Business Segments, Geographic Data, and Sales by Major Customers

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Note 2 — Business Segments, Geographic Data, and Sales by Major Customers

The Company is a worldwide producer and marketer of children’s toys and other consumer products, principally engaged in the design, development, production, marketing and distribution of its diverse portfolio of products. The Company’s segments are (i) Toys/Consumer Products and (ii) Costumes (formerly known as “Halloween”).

The Toys/Consumer Products segment includes action figures, vehicles, play sets, plush products, dolls, electronic products, construction toys, infant and pre-school toys, child-sized and hand-held role play toys and everyday costume play, foot-to-floor ride-on vehicles, wagons, novelty toys, seasonal and outdoor products, kids’ indoor and outdoor furniture, and related products, and makeup and skincare products under the C'est Moi brand.

The Costumes segment, under its Disguise branding, has been bringing innovative and trend-setting product to market since its inception in 1987. This business designs, develops, markets and sells a wide range of every-day and special occasion dress-up costumes and related accessories in support of Halloween, Carnival, Children’s Day, Book Day/Week, and every-day/any-day costume play. 

Segment performance is measured at the operating income (loss) level. All sales are made to external customers and general corporate expenses have been attributed to the segments based upon relative sales volumes. Segment assets are primarily comprised of accounts receivable and inventories, net of applicable reserves and allowances, goodwill and other assets. Certain assets which are not tracked by operating segment and/or that benefit multiple operating segments have been allocated on the same basis.

Results are not necessarily those which would be achieved if each segment was an unaffiliated business enterprise. Information by segment and a reconciliation to reported amounts for the three and six months ended June 30, 2021 and 2020 and as of June 30, 2021 and December 31, 2020 are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Net Sales
Toys/Consumer Products	$	81,538	$	56,214	$	161,413	$	118,779
Costumes		30,814		22,544		34,782		26,536
	$	112,352	$	78,758	$	196,195	$	145,315

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Income (loss) from Operations
Toys/Consumer Products	$	4,860		$	(5,611	)	$	5,216		$	(18,350	)
Costumes		(3,039	)		(4,135	)		(6,118	)		(7,382	)
	$	1,821		$	(9,746	)	$	(902	)	$	(25,732	)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Depreciation and Amortization Expense
Toys/Consumer Products	$	2,525	$	2,292	$	4,252	$	4,116
Costumes		254		287		320		345
	$	2,779	$	2,579	$	4,572	$	4,461

	June 30,		December 31,
	2021		2020
Assets
Toys/Consumer Products	$	263,106	$	315,838
Costumes		52,025		13,531
	$	315,131	$	329,369

Net revenues are categorized based upon location of the customer, while long-lived assets are categorized based upon the location of the Company’s assets. The following tables present information about the Company by geographic area as of June 30, 2021 and December 31, 2020 and for the three and six months ended June 30, 2021 and 2020 (in thousands):

	June 30,		December 31,
	2021		2020
Long-lived Assets
United States	$	20,044	$	23,607
China		12,528		10,773
Hong Kong		1,272		1,870
United Kingdom		1,326		1,458
Canada		87		100
Mexico		88		96
	$	35,345	$	37,904

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Net Sales by Customer Area
United States	$	95,265	$	66,777	$	164,181	$	118,695
Europe		9,930		5,761		17,267		13,379
Canada		2,208		2,684		4,309		5,032
Latin America		1,165		1,082		3,620		2,082
Asia		2,164		1,462		3,579		3,232
Australia & New Zealand		1,249		802		2,437		2,333
Middle East & Africa		371		190		802		562
	$	112,352	$	78,758	$	196,195	$	145,315

Major Customers

Net sales to major customers for the three and six months ended June 30, 2021 and 2020 were as follows (in thousands, except for percentages):

	Three Months Ended June 30,										Six Months Ended June 30,
	2021					2020					2021					2020
			Percentage					Percentage					Percentage					Percentage
	Amount		of Net Sales			Amount		of Net Sales			Amount		of Net Sales			Amount		of Net Sales
Wal-Mart	$	34,692		30.9	%	$	22,208		28.2	%	$	56,330		28.7	%	$	40,718		28.0	%
Target		30,575		27.2			18,929		24.0			53,328		27.2			33,544		23.1
	$	65,267		58.1	%	$	41,137		52.2	%	$	109,658		55.9	%	$	74,262		51.1	%

No other customer accounted for more than 10% of the Company's total net sales.

The concentration of the Company’s business with a relatively small number of customers may expose the Company to material adverse effects if one or more of its large customers were to experience financial difficulty. The Company performs ongoing credit evaluations of its top customers and maintains an allowance for potential credit losses.