Segment Data | Segment Data The Company currently operates three business segments, retail, direct and manufacturing. The operating segments are segments of the Company for which separate financial information is available and for which operating results are evaluated regularly by executive management in deciding how to allocate resources and in assessing performance. The Company's management evaluates segment operating results based on several indicators. The primary key performance indicators are sales and operating income for each segment. The table below represents key financial information for each of the Company's business segments as well as corporate costs. The retail segment primarily includes the Company's retail stores. The retail segment generates revenue primarily through the sale of VMS products through Vitamin Shoppe and Super Supplements retail stores in the United States and Puerto Rico. The direct segment generates revenue through the sale of VMS products primarily through the Company's websites. The Company's websites offer customers online access to a full assortment of approximately 17,400 SKUs. The manufacturing segment supplies the retail and direct segments, along with various third parties, with finished products for sale. Corporate costs represent all other expenses not allocated to the retail, direct or manufacturing segments which include, but are not limited to: human resources, legal, retail management, direct management, finance, information technology, depreciation (primarily related to assets utilized by the retail and direct business segments as well as corporate assets) and amortization, and various other corporate level activity related expenses. Intercompany sales transactions are eliminated in consolidation. The Company’s segments are designed to allocate resources internally and provide a framework to determine management responsibility. The accounting policies of the segments are consistent with those described in Note 2. Summary of Significant Accounting Policies in the Fiscal 2015 Form 10-K. The Company has allocated $165.3 million , $45.3 million and $32.6 million of its recorded goodwill to the retail, direct and manufacturing segments, respectively. The Company does not have identifiable assets separated by segment, with the exception of the identifiable assets of the manufacturing segment which were $88.5 million and $88.4 million as of June 25, 2016 and December 26, 2015, respectively. Capital expenditures for the manufacturing segment for the six months ended June 25, 2016 and June 27, 2015 were approximately $1.1 million and $2.3 million , respectively. At June 25, 2016 and December 26, 2015 , long lived assets of the manufacturing segment were $59.8 million and $60.4 million , respectively. Depreciation and amortization expense, included in selling, general and administrative expenses, for the manufacturing segment during the three months ended June 25, 2016 and June 27, 2015 was approximately $0.4 million in both periods. Depreciation and amortization expense, included in selling, general and administrative expenses, for the manufacturing segment during the six months ended June 25, 2016 and June 27, 2015 was approximately $0.8 million and $0.7 million , respectively. The following table contains key financial information of the Company’s business segments (in thousands): Three Months Ended Six Months Ended June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Net sales: Retail $ 288,290 $ 278,200 $ 576,302 $ 566,183 Direct 32,773 30,346 68,625 65,190 Manufacturing 20,778 24,664 41,338 46,492 Segment net sales 341,841 333,210 686,265 677,865 Elimination of intersegment revenues (9,124 ) (10,872 ) (16,774 ) (18,692 ) Net sales $ 332,717 $ 322,338 $ 669,491 $ 659,173 Income (Loss) from operations: Retail $ 50,469 $ 51,613 $ 107,132 $ 107,672 Direct 4,500 5,587 9,686 10,652 Manufacturing (1) (1,822 ) (1,510 ) (2,084 ) (1,211 ) Corporate costs (2) (32,423 ) (32,126 ) (66,748 ) (62,594 ) Income from operations $ 20,724 $ 23,564 $ 47,986 $ 54,519 (1) Manufacturing loss from operations for the three and six months ended June 27, 2015 includes a $1.4 million charge for accounts receivable for one wholesale customer which were deemed uncollectible. (2) Corporate costs include (in thousands): Three Months Ended Six Months Ended June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Depreciation and amortization expenses $ 8,965 $ 9,155 $ 18,634 $ 18,035 Canada stores closing costs (a) 1,864 — 2,963 — Cost reduction project (b) 1,492 — 1,492 — Super Supplements conversion costs (c) — — 1,275 — Reinvention strategy costs (d) — — 541 — Management realignment charges (e) — 2,174 — 2,174 Integration costs (f) — 410 — 770 (a) Costs primarily include lease termination charges. (b) Outside consulting costs relating to a project to identify and implement cost reduction opportunities. (c) Costs primarily related to the closure of the Seattle distribution center. (d) The costs represent outside consultants fees in connection with the Company’s “reinvention strategy”. (e) Management realignment charges primarily consist of severance, sign-on bonuses, recruiting and relocation costs. (f) Represents integration costs related to the acquisition of Nutri-Force, consisting primarily of professional fees. |