SEGMENTS

9 Months Ended

Oct. 31, 2022

Segments [Abstract]

SEGMENTS

Note 11 – Segments

The Company’s reportable segments are business units that offer products through different channels of distribution. The Company has two reportable segments: wholesale operations and retail operations. The wholesale operations segment includes sales of products under the Company’s owned, licensed and private label brands, as well as sales related to the Vilebrequin and Karl Lagerfeld businesses, other than sales of the Karl Lagerfeld Paris brand from retail stores and digital outlets. Wholesale revenues also include revenues from license agreements related to our owned trademarks including DKNY, Donna Karan, Vilebrequin, Karl Lagerfeld, G.H. Bass, Andrew Marc and Sonia Rykiel. The retail operations segment consists primarily of direct sales to consumers through Company-operated stores, which consists primarily of DKNY and Karl Lagerfeld Paris stores, as well as the digital channels for DKNY, Donna Karan, Karl Lagerfeld Paris, G.H. Bass, Andrew Marc and Wilsons Leather. Substantially all DKNY and Karl Lagerfeld Paris stores are operated as outlet stores.

The following segment information is presented for the three and nine month periods indicated below:

	Three Months Ended October 31, 2022
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,069,574	$	28,762	$	(20,037)	$	1,078,299
Cost of goods sold		740,734		12,975		(20,037)		733,672
Gross profit		328,840		15,787		—		344,627
Selling, general and administrative expenses		216,916		22,977		—		239,893
Depreciation and amortization		6,224		1,046		—		7,270
Asset impairment		250		—		—		250
Operating profit (loss)	$	105,450	$	(8,236)	$	—	$	97,214

	Three Months Ended October 31, 2021
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,013,440	$	26,164	$	(24,212)	$	1,015,392
Cost of goods sold		678,959		13,135		(24,212)		667,882
Gross profit		334,481		13,029		—		347,510
Selling, general and administrative expenses		162,357		20,003		—		182,360
Depreciation and amortization		6,089		935		—		7,024
Operating profit (loss)	$	166,035	$	(7,909)	$	—	$	158,126

	Nine Months Ended October 31, 2022
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	2,338,435	$	87,758	$	(53,893)	$	2,372,300
Cost of goods sold		1,564,595		42,006		(53,893)		1,552,708
Gross profit		773,840		45,752		—		819,592
Selling, general and administrative expenses		548,411		67,940		—		616,351
Depreciation and amortization		17,304		2,717		—		20,021
Asset impairment, net of gain on lease terminations		250		(38)		—		212
Operating profit (loss)	$	207,875	$	(24,867)	$	—	$	183,008

	Nine Months Ended October 31, 2021
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,991,967	$	72,869	$	(46,453)	$	2,018,383
Cost of goods sold		1,293,086		35,893		(46,453)		1,282,526
Gross profit		698,881		36,976		—		735,857
Selling, general and administrative expenses		416,982		53,821		—		470,803
Depreciation and amortization		18,388		2,778		—		21,166
Operating profit (loss)	$	263,511	$	(19,623)	$	—	$	243,888

(1)Represents intersegment sales to the Company’s retail operations segment.

The total net sales by licensed and proprietary product sales for each of the Company’s reportable segments are as follows:

	Three Months Ended				Nine Months Ended
	October 31, 2022		October 31, 2021		October 31, 2022		October 31, 2021
	(In thousands)
Licensed brands	$	669,408	$	661,148	$	1,403,142	$	1,265,544
Proprietary brands		400,166		352,292		935,293		726,423
Wholesale net sales	$	1,069,574	$	1,013,440	$	2,338,435	$	1,991,967
Licensed brands	$	—	$	—	$	—	$	45
Proprietary brands		28,762		26,164		87,758		72,824
Retail net sales	$	28,762	$	26,164	$	87,758	$	72,869

The total assets for each of the Company’s reportable segments, as well as assets not allocated to a segment, are as follows:

	October 31, 2022		October 31, 2021		January 31, 2022
	(In thousands)
Wholesale	$	2,257,232	$	1,461,600	$	2,073,834
Retail		121,632		111,875		111,517
Corporate		911,357		1,154,542		557,177
Total assets	$	3,290,221	$	2,728,017	$	2,742,528