Note 8—Segment Reporting

Our product lines include CSDs, 100% shelf stable juice and juice-based products, clear, still and sparkling flavored waters, purified, spring, artesian, distilled and fluoridated bottled water, energy drinks and shots, sports products, new age beverages, ready-to-drink teas and alcoholic beverages, beverage concentrates, liquid enhancers and freezeables, as well as hot chocolate, coffee, malt drinks, creamers/whiteners and cereals. In addition, Cott is now a national direct-to-consumer provider of bottled water, office coffee and water filtration services offering a comprehensive portfolio of beverage products, equipment and supplies to approximately 1.5 million customer locations through its network of over 180 warehouse, branch and distribution facilities and daily operation of over 2,200 routes. During the six months ended June 28, 2014, our business operated through three reporting segments—North America, U.K., and All Other (which includes our Mexico operating segment, our Royal Crown International (“RCI”) operating segment and other miscellaneous expenses). Our corporate oversight function (“Corporate”) is not treated as a segment; it includes certain general and administrative costs that are not allocated to any of the reporting segments. In December 2014, we added a fourth reporting segment, DSS, in connection with the DSS Acquisition.

(in millions of U.S. dollars)

North
America

DSS

U.K.

All
Other

Corporate

Elimination

Total

For the Three Months Ended July 4, 2015

Revenue, net

359.0

257.0

153.8

16.4

—

(6.4

)

779.8

Depreciation and amortization

20.6

31.8

5.4

0.4

—

58.2

Operating income (loss)

18.3

13.2

14.6

3.7

(3.7

)

—

46.1

Additions to property, plant and equipment

4.5

20.4

4.5

0.5

—

29.9

For the Six Months Ended July 4, 2015

Revenue, net

687.7

497.3

286.0

29.4

—

(10.8

)

1,489.6

Depreciation and amortization

41.9

62.0

10.9

0.8

—

115.6

Operating income (loss)

25.5

11.7

18.5

5.3

(8.2

)

—

52.8

Additions to property, plant and equipment

11.7

38.8

6.2

0.5

—

57.2

As of July 4, 2015

Property, plant and equipment

303.0

401.4

109.1

6.7

—

820.2

Goodwill

122.1

563.0

59.3

4.5

—

748.9

Intangibles and other assets

253.1

400.8

95.9

0.1

—

749.9

Total assets

1,037.2

1,554.2

450.9

31.2

—

3,073.5

^1.	Intersegment revenue between North America and the other reporting segments was $6.4 million and $10.8 million for the three and six months ended July 4, 2015, respectively.

^2.	Excludes intersegment receivables, investments and notes receivable.


(in millions of U.S. dollars)		North America		DSS		U.K.		All Other		Corporate			Elimination			Total

For the Three Months Ended June 28, 2014
Revenue, net	¹	$	379.3	$	—	$	157.7	$	18.3	$	—			(6.1	)	$	549.2
Depreciation and amortization			20.4		—		4.9		0.5		—			—			25.8
Operating income (loss)			15.3		—		10.7		3.1		(2.9	)		—			26.2
Additions to property, plant and equipment			7.2		—		4.6		—		—			—			11.8

For the Six Months Ended June 28, 2014
Revenue, net	¹	$	730.1	$	—	$	273.3	$	33.1	$	—			(12.2	)	$	1,024.3
Depreciation and amortization			41.1		—		8.9		0.9		—			—			50.9
Operating income (loss)			17.8		—		12.9		5.6		(5.8	)		—			30.5
Additions to property, plant and equipment			13.0		—		7.6		—		—			—			20.6

As of January 3, 2015
Property, plant and equipment			331.9		415.4		109.9		7.3		—			—			864.5
Goodwill			123.7		556.9		58.5		4.5		—			—			743.6
Intangibles and other assets			266.8		415.5		99.2		0.2		—			—			781.7
Total assets	²		1,077.7		1,572.8		426.8		30.4		—			—			3,107.7

^1.	Intersegment revenue between North America and the other reporting segments was $6.1 million and $12.2 million for the three and six months ended June 28, 2014, respectively.

^2.	Excludes intersegment receivables, investments and notes receivable.

For the six months ended July 4, 2015, sales to Walmart accounted for 18.3% (June 28, 2014—27.0%) of our total revenue, 32.7% of our North America reporting segment revenue (June 28, 2014—32.8%), 12.0% of our U.K. reporting segment revenue (June 28, 2014—13.4%), 3.4% of our All Other reporting segment revenue (June 28, 2014—2.2%), and 2.2% of our DSS reporting segment revenue.

Credit risk arises from the potential default of a customer in meeting its financial obligations to us. Concentrations of credit exposure may arise with a group of customers that have similar economic characteristics or that are located in the same geographic region. The ability of such customers to meet obligations would be similarly affected by changing economic, political or other conditions. We are not currently aware of any facts that would create a material credit risk.

Revenues for our DSS reporting segment from sales to external customers were generated exclusively in the United States. In our other reporting segments, revenues attributed to external customers located outside of Canada are displayed separately within the U.K. and All Other reporting segments above, with the exception of revenues attributed to external customers located in the United States, which are reported within the North America reporting segment. Revenues generated from sales to external customers in the United States for the North America reporting segment were as follows:


	For the Three Months Ended				For the Six Months Ended
(in millions of U.S. dollars)	July 4, 2015		June 28, 2014		July 4, 2015		June 28, 2014
United States	$	311.1	$	327.9	$	608.3	$	638.7

Total	$	311.1	$	327.9	$	608.3	$	638.7

Revenues are attributed to reporting segments based on the location of the customer. Revenues by channel by reporting segment were as follows:

For the Three Months Ended July 4, 2015

(in millions of U.S. dollars)

North
America

DSS

U.K.

All
Other

Elimination

Total

Revenue

Private label retail

289.7

17.2

71.8

1.7

(0.7

)

379.7

Branded retail

30.8

20.6

48.5

1.3

(0.5

)

100.7

Contract packaging

31.3

—

30.9

6.8

(1.6

)

67.4

Home and office bottled water delivery

—

164.8

—

164.8

Office coffee services

—

29.7

—

29.7

Other

7.2

24.7

2.6

6.6

(3.6

)

37.5

Total

359.0

257.0

153.8

16.4

(6.4

)

779.8

For the Six Months Ended July 4, 2015

(in millions of U.S. dollars)

North
America

DSS

U.K.

All
Other

Elimination

Total

Revenue

Private label retail

557.4

32.7

132.7

2.8

(1.2

)

724.4

Branded retail

57.9

40.3

89.3

2.4

(0.9

)

189.0

Contract packaging

56.9

—

59.3

10.7

(1.6

)

125.3

Home and office bottled water delivery

—

314.4

—

314.4

Office coffee services

—

61.7

—

61.7

Other

15.5

48.2

4.7

13.5

(7.1

)

74.8

Total

687.7

497.3

286.0

29.4

(10.8

)

1,489.6


For the Three Months Ended June 28, 2014
(in millions of U.S. dollars)	North America		U.K.		All Other		Elimination			Total
Revenue
Private label retail	$	313.9	$	79.0	$	1.8	$	(0.3	)	$	394.4
Branded retail		27.9		48.3		1.1		(0.5	)		76.8
Contract packaging		28.4		29.3		7.7		(1.9	)		63.5
Home and office bottled water delivery		—		—		—		—			—
Office coffee services		—		—		—		—			—
Other		9.1		1.1		7.7		(3.4	)		14.5

Total	$	379.3	$	157.7	$	18.3	$	(6.1	)	$	549.2


For the Six Months Ended June 28, 2014
(in millions of U.S. dollars)	North America		U.K.		All Other		Elimination			Total
Revenue
Private label retail	$	613.6	$	142.5	$	2.7	$	(0.4	)	$	758.4
Branded retail		53.0		79.7		2.3		(0.9	)		134.1
Contract packaging		48.3		49.4		14.5		(4.8	)		107.4
Home and office bottled water delivery		—		—		—		—			—
Office coffee services		—		—		—		—			—
Other		15.2		1.7		13.6		(6.1	)		24.4

Total	$	730.1	$	273.3	$	33.1	$	(12.2	)	$	1,024.3

Property, plant and equipment, net by geographic area as of July 4, 2015 and January 3, 2015 were as follows:


(in millions of U.S. dollars)	July 4, 2015		January 3, 2015
North America	$	704.4	$	747.3
U.K.		109.1		109.9
All Other		6.7		7.3

Total	$	820.2	$	864.5