Segment Reporting and Geographic Information

3 Months Ended

Apr. 29, 2017

Segment Reporting and Geographic Information

Segment Reporting and Geographic Information

(10)   Segment Reporting and Geographic Information

Authoritative guidance requires public companies to report financial and descriptive information about their reportable operating segments. The Company identifies reportable segments based on how management internally evaluates financial information, business activities and management responsibility.

As a result of the Hi-Tec acquisition, the Company’s reportable segments beginning in Fiscal 2017 consist of Cherokee Global Brands and Hi-Tec, for which Cherokee Global Brand’s chief-operating decision maker internally evaluates operating performance and financial results. For the three month period ended April 30, 2016 the Company considered the business activities to constitute a single segment, the marketing and licensing of brand names and trademarks for apparel, footwear and accessories. Cherokee Global Brands’ marketing and licensing activities extend to brands which the Company owns and to brands owned by others. Cherokee Global Brands’ operating activities relating to owned and represented brands are identical and are performed by a single group of marketing professionals.

The following table reconciles the segment activity to the consolidated statement of operations for the three months ended April 29, 2017 and the consolidated balance sheet as of April 29, 2017:

(amounts in thousands)	Cherokee Global Brands		Hi-Tec		Consolidated
Royalty revenues	$	5,180	$	1,660	$	6,840
Indirect product sales		—		4,273		4,273
Amortization of intangible assets		224		42		266
Other (expense) income , net		(877)		(750)		(1,627)
Income tax provision		1,008		(560)		448
Net (loss) income	$	(1,287)	$	(1,972)	$	(3,259)
Goodwill		100		15,635		15,735
Total assets	$	65,871	$	90,356	$	156,227

Revenues by geographic area based upon the licensees’ country of domicile consisted of the following:

	Three Months Ended
(amounts in thousands)	April 29, 2017		April 30, 2016
U.S. and Canada	$	3,189	$	8,121
Asia		1,105		1,102
Latin America		568		554
Africa		467		260
United Kingdom and Europe		1,116		155
All Others		395		486
Total	$	6,840	$	10,678

Long-lived tangible assets were located in the U.S., United Kingdom and Europe, Mexico and Asia with net values of approximately $702,  $558,  $176 and $9, respectively, as of April 29, 2017 and with net values of approximately $750,  $349,  $196 and $16, respectively, as of January 28, 2017.