Reportable Segment Information - Notes to Financial Statements

3 Months Ended

May 03, 2014

Reportable Segment Information [Abstract]

Reportable Segment Information

NOTE 5 – REPORTABLE SEGMENT INFORMATION:

The Company has determined that it has four operating segments, as defined under ASC 280-10, including Cato, It's Fashion, Versona Accessories and Credit.  As outlined in ASC 280-10, the Company has two reportable segments: Retail and Credit.  The Company has aggregated its retail operating segments based on the aggregation criteria outlined in ASC 280-10, which states that two or more operating segments may be aggregated into a single reportable segment if aggregation is consistent with the objective and basic principles of ASC 280-10 if the segments have similar economic characteristics, similar product, similar production processes, similar clients and similar methods of distribution. 

The Company's retail operating segments have similar economic characteristics and similar operating, financial and competitive risks.  They are similar in nature of product, as they all offer women's apparel, shoes and accessories.  Merchandise inventory of the Company's operating segments is sourced from the same countries and some of the same vendors, using similar production processes.  Clients of the Company's operating segments have similar characteristics.  Merchandise for the Company's operating segments is distributed to retail stores in a similar manner through the Company's single distribution center and is subsequently distributed to clients in a similar manner.

The Company operates its women's fashion specialty retail stores in 32 states as of May 3, 2014, principally in the southeastern United States. The Company offers its own credit card to its customers and all credit authorizations, payment processing and collection efforts are performed by a separate subsidiary of the Company.

NOTE 5 – REPORTABLE SEGMENT INFORMATION (CONTINUED):

The following schedule summarizes certain segment information (in thousands):

Three Months Ended
May 3, 2014	Retail	Credit	Total
Revenues	$ 283,257	$ 1,475	$ 284,732
Depreciation	5,439	13	5,452
Interest and other income	(742)	-	(742)
Income before taxes	47,690	482	48,172
Total assets	516,613	66,624	583,237
Capital expenditures	4,116	0	4,116
Three Months Ended
May 4, 2013	Retail	Credit	Total
Revenues	$ 268,079	$ 1,619	$ 269,698
Depreciation	5,436	13	5,449
Interest and other income	(875)	-	(875)
Income before taxes	48,334	500	48,834
Total assets	494,752	65,455	560,207
Capital expenditures	5,605	-	5,605

The Company evaluates segment performance based on income before taxes. The Company does not allocate certain corporate expenses or income taxes to the credit segment.

The following schedule summarizes the direct expenses of the credit segment which are reflected in selling, general and administrative expenses (in thousands):

	Three Months Ended
		May 3, 2014		May 4, 2013
Bad debt expense	$	307	$	382
Payroll		206		231
Postage		191		199
Other expenses		276		294
Total expenses	$	980	$	1,106