Business Segment Information

12 Months Ended

Jan. 30, 2016

Segment Reporting [Abstract]

Business Segment Information

7.    BUSINESS SEGMENT INFORMATION

The Company's reportable segments are Famous Footwear and Brand Portfolio.

The Famous Footwear segment is comprised of Famous Footwear and Famous.com. In addition, Shoes.com was included through December 12, 2014 (the date of sale). Famous Footwear operated 1,046 stores at the end of 2015, primarily selling branded footwear for the entire family.

The Brand Portfolio segment is comprised of our branded footwear, our branded retail stores and e-commerce sites associated with those brands. This segment sources and markets licensed, branded and private-label footwear primarily to national chains, department stores, online retailers, mass merchandisers, independent retailers and catalogs as well as Company-owned Famous Footwear, Naturalizer and Sam Edelman stores, and e-commerce businesses. The Brand Portfolio segment included 80 branded retail stores in the United States and 85 branded retail stores in Canada at the end of 2015, selling primarily Naturalizer brand footwear.

The Company’s Famous Footwear and Brand Portfolio reportable segments are operating units that are managed separately. An operating segment’s performance is evaluated and resources are allocated based primarily on operating earnings (loss). Operating earnings (loss) represent gross profit, less selling and administrative expenses, restructuring and other special charges, net and impairment of assets held for sale. The accounting policies of the reportable segments are the same as those described in Note 1 to the consolidated financial statements. Intersegment sales are generally recorded at a profit to the selling segment. All intersegment earnings related to inventory on hand at the purchasing segment are eliminated against the earnings of the selling segment.

Corporate assets, administrative expenses, and other costs and recoveries that are not allocated to the operating units are reported in the Other category.

Following is a summary of certain key financial measures for the respective periods. External sales, intersegment sales and operating earnings (loss) exclude discontinued operations. Segment assets, depreciation and amortization, amortization of debt issuance costs and debt discount, purchases of property and equipment and capitalized software include both continuing operations and discontinued operations.

($ thousands)	Famous Footwear		Brand Portfolio		Other			Total
Fiscal 2015
External sales	$	1,572,665	$	1,004,765	$	—		$	2,577,430
Intersegment sales	—		100,186		—			100,186
Depreciation and amortization	25,842		9,339		16,258			51,439
Amortization of debt issuance costs and debt discount	—		—		1,167			1,167
Operating earnings (loss)	109,030		66,578		(40,501		)	135,107
Segment assets	542,842		534,137		226,344			1,303,323
Purchases of property and equipment	48,761		18,340		6,378			73,479
Capitalized software	2,538		—		5,197			7,735
Fiscal 2014
External sales	$	1,589,258	$	982,451	$	—		$	2,571,709
Intersegment sales	—		114,408		—			114,408
Depreciation and amortization	26,581		8,974		16,060			51,615
Amortization of debt issuance costs and debt discount	—		—		2,400			2,400
Operating earnings (loss)	104,581		73,403		(52,050		)	125,934
Segment assets	458,847		518,099		237,381			1,214,327
Purchases of property and equipment	33,001		6,105		5,846			44,952
Capitalized software	198		58		4,830			5,086
Fiscal 2013
External sales	$	1,588,552	$	924,561	$	—		$	2,513,113
Intersegment sales	—		132,596		—			132,596
Depreciation and amortization	25,917		13,440		15,972			55,329
Amortization of debt issuance costs and debt discount	—		—		2,513			2,513
Operating earnings (loss)	105,382		39,909		(46,674		)	98,617
Segment assets	448,549		514,902		182,889			1,146,340
Purchases of property and equipment	32,728		6,026		5,214			43,968
Capitalized software	193		122		4,920			5,235

Following is a reconciliation of operating earnings to earnings before income taxes from continuing operations:

($ thousands)	2015			2014			2013
Operating earnings	$	135,107		$	125,934		$	98,617
Interest expense	(16,589		)	(20,445		)	(21,254		)
Loss on early extinguishment of debt	(10,651		)	(420		)	—
Interest income	899			379			377
Gain on sale of subsidiary	—			4,679			—
Earnings before income taxes from continuing operations	$	108,766		$	110,127		$	77,740

For geographic purposes, the domestic operations include the wholesale distribution of licensed, branded and private-label footwear to a variety of retail customers, including the Company’s Famous Footwear and Brand Portfolio stores and e-commerce businesses, as well as the Company's domestic retail operations.

The Company’s foreign operations primarily consist of wholesale and retail operations in the Far East and Canada. The Far East operations include first-cost transactions, where footwear is sold at foreign ports to customers who then import the footwear into the United States and other countries.

A summary of the Company’s net sales and long-lived assets by geographic area were as follows:

($ thousands)	2015		2014		2013
Net Sales
United States	$	2,342,590	$	2,318,530	$	2,258,605
Far East	177,654		194,296		193,725
Canada	57,186		58,883		60,783
Total net sales	$	2,577,430	$	2,571,709	$	2,513,113
Long-Lived Assets
United States	$	417,198	$	412,822	$	344,413
Canada	8,596		8,773		7,159
Far East	2,193		2,336		2,454
Latin America, Europe and other	271		248		236
Total long-lived assets	$	428,258	$	424,179	$	354,262

Long-lived assets consisted primarily of property and equipment, intangible assets, prepaid pension costs, goodwill and other noncurrent assets.