Annual report pursuant to Section 13 and 15(d)

Segment Information

v3.10.0.1
Segment Information
 12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Segment Information
ompany has aggregated its operating segments into four reportable geographic segments: (1) the United States, (2) Latin America and Asia Pacific ("LAAP"), (3) Europe, Middle East and Africa ("EMEA"), and (4) Canada, which are reflective of the Company's internal organization, management and oversight structure. Each geographic segment operates predominantly in one industry: the design, development, marketing, and distribution of outdoor and active lifestyle apparel, footwear, accessories, and equipment. Intersegment net sales and intersegment profits, which are recorded at a negotiated mark-up and eliminated in consolidation, are not material. Unallocated corporate expenses consist of expenses incurred by centrally-managed departments, including global information systems, finance, human resources and legal, executive compensation, unallocated benefit program expense, and other miscellaneous costs.
The geographic distribution of the Company's Net sales and Income from operations in the Consolidated Statements of Operations, as well as depreciation and amortization expense, are summarized in the following tables for the years ended December 31, 2018, 2017 and 2016 as well as Accounts receivable, net, Inventories and Property, plant and equipment, net on the Consolidated Balance Sheets at December 31, 2018 and 2017.
(in thousands)
 
2018
 
2017
 
2016
Net sales to unrelated entities:
 
 
 
 
 
 
United States
 
$
1,728,476

 
$
1,520,026

 
$
1,505,302

LAAP
 
530,152

 
475,128

 
453,686

EMEA
 
350,754

 
293,700

 
253,487

Canada
 
192,944

 
177,251

 
164,570

 
 
$
2,802,326

 
$
2,466,105

 
$
2,377,045

 
 
 
 
 
 
 
Segment income from operations:
 
 
 
 
 
 
United States
 
$
410,750

 
$
336,797

 
$
336,578

LAAP
 
80,967

 
75,922

 
63,927

EMEA
 
33,314

 
10,410

 
7,543

Canada
 
31,304

 
23,516

 
15,864

Total segment income from operations
 
556,335

 
446,645

 
423,912

Unallocated corporate expenses
 
(205,353
)
 
(183,676
)
 
(167,404
)
Interest income, net
 
9,876

 
4,515

 
2,003

Interest expense on note payable to related party
 
—

 
(429
)
 
(1,041
)
Other non-operating expense
 
(141
)
 
(321
)
 
(572
)
Income before income tax
 
$
360,717

 
$
266,734

 
$
256,898

 
 
 
 
 
 
 
Depreciation and amortization expense:
 
 
 
 
 
 
United States
 
$
21,938

 
$
21,256

 
$
19,473

LAAP
 
5,721

 
6,108

 
5,907

EMEA
 
4,260

 
3,791

 
2,920

Canada
 
3,076

 
2,746

 
2,787

Unallocated corporate expense
 
23,235

 
26,044

 
28,929

 
 
$
58,230

 
$
59,945

 
$
60,016

 
 
 
 
 
 
 
Accounts receivable, net:
 
 
 
 
 
 
United States
 
$
199,018

 
$
180,742

 
 
LAAP
 
110,494

 
95,765

 
 
EMEA
 
85,887

 
42,659

 
 
Canada
 
53,983

 
45,696

 
 
 
 
$
449,382

 
$
364,862

 


 
 
 
 
 
 
 
Inventories:
 
 
 
 
 
 
United States
 
$
328,815

 
$
285,481

 
 
LAAP
 
98,883

 
84,149

 
 
EMEA
 
63,261

 
57,055

 
 
Canada
 
30,868

 
31,242

 
 
 
 
$
521,827

 
$
457,927

 


 
 
 
 
 
 
 
Property, plant and equipment, net:
 
 
 
 
 
 
United States
 
$
224,012

 
$
206,172

 
 
Canada
 
26,566

 
30,318

 
 
All other countries
 
41,018

 
44,904

 
 
 
 
$
291,596

 
$
281,394

 
 

During the fourth quarter of 2018, the Company revised its methodology for allocating certain expenses to its reportable segments to better reflect how management reviews financial information and makes operating decisions. As a result, prior year balances for segment income from operations, and depreciation and amortization expenses for each reportable segment, and unallocated corporate expenses in the table above have been reclassified to conform with the current year's presentation.

In addition, during the fourth quarter of 2018, the Company determined it had incorrectly allocated certain amounts of operating income to its United States segment, resulting in the overstatement of both total segment income from operations and unallocated corporate expenses by approximately $13,300,000 and $9,300,000 for the years ended 2017 and 2016, respectively. The Company assessed the significance of the misclassifications and concluded that they were not material to any prior periods. As a result, the United States and total segment income from operations as well as unallocated corporate expenses for 2017 and 2016 in the table above have been revised from amounts previously reported to correct the misclassifications. These corrections had no effect on the Company's Consolidated Statements of Operations.