SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2022

Segment Information

Segment Information

Note 5–Segment Information

The internal reporting structure used by the Company’s chief operating decision maker (“CODM”) to assess performance and allocate resources determines the basis for the Company’s reportable operating segments. The Company’s CODM is its Chief Executive Officer, and he evaluates operations and allocates resources based on a measure of operating income.

The Company’s operations are organized under three reportable segments—the Business Solutions segment, which serves primarily small- and medium-sized businesses; the Enterprise Solutions segment, which serves primarily medium-to-large corporations; and the Public Sector Solutions segment, which serves primarily federal, state, and local governmental and educational institutions. In addition, the Headquarters/Other group provides services in areas such as finance, human resources, information technology, marketing, and product management. Most of the operating costs associated with the Headquarters/Other group functions are charged to the operating segments based on their estimated usage of the underlying functions. The Company reports these charges to the operating segments as “Allocations.” Certain headquarters costs relating to executive oversight and other fiduciary functions that are not allocated to the operating segments are included under the heading of Headquarters/Other in the tables below.

Segment information applicable to the Company’s reportable operating segments for the three and nine months ended September 30, 2022 and 2021 is shown below:

	Three Months Ended				Nine Months Ended
	September 30,		September 30,		September 30,		September 30,
	2022		2021		2022		2021
Net sales:
Business Solutions	$	315,816	$	281,425	$	964,610	$	795,017
Enterprise Solutions		305,510		309,722		989,861		882,168
Public Sector Solutions		154,366		160,221		438,074		415,236
Total net sales	$	775,692	$	751,368	$	2,392,545	$	2,092,421
Operating income (loss):
Business Solutions	$	19,278	$	12,774	$	62,230	$	29,559
Enterprise Solutions		12,401		19,151		42,103		52,203
Public Sector Solutions		4,211		619		4,156		(4,250)
Headquarters/Other		(4,151)		(5,216)		(11,845)		(12,300)
Total operating income		31,739		27,328		96,644		65,212
Other expenses, net		308		—		319		7
Income before taxes	$	32,047	$	27,328	$	96,963	$	65,219
Selected operating expense:
Depreciation and amortization:
Business Solutions	$	167	$	169	$	502	$	487
Enterprise Solutions		482		560		1,517		1,888
Public Sector Solutions		20		19		59		43
Headquarters/Other		2,351		2,199		6,922		6,747
Total depreciation and amortization	$	3,020	$	2,947	$	9,000	$	9,165
Total assets:
Business Solutions					$	451,872	$	375,557
Enterprise Solutions						647,592		603,173
Public Sector Solutions						113,820		91,227
Headquarters/Other						(79,159)		(56,031)
Total assets					$	1,134,125	$	1,013,926

The assets of the Company’s three operating segments presented above consist primarily of accounts receivable, net intercompany receivable, goodwill, and other intangibles. Assets reported under the Headquarters/Other group are managed by corporate headquarters, including cash and cash equivalents, inventories, property and equipment, ROU assets, and intercompany balance, net. As of September 30, 2022 and 2021, total assets for the Headquarters/Other group were presented net of intercompany balance eliminations of $62,154, and $39,209, respectively. The Company’s capital expenditures consist largely of IT hardware and software purchased to maintain or upgrade our management information systems. These information systems serve all of the Company’s segments, to varying degrees, and accordingly, the CODM does not evaluate capital expenditures on a segment-by-segment basis.