 30,900 |  |  |  | 28,104 |
total segment assets |  |  | 150,348 |  |  |  | 140,914 |  |  |  | 122,136 |
non-segment assets |  |  |  |  |  |  |  |  |  |  |  |
cash and cash equivalents |  |  | 21,228 |  |  |  | 20,795 |  |  |  | 37,787 |
short-term investments – available for sale |  |  | 2,451 |  |  |  | 2,443 |  |  |  | 4,359 |
short-term investments – held-to-maturity |  |  | 25,759 |  |  |  | — |  |  |  | — |
income taxes receivable |  |  | — |  |  |  | — |  |  |  | 155 |
deferred income taxes |  |  | 1,458 |  |  |  | 419 |  |  |  | 2,319 |
other current assets |  |  | 2,870 |  |  |  | 2,894 |  |  |  | 2,477 |
property, plant, and equipment |  |  | 552 | (8) |  |  | 856 | (8) |  |  | 929 | (8)
long-term investments - held-to-maturity |  |  | 5,035 |  |  |  | 30,945 |  |  |  | — |
long-term investments - rabbi trust |  |  | 7,326 |  |  |  | 5,466 |  |  |  | 4,025 |
other assets |  |  | 957 |  |  |  | 902 |  |  |  | 955 |
total assets |  | $ | 217,984 |  |  |  | 205,634 |  |  |  | 175,142 |
capital expenditures (9): |  |  |  |  |  |  |  |  |  |  |  |
mattress fabrics |  | $ | 6,713 |  |  |  | 17,689 |  |  |  | 9,666 |
upholstery fabrics |  |  | 488 |  |  |  | 822 |  |  |  | 626 |
unallocated corporate |  |  | 238 |  |  |  | 260 |  |  |  | 416 |
|  | $ | 7,439 |  |  |  | 18,771 |  |  |  | 10,708 |
depreciation expense |  |  |  |  |  |  |  |  |  |  |  |
mattress fabrics |  | $ | 6,850 |  |  |  | 6,245 |  |  |  | 5,837 |
upholstery fabrics |  |  | 822 |  |  |  | 840 |  |  |  | 834 |
total segment depreciation expense |  | $ | 7,672 |  |  |  | 7,085 |  |  |  | 6,671 |
(1) | Current assets represent accounts receivable and inventory.
(2) | The $48.8 million at April 29, 2018, represents property, plant, and equipment located in the U.S. of $35.4 million and located in Canada of $13.4 million.
(3) | The $48.9 million at April 30, 2017, represents property, plant, and equipment located in the U.S. of $34.0 million and located in Canada of $14.9 million.
(4) | The $37.5 million at May 1, 2016, represents property, plant, and equipment located in the U.S. of $24.8 million and located in Canada of $12.7 million.
(5) | The $2.4 million at April 29, 2018, represents property, plant, and equipment located in the U.S. of $1.8 million and located in China of $661.
(6) | The $1.9 million at April 30, 2017, represents property, plant, and equipment located in the U.S. of $1.2 million and located in China of $655.
(7) | The $1.6 million at May 1, 2016, represents property, plant, and equipment located in the U.S. of $893 and located in China of $671.
(8) | The $552, $856, and $929 balance at April 29, 2018, April 30, 2017, and May 1, 2016, represent property, plant, and equipment associated with unallocated corporate departments and corporate departments shared by both the mattress and upholstery fabric segments located in the U.S.
(9) | Capital expenditure amounts are stated on an accrual basis. See Consolidated Statement of Cash Flows for capital expenditure amounts on a cash basis.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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