Business Segments

3 Months Ended

Jul. 01, 2012

Business Segments [Abstract]

Business Segments

Note 7. Business Segments

Since the beginning of the second quarter of fiscal 2012, the Company has evaluated its business in two segments - commercial and retail.  The commercial segment includes: (1) public carriers, contractors and program managers that are generally responsible for building and maintaining the infrastructure system and provide airtime service to individual subscribers; (2) private system operators and governments including commercial entities such as major utilities and transportation companies, federal agencies and state and local governments that run wireless networks for their own use; and (3) commercial dealers and resellers that sell, install and/or service cellular telephone, wireless networking, broadband and two-way radio communications equipment primarily for the enterprise market.  The retail segment includes: (1) retailers, dealer agents and Tier 2 and 3 carriers; and (2) Tier 1 carriers (including the Company's largest customer, AT&T Mobility, Inc.).

The Company evaluates revenue, gross profit and net profit contribution for each of its segments.  Net profit contribution is defined as gross profit less any expenses that can be directly attributed or allocated to each segment.  This includes sales, product management, purchasing, credit and collections and distribution team expenses, plus freight out and internal and external marketing costs.  Corporate support expenses, which are not allocated to each segment, includes administrative costs - finance, human resources, information technology, operating facility occupancy expenses, depreciation, amortization and interest, plus the company-wide pay on performance bonus expense.

The Company does not segregate assets by segments, for internal reporting, for evaluating performance or for allocating capital. The Company has, however, allocated all goodwill and indefinite-lived intangible assets to the applicable segments (and reporting units within segments, where applicable) for purposes of its annual impairment tests. The Company's goodwill at July 1, 2012 relates to acquisitions within its commercial segment.  Certain cost of sales and other applicable expenses have been allocated to each segment based on a percentage of revenues and/or gross profit, where appropriate.

The segment information for the periods ended June 26, 2011 below has been restated to reflect the current year segment presentation.

Segment activity for the first quarter fiscal years 2013 and 2012 is as follows (in thousands):

	Three months ended July 1, 2012
	Commercial Segment		Retail Segment		Total
Revenues
Public carrier, contractor & program manager market	$	20,018	$	--	$	20,018
Private system operator & government market		29,600		--		29,600
Commercial dealer & reseller market		31,608		--		31,608
Retailer, dealer agent & Tier 2/3 carrier market		--		31,641		31,641
Revenues, excluding Tier 1 carrier market		81,226		31,641		112,867
Tier 1 carrier market		--		79,551		79,551
Total revenues		81,226		111,192		192,418
Gross Profit
Public carrier, contractor & program manager market		4,458		--		4,458
Private system operator & government market		8,153		--		8,153
Commercial dealer & reseller market		8,798		--		8,798
Retailer, dealer agent & Tier 2/3 carrier market		--		6,627		6,627
Gross profit, excluding Tier 1 carrier market		21,409		6,627		28,036
Tier 1 carrier market		--		7,457		7,457
Total gross profit		21,409		14,084		35,493
Directly allocatable expenses		10,111		7,146		17,257
Segment net profit contribution	$	11,298	$	6,938	$	18,236
Corporate support expenses						11,363
Income before provision for income taxes					$	6,873

	Three months ended June 26, 2011
	Commercial Segment		Retail Segment		Total
Revenues
Public carrier, contractor & program manager market	$	18,166	$	--	$	18,166
Private system operator & government market		31,273		--		31,273
Commercial dealer & reseller market		28,880		--		28,880
Retailer, dealer agent & Tier 2/3 carrier market		--		28,695		28,695
Revenues, excluding Tier 1 carrier market		78,319		28,695		107,014
Tier 1 carrier market		--		56,501		56,501
Total revenues		78,319		85,196		163,515
Gross Profit
Public carrier, contractor & program manager market		4,349		--		4,349
Private system operator & government market		9,369		--		9,369
Commercial dealer & reseller market		8,150		--		8,150
Retailer, dealer agent & Tier 2/3 carrier market		--		6,084		6,084
Gross profit, excluding Tier 1 carrier market		21,868		6,084		27,952
Tier 1 carrier market		--		9,248		9,248
Total gross profit		21,868		15,332		37,200
Directly allocatable expenses		10,024		6,817		16,841
Segment net profit contribution	$	11,844	$	8,515	$	20,359
Corporate support expenses						12,939
Income before provision for income taxes					$	7,420

The Company also reviews revenue and gross profit by its four product categories:

· Base station infrastructure products are used to build, repair and upgrade wireless telecommunications. Products include base station antennas, cable and transmission lines, small towers, lightning protection devices, connectors, power systems, miscellaneous hardware, and mobile antennas. Our base station infrastructure service offering includes connector installation, custom jumper assembly, site kitting and logistics integration.

· Network systems products are used to build and upgrade computing and Internet networks.  Products include fixed and mobile broadband equipment, wireless networking, filtering systems, two-way radios and security and surveillance products.  This product category also includes training classes, technical support and engineering design services.

· Installation, test and maintenance products are used to install, tune, maintain and repair wireless communications equipment. Products include sophisticated analysis equipment and various frequency-, voltage- and power-measuring devices, as well as an assortment of tools, hardware, GPS, safety and replacement and component parts and supplies required by service technicians.

· Mobile devices and accessory products include cellular phone and data device accessories such as replacement batteries, cases, speakers, mobile amplifiers, power supplies, headsets, mounts, car antennas, music accessories and data and memory cards. Retail merchandising displays, promotional programs, customized order fulfillment services and affinity-marketing programs, including private label Internet sites, complement our mobile devices and accessory product offering.

 Base station infrastructure, network systems and installation, test and maintenance products are primarily sold into the commercial segment, while mobile device and accessories products are primarily sold into the retail segment.

Supplemental revenue and gross profit information by product category for the first quarter of fiscals 2013 and 2012 are as follows (in thousands):

	Three months ended July 1, 2012
Revenues
Base station infrastructure	$	49,146
Network systems		17,736
Installation, test and maintenance		10,640
Mobile device accessories		114,896
Total revenues		192,418
Gross Profit
Base station infrastructure		14,404
Network systems		3,658
Installation, test and maintenance		2,540
Mobile device accessories		14,891
Total gross profit		35,493

	Three months ended June 26, 2011
Revenues
Base station infrastructure	$	47,208
Network systems		19,473
Installation, test and maintenance		9,947
Mobile device accessories		86,887
Total revenues		163,515
Gross Profit
Base station infrastructure		14,975
Network systems		3,874
Installation, test and maintenance		2,303
Mobile device accessories		16,048
Total gross profit		37,200