Segment Information

12 Months Ended

Dec. 31, 2011

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

The Company has three reportable segments—Stores, Port Supply (wholesale) and Direct-to-Customer (which we formerly referred to as Direct Sales)—all of which sell merchandise directly to customers. The Stores segment sells products through the Company's store locations. The Port Supply segment sells products directly to wholesale customers through our wholesale website and our call center. The Direct-to-Customer segment sells products through our retail eCommerce website, direct mail catalogs and our call center. The customer base overlaps between the Company’s Stores and Port Supply segments, and between its Stores and Direct-to-Customer segments. All processes for the three segments within the supply chain are commingled, including purchases from vendors, distribution center activity and customer delivery. Revenues from external customers are derived from merchandise sales, and the Company does not rely on any major customers as a source of revenue.

The Company considers its individual stores to be operating segments. Each store's operating performance has been aggregated into one reportable segment. The Company's individual store operating segments are aggregated for financial reporting purposes because they are similar in each of the following areas: economic characteristics; class of consumer; nature of products; and distribution methods. The Company recorded non-cash asset impairment charges of less than $0.1 million in fiscal 2011, $0.2 million in 2010 and less than $0.1 million in 2009 primarily related to the Stores segment. The Company believes that disaggregating its operating segments would not provide meaningful additional information.

In addition to the Company’s 10 stores located in Canada and three franchised stores located in Turkey, revenues are attributed to geographic locations based on the location to which the Company ships its products. Through the Direct-to-Customer segment, the Company promotes and sells products internationally through both its website and call center. The Company operates primarily in the United States with foreign revenues representing less than 5% of total net revenues during fiscal years 2011, 2010 and 2009, and foreign long-lived assets totaled less than 2% of long-lived assets at each of these dates.

Segment assets are those directly allocated to an operating segment’s operations. For the Stores segment, assets primarily consist of leasehold improvements, computer assets, fixtures, land and buildings. For the Port Supply and Direct-to-Customer segments, assets primarily consist of information technology assets. Unallocated assets include merchandise inventory, shared technology infrastructure, distribution centers, corporate headquarters, prepaid expenses, deferred taxes and other assets. Capital expenditures and depreciation expense for each segment are allocated to the assets assigned to the segment. Contribution is defined as net revenues less product costs and direct expenses.

Following is financial information related to the Company’s business segments (in thousands):

	2011			2010			2009
Net revenues:
Stores	$	578,863		$	560,482		$	525,392
Port Supply	27,450			28,309			28,936
Direct-to-Customer	37,130			34,011			34,088
Consolidated net revenues	$	643,443		$	622,802		$	588,416
Contribution:
Stores	$	81,827		$	77,591		$	64,239
Port Supply	(3,020		)	(2,809		)	(1,736		)
Direct-to-Customer	6,266			5,942			6,829
Consolidated contribution	$	85,073		$	80,724		$	69,332
Reconciliation of consolidated contribution to net income:
Consolidated contribution	$	85,073		$	80,724		$	69,332
Less:
Indirect costs of goods sold not included in consolidated contribution	(28,148		)	(30,413		)	(26,688		)
General and administrative expense	(34,786		)	(35,427		)	(32,299		)
Interest expense	(918		)	(637		)	(806		)
Benefit (provision) for income taxes	8,441			(1,020		)	2,837
Net income	$	29,662		$	13,227		$	12,376

	2011		2010		2009
Assets:
Stores	$	40,266	$	34,722	$	37,659
Port Supply	4,980		4,771		4,414
Direct-to-Customer	44		112		412
Unallocated	290,367		269,281		249,752
Total assets	$	335,657	$	308,886	$	292,237
Capital expenditures:
Stores	$	13,937	$	10,246	$	9,354
Port Supply	—		—		26
Direct-to-Customer	55		—		—
Unallocated	3,718		3,893		4,375
Total capital expenditures	$	17,710	$	14,139	$	13,755
Depreciation and amortization:
Stores	$	9,395	$	9,506	$	10,385
Port Supply	32		96		190
Direct-to-Customer	109		229		324
Unallocated	4,778		5,095		6,131
Total depreciation and amortization	$	14,314	$	14,926	$	17,030