Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.19.3
Segment Information
9 Months Ended
Sep. 30, 2019
Segment Reporting, Measurement Disclosures [Abstract]  
Segment Information SEGMENT INFORMATION
The Company has aggregated its operating segments into four reportable geographic segments: the United States, LAAP, EMEA, and 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 Condensed Consolidated Statements of Operations are summarized in the following table for the three and nine months ended September 30, 2019 and 2018.
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in thousands)
 
2019
 
2018
 
2019
 
2018
Net sales to unrelated entities:
 
 
 
 
 
 
 
 
United States
 
$
581,263

 
$
496,161

 
$
1,309,014

 
$
1,139,175

LAAP
 
123,246

 
118,379

 
357,719

 
350,832

EMEA
 
104,403

 
100,351

 
267,278

 
257,112

Canada
 
97,881

 
80,910

 
153,600

 
137,609

 
 
$
906,793

 
$
795,801

 
$
2,087,611

 
$
1,884,728

Segment income from operations:
 
 
 
 
 
 
 
 
United States
 
$
156,190

 
$
125,862

 
$
298,366

 
$
243,332

LAAP
 
17,081

 
17,183

 
53,822

 
51,548

EMEA
 
18,162

 
14,782

 
36,905

 
26,328

Canada
 
27,024

 
17,944

 
30,417

 
21,236

Total segment income from operations
 
218,457

 
175,771

 
419,510

 
342,444

Unallocated corporate expenses
 
(66,442
)
 
(46,627
)
 
(163,172
)
 
(144,230
)
Interest income, net
 
1,399

 
2,524

 
7,370

 
7,748

Other non-operating income (expense)
 
(563
)
 
736

 
915

 
372

Income before income taxes
 
$
152,851

 
$
132,404

 
$
264,623

 
$
206,334


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 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 that 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 $4.5 million and $10.8 million for the three and nine months ended September 30, 2018, 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 the three and nine months ended September 30, 2018 in the table above have been revised from amounts previously reported to correct the misclassifications. These corrections had no effect on the Company's Condensed Consolidated Statements of Operations.
Concentrations
No single customer that accounted for 10% or more of Accounts receivable, net of allowance on the Condensed Consolidated Balance Sheets as of September 30, 2019 or 2018. The Company had one customer that accounted for 11.6% of Accounts receivable, net of allowance as of December 31, 2018. No single customer accounted for 10% or more of Net sales in the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2019 or 2018.