Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.19.1
Segment Information
3 Months Ended
Mar. 31, 2019
Segment Information [Abstract]  
Segment Information

NOTE 13.  SEGMENT INFORMATION



As a result of our August 21, 2017 acquisition of Sierra, we operate our business structure within two segments. These segments are defined based on the internal financial reporting used by management.  Certain significant selling and general and administrative expenses are not allocated to the segments including non-cash stock compensation expense.  Each segment is described below:



·

Black Diamond segment, which includes Black Diamond Equipment, PIEPS, and SKINourishment, is a global leader in designing, manufacturing, and marketing innovative outdoor engineered equipment and apparel for climbing, mountaineering, trail running, backpacking, skiing, and a wide range of other year-round outdoor recreation activities.  Black Diamond segment offers a broad range of products including: high performance activity-based apparel (such as shells, insulation, midlayers, pants and logowear); rock-climbing footwear and equipment (such as carabiners, protection devices, harnesses, belay devices, helmets, and ice-climbing gear); technical backpacks and high-end day packs; trekking poles; headlamps and lanterns; gloves and mittens; and skincare and other sport-enhancing products. We also offer advanced skis, ski poles, ski skins, and snow safety products, including avalanche airbag systems, avalanche transceivers, shovels, and probes.



·

Sierra segment, which includes Sierra, is an iconic American manufacturer of a wide range of high-performance bullets and ammunition for both rifles and pistols. These bullets and ammunition are used for precision target shooting, hunting and military and law enforcement purposes.



The Company recognizes revenue when a contract exists with a customer that specifies the goods and services to be provided at an agreed upon sales price and when the performance obligation is satisfied by transferring the goods or service to the customer. The performance obligation is considered complete when products are shipped or delivered to the customer depending on the terms of the contract.  Sales are made on normal and customary short-term credit terms or upon delivery at point of sale transactions.  As noted above, the Company has a wide variety of technical outdoor equipment and lifestyle products focused on the climb, ski, mountain and sport product categories that are sold to a variety of customers in multiple end markets.  While there are multiple products sold, the terms and nature of revenue recognition policy is similar for all segments.  The sport product category represents the Sierra segment revenue.



We divide our product offerings into four primary categories of climb, mountain, ski and sport.  Revenue by category is as follows:







 

 

 

 

 

 



 

Three Months Ended



 

March 31, 2019

 

March 31, 2018



 

 

 

 

 

 

Climb

 

35 

%

 

36 

%

Mountain

 

31 

%

 

32 

%

Ski

 

20 

%

 

17 

%

Sport

 

14 

%

 

15 

%



 

 

 

 

 

 

Contract liabilities are recorded as a component of accounts payable and accrued liabilities when customers remit contractual cash payments in advance of us satisfying performance obligations which are satisfied at a future point of time. Contract liabilities were not material at March 31, 2019 and December 31, 2018.  Contract liabilities are derecognized when the performance obligation is satisfied. Revenue recognized from satisfaction of performance obligations relating to the advanced payments during the three months ended March 31, 2019 was not material.  No other material remaining performance obligations exist at March 31, 2019.



Financial information for our segments is as follows:























 

 

 

 

 

 



 

Three Months Ended



 

March 31, 2019

 

March 31, 2018

Sales to external customers:

 

 

 

 

 

 

Black Diamond

 

 

 

 

 

 

Domestic sales

 

$

24,532 

 

$

19,271 

International sales

 

 

27,869 

 

 

25,756 

Total Black Diamond

 

 

52,401 

 

 

45,027 

Sierra

 

 

 

 

 

 

Domestic sales

 

 

6,057 

 

 

6,383 

International sales

 

 

2,760 

 

 

1,857 

Total Sierra

 

 

8,817 

 

 

8,240 

Total sales to external customers

 

 

61,218 

 

 

53,267 

Segment operating income:

 

 

 

 

 

 

Black Diamond

 

 

5,176 

 

 

1,937 

Sierra

 

 

1,661 

 

 

797 

Total segment operating income

 

 

6,837 

 

 

2,734 

Restructuring charge

 

 

(13)

 

 

(40)

Transaction costs

 

 

(46)

 

 

(165)

Corporate and other expenses

 

 

(2,384)

 

 

(1,914)

Interest expense, net

 

 

(310)

 

 

(254)

Income before income tax

 

$

4,084 

 

$

361 



There were no intercompany sales between the Black Diamond and Sierra segments for the periods presented.  Restructuring charges for the periods presented relate to the Black Diamond segment.



Total assets by segment, as of March 31, 2019 and December 31, 2018, were as follows:







 

 

 

 

 

 



 

March 31, 2019

 

December 31, 2018



 

 

 

 

 

 

Black Diamond

 

$

137,529 

 

$

138,029 

Sierra

 

 

72,473 

 

 

72,796 

Corporate

 

 

2,159 

 

 

2,303 



 

$

212,161 

 

$

213,128 



Capital expenditures, depreciation and amortization by segment is as follows.







 

 

 

 

 

 



 

Three Months Ended



 

March 31, 2019

 

March 31, 2018

Capital expenditures:

 

 

 

 

 

 

Black Diamond

 

$

764 

 

$

658 

Sierra

 

 

282 

 

 

195 

Total capital expenditures

 

$

1,046 

 

$

853 

Depreciation:

 

 

 

 

 

 

Black Diamond

 

$

611 

 

$

587 

Sierra

 

 

492 

 

 

486 

Total depreciation

 

$

1,103 

 

$

1,073 

Amortization:

 

 

 

 

 

 

Black Diamond

 

$

279 

 

$

275 

Sierra

 

 

610 

 

 

694 

Total amortization

 

$

889 

 

$

969