SEGMENTS

6 Months Ended

Jul. 31, 2023

SEGMENTS [Abstract]

SEGMENTS

NOTE 10 – 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 to retailers under owned, licensed and private label brands, as well as sales related to the Vilebrequin and Karl Lagerfeld businesses, including from retail stores operated by Vilebrequin and Karl Lagerfeld, other than sales of product under the Karl Lagerfeld Paris brand from the Company’s retail stores and digital outlets. Wholesale revenues also include revenues from license agreements related to the DKNY, Donna Karan, Karl Lagerfeld, Vilebrequin, G.H. Bass, Andrew Marc and Sonia Rykiel trademarks owned by the Company. 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 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 six month periods indicated below:

	Three Months Ended July 31, 2023
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	639,184	$	34,341	$	(13,764)	$	659,761
Cost of goods sold		379,884		16,988		(13,764)		383,108
Gross profit		259,300		17,353		—		276,653
Selling, general and administrative expenses		216,489		22,718		—		239,207
Depreciation and amortization		5,027		932		—		5,959
Operating profit (loss)	$	37,784	$	(6,297)	$	—	$	31,487

	Three Months Ended July 31, 2022
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	587,955	$	31,112	$	(13,823)	$	605,244
Cost of goods sold		375,090		15,051		(13,823)		376,318
Gross profit		212,865		16,061		—		228,926
Selling, general and administrative expenses		169,677		21,335		—		191,012
Depreciation and amortization		5,666		990		—		6,656
Operating profit (loss)	$	37,522	$	(6,264)	$	—	$	31,258

	Six Months Ended July 31, 2023
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,226,086	$	64,558	$	(24,294)	$	1,266,350
Cost of goods sold		732,354		31,837		(24,294)		739,897
Gross profit		493,732		32,721		—		526,453
Selling, general and administrative expenses		420,578		46,590		—		467,168
Depreciation and amortization		10,772		1,763		—		12,535
Operating profit (loss)	$	62,382	$	(15,632)	$	—	$	46,750

	Six Months Ended July 31, 2022
	Wholesale		Retail		Elimination (1)		Total
	(In thousands)
Net sales	$	1,268,859	$	58,997	$	(33,855)	$	1,294,001
Cost of goods sold		823,860		29,031		(33,855)		819,036
Gross profit		444,999		29,966		—		474,965
Selling, general and administrative expenses		331,495		44,925		—		376,420
Depreciation and amortization		11,080		1,671		—		12,751
Operating profit (loss)	$	102,424	$	(16,630)	$	—	$	85,794

(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				Six Months Ended
	July 31, 2023		July 31, 2022		July 31, 2023		July 31, 2022
	(In thousands)
Licensed brands	$	338,656	$	317,081	$	636,661	$	733,732
Proprietary brands		300,528		270,874		589,425		535,127
Wholesale net sales(1)	$	639,184	$	587,955	$	1,226,086	$	1,268,859
Licensed brands	$	—	$	—	$	—	$	—
Proprietary brands		34,341		31,112		64,558		58,997
Retail net sales	$	34,341	$	31,112	$	64,558	$	58,997

(1) The Company acquired the remaining interests in KLH (the Karl Lagerfeld branded product) that it did not already own as of May 31, 2022. Net sales of Karl Lagerfeld product were included in licensed brands net sales of the wholesale operations segment through May 31, 2022. Subsequent to May 31, 2022, net sales of Karl Lagerfeld product are included in proprietary brands net sales of the wholesale operations segment.