LIFETIME BRANDS, INCLCUT
LIFETIME BRANDS, INC Segments Disclosure
Segment information
The Company operates in two reportable segments: U.S. and International. The U.S. segment is the Company’s domestic business that designs, markets and distributes its products to retailers and distributors, as well as directly to consumers through third parties and its own internet websites primarily in the U.S. The International segment is the Company’s international business that sells and distributes products to consumers primarily in the U.K., the European Union and the Asia Pacific region.
The Company’s chief operation decision maker (“CODM”) is the Company’s Chief Executive Officer. The Company has segmented its operations to reflect the manner in which the CODM reviews and evaluates the results of its operations. The CODM allocates operating and capital resources and evaluates the performance of the Company’s segments based on segment net sales, segment gross margin, and segment income from operations. Such measures give recognition to specifically identifiable operating costs. Significant segment expenses that are included in segment operating income consist of cost of sales, distribution expenses and selling, general and administrative expenses.
Certain general and administrative expenses are not allocated to the Company’s segments as these represent corporate level activities and are reflected below as unallocated corporate expenses. These costs primarily include senior executive salaries and benefits, stock compensation, director fees and accounting, legal fees and consulting fees.
| Year Ended December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
Segment Performance Measures: | (in thousands) | ||||||||||||||||
| Net sales: | |||||||||||||||||
| U.S. | $ | 627,202 | $ | 633,079 | $ | 669,179 | |||||||||||
| International | 55,750 | 53,604 | 58,483 | ||||||||||||||
| Total net sales | $ | 682,952 | $ | 686,683 | $ | 727,662 | |||||||||||
Gross margin: | |||||||||||||||||
| U.S. | $ | 240,265 | $ | 236,568 | $ | 241,093 | |||||||||||
| International | 20,438 | 18,071 | 19,223 | ||||||||||||||
Total gross margin | $ | 260,703 | $ | 254,639 | $ | 260,316 | |||||||||||
Income from operations: | |||||||||||||||||
U.S. (1) | $ | 57,215 | $ | 63,341 | $ | 61,479 | |||||||||||
International (1) | (10,523) | (11,064) | (12,153) | ||||||||||||||
Unallocated corporate expenses (2) | (19,608) | (20,336) | (25,063) | ||||||||||||||
Total income from operations | $ | 27,084 | $ | 31,941 | $ | 24,263 | |||||||||||
| Year Ended December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
Supplemental information for significant segment expenses: | (in thousands) | ||||||||||||||||
| Cost of sales: | |||||||||||||||||
| U.S. | $ | 386,937 | $ | 396,511 | $ | 428,086 | |||||||||||
| International | 35,312 | 35,533 | 39,260 | ||||||||||||||
| Total cost of sales | $ | 422,249 | $ | 432,044 | $ | 467,346 | |||||||||||
| Freight-out expenses: | |||||||||||||||||
| U.S. | $ | 13,487 | $ | 13,636 | $ | 13,333 | |||||||||||
| International | 3,099 | 3,402 | 4,032 | ||||||||||||||
| Total freight-out expenses | $ | 16,586 | $ | 17,038 | $ | 17,365 | |||||||||||
| Warehouse expenses: | |||||||||||||||||
| U.S. | $ | 46,545 | $ | 42,148 | $ | 47,691 | |||||||||||
| International | 10,679 | 10,008 | 9,892 | ||||||||||||||
| Total warehouse expenses | $ | 57,224 | $ | 52,156 | $ | 57,583 | |||||||||||
| Selling, general and administrative expenses: | |||||||||||||||||
| U.S. | $ | 123,018 | $ | 117,443 | $ | 118,175 | |||||||||||
| International | 17,183 | 15,725 | 17,018 | ||||||||||||||
| Unallocated corporate expenses | 19,608 | 19,480 | 19,352 | ||||||||||||||
| Total selling, general and administrative expenses | $ | 159,809 | $ | 152,648 | $ | 154,545 | |||||||||||
| Other expenses: | |||||||||||||||||
U.S.(1) | $ | — | $ | — | $ | 415 | |||||||||||
International(1) | — | — | 434 | ||||||||||||||
Unallocated corporate expenses(2) | — | 856 | 5,711 | ||||||||||||||
| Total other expenses | $ | — | $ | 856 | $ | 6,560 | |||||||||||
(1)In 2022, other expenses and income from operations includes restructuring expenses of $0.4 million for the U.S. segment and $0.4 million for the International segment, as described in NOTE 1 — SIGNIFICANT ACCOUNTING POLICIES.
(2)The Company recognized expenses of $5.1 million in 2022 for estimated remediation costs related to the Wallace EPA Matter, as described in NOTE 13 — COMMITMENTS AND CONTINGENCIES. In 2023 and 2022, the Company recognized $0.8 million and $0.6 million, respectively, of restructuring expenses within unallocated corporate expenses, as described in NOTE 1 — SIGNIFICANT ACCOUNTING POLICIES.
December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
| (in thousands) | |||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||
| U.S. | $ | 21,144 | $ | 18,489 | $ | 18,279 | |||||||||||
| International | 1,170 | 1,082 | 1,257 | ||||||||||||||
| Total depreciation and amortization | $ | 22,314 | $ | 19,571 | $ | 19,536 | |||||||||||
| Capital expenditures: | |||||||||||||||||
| U.S. | $ | 1,931 | $ | 2,427 | $ | 2,088 | |||||||||||
| International | 296 | 374 | 887 | ||||||||||||||
| Total capital expenditures | $ | 2,227 | $ | 2,801 | $ | 2,975 | |||||||||||
December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| (in thousands) | |||||||||||
| Assets: | |||||||||||
| U.S. | $ | 542,420 | $ | 560,716 | |||||||
| International | 88,961 | 90,237 | |||||||||
| Unallocated corporate | 2,929 | 16,189 | |||||||||
| Total assets | $ | 634,310 | $ | 667,142 | |||||||
Year Ended December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| (in thousands) | |||||||||||
| Goodwill: | |||||||||||
| U.S. | $ | 33,237 | $ | 33,237 | |||||||
| Total goodwill | $ | 33,237 | $ | 33,237 | |||||||
Geographical information
The following table sets forth long-lived assets by the major geographic locations:
| December, | |||||||||||
| 2024 | 2023 | ||||||||||
| (in thousands) | |||||||||||
| Long-lived assets, excluding intangible assets, at period-end: | |||||||||||
| United States | $ | 54,526 | $ | 66,341 | |||||||
| United Kingdom | 21,187 | 22,692 | |||||||||
| Rest of World | 1,502 | 2,621 | |||||||||
| Total | $ | 77,215 | $ | 91,654 | |||||||
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.