Industry Segments

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements

Industry Segments

13. Industry Segments

The Company has three segments for financial reporting purposes: the tape division, jewelry and a Canadian division. The tape division segment manufactures paper, film, HVAC, electrical, shoe and other tape products for use in industrial and automotive markets in two production facilities in the United States, and in finishing and sales facilities in Belgium and Singapore. The jewelry segment consists of the Company's subsidiary K&M Associates L.P., a national costume jewelry supplier to mass merchandisers and department stores. The Company's Canadian division, its wholly-owned subsidiary American Biltrite (Canada) Ltd., produces flooring, rubber and other industrial products. The Company’s continuing operations is comprised of the three reportable segments.

Prior to July 1, 2010, the Company had a flooring segment, which consisted of Congoleum, a manufacturer of resilient floor coverings. On July 1, 2010, Congoleum’s plan of reorganization became effective and, consequently, ABI’s ownership interest in Congoleum was cancelled by operation of that plan (see Notes 1 and 14). In the accompanying consolidated financial statements, the historical results of Congoleum have been reported as a discontinued operation.

Net sales and segment profit provided below relate to the segments of the continuing operations. Intersegment net sales reported below were sales made by the tape and Canadian divisions to Congoleum for the six months ended June 30, 2010. Subsequent to June 30, 2010, the Tape and Canadian divisions continued to sell products to reorganized Congoleum. Net sales to reorganized Congoleum recorded by the Tape Division and AB Canada subsequent to June 30, 2010, through December 31, 2010, totaled $637 thousand and $1.2 million, respectively. During 2011, the Tape Division and AB Canada recorded net sales to reorganized Congoleum of $207 thousand and $2.3 million, respectively.

Reportable segments are business units that offer different products and are each managed separately.

Costs specific to a segment, such as pension expense, are charged to the segment. Certain Corporate office expenses are allocated to certain segments based on resources allocated. Significant assets of the Corporate office include cash, insurance assets related to accrued liabilities, and deferred tax assets. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.

Intersegment sales and transfers are recorded at cost plus an agreed upon intercompany profit on intersegment sales or transfers.

	Years ended December 31
	2011		2010
	(In thousands)
Revenues:
Tape products	$	101,158	$	98,740
Jewelry		45,749		49,223
Canadian division		61,826		56,433
		208,733		204,396
Sales to Congoleum through June 30, 2010
Tape products		–		(1,248	)
Canadian division		–		(1,520	)
		–		(2,768	)
Total consolidated net revenues	$	208,733	$	201,628

Approximately 52% and 51% of the Canadian division’s revenues from external customers were for flooring products for 2011 and 2010, respectively. The remaining revenues from the Canadian division’s external customers were from sale of rubber and other industrial products.

	Years ended December 31
	2011		2010
	(In thousands)
Interest expense
Tape products	$	55	$	78
Jewelry		333		370
Canadian division		111		92
Total segment interest expense		499		540
Corporate		336		382
Total consolidated interest expense	$	835	$	922

Depreciation and amortization expense
Tape products	$	1,990		$	2,044
Jewelry		365			353
Canadian division		1,384			1,494
Total segment depreciation and amortization		3,739			3,891
Corporate		604			603
Total consolidated depreciation and amortization	$	4,343		$	4,494
Segment (loss) profit
Tape products	$	(3,814	)	$	(660	)
Jewelry		341			3,538
Canadian division		2,080			1,591
Total segment (loss) profit		(1,393	)		4,469
Reconciling items
Corporate expenses		(74	)		(240	)
Intercompany loss		-–			(71	)
Total consolidated (loss) profit from continuing operations  before income taxes and other items	$	(1,467	)	$	4,158

Segment profit or loss is before income tax expense or benefit.

	December 31
	2011			2010
	(In thousands)
Segment assets
Tape products	$	42,011		$	43,894
Jewelry		17,954			17,914
Canadian division		33,406			34,290
Total segment assets		93,371			96,098
Reconciling items
Corporate assets		28,978			30,652
Intersegment accounts receivable		(1,949	)		(3,520	)
Intersegment profit in inventory		–			–
Intersegment other asset		–			–
Total consolidated assets	$	120,400		$	123,230

	Years Ended December 31
	2011		2010
	(In thousands)
Additions to long-lived assets
Tape products	$	1,044	$	714
Jewelry		479		246
Canadian division		1,046		1,041
Total additions to long-lived assets	$	2,569	$	2,001

	December 31
	2011		2010
	(In thousands)
Long-lived assets by area
United States	$	39,914	$	41,196
Canada		12,617		12,681
Europe		525		593
Asia		1,891		1,867
Total long-lived assets	$	54,947	$	56,337
		Years Ended December 31
		2011		2010
		(In thousands)
Revenues from external customers
United States	$	122,380	$	123,056
Canada		32,226		29,600
Mexico		4,915		3,610
Europe		21,662		19,823
Asia		25,189		22,990
Other		2,361		2,549
Total revenues from external customers	$	208,733	$	201,628

Revenues are attributed to regions based on the location of customers.