| Segment and Related Disclosures | Note 3–Segment and Related Disclosures
The internal reporting structure used by our chief operating
decision maker (“CODM”) to assess performance and
allocate resources determines the basis for our reportable
operating segments. Our CODM is our Chairman of the Board of
Directors, and she evaluates operations and allocates resources
based on a measure of operating income.
Our operations are organized under three reporting
segments—the SMB segment, which serves primarily small- and
medium-sized businesses; the Large Account segment, which serves
primarily medium-to-large corporations; and the Public Sector
segment, which serves primarily federal, state, and local
governmental and educational institutions. In addition, the
Headquarters/Other group provides services in areas such as
finance, human resources, information technology, marketing, and
product management. Most of the operating costs associated with the
Headquarters/Other group functions are charged to the operating
segments based on their estimated usage of the underlying
functions. We report these charges to the operating segments as
“Allocations.” Certain headquarters costs relating to
executive oversight and other fiduciary functions that are not
allocated to the operating segments are included under the heading
of Headquarters/Other in the tables below.
Net sales presented below exclude inter-segment product revenues.
Segment information applicable to our reportable operating segments
for the three and six months ended June 30, 2015 and 2014 is
shown below:
Three Months Ended Six Months Ended
June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014
Net sales:
SMB $ 259,346 $ 268,056 $ 509,220 $ 521,527
Large Account 231,803 222,276 441,262 423,208
Public Sector 136,473 142,912 258,399 248,269
Total net sales $ 627,622 $ 633,244 $ 1,208,881 $ 1,193,004
Operating income (loss):
SMB 10,811 9,570 20,142 17,377
Large Account 11,434 10,326 19,909 18,102
Public Sector 579 1,694 (16 ) (191 )
Headquarters/Other (3,201 ) (2,388 ) (6,233 ) (4,340 )
Total operating income $ 19,623 $ 19,202 $ 33,802 $ 30,948
Interest/other expense, net (39 ) (26 ) (38 ) (36 )
Income before taxes $ 19,584 $ 19,176 $ 33,764 $ 30,912
Selected Operating Expense:
Depreciation and amortization:
SMB 6 1 10 2
Large Account 324 341 653 675
Public Sector 39 24 79 68
Headquarters/Other 1,810 1,420 3,628 3,118
Total depreciation and amortization $ 2,179 $ 1,786 $ 4,370 $ 3,863
Assets at June 30, 2015:
SMB $ 205,521
Large Account 282,032
Public Sector 65,330
Headquarters/Other 49,663
Total assets $ 602,546
The assets of our three operating segments presented above consist
primarily of accounts receivable, intercompany receivable,
goodwill, and other intangibles. Assets reported under the
Headquarters/Other group are managed by corporate headquarters,
including cash, inventory, and property and equipment. Total assets
for the Headquarters/Other group are presented net of intercompany
balance eliminations of $34,444 as of June 30, 2015. Our
capital expenditures consist largely of IT hardware and software
purchased to maintain or upgrade our management information
systems. These systems serve all of our subsidiaries, to varying
degrees, and accordingly, our CODM does not evaluate capital
expenditures on a segment basis. |
