Segment Information

3 Months Ended

Jul. 02, 2016

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company operates its business through three operating segments—Retail, Wholesale and Licensing—which are based on its business activities and organization. The operating segments are segments of the Company for which separate financial information is available and for which operating results are evaluated regularly by the Company's chief operating decision maker in deciding how to allocate resources, as well as in assessing performance. The primary key performance indicators are net sales or revenue (in the case of Licensing) and operating income for each segment. The Company’s reportable segments represent channels of distribution that offer similar merchandise, customer experience and sales/marketing strategies. The Company’s Retail segment includes sales through the Company owned stores, including “Collection,” “Lifestyle” including “concessions,” and outlet stores located throughout the Americas (U.S., Canada and Latin America), Europe, and Asia, as well as the Company’s e-commerce sales. Products sold through the Retail segment include women’s apparel, accessories (which include handbags and small leather goods such as wallets), men's apparel, footwear and licensed products, such as watches, jewelry, fragrances and beauty, and eyewear. The Wholesale segment includes sales primarily to major department stores and specialty shops throughout the Americas, Europe and Asia. Products sold through the Wholesale segment include accessories (which include handbags and small leather goods such as wallets), footwear and women’s and men’s apparel. We also have wholesale arrangements pursuant to which we sell products to certain of our licensees, including our licensees in Asia (which were previously reported within our Americas wholesale operations). The Licensing segment includes royalties earned on licensed products and use of the Company’s trademarks, and rights granted to third parties for the right to sell the Company’s products in certain geographic regions such as the Middle East, Eastern Europe, certain parts of Asia and Australia. All intercompany revenues are eliminated in consolidation and are not reviewed when evaluating segment performance. Corporate overhead expenses are allocated to the segments based upon specific usage or other allocation methods.

The Company has allocated $26.1 million, $94.2 million and $1.9 million of its recorded $122.2 million goodwill as of July 2, 2016 to its Wholesale, Retail and Licensing segments, respectively. Please refer to Note 3 and Note 6 for goodwill recorded upon the Company's acquisition of MKHKL on May 31, 2016. As of April 2, 2016, the Company's goodwill balance of $23.2 million was allocated $13.3 million, $8.0 million and $1.9 million to the Company's Wholesale, Retail and Licensing segments, respectively. The Company does not have identifiable assets separated by segment.

The following table presents the key performance information of the Company’s reportable segments (in millions):

	Three Months Ended
	July 2, 2016		June 27, 2015
Revenue:
Net sales: Retail	$	562.9	$	523.3
Wholesale	394.4		424.0
Licensing	30.6		38.7
Total revenue	$	987.9	$	986.0
Income from operations:
Retail	$	66.6	$	120.9
Wholesale	105.0		106.3
Licensing	15.3		21.4
Income from operations	$	186.9	$	248.6

Depreciation and amortization expense for each segment are as follows (in millions):

	Three Months Ended
	July 2, 2016		June 27, 2015
Depreciation and amortization:
Retail	$	34.0	$	25.1
Wholesale	15.9		16.1
Licensing	0.5		0.4
Total depreciation and amortization	$	50.4	$	41.6

Total revenue (as recognized based on country of origin), and long-lived assets by geographic location of the consolidated Company are as follows (in millions):

	Three Months Ended
	July 2, 2016		June 27, 2015
Revenue:
The Americas (U.S., Canada and L. America)(1)	$	690.8	$	727.3
Europe	224.0		216.8
Asia	73.1		41.9
Total revenue	$	987.9	$	986.0

	As of
	July 2, 2016		April 2, 2016
Long-lived assets:
The Americas (U.S., Canada and Latin America)(1)	$	498.0	$	507.7
Europe	284.1		284.2
Asia	480.9		33.7
Total Long-lived assets	$	1,263.0	$	825.6

⁽¹⁾  Net revenues earned in the U.S. were $641.4 million and $684.8 million during the three months ended July 2, 2016 and June 27, 2015. Long-lived assets located in the U.S. as of July 2, 2016 and April 2, 2016 were $462.8 million and $472.2 million, respectively.