SEGMENTS AND GEOGRAPHIC INFORMATION

3 Months Ended

Apr. 30, 2016

SEGMENTS AND GEOGRAPHIC INFORMATION

SEGMENTS AND GEOGRAPHIC INFORMATION

6. SEGMENTS AND GEOGRAPHIC INFORMATION

We consider Michaels-U.S., Michaels-Canada, Aaron Brothers, Pat Catan’s and Darice to be our operating segments for purposes of determining reportable segments based on the criteria of ASC 280, Segment Reporting (“ASC 280”). We determined that Michaels-U.S., Michaels-Canada, Aaron Brothers and Pat Catan’s have similar economic characteristics and meet the aggregation criteria set forth in ASC 280. Therefore, we combine these operating segments into one reporting segment. Darice does not meet the materiality criteria in ASC 280 and, therefore, is not disclosed as a reportable segment.

Our net sales by country are as follows (in thousands):

	13 Weeks Ended
	April 30,		May 2,
	2016		2015
United States	$	1,063,837	$	983,260
Canada		95,043		94,340
Total	$	1,158,880	$	1,077,600

Our chief operating decision makers evaluate historical operating performance and forecast future periods’ operating performance based on operating income and earnings before interest, income taxes, depreciation and amortization (“EBITDA”). We believe these metrics more closely reflect the operating effectiveness of factors over which management has control. A reconciliation of EBITDA to net income is presented below (in thousands):

	13 Weeks Ended
	April 30,		May 2,
	2016		2015
Net income	$	70,765	$	66,738
Interest expense		32,219		37,816
Provision for income taxes		41,895		39,233
Depreciation and amortization		29,470		27,945
Interest income		(280)		(123)
EBITDA	$	174,069	$	171,609