Quarterly report pursuant to Section 13 or 15(d)

Note 9 - Operating Segments

v3.4.0.3
Note 9 - Operating Segments
 3 Months Ended
Mar. 31, 2016
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]
9
.
Operating Segments
 
In accordance with ASC 280, “Segment Reporting”, the Company defines an operating segment as a business activity: (a) from which we may earn revenue and incur expenses; (2) 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 (3) for which discrete financial information is available.
 
 
Our reporting segments are defined as below:
 
TREATMENT SEGMENT reporting includes:
 
-
nuclear, low-level radioactive, mixed, hazardous and non-hazardous waste treatment, processing and disposal services primarily through four uniquely licensed and permitted treatment and storage facilities; and
 
-
R&D activities to identify, develop and implement innovative waste processing techniques for problematic waste streams.
 
SERVICES SEGMENT, which includes:
 
-
On-site waste management services to commercial and government customers;
 
-
Technical services, which include:
 
o
professional radiological measurement and site survey of large government and commercial installations using advanced methods, technology and engineering;
 
o
integrated Occupational Safety and Health services including industrial hygiene (“IH”) assessments; hazardous materials surveys, e.g., exposure monitoring; lead and asbestos
management/abatement oversight; indoor air quality evaluations; health risk and exposure assessments; health & safety plan/program development, compliance auditing and training services; and Occupational Safety and Health Administration (“OSHA”) citation assistance;
 
o
global technical services providing consulting, engineering, project management, waste management, environmental, and decontamination and decommissioning field, technical, and management personnel and services to commercial and government customers;
 
-
Nuclear services, which include:
 
o
technology-based services including engineering, decontamination and decommissioning (“D&D”), specialty services and construction, logistics, transportation, processing and disposal;
 
o
remediation of nuclear licensed and federal facilities and the remediation cleanup of nuclear legacy sites. Such services capability includes: project investigation; radiological engineering; partial and total plant D&D; facility decontamination, dismantling, demolition, and planning; site restoration; site construction; logistics; transportation; and emergency response; and
 
-
A company owned equipment calibration and maintenance laboratory that services, maintains, calibrates, and sources (i.e., rental) of health physics, IH and customized nuclear, environmental, and occupational safety and health (“NEOSH”) instrumentation.
 
MEDICAL SEGMENT reporting includes: R&D costs for the new medical isotope production technology from our majority-owned Polish subsidiary, PF Medical. The Medical Segment has not generated any revenue as it continues to be primarily in the R&D stage.
All costs incurred for the Medical Segment are reflected within R&D in the accompanying Consolidated Statements of Operations and consist primarily of employee salaries and benefits, laboratory costs, third party fees, and other related costs associated with the development of this new technology.
 
Our reporting segments exclude our corporate headquarters and our discontinued operations (see Note 8 – “Discontinued Operations”) which do not generate revenues.
 
 
The table below presents certain financial information of our operating segments as of and for the three months ended March 31, 2016 and 2015 (in thousands).
 
Segment Reporting as of and for the Quarter Ended March 31, 2016
  
 
 
 
 
 
 
 
 
   
Treatment
    
Services
    
Medical
    
Segments
Total
    
Corporate
(1)
    
Consolidated
Total
  
Revenue from external customers
   $ 7,204     $ 2,834  
 
 
—
     $ 10,038     $ —     $ 10,038  
Intercompany revenues
     4       5  
 
 
—
       9  
 
 
—
  
 
 
—
  
Gross profit
    (138 )     172  
 
 
—
       34  
 
 
—
       34  
Research and development
     106       26       438       570       5       575  
Interest income
 
 
—
  
 
 
—
  
 
 
—
  
 
 
—
       16       16  
Interest expense
     (2 )
 
 
—
  
 
 
—
       (2 )     (166 )     (168 )
Interest expense-financing fees
 
 
—
  
 
 
—
  
 
 
—
  
 
 
—
       (57 )     (57 )
Depreciation and amortization
     713       161  
 
 
—
       874       10       884  
Segment loss before income taxes
     (1,248 )     (725 )     (438 )     (2,411 )     (1,399 )     (3,810 )
Income tax expense
     36  
 
 
—
  
 
 
—
       36  
 
 
—
       36  
Segment loss
     (1,284 )     (725 )     (438 )     (2,447 )     (1,399 )     (3,846 )
Expenditures for segment assets
     8  
 
 
—
       1       9  
 
 
—
       9  
 
Segment Reporting as of and for the Quarter Ended March 31, 2015
  
 
 
 
 
 
 
 
 
   
Treatment
    
Services
    
Medical
    
Segments
Total
    
Corporate
(1)
    
Consolidated
Total
  
Revenue from external customers
   $ 9,749     $ 3,851  
 
 
—
     $ 13,600     $ —     $ 13,600  
Intercompany revenues
     2       8  
 
 
—
       10  
 
 
—
  
 
 
—
  
Gross profit
    1,235       243  
 
 
—
       1,478  
 
 
—
       1,478  
Research and development
     34  
 
 
—
       395       429  
 
 
—
       429  
Interest income
 
 
—
  
 
 
—
  
 
 
—
  
 
 
—
       8       8  
Interest expense
     (22 )
 
 
—
  
 
 
—
       (22 )     (104 )     (126 )
Interest expense-financing fees
 
 
—
  
 
 
—
  
 
 
—
  
 
 
—
       (58 )     (58 )
Depreciation and amortization
     764       190  
 
 
—
       954       12       966  
Segment income (loss) before income taxes
     221       (303 )     (395 )     (477 )     (1,501 )     (1,978 )
Income tax expense
    36  
 
 
—
  
 
 
—
       36  
 
 
—
       36  
Segment income (loss)
     185       (303 )     (395 )     (513 )     (1,501 )     (2,014 )
Expenditures for segment assets
     104       16  
 
 
—
       120       1       121  
 
(
1
)
Amounts reflect the activity for corporate headquarters not included in the segment information.