Note 15 - Segment Information

6 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

(15) Segment Information

Our operating segments are aligned with how the Company, including our chief operating decision maker, manages the business. As such, our reportable operating segments are the wholesale segment and the retail segment. Our wholesale and retail operating segments represent strategic business areas of our vertically integrated enterprise that operate separately and provide their own distinctive services. This vertical structure enables us to offer our complete line of home furnishings and accents more effectively while controlling quality and cost. We evaluate performance of the respective segments based upon revenues and operating income. Inter-segment transactions result, primarily, from the wholesale sale of inventory to the retail segment, including the related profit margin.

As of December 31, 2020, the Company operated 144 design centers (our retail segment) and our independent retailers operated 158 design centers. Our wholesale segment net sales include sales to our retail segment, which are eliminated in consolidation, and sales to our independent retailers and other third parties. Our retail segment net sales accounted for 79.7% of our consolidated net sales for the six months ended December 31, 2020 compared to 79.3% a year ago. Our wholesale segment net sales accounted for the remaining 20.3% during fiscal 2021.

Segment information is provided below (in thousands):

	Three months ended						Six months ended
	December 31,						December 31,
	2020			2019			2020			2019
Net sales
Wholesale segment	$	101,550		$	91,889		$	198,884		$	193,218
Retail segment		144,818			139,101			262,899			276,367
Elimination of intercompany sales		(67,542	)		(56,416	)		(131,899	)		(121,090	)
Consolidated total	$	178,826		$	174,574		$	329,884		$	348,495
Income before income taxes
Wholesale segment	$	12,720		$	5,730		$	25,858		$	22,658
Retail segment		9,909			(135	)		11,892			1,429
Elimination of intercompany profit (a)		(74	)		3,609			(3,514	)		3,758
Operating income		22,555			9,204			34,236			27,845
Other income (expense), including interest, net		(377	)		63			(817	)		82
Consolidated total	$	22,178		$	9,267		$	33,419		$	27,927
Depreciation and amortization
Wholesale segment	$	1,643		$	1,750		$	3,347		$	3,640
Retail segment		2,362			2,704			4,798			4,790
Consolidated total	$	4,005		$	4,454		$	8,145		$	8,430
Capital expenditures
Wholesale segment	$	2,082		$	1,148		$	3,124		$	2,311
Retail segment		1,357			3,425			2,754			5,676
Consolidated total	$	3,439		$	4,573		$	5,878		$	7,987

(a) Represents the change in wholesale profit contained in the retail segment inventory at the end of the period.

(in thousands)	December 31,			June 30,
Total Assets	2020			2020
Wholesale segment	$	263,365		$	255,011
Retail segment		399,647			390,635
Inventory profit elimination (a)		(26,793	)		(22,857	)
Consolidated total	$	636,219		$	622,789

(a) Represents the wholesale profit contained in the retail segment inventory that has not yet been realized. These profits are realized when the related inventory is sold.