Business Segment Information

3 Months Ended

May 30, 2014

Segment Reporting [Abstract]

Business Segment Information

Note 16 – Business Segment Information

The Corporation has North American Social Expression Products, International Social Expression Products, Retail Operations, AG Interactive and non-reportable segments. The North American Social Expression Products and International Social Expression Products segments primarily design, manufacture and sell greeting cards and other related products through various channels of distribution with mass merchandising as the primary channel. At May 30, 2014, the Retail Operations segment operated 400 card and gift retail stores in the United Kingdom. The stores sell products purchased from the International Social Expression Products segment as well as products purchased from other vendors. AG Interactive distributes social expression products, including electronic greetings and a broad range of graphics and digital services and products, through a variety of electronic channels, including Web sites, Internet portals and electronic mobile devices. The Corporation’s non-reportable operating segments primarily include licensing activities and the design, manufacture and sale of display fixtures.

(In thousands)	Three Months Ended
	May 30, 2014			May 31, 2013
Total Revenue:
North American Social Expression Products	$	329,057		$	328,287
International Social Expression Products		75,039			70,801
Intersegment items		(10,065	)		(11,092	)
Net		64,974			59,709
Retail Operations		79,164			74,718
AG Interactive		14,499			14,700
Non-reportable segment		15,890			19,889
	$	503,584		$	497,303

(In thousands)	Three Months Ended
	May 30, 2014			May 31, 2013
Segment Earnings (Loss) Before Tax:
North American Social Expression Products	$	69,364		$	66,347
International Social Expression Products		3,762			2,544
Intersegment items		(2,310	)		(2,214	)
Net		1,452			330
Retail Operations		(4,040	)		(3,452	)
AG Interactive		5,412			3,313
Non-reportable segment		4,015			7,382
Unallocated
Interest expense		(8,994	)		(4,312	)
Profit-sharing plan expense		(4,079	)		(3,981	)
Stock-based compensation expense		—			(2,475	)
Corporate overhead expense		(7,694	)		(10,606	)
		(20,767	)		(21,374	)
	$	55,436		$	52,546

For the three months ended May 31, 2013, stock-based compensation in the table above includes non-cash stock-based compensation prior to the Merger. There is no stock-based compensation subsequent to the Merger as these plans were converted into cash compensation plans at the time of the Merger.

“Corporate overhead expense” includes costs associated with corporate operations including, among other costs, senior management, corporate finance, legal, and insurance programs.

In the prior year first quarter, the Corporation’s Unallocated segment included approximately $4.5 million of non-recurring transaction costs associated with the Merger.

Termination Benefits

Termination benefits are primarily considered part of an ongoing benefit arrangement, accounted for in accordance with ASC Topic 712, “Compensation – Nonretirement Postemployment Benefits,” and are recorded when payment of the benefits is probable and can be reasonably estimated.

The balance of the severance accrual was $3.9 million, $4.0 million and $4.5 million at May 30, 2014, February 28, 2014 and May 31, 2013, respectively. The payments expected within the next twelve months are included in “Accrued liabilities” while the remaining payments beyond the next twelve months are included in “Other liabilities” on the Consolidated Statement of Financial Position.