Note 1 - Description of Business and Basis of Operation
|12 Months Ended|
Dec. 31, 2015
|Notes to Financial Statements|
|Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Perma-Fix Environmental Services, Inc. (the Company, which may be referred to as we, us, or our), an environmental and technology know-how company, is a Delaware corporation, engaged through its subsidiaries, in three reportable segments:
TREATMENT SEGMENT, which includes:
SERVICES SEGMENT, which includes:
On April 4, 2014, the Company completed the acquisition of a controlling interest in a Polish Company, a publicly traded shell company on the NewConnect (alternative share market run by the Warsaw Stock Exchange) in Poland and sold to the Polish shell all of the shares of Perma-Fix Medical Corporation, a Delaware corporation organized by the Company (incorporated in January 2014). Perma-Fix Medical Corporation’s only asset was a worldwide license granted by the Company to use, develop and market the new process and technology developed by the Company in the production of Technetium-99 (“Tc-99m”) for medical diagnostic applications. Tc-99m is the most widely used medical isotope in the world. Since the acquired shell company (now named Perma-Fix Medical S.A. or “PF Medical”) did not meet the definition of a business under Accounting Standards Codification (“ASC”) 805, “Business Combinations”, the transaction was accounted for as a capital transaction. PF Medical, the Company’s majority-owned Polish subsidiary (which we own approximately 60.5% as of December 31, 2015), continues to perform research and development (“R&D”) of its new medical isotope production technology. As of December 31, 2015, PF Medical has not generated any revenue as it is primarily in the R&D stage. In accordance with ASC 280, “Segment Reporting,” the Company has determined that the operations of PF Medical meet the definition of a reportable segment. Accordingly, all of the historical numbers presented in the consolidated financial statements have been recast to include the operations of PF Medical as a separate reportable segment (“Medical Segment”)
MEDICAL SEGMENT, which includes: R&D of a new medical isotope production technology by our majority-owned Polish subsidiary, PF Medical. The Company’s Medical Segment has not generated any revenue as it continues to be primarily in the R&D stage. All costs incurred by the Medical Segment are reflected within R&D in the accompanying consolidated financial statements..
The Company’s continuing operations consist of Diversified Scientific Services, Inc. (“DSSI”), East Tennessee Materials & Energy Corporation (“M&EC”), Perma-Fix of Florida, Inc. (“PFF”), Perma-Fix of Northwest Richland, Inc. (“PFNWR”), Schreiber, Yonley & Associates (“SYA” which was divested on July 29, 2014), Safety & Ecology Corporation (“SEC”), Perma-Fix Environmental Services UK Limited (“PF UK Limited”), Perma-Fix of Canada, Inc. (“PF Canada”), and PF Medical (a majority-owned Polish subsidiary).
The Company’s discontinued operations (see Note 8) consist of all our subsidiaries included in our Industrial Segment which were divested in 2011 and prior, two previously closed locations, and our Perma-Fix of South Georgia, Inc. (“PFSG”) facility which suffered a fire on August 14, 2013 and became non-operational and is closure status.
Financial Position and Liquidity
The Company achieved improvement in financial position and liquidity in the twelve months ended December 31, 2015 as compared to the corresponding period of 2014. As of December 31, 2015, working capital was approximately $3,091,000, an improvement of $2,719,000 from a working capital of approximately $372,000 as of December 31, 2014. The Company generated a loss from continuing operations of $63,000 as compared to a loss from continuing operations of $2,992,000 in 2014. The Company’s financial results were negatively impacted by certain non-recurring charges incurred in 2015 within discontinued operations (see Note 8 – “Discontinued Operations and Divestitures”).
The Company’s cash flow requirements during 2015 were financed primarily by our operations, Credit Facility availability, and an equity raise by PF Medical. The Company is continually reviewing operating costs and is committed to further reducing operating costs to bring them in line with revenue levels, when needed.
The Company’s cash flow requirements for 2016 will consist primarily of general working capital needs, scheduled principal payments on our debt obligations and capital leases, remediation projects and planned capital expenditures which we plan to fund from operations and our Credit Facility availability. The Company’s majority-owned Polish subsidiary, PF Medical, continues to dedicate resources to the R&D of the new medical isotope production technology and to take the necessary steps for eventual submittal of this technology for U.S. Food and Drug Administration (“FDA”) and other regulatory approval and commercialization of this technology. The need for capital may require PF Medical to obtain its own credit facility or through additional equity raises by PF Medical. If PF Medical obtains its own separate credit facility, such could result in restrictions on our rights as a majority stock owner. Any equity raises, if successful, would result in dilution of the Company’s ownership of PF Medical.
The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.
Reference 1: http://www.xbrl.org/2003/role/presentationRef