Quarterly report pursuant to Section 13 or 15(d)

New Accounting Standards (Tables)

New Accounting Standards (Tables)

3 Months Ended

Dec. 29, 2018

Accounting Changes and Error Corrections [Abstract]

The table below identifies the amount of net sales by distribution channel and percentage of net sales (in thousands):



	Three Months Ended
	December 29, 2018				December 30, 2017
	$		%		$		%
Retail	$	1,012	1	%	$	884	1	%
Ecommerce	6,826		7	%	5,450		6	%
Wholesale	93,837		92	%	84,008		93	%
Net Sales	$	101,675	100	%	$	90,342	100	%

The table below provides net sales by reportable segment (in thousands) and the percentage of net sales by distribution channel for each reportable segment:



	First Quarter Fiscal Year 2019
	Net Sales		Wholesale		Retail		Ecommerce
Delta Group	$	94,391	94.0	%	0.5	%	5.5	%
Salt Life Group	7,284		73.0	%	10.0	%	17.0	%
Total	$	101,675

	First Quarter Fiscal Year 2018
	Net Sales		Wholesale		Retail		Ecommerce
Delta Group	$	83,924	94.0	%	0.4	%	5.6	%
Salt Life Group	6,418		73.0	%	9.0	%	18.0	%
Total	$	90,342

Schedule of the effect of the adoption of the standard

Our revenue streams consist of wholesale, direct-to-consumer and ecommerce sales which are included in our Condensed Consolidated Statements of Operations. The table below identifies the amount of net sales by distribution channel and percentage of net sales (in thousands):



	Three Months Ended
	December 29, 2018				December 30, 2017
	$		%		$		%
Retail	$	1,012	1	%	$	884	1	%
Ecommerce	6,826		7	%	5,450		6	%
Wholesale	93,837		92	%	84,008		93	%
Net Sales	$	101,675	100	%	$	90,342	100	%

The table below provides net sales by reportable segment (in thousands) and the percentage of net sales by distribution channel for each reportable segment:



	First Quarter Fiscal Year 2019
	Net Sales		Wholesale		Retail		Ecommerce
Delta Group	$	94,391	94.0	%	0.5	%	5.5	%
Salt Life Group	7,284		73.0	%	10.0	%	17.0	%
Total	$	101,675

	First Quarter Fiscal Year 2018
	Net Sales		Wholesale		Retail		Ecommerce
Delta Group	$	83,924	94.0	%	0.4	%	5.6	%
Salt Life Group	6,418		73.0	%	9.0	%	18.0	%
Total	$	90,342

Revenue is recognized when performance obligations under the terms of the contracts are satisfied. Our performance obligation primarily consists of delivering products to our customers. Control is transferred upon providing the products to customers in our retail stores and upon shipment of our products to the consumers from our ecommerce sites and upon shipment from our distribution centers to our customers in our wholesale operations. Once control is transferred to the customer, we have completed our performance obligation.

Our receivables resulting from wholesale customers are generally collected within two months, in accordance with our established credit terms. Our ecommerce and direct-to-consumer receivables are collected within a few days. Our revenue, including freight income, is recognized net of applicable taxes in our Condensed Consolidated Statements of Operations.

In certain areas of our wholesale business, we offer discounts and allowances to support our customers. Some of these arrangements are written agreements, while others may be implied by customary practices in the industry. Wholesale sales are recorded net of discounts, allowances, and operational chargebacks. As certain allowances and other deductions are not finalized until the end of a season, program or other event which may not have occurred, we estimate such discounts, allowances, and returns that we expect to provide.

In accordance with the new revenue guidance, we only recognize revenue to the extent that it is probable that we will not recognize a significant reversal of revenue when the uncertainties related to the variability are ultimately resolved. In determining our estimates for discounts, allowances, chargebacks, and returns, we consider historical and current trends, agreements with our customers and retailer performance. We record these discounts, returns and allowances as a reduction to net sales in our Condensed Consolidated Statements of Operations and as a liability in our accrued expenses in our Condensed Consolidated Balance Sheets, with the estimated value of inventory expected to be returned in prepaid and other current assets in our Condensed Consolidated Balance Sheets.

We have made accounting policy elections related to the new revenue recognition standard. We exclude any taxes collected from customers that are remitted to taxing authorities from net sales. We record shipping and handling charges incurred by us before and after the customer obtains control as a fulfillment cost rather than an additional promised service. Our customers' terms are less than one year from the transfer of goods, and we do not adjust receivable amounts for the impact of the time value of money. We do not capitalize costs of obtaining a contract which we expect to recover, such as commissions, as the amortization period of the asset recognized would be one year or less. We do not believe any of these expedients had a material impact on our financial statements upon our adoption of the guidance.

We expect that the timing of revenue recognition for our primary revenue streams to remain substantially unchanged, with no material effect on net sales. See the table below for the effect of the adoption of the standard on our Condensed Consolidated Balance Sheets as of December 29, 2018 (in thousands), due to the change in recording provisions for customer refunds as a liability instead of netted against trade accounts receivable .



	As Reported December 29, 2018		Effect of standard			Balances without Adoption
Accounts receivable, net	$	52,952	$	(1,119	)	$	51,833
Prepaid expenses and other current assets	3,602		(160		)	3,442
Total Current Assets	248,738		(1,279		)	247,459
Total assets	377,329		(1,279		)	376,050
Accrued liabilities	18,811		(1,500		)	17,311
Total current liabilities	94,915		(1,500		)	93,415
Total liabilities	231,974		(1,500		)	230,474
Total liabilities and equity	$	377,329	$	(1,500	)	$	375,829