SEGMENT INFORMATION

9 Months Ended

Sep. 25, 2011

SEGMENT INFORMATION [Abstract]

SEGMENT INFORMATION

15.      SEGMENT INFORMATION

Patrick has determined that its reportable segments are those based on the Company's method of internal reporting, which segregates its businesses by product category and production/distribution process.  Effective January 1, 2011, certain changes were made to the manner in which operating segment results are used by or provided to the chief operating decision makers of the Company, including: (1) certain costs related to wages, payroll taxes and incentive compensation that were previously reflected as unallocated corporate expenses are now being allocated to the Company's two operating segments; and (2) a majority of corporate incentive agreements (which include vendor rebate agreements) previously included in the corporate segment are now being allocated to the operating segments and reflected as a reduction of cost of goods sold.   Prior period results were reclassified to reflect the current year presentation.

A description of the Company's reportable segments is as follows:

Manufacturing - Utilizes various materials, including lauan, MDF, gypsum, and particleboard, which are bonded by adhesives or a heating process to a number of products, including vinyl, paper, foil, and high pressure laminate.  These products are utilized to produce furniture, shelving, wall, counter, and cabinet products with a wide variety of finishes and textures.  This segment also includes a cabinet door division, a vinyl printing division, and the recently acquired solid surface fabrication operation of AIA.  Patrick's major manufactured products also include wrapped profile mouldings, interior passage doors, and slotwall and slotwall components.  The Manufacturing segment contributed approximately 76% and 81% of the Company's net sales for the nine months ended September 25, 2011 and September 26, 2010, respectively.

Distribution - Distributes pre-finished wall and ceiling panels, drywall and drywall finishing products, wiring, electrical and plumbing products, electronics, cement siding, interior passage doors, shower doors, roofing products, and other miscellaneous products.  The Distribution segment contributed approximately 24% and 19% of the Company's net sales for the nine months ended September 25, 2011 and September 26, 2010, respectively.

The tables below present unaudited information about the sales and operating income of those segments.

Third Quarter Ended September 25, 2011:
(thousands)	Manufacturing		Distribution		Total
Net outside sales	$	57,786	$	19,653	$	77,439
Intersegment sales		3,219		34		3,253
Operating income		6,585		809		7,394
Third Quarter Ended September 26, 2010:
(thousands)	Manufacturing		Distribution		Total
Net outside sales	$	57,004	$	15,781	$	72,785
Intersegment sales		3,057		19		3,076
Operating income		1,953		354		2,307
Nine Months Ended September 25, 2011:
(thousands)	Manufacturing		Distribution		Total
Net outside sales	$	173,648	$	55,896	$	229,544
Intersegment sales		9,501		59		9,560
Operating income		14,317		1,604		15,921
Nine Months Ended September 26, 2010:
(thousands)	Manufacturing		Distribution		Total
Net outside sales	$	179,396	$	40,754	$	220,150
Intersegment sales		9,562		38		9,600
Operating income		7,809		1,017		8,826

The table bellows presents a reconciliation of segment operating income to consolidated operating income:

	Third Quarter Ended						Nine Months Ended
	Sept. 25,			Sept. 26,			Sept. 25,			Sept. 26,
(thousands)	2011			2010			2011			2010
Operating income for reportable segments	$	7,394		$	2,307		$	15,921		$	8,826
Corporate incentive agreements		(44	)		5			37			(30	)
Gain (loss) on sale of fixed assets and acquisition of business		11			(26	)		263			2,794
Unallocated corporate expenses		(1,922	)		(1,443	)		(5,172	)		(4,892	)
Amortization of intangible assets		(195	)		(125	)		(538	)		(377	)
Consolidated operating income	$	5,244		$	718		$	10,511		$	6,321