Annual report pursuant to Section 13 and 15(d)

Business Segments and Sales by Product Group

v3.20.1
Business Segments and Sales by Product Group
12 Months Ended
Feb. 01, 2020
Segment Reporting [Abstract]  
Business Segments and Sales by Product Group
Business Segments and Sales by Product Group
During the fourth quarter of fiscal 2019, the Company changed its reportable segments into two reporting segments: “ShopHQ” and “Emerging.” In light of recent strategic shifts in the Company's emerging businesses, the Company's Chief Executive Officer, the chief operating decision maker, began reviewing operating results of the Emerging segment separately from our core business, ShopHQ. The chief operating decision maker is our Chief Executive Officer and Interim Chief Financial Officer. These segments reflect the way the Company's chief operating decision maker evaluates the Company's business performance and manages its operations. All of Company's sales are made to customers residing in the United States.
The Company does not allocate assets between the segments for our internal management purposes, and as such, they are not presented here. There was no significant inter-segment sales or transfers during fiscal 2019, fiscal 2018 and fiscal 2017. The Company allocates corporate support costs (such as finance, human resources, warehouse management and legal) to our operating segments based on their estimated usage and based on how the Company manages the business. The Company has recast its segment results for all periods presented to conform to the new segment structure.
ShopHQ
The ShopHQ segment encompasses the Company's nationally distributed shopping entertainment network. ShopHQ sells and distributes its products to consumers through its video commerce television, online website and mobile platforms.
Emerging
The Emerging segment consists of the Company's developing business models. This segment includes the Company's Media Services, which includes creative and interactive services and third-party logistics services. The Emerging segment also encompasses the Bulldog Shopping Network, and recently acquired businesses, J.W. Hulme and Float Left. Bulldog shopping network is a niche television shopping network geared towards male consumers. J.W. Hulme is a business specializing in artisan-crafted leather products, including handbags and luggage. J.W. Hulme products are distributed primarily through jwhulme.com, retails stores, and programming on ShopHQ. Float Left is a business comprised of connected TVs, video-based content, application development and distribution, including technical consulting services, software development and maintenance related to video distribution.
Net Sales by Segment and Significant Product Groups
 
 
For the Years Ended
 
 
February 1,
2020
 
February 2,
2019
 
February 3,
2018
 
 
(in thousands)
ShopHQ
 
 
 
 
 
 
Net merchandise sales by category:
 
 
 
 
 
 
Jewelry & Watches
 
$
200,893

 
$
206,021

 
$
222,999

Home & Consumer Electronics
 
106,025

 
135,184

 
147,769

Beauty & Wellness
 
80,945

 
102,099

 
100,829

Fashion & Accessories
 
65,616

 
94,295

 
108,409

All other (primarily shipping & handling revenue)
 
42,628

 
52,630

 
60,830

Total ShopHQ
 
496,107

 
590,229

 
640,836

Emerging
 
5,715

 
6,408

 
7,384

Consolidated net sales
 
$
501,822

 
$
596,637

 
$
648,220


Performance Measures by Segment
 
 
For the Years Ended
 
 
February 1,
2020
 
February 2,
2019
 
February 3,
2018
 
 
(in thousands)
Gross profit
 
 
 
 
 
 
ShopHQ
 
$
162,809

 
$
205,036

 
$
232,905

Emerging
 
$
828

 
$
1,811

 
$
2,207

Consolidated gross profit
 
$
163,637

 
$
206,847

 
$
235,112

 
 
 
 
 
 
 
Operating income (loss)
 
 
 
 
 
 
ShopHQ
 
$
(46,956
)
 
$
(17,173
)
 
$
3,960

Emerging
 
(5,569
)
 
(1,451
)
 
(738
)
Consolidated operating income (loss)
 
$
(52,525
)
 
$
(18,624
)
 
$
3,222

 
 
 
 
 
 
 
Depreciation and amortization
 
 
 
 
 
 
ShopHQ
 
$
11,395

 
$
10,065

 
$
10,207

Emerging
 
619

 
99

 
100

Consolidated depreciation and amortization
 
$
12,014

 
$
10,164

 
$
10,307