Segment Reporting

The Company has two reportable segments: Sweet Baked Goods and In-Store Bakery. The Company’s Sweet Baked Goods segment consists of sweet baked goods that are sold under the Hostess® and Dolly Madison® brands, Hostess® branded bread and buns and frozen retail products. The operations attributed to assets acquired from Aryzta are included in the Sweet Baked Goods segment. The In-Store Bakery segment consists of Superior® and Hostess® branded products sold through the in-store bakery section of grocery and club stores.

We evaluate performance and allocate resources based on net revenue and gross profit. Information regarding the operations of these reportable segments is as follows:



(In thousands)	Three Months Ended March 31, 2018		Three Months Ended March 31, 2017

Net revenue:
Sweet Baked Goods	$	199,293	$	174,793
In-Store Bakery	9,450		9,745
Net revenue	$	208,743	$	184,538

Depreciation and amortization:
Sweet Baked Goods	$	9,394	$	8,624
In-Store Bakery	697		642
Depreciation and amortization	$	10,091	$	9,266

Gross profit:
Sweet Baked Goods	$	69,438	$	76,781
In-Store Bakery	1,803		2,514
Gross profit	$	71,241	$	79,295

Capital expenditures (1):
Sweet Baked Goods	$	9,165	$	7,916
In-Store Bakery	54		374
Capital expenditures	$	9,219	$	8,290


(1)	Capital expenditures consists of purchases of property and equipment and acquisition and development of software assets paid in cash or acquired through accounts payable during the three months ended March 31, 2018 and 2017.

Total assets by reportable segment are as follows:



(In thousands)	March 31, 2018		December 31, 2017

Total segment assets:
Sweet Baked Goods	$	2,889,048	$	2,884,642
In-Store Bakery	75,473		81,633
Total segment assets	$	2,964,521	$	2,966,275