Segments

9 Months Ended

Oct. 31, 2020

Segments [Abstract]

SEGMENTS

Note 11 – Segments

The Company’s reportable segments are business units that offer products through different channels of distribution. The Company has two reportable segments: wholesale operations and retail operations. The wholesale operations segment includes sales of products under the Company’s owned, licensed and private label brands, as well as sales related to the Vilebrequin business. Wholesale revenues also include revenues from license agreements related to our owned trademarks including DKNY, Donna Karan, Vilebrequin, G.H. Bass and Andrew Marc. The retail operations segment consists primarily of direct sales to consumers through Company-operated stores, consisting primarily of Wilsons Leather, G.H. Bass and DKNY stores, substantially all of which are operated as outlet stores. Sales through Company-owned channels, with the exception of Vilebrequin, are also included in the retail operations segment. As a result of the restructuring of the Company’s retail operations, the Company is in the process of closing all of its Wilsons Leather and G.H. Bass retail stores which is expected to be completed by the end of fiscal 2021. After completion of the restructuring, the Company’s retail operations segment will consist of DKNY and Karl Lagerfeld Paris stores, as well as the digital channels for DKNY, Donna Karan, Karl Lagerfeld Paris, Andrew Marc, Wilsons Leather and G.H. Bass.

The following segment information is presented for the three and nine-month periods indicated below:

	Three Months Ended October 31, 2020
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	783,030	$	57,982	$	(14,451)	$	826,561
Cost of goods sold		504,919		38,338		(14,451)		528,806
Gross profit		278,111		19,644		—		297,755
Selling, general and administrative expenses		134,050		43,575		—		177,625
Depreciation and amortization		8,472		1,715		—		10,187
Asset impairments, net of gain on lease modifications		(102)		(15)		—		(117)
Operating profit (loss)	$	135,691	$	(25,631)	$	—	$	110,060

	Three Months Ended October 31, 2019
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,067,858	$	89,671	$	(29,126)	$	1,128,403
Cost of goods sold		713,063		45,447		(29,126)		729,384
Gross profit		354,795		44,224		—		399,019
Selling, general and administrative expenses		190,166		56,414		—		246,580
Depreciation and amortization		7,748		1,953		—		9,701
Gain on lease modifications		—		(124)		—		(124)
Operating profit (loss)	$	156,881	$	(14,019)	$	—	$	142,862

	Nine Months Ended October 31, 2020
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,428,711	$	126,397	$	(26,204)	$	1,528,904
Cost of goods sold		914,900		83,359		(26,204)		972,055
Gross profit		513,811		43,038		—		556,849
Selling, general and administrative expenses		323,377		130,970		—		454,347
Depreciation and amortization		25,155		4,590		—		29,745
Asset impairments, net of gain on lease modifications		505		16,867		—		17,372
Operating profit (loss)	$	164,774	$	(109,389)	$	—	$	55,385

	Nine Months Ended October 31, 2019
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	2,227,404	$	255,282	$	(76,839)	$	2,405,847
Cost of goods sold		1,480,678		135,156		(76,839)		1,538,995
Gross profit		746,726		120,126		—		866,852
Selling, general and administrative expenses		478,964		165,923		—		644,887
Depreciation and amortization		23,033		5,930		—		28,963
Gain on lease modifications		—		(2,346)		—		(2,346)
Operating profit (loss)	$	244,729	$	(49,381)	$	—	$	195,348

(1)Represents intersegment sales to the Company’s retail operations segment.

The total assets for each of the Company’s reportable segments, as well as assets not allocated to a segment, are as follows:

	October 31, 2020		October 31, 2019		January 31, 2020
	(In thousands)
Wholesale	$	2,028,798	$	2,342,209	$	1,912,175
Retail		105,702		348,898		272,832
Corporate		334,916		237,500		380,130
Total assets	$	2,469,416	$	2,928,607	$	2,565,137