SEGMENT INFORMATION

6 Months Ended

Aug. 01, 2020

Segment Reporting Disclosure [Text Block]

SEGMENT INFORMATION

In accordance with FASB ASC 280---Segment Reporting, the Company reports segment data based on geography: The Children’s Place U.S. and The Children’s Place International. Each segment includes an e-commerce business located at www.childrensplace.com and www.gymboree.com. Included in The Children’s Place U.S. segment are the Company’s U.S. and Puerto Rico-based stores and revenue from the Company’s U.S.-based wholesale business. Included in The Children’s Place International segment are the Company’s Canadian-based stores, revenue from the Company’s Canadian wholesale business, and revenue from international franchisees. The Company measures its segment profitability based on operating income, defined as income before interest and taxes. Net sales and direct costs are recorded by each segment. Certain inventory procurement functions such as production and design as well as corporate overhead, including executive management, finance, real estate, human resources, legal, and information technology services are managed by The Children’s Place U.S. segment. Expenses related to these functions, including depreciation and amortization, are allocated to The Children’s Place International segment based primarily on net sales. The assets related to these functions are not allocated. The Company periodically reviews these allocations and adjusts them based upon changes in business circumstances. Net sales to external customers are derived from merchandise sales, and the Company has no major customers that account for more than 10% of its net sales. As of August 1, 2020, The Children’s Place U.S. had 711 stores and The Children’s Place International had 113 stores. As of August 3, 2019, The Children’s Place U.S. had 840 stores and The Children’s Place International had 121 stores.

The following tables provide segment level financial information:


	Thirteen Weeks Ended									Twenty-six Weeks Ended
	August 1, 2020			August 3, 2019			August 1, 2020			August 3, 2019
	(In thousands)
Net sales⁽¹⁾:
The Children’s Place U.S.	$	333,034		$	374,725		$	567,982		$	749,381
The Children’s Place International ⁽²⁾	35,889			45,745			56,148			83,470
Total net sales	$	368,923		$	420,470		$	624,130		$	832,851








Operating income (loss)⁽¹⁾:
The Children’s Place U.S.	$	(62,623)		$	3,433		$	(221,959)		$	7,593
The Children’s Place International	(1,861)			403			(15,668)			1,280
Total operating income (loss)	$	(64,484)		$	3,836		$	(237,627)		$	8,873
Operating income (loss) as a percent of net sales⁽¹⁾:
The Children’s Place U.S.	(18.8)		%	0.9		%	(39.1)		%	1.0		%
The Children’s Place International	(5.2)		%	0.9		%	(27.9)		%	1.5		%
Total operating income (loss) as a percent of net sales	(17.5)		%	0.9		%	(38.1)		%	1.1		%
Depreciation and amortization:
The Children’s Place U.S.	$	15,594		$	16,621		$	31,780		$	33,330
The Children’s Place International	1,114			1,851			2,816			3,726
Total depreciation and amortization	$	16,708		$	18,472		$	34,596		$	37,056
Capital expenditures:
The Children’s Place U.S.	$	8,433		$	10,615		$	13,633		$	21,415
The Children’s Place International	102			216			635			425
Total capital expenditures	$	8,535		$	10,831		$	14,268		$	21,840

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⁽¹⁾Net sales and operating income (loss) were significantly impacted by the COVID-19 pandemic.

⁽²⁾Net sales from The Children’s Place International are primarily derived from revenues from Canadian operations.


	August 1, 2020		February 1, 2020		August 3, 2019
Total assets:	(In thousands)
The Children’s Place U.S.	$	1,088,348	$	1,080,665	$	1,195,038
The Children’s Place International	79,591		100,732		108,499
Total assets	$	1,167,939	$	1,181,397	$	1,303,537