Annual report [Section 13 and 15(d), not S-K Item 405]

SEGMENT REPORTING

v3.26.1
SEGMENT REPORTING
 12 Months Ended
Dec. 31, 2025
Segment Reporting [Abstract]  
SEGMENT REPORTING

NOTE 16

SEGMENT REPORTING

 

In accordance with ASC 280, “Segment Reporting”, the Company defines an operating segment as a business activity:

 

  ● from which we may earn revenue and incur expenses;
  ● whose operating results are regularly reviewed by the chief operating decision maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance; and
  ● for which discrete financial information is available.

 

The Company has two reporting segments, consisting of the Treatment and Services Segments, which are primarily based on a service offering approach (see “Note 1- Description of Business and Basis of Presentation” for the type of services from which each of the Company’s reportable segments derives its revenue). The Company’s reporting segments exclude our corporate headquarters which serve to support its two reporting segments through various functions, such as our executives, finance, treasury, human resources, accounting, and legal departments. Financial results for our corporate headquarters are not considered by the CODM in evaluating the performance of the reportable segments. Our reporting segments also exclude our discontinued operations (see “Note 8 – Discontinued Operations”) which do not generate revenues.

 

The Company’s CODM is represented by its Chief Executive Officer (“CEO”) and COO (or “CODM group”). The CODM group evaluates the performance of the Treatment and Services segments and allocates resources (including financial or capital resources) to each reporting segment based on revenue and income (loss) from operations by comparing actual results for these metrics to budgeted and forecasted amounts for these metrics on a monthly, quarterly and year-to-date basis. The Company’s CODM group does not evaluate and allocate resources for the reportable segments using assets; therefore, the Company does not disclose assets for its reporting segments.

 

The table below summarizes loss from operations for the Company’s two reporting segments and its corporate headquarters and provides reconciliation of such financial metric to the Company’s consolidated totals for the years 2025 and 2024 for our continuing operations. Significant segment expenses that are included in the measure of segment profit or losses for each reportable segment and regularly provided to the CODM include payroll and benefit, material and supplies, disposal and transportation and subcontract expenses and are reflected separately, where applicable (in thousands).

 

 

Segment Reporting as of and for the year ended December 31, 2025

 

    Treatment     Services     Segments Total     Corporate (1)     Consolidated Total  
Revenue from external customers   $ 45,097     $ 16,577     $ 61,674 (4)(5)   $ —     $ 61,674  
Cost of goods sold:                                        
Payroll and benefit expenses     18,810       8,516       27,326       —       27,326  
Material and supplies expenses     6,965       —       6,965       —       6,965  
Disposal expenses     3,195       —       3,195       —       3,195  
Transportation expenses     1,488       —       1,488       —       1,488  
Subcontract expenses     —       1,256       1,256       —       1,256  
Other cost of goods sold (2)     9,845       5,626       15,471       —       15,471  
Total cost of goods sold     40,303       15,398       55,701       —       55,701  
Gross profit     4,794       1,179       5,973       —       5,973  
Selling, general and administrative expenses (“SG&A”):                                        
Payroll and benefits     3,571       2,355       5,926       3,854       9,780  
Other SG&A (3)     1,697       861       2,558       4,078       6,636  
Total SG&A     5,268       3,216       8,484       7,932       16,416  
Research and development     969       30       999       292       1,291  
Loss (gain) on disposal of property and equipment     6       (5 )     1       —       1  
Loss from operations   $ (1,449 )   $ (2,062 )   $ (3,511 )   $ (8,224 )     (11,735 )
Interest income                                     1,123  
Interest expense                                     (230 )
Interest expense-financing fees                                     (84 )
Other expense                                     261  
Loss from continuing operations before taxes                                     (10,665 )
Income tax expense                                     —  
Loss from continuing operations, net of taxes                                   $ (10,665 )

 

Segment Reporting as of and for the year ended December 31, 2024

 

    Treatment     Services     Segments Total     Corporate (1)     Consolidated Total  
Revenue from external customers   $ 34,953     $ 24,164        $ 59,117 (4)(5)   $ —     $ 59,117  
Cost of Goods Sold:                                        
Payroll and benefits expenses     16,257       9,494       25,751       —       25,751  
Material and supplies expenses     4,074       —       4,074       —       4,074  
Disposal expenses     5,317       —       5,317       —       5,317  
Transportation expenses     1,118       —       1,118       —       1,118  
Subcontract expenses     —       7,152       7,152       —       7,152  
Other cost of goods sold (2)     9,297       6,406       15,703       —       15,703  
Total cost of goods sold     36,063       23,052       59,115       —       59,115  
Gross (loss) profit     (1,110 )     1,112       2       —       2  
SG&A:                                        
Payroll and benefits     2,858       2,413       5,271       3,296       8,567  
Other SG&A (3)     1,432       892       2,324       3,600       5,924  
Total SG&A     4,290       3,305       7,595       6,896       14,491  
Research and development     842       111       953       219       1,172  
Loss on disposal of property and equipment     18       3       21       —       21  
Loss from operations   $ (6,260 )   $ (2,307 )   $ (8,567 )   $ (7,115 )     (15,682 )
Interest income                                     921  
Interest expense                                     (473 )
Interest expense-financing fees                                     (66 )
Other income                                     166  
Loss from continuing operations before taxes                                     (15,134 )
Income tax expense                                     4,435  
Loss from continuing operations, net of taxes                                   $ (19,569 )

 

(1) Amounts reflect the activity for corporate headquarters not included in the segment reporting information.

 

(2) Other cost of goods sold for each reportable segment includes:
  Treatment - lab, regulatory, maintenance, depreciation and amortization, travel, outside services and general expenses.
  Services - material and supplies, disposal and transportation, lab, regulatory, maintenance, depreciation and amortization, travel, outside services and general expenses.

 

 

(3) Other SG&A for each reportable segment and Corporate includes:
  Treatment-depreciation and amortization, travel, outside services, maintenance and general expenses.
  Services- travel, outside services, maintenance and general expenses.
  Corporate-maintenance, depreciation and amortization, travel, outside services/public company and general expenses.

 

(4) Revenue derived from federal government entities, either directly as a prime contractor or indirectly for others as a subcontractor to federal government entities, was approximately $39,243,000 or 63.6% of total revenue for 2025 and $40,550,000 or 68.6% of total revenue for 2024.

 

(5) The following table reflects revenue based on customer location (in thousands):

 SCHEDULE OF REVENUE BASED ON CUSTOMER LOCATION

    2025     2024  
United States   $ 55,234     $ 56,665  
Canada     2,820       513  
Germany     774       734  
Italy     389       77  
Mexico     2,144       394  
Slovenia     94       181  
United Kingdom     219       553  
Total   $ 61,674     $ 59,117  

 

The following table presents depreciation and amortization for the years ended December 31, (in thousands):

 

    2025     2024  
Treatment   $ 1,582     $ 1,484  
Services     133       177  
Total segment     1,715       1,661  
Corporate     44       102  
Total   $ 1,759     $ 1,763  

 

The following table presents capital expenditures for the years ended December 31, (net of financed amount of $464,000 and $406,000 for 2025 and 2024, respectively (in thousands):

 

    2025     2024  
Treatment   $ 4,623     $ 3,002  
Services     85       403  
Total segment     4,708       3,405  
Corporate     —       —  
Total   $ 4,708     $ 3,405  


 

The following table presents long-lived assets for the Company’s continuing operations for the years ended December 31, (in thousands):

 

    2025     2024  
United States   $ 24,600     $ 21,133  
Foreign Subsidiaries     —       —  
Total   $ 24,600     $ 21,133