Annual report pursuant to Section 13 and 15(d)

SEGMENT REPORTING

v3.19.1
SEGMENT REPORTING
12 Months Ended
Feb. 02, 2019
SEGMENT REPORTING  
SEGMENT REPORTING

18.    SEGMENT REPORTING

Our operations are conducted in two reportable segments, retail and corporate apparel, based on the way we manage, evaluate and internally report our business activities.

The retail segment includes the results from our four retail merchandising brands: Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A. Bank, Moores and K&G. These four brands are operating segments that have been aggregated into the retail reportable segment. Prior to its divestiture, MW Cleaners was also aggregated in the retail segment as its operations did not have a significant effect on our revenues or expenses. Specialty apparel merchandise offered by our four retail merchandising concepts include suits, suit separates, sport coats, slacks, formalwear, business casual, denim, sportswear, outerwear, dress shirts, shoes and accessories for men. Women’s career and casual apparel, sportswear and accessories, including shoes, and children’s apparel is offered at most of our K&G stores.  Rental product is offered at our Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A Bank and Moores retail stores.

The corporate apparel segment includes the results from our corporate apparel and uniform operations conducted by Dimensions, Alexandra and Yaffy in the UK and Twin Hill in the U.S., which provide corporate apparel uniforms and workwear to workforces.

We measure segment profitability based on operating income, defined as income before interest expense, interest income, (loss) gain on extinguishment of debt, net, and income taxes, before shared service expenses. Shared service expenses include costs incurred and directed primarily by our corporate offices that are not allocated to segments.

Additional net sales information is as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year

 

 

 

2018

    

2017

    

2016

 

Net sales:

 

 

    

 

 

    

 

 

    

 

Men's Wearhouse(1)

 

$

1,741,983

 

$

1,742,668

 

$

1,770,968

 

Jos. A. Bank

 

 

722,887

 

 

735,149

 

 

749,869

 

K&G

 

 

319,476

 

 

323,994

 

 

329,954

 

Moores

 

 

217,614

 

 

216,366

 

 

214,470

 

MW Cleaners(2)

 

 

2,551

 

 

34,844

 

 

33,140

 

Total retail segment

 

 

3,004,511

 

 

3,053,021

 

 

3,098,401

 

Total corporate apparel segment

 

 

235,391

 

 

251,325

 

 

280,302

 

Total net sales

 

$

3,239,902

 

$

3,304,346

 

$

3,378,703

 


(1)

Consists of Men’s Wearhouse, Men’s Wearhouse and Tux, tuxedo shops within Macy's (all 170 of which were closed during the second quarter of 2017) and Joseph Abboud.

(2)

On March 3, 2018, we completed the divestiture of our MW Cleaners business. See Note 3 for additional information.

Operating (loss) income by reportable segment, shared service expense, and the reconciliation to earnings before income taxes is as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year

 

 

 

2018

    

2017

    

2016

 

Operating income (loss):

 

 

    

 

 

    

 

 

    

 

Retail

 

$

418,062

 

$

411,258

 

$

308,283

 

Corporate apparel

 

 

(16,025)

 

 

11,326

 

 

25,315

 

Shared service expense

 

 

(190,098)

 

 

(193,168)

 

 

(200,772)

 

Operating income

 

 

211,939

 

 

229,416

 

 

132,826

 

Interest income

 

 

563

 

 

564

 

 

167

 

Interest expense

 

 

(79,573)

 

 

(100,471)

 

 

(103,149)

 

(Loss) gain on extinguishment of debt, net

 

 

(30,253)

 

 

5,445

 

 

1,737

 

Earnings before income taxes

 

$

102,676

 

$

134,954

 

$

31,581

 

 

Capital expenditures by reportable segment and shared services are as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year

 

 

    

2018

    

2017

    

2016

 

Capital expenditures:

 

 

    

 

 

    

 

 

    

 

Retail

 

$

56,545

 

$

56,133

 

$

39,059

 

Corporate apparel

 

 

3,744

 

 

3,663

 

 

3,440

 

Shared services

 

 

21,997

 

 

35,162

 

 

57,195

 

Total capital expenditures

 

$

82,286

 

$

94,958

 

$

99,694

 

Depreciation and amortization expense by reportable segment and shared services is as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year

 

 

 

2018

    

2017

    

2016

 

Depreciation and amortization expense:

    

 

    

 

 

    

 

 

    

 

Retail

 

$

79,113

 

$

79,579

 

$

75,284

 

Corporate apparel

 

 

6,501

 

 

6,197

 

 

5,940

 

Shared services

 

 

18,602

 

 

20,717

 

 

33,981

 

Total depreciation and amortization expense

 

$

104,216

 

$

106,493

 

$

115,205

 

Total assets by reportable segment and shared services are as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

February 2,

    

February 3,

 

 

 

2019

 

2018

 

Segment assets:

 

 

 

 

 

 

 

Retail

 

$

1,375,902

 

$

1,434,992

 

Corporate apparel

 

 

175,488

 

 

222,872

 

Shared services(1)

 

 

269,100

 

 

342,091

 

Total assets

 

$

1,820,490

 

$

1,999,955

 


(1)

Shared service assets consist primarily of cash and cash equivalents, assets related to our distribution network and tax-related assets.

The tables below present information related to geographic areas in which we operate, with net sales classified based primarily on the geographic area where our customer is located (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year

 

 

    

2018

    

2017

    

2016

 

Net sales:

 

 

    

 

 

    

 

 

    

 

U.S.

 

$

2,838,577

 

$

2,893,689

 

$

2,973,177

 

International (1)

 

 

401,325

 

 

410,657

 

 

405,526

 

Total net sales

 

$

3,239,902

 

$

3,304,346

 

$

3,378,703

 


(1)

Primarily in Canada and the UK.

 

 

 

 

 

 

 

 

 

    

February 2, 2019

    

February 3, 2018

 

Long-lived assets, net (including rental product):

 

 

 

 

 

 

 

U.S.

 

$

489,483

 

$

531,915

 

International (1)

 

 

49,459

 

 

52,489

 

Total long-lived assets

 

$

538,942

 

$

584,404

 


(1)

Primarily in Canada and the UK.