Note 14 - Segment Information

3 Months Ended

Feb. 27, 2016

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

14. Segment

Information

We have strategically aligned our business into three reportable segments as defined in ASC 280,

Segment Reporting

, and as described below:

● Wholesale. The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of Bassett stores (Company-owned and licensee-owned retail stores) and independent furniture retailers. Our wholesale segment includes our wood and upholstery operations as well as all corporate selling, general and administrative expenses, including those corporate expenses related to both Company- and licensee-owned stores. Also included in our wholesale segment are our short-term investments and our holdings of retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other income (loss), net, in our condensed consolidated statements of income.

● Retail – Company-owned s tores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores.

● Logistical services . With our acquisition of Zenith on February 2, 2015, we created the logistical services operating segment which reflects the operations of Zenith. In addition to providing shipping, delivery and warehousing services for the Company, Zenith also provides similar services to other customers, primarily in the furniture industry. Revenue from the performance of these services to other customers is included in logistical services revenue in our condensed consolidated statement of income. Zenith’s operating costs are included in selling, general and administrative expenses and total $23,934 for the three months ended February 27, 2016 and $6,007 from the date of acquisition through February 28, 2015. Amounts charged by Zenith to the Company for logistical services prior to the date of acquisition are included in selling, general and administrative expenses, and our equity in the earnings of Zenith prior to the date of acquisition is included in other income (loss), net, in the accompanying statements of income.

Inter-company net sales elimination represents the elimination of wholesale sales to our Company-owned stores and the elimination of Zenith logistics revenue from our wholesale and retail segments. Inter-company income elimination includes the embedded wholesale profit in the Company-owned store inventory that has not been realized. These profits will be recorded when merchandise is delivered to the retail consumer. The inter-company income elimination also includes rent paid by our retail stores occupying Company-owned real estate, and the elimination of shipping and handling charges from Zenith for services provided to our wholesale and retail operations.

The following table presents our segment information:

	Quarter Ended
	February 27, 2016			February 28, 2015
Sales Revenue
Wholesale	$	59,576		$	58,805
Retail - Company-owned stores		61,595			57,183
Logistical services		24,679			5,999
Inter-company eliminations:
Furniture and accessories		(28,769	)		(26,440	)
Logistical services		(10,208	)		(2,740	)
Consolidated	$	106,873		$	92,807
Income (loss) from Operations
Wholesale	$	4,398		$	2,927
Retail - Company-owned stores		316			(42	)
Logistical services		744			(8	)
Inter-company elimination		333			525
Lease exit costs		-			(419	)
Asset impairment charges		-			(106	)
Consolidated	$	5,791		$	2,877
Depreciation and Amortization
Wholesale	$	456		$	534
Retail - Company-owned stores		1,531			1,355
Logistical services		830			257
Consolidated	$	2,817		$	2,146
Capital Expenditures
Wholesale	$	1,537		$	961
Retail - Company-owned stores		2,021			2,111
Logistical services		5,010			846
Consolidated	$	8,568		$	3,918

Identifiable Assets	As of February 27, 2016		As of November 28, 2015
Wholesale	$	132,623	$	146,878
Retail - Company-owned stores		91,548		88,878
Logistical services		49,483		46,787
Consolidated	$	273,654	$	282,543