Note 7 – Segment Information

Industry Segments

The Company has two identifiable business segments. The Wholesale segment designs, manufactures, sources and distributes decorated party goods, including paper and plastic tableware, metallic and latex balloons, Halloween and other costumes, accessories, novelties, gifts and stationery throughout the world. The Retail segment operates specialty retail party supply stores in the United States and Canada, principally under the names Party City, Halloween City and Toy City, and it operates e-commerce websites, principally through the domain name Partycity.com. The Retail segment also franchises both individual stores and franchise areas throughout the United States, Mexico and Puerto Rico, principally under the name Party City. The Company’s industry segment data for the three months ended June 30, 2018 and June 30, 2017 was as follows:


	Wholesale			Retail		Consolidated
Three Months Ended June 30, 2018
Revenues:
Net sales	$	285,733		$	411,353	$	697,086
Royalties and franchise fees		—			2,910		2,910

Total revenues		285,733			414,263		699,996
Eliminations		(138,985	)		—		(138,985	)

Net revenues	$	146,748		$	414,263	$	561,011

Income from operations	$	11,148		$	54,303	$	65,451

Interest expense, net							25,501
Other expense, net							2,532

Income before income taxes						$	37,418


	Wholesale			Retail		Consolidated
Three Months Ended June 30, 2017
Revenues:
Net sales	$	276,705		$	399,801	$	676,506
Royalties and franchise fees		0			3,225		3,225

Total revenues		276,705			403,026		679,731
Eliminations		(134,853	)		0		(134,853	)

Net revenues	$	141,852		$	403,026	$	544,878

Income from operations	$	16,034		$	44,665	$	60,699

Interest expense, net							21,294
Other income, net							(895	)

Income before income taxes						$	40,300

The Company’s industry segment data for the six months ended June 30, 2018 and June 30, 2017 was as follows:


	Wholesale			Retail		Consolidated
Six Months Ended June 30, 2018
Revenues:
Net sales	$	563,560		$	774,929	$	1,338,489
Royalties and franchise fees		—			5,626		5,626

Total revenues		563,560			780,555		1,344,115
Eliminations		(275,280	)		—		(275,280	)

Net revenues	$	288,280		$	780,555	$	1,068,835

Income from operations	$	16,496		$	71,211	$	87,707

Interest expense, net							48,776
Other expense, net							3,380

Income before income taxes						$	35,551


	Wholesale			Retail		Consolidated
Six Months Ended June 30, 2017
Revenues:
Net sales	$	547,397		$	739,070	$	1,286,467
Royalties and franchise fees		0			6,261		6,261

Total revenues		547,397			745,331		1,292,728
Eliminations		(270,851	)		0		(270,851	)

Net revenues	$	276,546		$	745,331	$	1,021,877

Income from operations	$	26,450		$	48,920	$	75,370

Interest expense, net							41,986
Other expense, net							267

Income before income taxes						$	33,117