RSTO » Topics » Segment

This excerpt taken from the RSTO 10-K filed Apr 17, 2008.

Segment

We are organized into two reportable segments—the Stores segment and the Direct-to-customer segment—and our results in this Form 10-K are presented in this manner. Our focus on maximizing the potential of our Direct-to-customer segment as well as the consolidation of small package Direct-to-customer fulfillment has resulted in an increase of this segment’s net revenues in relation to our total net revenues. Direct-to-customer segment revenue has grown from 11% of net revenues in fiscal 2002 to 49% of net revenues in fiscal 2007. We expect this trend to continue. Although our Stores segment has generally experienced growth, it has declined as a percentage of net revenues from 89% in fiscal 2002 to 51% in fiscal 2007 in part reflecting the changes discussed above and in Note 12 to the consolidated financial statements. A summary of our net revenues and condensed results of operations for our two reportable segments is disclosed in Note 12, “Segment Reporting,” to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.

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