Note 14 - Segment Information

6 Months Ended

May 29, 2021

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, which include Lane Venture, 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 income (loss), net, in our condensed consolidated statements of operations.

● Retail – Company-owned stores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores and the Company-owned distribution network utilized to deliver products to our retail customers.

● Logistical services. Our logistical services segment reflects the operations of Zenith. In addition to providing shipping 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 and the associated cost is included in logistical services revenue and cost of logistical services, respectively, in our condensed consolidated statements of operations.

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 segment. 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 operations.

The following table presents our segment information:

	Quarter Ended						Six Months Ended
	May 29, 2021			May 30, 2020			May 29, 2021			May 30, 2020
Sales Revenue
Wholesale sales of furniture and accessories	$	76,034		$	33,128		$	146,298		$	98,145
Less: Sales to retail segment		(28,520	)		(13,299	)		(57,524	)		(45,220	)
Wholesale sales to external customers		47,514			19,829			88,774			52,925
Retail sales of furniture and accessories		62,483			33,171			122,878			99,017
Consolidated net sales of furniture and accessories		109,997			53,000			211,652			151,942
Logistical services revenue		22,244			15,259			42,325			36,574
Less: Services to wholesale segment		(8,182	)		(4,458	)		(16,245	)		(12,595	)
Logistical services to external customers		14,062			10,801			26,080			23,979
Total sales revenue	$	124,059		$	63,801		$	237,732		$	175,921
Income (Loss) from Operations
Wholesale	$	5,359		$	(7,381	)	$	10,156		$	(4,668	)
Retail - Company-owned stores		1,652			(9,170	)		2,746			(10,419	)
Logistical services		1,294			(1,842	)		1,753			(1,007	)
Inter-company elimination		74			2,369			(255	)		2,280
Asset impairment charges		-			(12,184	)		-			(12,184	)
Goodwill impairment charge		-			(1,971	)		-			(1,971	)
Litigation expense		-			(1,050	)		-			(1,050	)
Consolidated	$	8,379		$	(31,229	)	$	14,400		$	(29,019	)
Depreciation and Amortization
Wholesale	$	823		$	782		$	1,621		$	1,591
Retail - Company-owned stores		1,581			1,712			3,097			3,442
Logistical services		1,158			1,122			2,175			2,206
Consolidated	$	3,562		$	3,616		$	6,893		$	7,239
Capital Expenditures
Wholesale	$	1,409		$	271		$	2,166		$	693
Retail - Company-owned stores		119			42			137			603
Logistical services		1,060			138			1,180			495
Consolidated	$	2,588		$	451		$	3,483		$	1,791

	As of		As of
Identifiable Assets	May 29, 2021		November 28, 2020
Wholesale	$	185,780	$	176,243
Retail - Company-owned stores		168,697		169,105
Logistical services		64,002		57,201
Consolidated	$	418,479	$	402,549

See Note 15, Revenue Recognition, for disaggregated revenue information regarding sales of furniture and accessories by product type for the wholesale and retail segments.