Segment Information (Tables)

9 Months Ended

Sep. 30, 2012

Segment Information

Schedule of financial information for reporting segments

	Three months ended September 30, 2012
	Guitar Center		Music & Arts		Direct Response		Corporate			Total
Net sales	$	366,564	$	50,077	$	79,590	$	—		$	496,231
Gross profit	103,320		19,564		24,034		444			147,362
Selling, general and administrative expenses	84,601		18,481		20,674		7,622			131,378
Operating income (loss)	18,719		1,083		3,360		(7,178		)	15,984
Depreciation and amortization	16,728		1,132		3,788		1,019			22,667
Adjusted EBITDA	36,793		2,275		7,304		(3,793		)	42,579
Capital expenditures	9,736		1,425		1,885		3,270			16,316

	Three months ended September 30, 2011
	Guitar Center		Music & Arts		Direct Response			Corporate			Total
Net sales	$	358,610	$	44,699	$	84,820		$	—		$	488,129
Gross profit	102,713		18,625		22,915			—			144,253
Selling, general and administrative expenses	89,000		17,739		27,813			9,131			143,683
Operating income (loss)	13,713		886		(4,898		)	(9,131		)	570
Depreciation and amortization	18,867		1,007		5,957			670			26,501
Adjusted EBITDA	35,050		2,176		4,121			(4,229		)	37,118
Capital expenditures	6,690		982		1,835			3,934			13,441

	Nine months ended September 30, 2012
	Guitar Center		Music & Arts		Direct Response		Corporate			Total
Net sales	$	1,125,599	$	135,865	$	249,516	$	—		$	1,510,980
Gross profit	324,327		62,126		70,844		102			457,399
Selling, general and administrative expenses	261,027		51,989		70,549		19,433			402,998
Operating income (loss)	63,300		10,137		295		(19,331		)	54,401
Depreciation and amortization	49,467		3,357		11,820		2,760			67,404
Adjusted EBITDA	116,869		14,089		12,994		(9,073		)	134,879
Capital expenditures	28,487		4,319		6,022		9,953			48,781
Total assets
Holdings	1,462,007		121,588		186,509		75,998			1,846,102
Guitar Center	1,462,007		121,588		186,509		98,108			1,868,212

	Nine months ended September 30, 2011
	Guitar Center		Music & Arts		Direct Response			Corporate			Total
Net sales	$	1,075,136	$	126,897	$	267,949		$	—		$	1,469,982
Gross profit	310,443		60,264		75,211			—			445,918
Selling, general and administrative expenses	258,094		50,693		83,204			30,931			422,922
Operating income (loss)	52,349		9,571		(7,993		)	(30,931		)	22,996
Depreciation and amortization	55,883		3,148		16,413			2,043			77,487
Adjusted EBITDA	112,897		13,261		13,181			(13,711		)	125,628
Capital expenditures	16,589		2,998		6,254			9,245			35,086
Total assets
Holdings	1,492,607		114,151		335,344			126,694			2,068,796
Guitar Center	1,492,607		114,151		335,344			123,472			2,065,574

Schedule of reconciliation of adjusted EBITDA to consolidated loss before income taxes

Holdings

	Three months  ended September 30,						Nine months  ended September 30,
	2012			2011			2012			2011
Adjusted EBITDA
Guitar Center	$	36,793		$	35,050		$	116,869		$	112,897
Music & Arts	2,275			2,176			14,089			13,261
Direct response	7,304			4,121			12,994			13,181
Corporate	(3,793		)	(4,229		)	(9,073		)	(13,711		)
	42,579			37,118			134,879			125,628
Depreciation and amortization expense	22,667			26,501			67,404			77,487
Interest expense, net	41,208			40,870			123,726			119,998
Non-cash charges	525			820			2,215			2,485
Non-recurring charges	—			635			—			5,252
Impairment charges	559			—			559			—
Other adjustments	2,844			8,592			10,300			17,408
Consolidated loss before income taxes	$	(25,224	)	$	(40,300	)	$	(69,325	)	$	(97,002	)

Guitar Center

	Three months  ended September 30,						Nine months  ended September 30,
	2012			2011			2012			2011
Adjusted EBITDA
Guitar Center	$	36,793		$	35,050		$	116,869		$	112,897
Music & Arts	2,275			2,176			14,089			13,261
Direct response	7,304			4,121			12,994			13,181
Corporate	(3,793		)	(4,229		)	(9,073		)	(13,711		)
	42,579			37,118			134,879			125,628
Depreciation and amortization expense	22,667			26,501			67,404			77,487
Interest expense, net	21,214			20,877			63,746			60,020
Non-cash charges	525			820			2,215			2,485
Non-recurring charges	—			635			—			5,252
Impairment charges	559			—			559			—
Other adjustments	2,844			8,592			10,300			17,130
Consolidated loss before income taxes	$	(5,230	)	$	(20,307	)	$	(9,345	)	$	(36,746	)