Segment Information

12 Months Ended

Dec. 31, 2023

Segment Information [Abstract]

Segment Information

10. Segment Information

The Company reports financial information based on the organizational structure used by the Company’s chief operating decision maker for making operating and investment decisions and for assessing performance. The Company’s reportable business segments consist of: (1) United States; (2) Canada; and (3) Europe. As described below, the activities of the Company’s Asian operations are closely linked to those of the U.S. operations; accordingly, the Company’s chief operating decision maker reviews the financial results of both on a consolidated basis, and the results of the Asian operations have been aggregated with the results of the United States operations to form one reportable segment called the “United States segment” or “U.S. segment”. Each reportable segment derives its revenue from the sales of cutting devices, measuring instruments and safety products for school, office, home, hardware, sporting and industrial use.

Domestic sales orders are filled primarily from the Company’s distribution centers and facilities in North Carolina, Washington, Massachusetts, Tennessee, Florida, California and New Hampshire. The Company is responsible for the costs of shipping, insurance, customs clearance, duties, storage and distribution related to such products. Orders filled from the Company’s inventory are generally for less than container-sized lots.

Direct import sales are products sold by the Company’s Asian subsidiary, directly to major U.S. retailers who take ownership of the products in Asia. These sales are completed by delivering product to the customers’ common carriers at the shipping points in Asia. Direct import sales are made in larger quantities than domestic sales, typically full containers. Direct import sales represented approximately 6% and 8% of the Company’s total net sales in 2023 and 2022, respectively.

The Chief Operating Decision Maker evaluates the performance of each operating segment based on segment revenues and operating income. Segment revenues are defined as total revenues, including both external customer revenue and inter-segment revenue. Segment operating earnings are defined as segment revenues, less cost of goods sold and operating expenses. Identifiable assets by segment are those assets used in the respective reportable segment’s operations. Inter-segment amounts are eliminated to arrive at consolidated financial results.

The following table sets forth certain financial data by segment for the years ended December 31, 2023 and 2022:

Financial data by segment:

(000’s omitted)

Year Ended December 31, 2023
	United States		Canada		Europe		Consolidated
Net sales	$	163,205	$	13,891	$	14,405	$	191,501
Operating income		11,477		866		845		13,188
Assets		131,382		8,557		9,302		149,241
Additions to property, plant and equipment		4,626		—		47		4,673
Depreciation and amortization		4,833		102		76		5,011

Year Ended December 31, 2022
	United States		Canada		Europe		Consolidated
Net sales	$	165,205	$	13,779	$	14,978	$	193,962
Operating income		4,783		1,136		354		6,273
Assets		144,466		9,078		10,833		164,377
Additions to property, plant and equipment		4,174		52		79		4,305
Depreciation and amortization		4,398		96		84		4,578

The following is a reconciliation of segment operating income to consolidated income before taxes:

(000’s omitted)

	2023			2022
Total operating income	$	13,188		$	6,273
Interest expense, net		(2,977	)		(2,364	)
Gain on sale of business		12,564			—
Other (expense), net		(41	)		(247	)
Consolidated income before taxes	$	22,734		$	3,662

The table below presents revenue by geographic area. Revenues are attributed to countries based on location of the customer.

(000’s omitted)

Revenues	2023		2022
United States	$	162,070	$	163,546
International:
Canada		13,891		13,779
Europe		14,405		14,978
Other		1,135		1,659
Total International	$	29,431	$	30,416
Total Revenues	$	191,501	$	193,962