Segment Information (Tables)

12 Months Ended

Feb. 02, 2019

Summary of net revenue, earnings (loss) from operations, capital expenditures and total assets by segment

Segment information is summarized as follows (in thousands):



	Year Ended			Year Ended			Year Ended
	Feb 2, 2019¹			Feb 3, 2018¹			Jan 28, 2017¹
Net revenue:
Americas Retail	$	824,674		$	833,077		$	935,479
Americas Wholesale	170,812			150,366			146,260
Europe	1,142,768			998,657			788,194
Asia	388,246			308,899			248,601
Licensing^2,3	83,194			72,755			71,919
Total net revenue^2,3	$	2,609,694		$	2,363,754		$	2,190,453
Earnings (loss) from operations:
Americas Retail^2,4	$	27,532		$	(11,096	)	$	(13,752	)
Americas Wholesale^2,4	29,935			25,845			25,007
Europe^4,5	58,298			94,545			65,068
Asia⁴	12,365			14,809			(1,392		)
Licensing^2,3,4	72,986			63,538			61,472
Total segment earnings from operations	201,116			187,641			136,403
Corporate overhead^2,4	(96,805		)	(100,434		)	(71,867		)
European Commission fine⁶	(45,637		)	—			—
Asset impairment charges⁷	(6,939		)	(8,479		)	(34,385		)
Net gains (losses) on lease terminations⁸	477			(11,373		)	695
Restructuring charges⁹	—			—			(6,083		)
Total earnings from operations⁵	$	52,212		$	67,355		$	24,763
Capital expenditures:
Americas Retail	$	19,614		$	16,899		$	25,881
Americas Wholesale	376			1,303			3,320
Europe	56,792			46,419			42,080
Asia	23,458			12,111			13,869
Licensing	—			—			20
Corporate overhead	7,877			7,923			5,411
Total capital expenditures	$	108,117		$	84,655		$	90,581

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¹	The Company operates on a 52/53-week fiscal year calendar, which ends on the Saturday nearest to January 31 of each year. The results for fiscal 2018 included the impact of an additional week which occurred during the fourth quarter ended February 3, 2018.

During the first quarter of fiscal 2019, the Company adopted a comprehensive new revenue recognition standard using a modified retrospective method that does not restate prior periods to be comparable to the current period presentation. The adoption of this guidance primarily impacted the presentation of advertising contributions received from the Company’s licensees and the related advertising expenditures incurred by the Company. The adoption of this guidance resulted in an increase in net royalty revenue within the Company’s Licensing segment of $10.7 million, as well as an increase in SG&A expenses in our Americas Retail, Americas Wholesale and Licensing segments as well as corporate overhead of $3.9 million, $1.7 million, $1.1 million and $3.0 million, respectively, during fiscal 2019 compared to the prior year. The net favorable impact on earnings from operations was approximately $1.0 million during fiscal 2019 compared to the prior year. Refer to Note 2 to the Condensed Consolidated Financial Statements for more information regarding the impact from the adoption of this new standard.


³	During the fourth quarter of fiscal 2018, the Company reclassified net royalties received on the Company’s inventory purchases of licensed product from net revenue to cost of product sales. Accordingly, net revenue by geographic area has been adjusted for fiscal 2017 to conform.

⁴

During fiscal 2019, the Company changed the segment accountability for funds received from licensees on the Company’s purchases of its licensed products. These amounts were treated as a reduction of cost of product sales within the Licensing segment but now are considered in the results of the segments that control the respective purchases for purposes of segment performance evaluation. Accordingly, segment results for fiscal 2018 and fiscal 2017 have been adjusted to conform to the current period presentation.


⁵	During fiscal 2019, the Company adopted new authoritative guidance which requires that the non-service components of net periodic defined benefit pension cost be presented outside of earnings (loss) from operations. Accordingly, earnings from operations and segment results for fiscal 2018 and fiscal 2017 have been adjusted to conform to the current period presentation.


⁶	During fiscal 2019, the Company recognized a charge of €39.8 million ($45.6 million) for a fine imposed by the European Commission related to alleged violations of European Union competition rules by the Company. The Company paid the full amount of the fine during the first quarter of fiscal 2020.


⁷	During each of the years presented, the Company recognized asset impairment charges for certain retail locations resulting from under-performance and expected store closures. Refer to Note 5 for more information regarding these asset impairment charges.

⁸

During fiscal 2019, the Company recorded net gain on lease terminations related primarily to the early termination of certain lease agreements in North America. During fiscal 2018, the Company incurred net losses on lease terminations related primarily to the modification of certain lease agreements held with a common landlord in North America. During fiscal 2017, the Company recorded net gains on lease terminations related primarily to the early termination of certain lease agreements in Europe. Refer to Note 1 for more information regarding the net gains (losses) on lease terminations.


⁹	Restructuring charges incurred during fiscal 2017 related to plans to better align the Company’s global cost and organizational structure with its current strategic initiatives. Refer to Note 9 for more information regarding these restructuring charges.

Summary of net revenue and long-lived assets by country

The table below presents information regarding geographic areas in which the Company operated. Net revenue is classified primarily based on the country where the Company’s customer is located (in thousands):



	Year Ended		Year Ended		Year Ended
	Feb 2, 2019		Feb 3, 2018		Jan 28, 2017
Net product sales:
U.S.	$	722,794	$	709,155	$	801,623
Italy	304,435		289,981		251,709
Canada	187,367		200,364		217,029
South Korea	162,943		163,382		156,094
Other foreign countries	1,148,961		928,117		692,079
Total product sales	2,526,500		2,290,999		2,118,534
Net royalties¹	83,194		72,755		71,919
Net revenue	$	2,609,694	$	2,363,754	$	2,190,453

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¹	During the fourth quarter of fiscal 2018, the Company reclassified net royalties received on the Company’s inventory purchases of licensed product from net revenue to cost of product sales. Accordingly, net revenue by geographic area has been adjusted for fiscal 2017 to conform to the current period presentation.

Long-lived assets by geographic location are as follows:



	Feb 2, 2019		Feb 3, 2018
Long-lived assets:
U.S.	$	111,022	$	109,943
Italy	30,038		34,884
Canada	13,225		18,845
South Korea	9,437		9,584
Other foreign countries	222,727		187,214
Total long-lived assets	$	386,449	$	360,470