Quarterly report pursuant to Section 13 or 15(d)

Segments and Geographic Information

v3.22.1
Segments and Geographic Information
9 Months Ended
Mar. 31, 2022
Segment Reporting [Abstract]  
Segments and Geographic Information

19. SEGMENTS AND GEOGRAPHIC INFORMATION

The Company evaluates segment reporting in accordance with Segment Reporting Topic 280 of the ASC, each reporting period, including evaluating the organizational structure and the reporting package that is reviewed by the chief operating decision makers. The Company's operations are organized under three business segments (i) Wholesale Sales & Ancillary Services, (ii) Direct-to-Consumer, and (iii) Secured Lending. The Wholesale Sales & Ancillary Services segment includes the consolidating eliminations of inter-segment transactions and unallocated segment adjustments. (See Note 1 for a description of the types of products and services from which each reportable segment derives its revenues.)

Revenue

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

Revenue by segment(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

1,966,897

 

 

 

$

2,017,120

 

 

 

$

5,732,207

 

 

 

$

5,347,951

 

 

Eliminations of inter-segment sales

 

 

(447,857

)

 

 

 

(93,857

)

 

 

 

(1,306,411

)

 

 

 

(133,491

)

 

Wholesale Sales & Ancillary Services, net of eliminations (2)

 

 

1,519,040

 

 

 

 

1,923,263

 

 

 

 

4,425,796

 

 

 

 

5,214,460

 

 

Direct-to-Consumer

 

 

590,075

 

(a)

 

 

126,226

 

(b)

 

 

1,643,654

 

(c)

 

 

219,889

 

(d)

 

 

$

2,109,115

 

 

 

$

2,049,489

 

 

 

$

6,069,450

 

 

 

$

5,434,349

 

 

 

(1)
The Secured Lending segment earns interest income from its lending activity and earns no revenue from the sales of precious metals. Therefore, no amounts are shown for the Secured Lending segment in the above table.
(2)
The eliminations of inter-segment sales are reflected in the Wholesale Sales & Ancillary Services segment.
(a)
Includes $0.4 million of inter-segment sales from the Direct-to-Consumer segment to the Wholesale Sales & Ancillary Services segment.
(b)
Includes $0.9 million of inter-segment sales from the Direct-to-Consumer segment to the Wholesale Sales & Ancillary Services segment.
(c)
Includes $2.0 million of inter-segment sales from the Direct-to-Consumer segment to the Wholesale Sales & Ancillary Services segment.
(d)
Includes $7.8 million of inter-segment sales from the Direct-to-Consumer segment to the Wholesale Sales & Ancillary Services segment.

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Revenue by geographic region(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

1,256,092

 

 

 

$

1,320,129

 

 

 

$

3,631,974

 

 

 

$

3,407,484

 

Europe

 

 

495,293

 

 

 

 

285,843

 

 

 

 

1,542,293

 

 

 

 

1,067,325

 

North America, excluding United States

 

 

342,392

 

 

 

 

394,562

 

 

 

 

850,681

 

 

 

 

867,437

 

Asia Pacific

 

 

9,592

 

 

 

 

17,514

 

 

 

 

34,586

 

 

 

 

43,649

 

Africa

 

 

 

 

 

 

 

 

 

 

17

 

 

 

 

 

Australia

 

 

5,746

 

 

 

 

31,441

 

 

 

 

9,899

 

 

 

 

48,454

 

 

 

$

2,109,115

 

 

 

$

2,049,489

 

 

 

$

6,069,450

 

 

 

$

5,434,349

 

 

(1)
Presentation of amounts realigned based on current accounting policy that defines geographic area based on the delivery or settlement location. The presentation change had no impact on the segments' operations or the Company's condensed consolidated results.

Gross Profit and Gross Margin Percentage

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Gross profit by segment(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

32,002

 

 

 

$

51,529

 

 

 

$

85,474

 

 

 

$

95,327

 

Eliminations and adjustments

 

 

(1,463

)

 

 

 

34

 

 

 

 

(445

)

 

 

 

103

 

Wholesale Sales & Ancillary Services, net of eliminations and adjustments

 

 

30,539

 

 

 

 

51,563

 

 

 

 

85,029

 

 

 

 

95,430

 

Direct-to-Consumer, net of eliminations

 

 

41,544

 

 

 

 

16,608

 

 

 

 

108,986

 

 

 

 

27,637

 

 

 

$

72,083

 

 

 

$

68,171

 

 

 

$

194,015

 

 

 

$

123,067

 

Gross margin percentage by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

 

1.627

%

 

 

 

2.555

%

 

 

 

1.491

%

 

 

 

1.782

%

Wholesale Sales & Ancillary Services, net of eliminations and adjustments

 

 

2.010

%

 

 

 

2.681

%

 

 

 

1.921

%

 

 

 

1.830

%

Direct-to-Consumer

 

 

7.040

%

 

 

 

13.157

%

 

 

 

6.631

%

 

 

 

12.569

%

Weighted average gross margin percentage

 

 

3.418

%

 

 

 

3.326

%

 

 

 

3.197

%

 

 

 

2.265

%

 

(1)
The Secured Lending segment earns interest income from its lending activity and earns no gross profit from the sales of precious metals. Therefore, no amounts are shown for the Secured Lending segment in the above table.

 

Operating income and (expenses)

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Operating income (expense) by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

(9,963

)

 

 

$

22,916

 

 

 

$

(24,485

)

 

 

$

14,176

 

Eliminations

 

 

(60

)

 

 

 

(45

)

 

 

 

(191

)

 

 

 

(114

)

Wholesale Sales & Ancillary Services, net of eliminations

 

$

(10,023

)

 

 

$

22,871

 

 

 

$

(24,676

)

 

 

$

14,062

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services, net of eliminations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(11,203

)

 

 

$

(9,859

)

 

 

$

(28,748

)

 

 

$

(23,727

)

Depreciation and amortization expense

 

 

(214

)

 

 

 

(213

)

 

 

 

(673

)

 

 

 

(637

)

Interest income

 

 

2,300

 

 

 

 

2,554

 

 

 

 

7,952

 

 

 

 

7,490

 

Interest expense

 

 

(2,379

)

 

 

 

(3,274

)

 

 

 

(7,396

)

 

 

 

(9,137

)

Earnings from equity method investments

 

 

1,608

 

 

 

 

7,410

 

 

 

 

4,317

 

 

 

 

13,898

 

Remeasurement gain on pre-existing equity interest

 

 

 

 

 

 

26,306

 

 

 

 

 

 

 

 

26,306

 

Unrealized losses on foreign exchange

 

 

(135

)

 

 

 

(53

)

 

 

 

(128

)

 

 

 

(131

)

 

 

$

(10,023

)

 

 

$

22,871

 

 

 

$

(24,676

)

 

 

$

14,062

 

Direct-to-Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(8,913

)

 

 

$

(2,644

)

 

 

$

(25,906

)

 

 

$

(5,982

)

Depreciation and amortization expense

 

 

(7,245

)

 

 

 

(1,187

)

 

 

 

(23,140

)

 

 

 

(1,593

)

Interest expense

 

 

(703

)

 

 

 

(45

)

 

 

 

(2,062

)

 

 

 

(45

)

Other expense, net

 

 

(50

)

 

 

 

 

 

 

 

(50

)

 

 

 

 

 

 

$

(16,911

)

 

 

$

(3,876

)

 

 

$

(51,158

)

 

 

$

(7,620

)

Secured Lending

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(379

)

 

 

$

(792

)

 

 

$

(1,230

)

 

 

$

(1,619

)

Depreciation and amortization expense

 

 

(88

)

 

 

 

(88

)

 

 

 

(264

)

 

 

 

(264

)

Interest income

 

 

3,043

 

 

 

 

2,170

 

 

 

 

8,173

 

 

 

 

5,750

 

Interest expense

 

 

(2,347

)

 

 

 

(2,016

)

 

 

 

(6,839

)

 

 

 

(5,483

)

Other income, net

 

 

543

 

 

 

 

340

 

 

 

 

1,385

 

 

 

 

904

 

 

 

$

772

 

 

 

$

(386

)

 

 

$

1,225

 

 

 

$

(712

)

 

Net income before provision for income taxes

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Net income before provision for income taxes by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

20,516

 

 

 

$

74,434

 

 

 

$

60,353

 

 

 

$

109,492

 

Direct-to-Consumer

 

 

24,633

 

 

 

 

12,732

 

 

 

 

57,828

 

 

 

 

20,017

 

Secured Lending

 

 

772

 

 

 

 

(386

)

 

 

 

1,225

 

 

 

 

(712

)

 

 

$

45,921

 

 

 

$

86,780

 

 

 

$

119,406

 

 

 

$

128,797

 

Advertising expense

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Advertising expense by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

(190

)

 

 

$

(74

)

 

 

$

(433

)

 

 

$

(217

)

Direct-to-Consumer

 

 

(3,077

)

 

 

 

(821

)

 

 

 

(8,493

)

 

 

 

(1,932

)

Secured Lending

 

 

(52

)

 

 

 

(63

)

 

 

 

(154

)

 

 

 

(131

)

 

 

$

(3,319

)

 

 

$

(958

)

 

 

$

(9,080

)

 

 

$

(2,280

)

 

Precious metals held under financing arrangements

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Precious metals held under financing arrangements by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

87,450

 

 

 

$

130,766

 

Secured Lending

 

 

 

 

 

 

23,976

 

 

 

$

87,450

 

 

 

$

154,742

 

Inventories

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Inventories by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

623,188

 

 

 

$

402,418

 

Direct-to-Consumer

 

 

141,075

 

 

 

 

53,069

 

Secured Lending

 

 

 

 

 

 

2,532

 

 

 

$

764,263

 

 

 

$

458,019

 

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Inventories by geographic region

 

 

 

 

 

 

 

United States

 

$

706,249

 

 

 

$

431,732

 

North America, excluding United States

 

 

35,329

 

 

 

 

16,633

 

Europe

 

 

22,098

 

 

 

 

9,451

 

Asia

 

 

405

 

 

 

 

203

 

Australia

 

 

182

 

 

 

 

 

 

 

$

764,263

 

 

 

$

458,019

 

 

Total Assets

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Assets by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

968,591

 

 

 

$

874,152

 

Eliminations

 

 

(143,462

)

 

 

 

(163,850

)

Wholesale Sales & Ancillary Services, net of eliminations

 

 

825,129

 

 

 

 

710,302

 

Direct-to-Consumer

 

 

368,768

 

 

 

 

335,829

 

Secured Lending

 

 

152,686

 

 

 

 

145,450

 

 

 

$

1,346,583

 

 

 

$

1,191,581

 

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Assets by geographic region

 

 

 

 

 

 

 

United States

 

$

1,285,377

 

 

 

$

1,162,195

 

North America, excluding United States

 

 

35,329

 

 

 

 

16,633

 

Europe

 

 

25,290

 

 

 

 

12,550

 

Asia

 

 

405

 

 

 

 

203

 

Australia

 

 

182

 

 

 

 

 

 

 

$

1,346,583

 

 

 

$

1,191,581

 

 

Long-term Assets

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Long-term assets by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

49,946

 

 

 

$

36,174

 

Direct-to-Consumer

 

 

168,031

 

 

 

 

188,208

 

Secured Lending

 

 

2,710

 

 

 

 

2,972

 

 

 

$

220,687

 

 

 

$

227,354

 

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Long-term assets by geographic region

 

 

 

 

 

 

 

United States

 

$

220,685

 

 

 

$

227,352

 

Europe

 

 

2

 

 

 

 

2

 

 

 

$

220,687

 

 

 

$

227,354

 

 

Capital Expenditures for Property, Plant, and Equipment

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

 

 

March 31,
2022

 

 

 

March 31,
2021

 

Capital expenditures on property, plant, and equipment by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

183

 

 

 

$

411

 

 

 

$

812

 

 

 

$

1,335

 

Direct-to-Consumer

 

 

296

 

 

 

 

3

 

 

 

 

1,294

 

 

 

 

12

 

Secured Lending

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

$

479

 

 

 

$

414

 

 

 

$

2,106

 

 

 

$

1,351

 

Goodwill and Intangible Assets

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Goodwill by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

8,881

 

 

 

$

8,881

 

Direct-to-Consumer(1)

 

 

92,062

 

 

 

 

92,062

 

 

 

$

100,943

 

 

 

$

100,943

 

 

(1)
Direct-to-Consumer segment’s goodwill balance is net of $1.4 million accumulated impairment losses.

 

Intangible assets

 

in thousands

 

 

 

 

 

 

 

 

 

March 31,
2022

 

 

 

June 30,
2021

 

Intangibles by segment

 

 

 

 

 

 

 

Wholesale Sales & Ancillary Services

 

$

2,774

 

 

 

$

2,831

 

Direct-to-Consumer(1)

 

 

67,942

 

 

 

 

90,802

 

 

 

$

70,716

 

 

 

$

93,633

 

 

(1)
Direct-to-Consumer segment’s intangibles balance is net of $1.3 million accumulated impairment losses.