Annual report pursuant to Section 13 and 15(d)

Segment Reporting

Segment Reporting

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Segment Reporting

NOTE 17

SEGMENT REPORTING

In accordance with ASC 280, “Segment Reporting”, we define 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.

We currently have three reporting segments, which include Treatment and Services Segments, which are based on a service offering approach; and Medical, whose primary purpose is the R&D of a new medical isotope production technology. The Medical Segment has not generated any revenues and all costs incurred are reflected within R&D in the accompanying consolidated financial statements. As previously disclosed, the Medical Segment has substantially reduced its R&D costs and activities due to the need for capital to fund these activities. The Company anticipates that the Medical Segment will not resume full R&D activities until the necessary capital is obtained through its own credit facility or additional equity raise, or obtains partners willing to provide funding for its R&D. Our reporting segments exclude our corporate headquarter and our discontinued operations (see “Note 9 – Discontinued Operations”) which do not generate revenues.

The table below shows certain financial information of our reporting segments as of and for the years ended December 31, 2019 and 2018 (in thousands).

Segment Reporting as of and for the year ended December 31, 2019

	Treatment			Services			Medical			Segments Total			Corporate ⁽²⁾			Consolidated Total
Revenue from external customers	$	40,364		$	33,095			—		$	73,459	⁽³⁾⁽⁴⁾	$	—		$	73,459
Intercompany revenues		329			38			—			367			—			—
Gross profit		12,248			3,336			—			15,584			—			15,584
Research and development		401			12			314			727			23			750
Interest income		—			—			—			—			337			337
Interest expense		(129	)		(23	)		—			(152	)		(280	)		(432	)
Interest expense-financing fees		—			—			—			—			(208	)		(208	)
Depreciation and amortization		999			318			—			1,317			25			1,342
Segment income (loss) before income taxes		7,973			795			(314	)		8,454			(5,565	)		2,889
Income tax expense		153			—			—			153			4			157
Segment income (loss)		7,820			795			(314	)		8,301			(5,569	)		2,732
Segment assets⁽¹⁾		34,260			15,410	⁽¹⁰⁾		16			49,686			16,829	⁽⁵⁾		66,515
Expenditures for segment assets (net)		169			1,366			—			1,535			—			1,535	⁽⁹⁾
Total debt		—			—			—			—			3,880			3,880	⁽⁶⁾

Segment Reporting as of and for the year ended December 31, 2018

	Treatment			Services			Medical			Segments Total			Corporate ⁽²⁾			Consolidated Total
Revenue from external customers	$	36,271		$	13,268			—		$	49,539	⁽³⁾⁽⁴⁾	$	—		$	49,539
Intercompany revenues		509			70			—			579			—			—
Gross profit		7,197			1,264			—			8,461			—			8,461
Research and development		483			—			811			1,294			76			1,370
Interest income		—			—			—			—			295			295
Interest expense		(22	)		(2	)		—			(24	)		(227	)		(251	)
Interest expense-financing fees		—			—			—			—			(38	)		(38	)
Depreciation and amortization		943			465			—			1,408			47			1,455
Segment income (loss) before income taxes		4,550	⁽⁷⁾		(756	)		(811	)		2,983			(4,993	)		(2,010	)
Income tax (benefit) expense		(943	)⁽⁸⁾		—			—			(943	)		7			(936	)
Segment income (loss)		5,493			(756	)		(811	)		3,926			(5,000	)		(1,074	)
Segment assets⁽¹⁾		32,800			5,188	⁽¹⁰⁾		25			38,013			19,429	⁽⁵⁾		57,442
Expenditures for segment assets (net)		1,311			117			—			1,428			4			1,432	⁽⁹⁾
Total debt		—			—			—			—			3,302			3,302	⁽⁶⁾

⁽¹⁾	Segment assets have been adjusted for intercompany accounts to reflect actual assets for each segment.

⁽²⁾	Amounts reflect the activity for corporate headquarters not included in the segment information.

⁽³⁾	The Company performed services relating to waste generated by government clients (domestic and foreign (primarily Canadian)), either directly as a prime contractor or indirectly for others as a subcontractor to government entities, representing approximately $59,985,000 or 81.7% of total revenue for 2019 and $35,944,000 or 72.6% of total revenue for 2018. The following reflects such revenue generated by our two segments:

	2019						2018
	Treatment		Services		Total		Treatment		Services		Total
Domestic government	$	29,420	$	25,077	$	54,497	$	25,181	$	9,630	$	34,811
Foreign government		279		5,209		5,488		114		1,019		1,133
Total	$	29,699	$	30,286	$	59,985	$	25,295	$	10,649	$	35,944

⁽⁴⁾	The following table reflects revenue based on customer location:

	2019		2018
United States	$	67,822	$	48,301
Canada		5,488		1,140
United Kingdom		149		98
Total	$	73,459	$	49,539

⁽⁵⁾	Amount includes assets from our discontinued operations of $221,000 and $306,000 at December 31, 2019 and 2018, respectively.

⁽⁶⁾	Net of debt discount/debt issuance costs of ($340,000) and ($80,000) for 2019 and 2018, respectively (see “Note 10 – “Long-Term Debt” for additional information).

⁽⁷⁾	Amount includes a net gain of $1,596,000 recorded resulting from the exchange offer of the Series B Preferred Stock of the Company’s M&EC subsidiary (see “Note 8 – Series B Preferred Stock”)

⁽⁸⁾	For the year ended December 31, 2018, amount includes a tax benefit recorded in the amount of approximately $1,235,000 resulting from certain provisions of the TCJA (see “Note 13 – Income Taxes” for further information of this tax benefit).

⁽⁹⁾	Net of financed amount of $393,000 and $545,000 for the year ended December 31, 2019 and 2018, respectively.

⁽¹⁰⁾	Includes long-lived asset (net) for our PF Canada, Inc. subsidiary of $41,000 and $0, for the year ended December 31, 2019 and 2018, respectively.