Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.19.2
Segment Information
 6 Months Ended
Jun. 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 six months ended June 30, 2019 and 2018.
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
(in thousands)
 
2019
 
2018
 
2019
 
2018
Net sales to unrelated entities:
 
 
 
 
 
 
 
 
United States
 
$
315,527

 
$
280,170

 
$
727,751

 
$
643,014

LAAP
 
101,614

 
100,884

 
234,473

 
232,453

EMEA
 
91,527

 
84,986

 
162,875

 
156,761

Canada
 
17,542

 
15,579

 
55,719

 
56,699

 
 
$
526,210

 
$
481,619

 
$
1,180,818

 
$
1,088,927

Segment income (loss) from operations:
 
 
 
 
 
 
 
 
United States
 
$
46,453

 
$
41,640

 
$
142,176

 
$
117,470

LAAP
 
9,991

 
10,247

 
36,741

 
34,365

EMEA
 
9,557

 
4,898

 
18,743

 
11,546

Canada
 
(2,618
)
 
(2,950
)
 
3,393

 
3,292

Total segment income from operations
 
63,383

 
53,835

 
201,053

 
166,673

Unallocated corporate expenses
 
(47,018
)
 
(44,086
)
 
(96,730
)
 
(97,603
)
Interest income, net
 
2,571

 
2,928

 
5,971

 
5,224

Other non-operating income (expense)
 
1,032

 
(96
)
 
1,478

 
(364
)
Income before income taxes
 
$
19,968

 
$
12,581

 
$
111,772

 
$
73,930


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 $3.2 million and $6.3 million for the three and six months ended June 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 six months ended June 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
The Company had one customer that accounted for 10.7% of Accounts receivable, net of allowance on the Condensed Consolidated Balance Sheets as of June 30, 2019. The Company had one customer that accounted for 11.6% of Accounts receivable, net of allowance as of December 31, 2018. The Company had two customers that accounted for 11.3% and 10.6%, respectively, of Accounts receivable, net of allowance as of June 30, 2018. No single customer accounted for 10% or more of Net sales in the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2019 or 2018, or for the year ended December 31, 2018.