Business Segments and Sales by Product Group

12 Months Ended

Jan. 30, 2021

Segment Reporting [Abstract]

Business Segments and Sales by Product Group

(11)  Business Segments and Sales by Product Group

During fiscal 2019, the Company changed its reportable segments into two reporting segments: “ShopHQ” and “Emerging.” In light of strategic shifts in the Company’s emerging businesses, the Company’s Chief Executive Officer began reviewing operating results of the Emerging segment separately from its core business, ShopHQ. The chief operating decision maker is the Company’s Chief Executive Officer and Interim Chief Financial Officer. These segments reflect the way the Company’s chief operating decision maker evaluates the Company’s business performance and manages its operations. All of Company’s sales are made to customers residing in the United States.

The Company does not allocate assets between the segments for our internal management purposes, and as such, they are not presented here. There were no significant inter-segment sales or transfers during fiscal 2020, fiscal 2019 and fiscal 2018. The Company allocates corporate support costs (such as finance, human resources, warehouse management and legal) to our operating segments based on their estimated usage and based on how the Company manages the business.

ShopHQ

The ShopHQ segment encompasses the Company’s nationally distributed shopping entertainment network. ShopHQ sells and distributes its products to consumers through its video commerce television, online website and mobile platforms.

Emerging

The Emerging segment consists of the Company’s developing business models. This segment includes the Company’s Media Commerce Services, which offers creative and interactive advertising, OTT app services and third-party logistics. The Media Commerce Services brands include Float Left and third-party logistics business i3PL. Float Left is a business comprised of connected TVs, video-based content, application development and distribution, including technical consulting services, software development and maintenance related to video distribution. The Emerging segment also encompasses the ShopHQHealth, ShopBulldogTV, J.W. Hulme, and OurGalleria.com. ShopHQHealth is a health and wellness focused network that offers a robust assortment of products and services dedicated to addressing the physical, spiritual and mental health needs of its customers. ShopBulldog TV is a niche television shopping network geared towards male consumers. J.W. Hulme is a business specializing in artisan-crafted leather products, including handbags and luggage. J.W. Hulme products are distributed primarily through jwhulme.com, retails stores, and programming on ShopHQ. OurGalleria.com is a higher-end online marketplace for discounted merchandise.

Net Sales by Segment and Significant Product Groups

	For the Years Ended
	January 30,		February 1,		February 2,
	2021		2020		2019
	(in thousands)
ShopHQ
Net merchandise sales by category:
Jewelry & Watches	$	161,999	$	200,893	$	206,021
Home & Consumer Electronics		62,910		106,025		135,184
Beauty & Wellness		124,222		80,945		102,099
Fashion & Accessories		45,261		65,616		94,295
All other (primarily shipping & handling revenue)		42,750		42,628		52,630
Total ShopHQ		437,142		496,107		590,229
Emerging		17,029		5,715		6,408
Consolidated net sales	$	454,171	$	501,822	$	596,637

Performance Measures by Segment

	For the Years Ended
	January 30,		February 1,		February 2,
	2021		2020		2019
	(in thousands)
Gross profit
ShopHQ	$	160,190	$	162,809	$	205,036
Emerging	$	6,863	$	828	$	1,811
Consolidated gross profit	$	167,053	$	163,637	$	206,847
Operating loss
ShopHQ	$	(3,616)	$	(46,956)	$	(17,173)
Emerging		(4,324)		(5,569)		(1,451)
Consolidated operating loss	$	(7,940)	$	(52,525)	$	(18,624)
Depreciation and amortization
ShopHQ (a)	$	27,264	$	11,395	$	10,065
Emerging		714		619		99
Consolidated depreciation and amortization	$	27,978	$	12,014	$	10,164

(a) Includes distribution facility depreciation of $3,955,000, $3,957,000 and $3,921,000 for fiscal 2020, fiscal 2019 and fiscal 2018. Distribution facility depreciation is included as a component of cost of sales within the accompanying consolidated statements of operations.