Annual report pursuant to Section 13 and 15(d)

SEGMENTS AND GEOGRAPHIC INFORMATION

v3.20.4
SEGMENTS AND GEOGRAPHIC INFORMATION
12 Months Ended
Jan. 30, 2021
SEGMENTS AND GEOGRAPHIC INFORMATION  
SEGMENTS AND GEOGRAPHIC INFORMATION

12. SEGMENTS AND GEOGRAPHIC INFORMATION

In fiscal 2020 and fiscal 2019, we considered Michaels-U.S., Michaels-Canada and Darice to be our operating segments for purposes of determining reportable segments based on the criteria of ASC 280, Segment Reporting (“ASC 280”). In fiscal 2018, our operating segments also included Aaron Brothers and Pat Catan’s. We determined that Michaels-U.S., Michaels-Canada, Aaron Brothers and Pat Catan’s have similar economic characteristics and meet the aggregation criteria set forth in ASC 280. Therefore, we combine these operating segments into one reporting segment. Darice does not meet the materiality criteria in ASC 280 and, therefore, is not disclosed separately as a reportable segment. Our chief operating decision makers evaluate historical operating performance and forecast future periods’ operating performance based on operating income.

Our net sales by country and sales by product category are as follows (in thousands):

Fiscal Year

    

2020

    

2019

2018

Net Sales:

United States (1)

$

4,757,829

$

4,597,262

$

4,783,903

Canada

 

513,283

 

474,775

 

488,041

Total

$

5,271,112

$

5,072,037

$

5,271,944

Sales by Product Category:

General crafts

$

2,495,675

$

2,389,745

$

2,604,905

Home décor and seasonal

 

1,146,921

 

1,167,418

 

1,230,054

Custom and ready-made framing

 

822,731

 

816,869

 

801,075

Papercrafting

 

805,785

 

698,005

 

635,910

Total

$

5,271,112

$

5,072,037

$

5,271,944

(1) In March 2018 we closed our Aaron Brothers stores and in January 2019 we closed our Pat Catan’s stores. For fiscal 2018, Pat Catan’s net sales totaled approximately $109.6 million and Aaron Brothers net sales totaled approximately $12.9 million. In the fourth quarter of fiscal 2020 we completed the liquidation of our Darice wholesale operations. For fiscal 2020, fiscal 2019 and fiscal 2018, Darice’s net sales totaled approximately $37.6 million, $79.9 million and $106.7 million, respectively.

Our total assets by country are as follows (in thousands):

Fiscal Year (1)

    

2020

    

2019

Total Assets:

United States

$

4,192,094

$

3,527,374

Canada

 

336,311

 

310,721

Total

$

4,528,405

$

3,838,095

(1) In fiscal 2020, we recorded $28.8 million of impairment charges related to the closure of 13 underperforming stores and the relocation of our support center. In fiscal 2019, we wrote-off $42.7 million of assets in connection with impairment charges related to Darice and the closure of our Pat Catan’s stores.

Assets are categorized based on their geographic location. Certain assets located in the U.S. are also used to support our Canadian operations but are not allocated to Canada.