Reportable Segment Information - Notes to Financial Statements

6 Months Ended

Aug. 01, 2020

Reportable Segment Information [Abstract]

Reportable Segment Information

NOTE 5 – REPORTABLE SEGMENT INFORMATION:

The Company has determined that it has four operating segments, as defined under ASC 280-10, including Cato, It’s Fashion, Versona and Credit. As outlined in ASC 280-10, the Company has two reportable segments: Retail and Credit. The Company has aggregated its three retail operating segments, including e-commerce, based on the aggregation criteria outlined in ASC 280-10, which states that two or more operating segments may be aggregated into a single reportable segment if aggregation is consistent with the objective and basic principles of ASC 280-10, which require the segments to have similar economic characteristics, products, production processes, clients and methods of distribution.

The Company’s retail operating segments have similar economic characteristics and similar operating, financial and competitive risks. They are similar in nature of product, as they all offer women’s apparel, shoes and accessories. Merchandise inventory for the Company’s retail operating segments is sourced from the same countries and some of the same vendors, using similar production processes. Merchandise for the Company’s operating segments is distributed to retail stores in a similar manner through the Company’s single distribution center and is subsequently distributed to clients in a similar manner.

The Company operates its women’s fashion specialty retail stores in 31 states as of August 1, 2020, principally in the southeastern United States. The Company offers its own credit card to its customers and all credit authorizations, payment processing and collection efforts are performed by a separate subsidiary of the Company.

NOTE 5 – REPORTABLE SEGMENT INFORMATION (CONTINUED):

The following schedule summarizes certain segment information (in thousands):

Three Months Ended				Six Months Ended
August 1, 2020	Retail	Credit	Total	August 1, 2020	Retail	Credit	Total
Revenues	$167,523	$647	$168,170	Revenues	$267,413	$1,489	$268,902
Depreciation	3,488	-	3,488	Depreciation	7,494	-	7,494
Interest and other income	(961)	-	(961)	Interest and other income	(2,812)	-	(2,812)
Income/(Loss) before income taxes	(11,368)	318	(11,050)	Income/(Loss) before income taxes	(49,291)	710	(48,581)
Capital expenditures	4,490	-	4,490	Capital expenditures	9,801	-	9,801
Three Months Ended				Six Months Ended
August 3, 2019	Retail	Credit	Total	August 3, 2019	Retail	Credit	Total
Revenues	$211,672	$909	$212,581	Revenues	$441,114	$1,819	$442,933
Depreciation	3,836	-	3,836	Depreciation	7,679	-	7,679
Interest and other income	(1,693)	-	(1,693)	Interest and other income	(2,829)	-	(2,829)
Income/(Loss) before income taxes	13,501	499	14,000	Income/(Loss) before income taxes	38,680	892	39,572
Capital expenditures	1,222	-	1,222	Capital expenditures	2,217	-	2,217
	Retail	Credit	Total
Total assets as of August 1, 2020	$549,817	$46,600	$596,417
Total assets as of February 1, 2020	636,503	48,473	684,976

The Company evaluates segment performance based on income before taxes. The Company does not allocate certain corporate expenses or income taxes to the credit segment.The following schedule summarizes the direct expenses of the credit segment, which are reflected in Selling, general and administrative expenses (in thousands):

	Three Months Ended				Six Months Ended
		August 1, 2020		August 3, 2019		August 1, 2020		August 3, 2019
Payroll	$	130	$	164	$	282	$	314
Postage		82		117		193		241
Other expenses		118		129		305		372
Total expenses	$	330	$	410	$	780	$	927