Note 20 - Segment Information

12 Months Ended

Nov. 26, 2016

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

20.

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 stores 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. Our wholesale segment also includes our holdings of short - term investments and retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other loss, net, in our 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 logistics revenue in our condensed consolidated statement of income. Zenith’s operating costs are included in selling, general and administrative expenses and total $92,196 for the year ended November 26, 2016 and $73,722 from the date of acquisition through November 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 loss, net, in the accompanying statements of income.

Inter - company 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.

Notes to Con

s

olidated Financial Statements

- Continued

(In thousands, except share and per share data)

The following table presents segment information for each of the last

three

fiscal years:

	2016			2015			2014
Net Sales
Wholesale	$	240,346		$	252,180		$	223,993
Retail		254,667			249,379			216,631
Logistical services		95,707			77,250			-
Inter-company eliminations:
Furniture and accessories		(117,817	)		(114,154	)		(99,886	)
Logistical services		(40,865	)		(33,728	)		-
Consolidated	$	432,038		$	430,927		$	340,738
Income (loss) from Operations
Wholesale	$	18,672		$	15,618		$	14,120
Retail		4,333			6,170			(528	)
Logistical services		3,511			3,528			-
Inter-company elimination		1,677			1,647			1,539
Lease exit costs		-			(419	)		-
Asset impairment charges		-			(106	)		-
Management restructuring costs		-			(449	)		-
Consolidated income from operations	$	28,193		$	25,989		$	15,131
Depreciation and Amortization
Wholesale	$	2,053		$	2,075		$	1,972
Retail		5,992			5,428			5,344
Logistical services		4,204			2,634			-
Consolidated	$	12,249		$	10,137		$	7,316
Capital Expenditures
Wholesale	$	7,232		$	4,898		$	4,527
Retail		5,115			7,077			13,836
Logistical services		9,154			1,999			-
Consolidated	$	21,501		$	13,974		$	18,363
Identifiable Assets
Wholesale	$	139,477		$	146,878		$	154,275
Retail		88,855			88,878			86,471
Logistical services		49,935			46,787			-
Consolidated	$	278,267		$	282,543		$	240,746

A breakdown of wholesale sales by product category for each of the last

three

fiscal years is provided below:

	2016			2015			2014
Wood		37	%		37	%		39	%
Upholstery		63	%		63	%		61	%
		100	%		100	%		100	%