Segment Information

12 Months Ended

Sep. 30, 2011

Segment Information

Segment Information

23. Segment Information

        We are organized by sales segments on a worldwide basis. We evaluate performance based on a number of factors; however, the primary measures of performance are the net sales and income or loss from operations (before corporate allocations) of each segment, as these are the key performance indicators that we review. Operating income or loss for each segment does not include the impact of any intercompany transfer pricing mark-up, corporate general and administrative expenses, interest expense and other miscellaneous income/expense items. Corporate general and administrative expenses include, but are not limited to, human resources, legal, finance, and various other corporate level activity related expenses. Such unallocated expenses remain within Corporate.

        All our products fall into one or more of these four segments:

•

Wholesale/U.S. Nutrition—This segment sells products under various brand names and third-party private labels, each targeting specific market groups which include virtually all major mass merchandisers, club stores, drug store chains and supermarkets. This segment also sells products to independent pharmacies, health food stores, the military and other retailers.

•

European Retail—This segment generates revenue through its 660 Holland & Barrett stores (including seven franchised stores in Singapore, one franchised store in each of South Africa, Hungary and United Arab Emirates, two in Malta and six franchised stores in Cyprus), 217 Julian Graves stores and 49 GNC (UK) stores in the U.K., 101 De Tuinen stores (including 10 franchised locations) in the Netherlands and 41 Nature's Way stores in Ireland. Such revenue consists of sales of proprietary brand and third-party products as well as franchise fees.

•

Direct Response/E-Commerce—This segment generates revenue through the sale of proprietary brand and third-party products primarily through mail order catalog and internet. Catalogs are strategically mailed to customers who order by mail, internet, or by phone.

•

North American Retail—This segment generates revenue through its 443 owned and operated Vitamin World stores selling proprietary brand and third-party products and through its Canadian operation of 80 owned and operated Le Naturiste stores.

        The following table represents key financial information of our business segments:

		Wholesale/ U.S. Nutrition		European Retail		Direct Response/ E-Commerce		North American Retail		Corporate/ Manufacturing			Consolidated
Successor
Fiscal 2011:
	Net sales	$	1,764,755	$	711,180	$	257,466	$	225,090	$	—		$	2,958,491
	Income (loss) from operations		283,775		118,770		59,193		11,669		(239,441	)		233,966
	Depreciation and amortization		38,840		16,627		10,649		3,307		33,912			103,335
	Capital expenditures		652		19,536		40		992		23,014			44,234
Predecessor
Fiscal 2010:
	Net sales	$	1,734,860	$	645,250	$	233,972	$	212,655	$	—		$	2,826,737
	Income (loss) from operations		292,991		100,865		68,018		10,032		(118,129	)		353,777
	Depreciation and amortization		14,578		13,598		4,698		2,597		31,333			66,804
	Capital expenditures		1,473		39,158		36		3,427		25,809			69,903
Fiscal 2009:
	Net sales	$	1,557,089	$	601,574	$	221,409	$	201,878	$	—		$	2,581,950
	Income (loss) from operations		180,660		89,747		57,442		1,420		(65,358	)		263,911
	Depreciation and amortization		14,794		14,385		5,022		3,007		31,680			68,888
	Capital expenditures		834		10,575		4,662		2,501		24,803			43,375

        Net sales by location of customer

		Successor		Predecessor
		2011		2010		2009
United States		$	1,898,535	$	1,870,622	$	1,745,348
United Kingdom			671,804		618,085		576,584
Canada			114,826		100,350		86,071
Netherlands			80,221		65,591		56,557
Ireland			33,774		24,567		20,844
Other foreign countries			159,331		147,522		96,546
	Consolidated net sales	$	2,958,491	$	2,826,737	$	2,581,950

        Long-lived assets—Property, plant and equipment

		Successor		Predecessor
		2011		2010
United States		$	333,863	$	266,715
United Kingdom			107,184		87,105
Netherlands			7,635		6,010
Ireland			4,716		4,183
Canada			13,777		15,604
Other foreign countries			12,098		12,282
	Consolidated long-lived assets	$	479,273	$	391,899

        Total assets by segment as of September 30, 2011 and 2010 are as follows:

		Successor		Predecessor
		2011		2010
Wholesale/U.S. Nutrition		$	2,535,178	$	917,026
European Retail			769,329		424,065
Direct Response/E-Commerce			781,135		54,404
North American Retail			206,582		32,782
Corporate/Manufacturing			803,332		772,491
	Consolidated assets	$	5,095,556	$	2,200,768

        Approximately 32%, 29% and 29% of our net sales for the fiscal years ended September 30, 2011, 2010 and 2009, respectively, were denominated in currencies other than U.S. dollars, principally British pounds, euros and Canadian dollars. A significant weakening of such currencies versus the U.S. dollar could have a material adverse effect on the Company, as this would result in a decrease in our consolidated operating results.

        Foreign subsidiaries accounted for the following percentages of assets and total liabilities as of September 30, 2011 and 2010:

	Successor			Predecessor
	2011			2010
Total Assets		24	%		26	%
Total Liabilities		4	%		16	%