Annual report pursuant to Section 13 and 15(d)

BUSINESS SEGMENT INFORMATION

v3.24.0.1
BUSINESS SEGMENT INFORMATION
 12 Months Ended
Dec. 30, 2023
Segment Reporting [Abstract]  
BUSINESS SEGMENT INFORMATION BUSINESS SEGMENT INFORMATION
The Company has two reportable segments:
•Wrangler — Wrangler® branded denim, apparel, footwear and accessories.
•Lee — Lee® branded denim, apparel, footwear and accessories.
The Company considers its chief executive officer to be its chief operating decision maker. The chief operating decision maker allocates resources and assesses performance based on the global brand operating results of Wrangler® and Lee®, which are the Company's operating and reportable segments.
In addition, we report an "Other" category to reconcile segment revenues and segment profit to the Company's operating results, but the Other category does not meet the criteria to be considered a reportable segment. Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel. Other also included sales of third-party branded merchandise at company-owned outlet stores through the first quarter of 2021, after which they were discontinued.
Accounting policies utilized for internal management reporting at the individual segments are consistent with those included in Note 1 to the Company's financial statements, except as noted below.
The Company has certain shared costs in each region that it allocates between the Wrangler® and Lee® segments. In addition, the Company allocates costs for certain centralized functions and programs to the Wrangler® and Lee® segments. These centralized functions and programs include, but are not limited to, information technology, human resources, supply chain, insurance and related benefit costs associated with those functions. Allocations are based on appropriate metrics such as usage or production of net revenues.
Corporate and other expenses, including certain restructuring costs, and interest income and expense are not controlled by segment management and therefore are excluded from the measurement of segment profit.
The following table presents financial information for the Company's reportable segments and income before income taxes:
Year Ended December
(In thousands) 2023 2022 2021
Segment revenues:
Wrangler $ 1,754,130  $ 1,745,805  $ 1,575,231 
Lee 842,520  874,366  887,052 
Total reportable segment revenues 2,596,650  2,620,171  2,462,283 
Other revenues 10,822  11,273  13,633 
Total net revenues $ 2,607,472  $ 2,631,444  $ 2,475,916 
Segment profit:
Wrangler $ 307,521  $ 321,173  $ 294,153 
Lee 98,148  121,056  128,305 
Total reportable segment profit $ 405,669  $ 442,229  $ 422,458 
Corporate and other expenses (96,075) (88,932) (140,960)
Interest expense (40,408) (34,919) (38,900)
Interest income 3,791  1,352  1,480 
(Loss) profit related to other revenues (1,078) (594) 522 
Income before income taxes $ 271,899  $ 319,136  $ 244,600 
The Company reports inventories by segment as that information is used by the chief operating decision maker in assessing segment performance. Segment assets included in the "Other inventories" category represent balances related to other brands and corporate activities, and are provided for purposes of reconciliation. The Company does not report any other assets by segment. Total expenditures for long-lived assets are not disclosed as this information is not regularly provided to the chief operating decision maker at the segment level.
The following table presents assets for the Company's reportable segments and a reconciliation to total asset balances:
(In thousands) December 2023 December 2022
Segment assets:
Wrangler $ 335,629  $ 402,826 
Lee 160,139  187,929 
Total reportable segment assets 495,768  590,755 
Other inventories 4,585  6,081 
Total inventories $ 500,353  $ 596,836 
All other assets 1,145,086  985,425 
Total assets $ 1,645,439  $ 1,582,261 
The following table presents supplemental information of net revenues by geographic area based on the location of the customer:
Year Ended December
(In thousands) 2023 2022 2021
Revenues:
U.S. $ 2,060,679  $ 2,074,599  $ 1,868,909 
International 546,793  556,845  607,007 
Total $ 2,607,472  $ 2,631,444  $ 2,475,916 
Our largest customer accounted for 36% of the Company's total net revenues in both 2023 and 2022, and 34% of the Company's total net revenues in 2021. Another customer accounted for 11% of total net revenues in both 2023 and 2022, and 9% of total net revenues in 2021. Sales to these two customers are included in both the Wrangler® and Lee® reportable segments.
The following table presents "property, plant and equipment, net" recorded in the Company's balance sheets by geographic area based on physical location:
(In thousands) December 2023 December 2022
Property, plant and equipment, net:
U.S. $ 66,803  $ 63,704 
International 45,242  40,761 
Total $ 112,045  $ 104,465