Annual report pursuant to Section 13 and 15(d)

Note 17 - Segment Reporting

v3.6.0.2
Note 17 - Segment Reporting
 12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]
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 at this time 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 Statements of Operations. 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 for
2016
and
2015
(in thousands).
 
Segment Reporting as of and for the year ended
December
31,
2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
Treatment
    
Services
    
Medical
    
Segments
Total
    
Corporate
(2)
  
Consolidated
Total
  
Revenue from external customers
   $
32,253
 
   $
18,966
 
 
 
—
    $
51,219
  (3)
   $
—
 
   $
51,219
 
Intercompany revenues
    
40
 
    
28
 
 
 
—
     
68
 
 
 
—
 
 
 
—
 
Gross profit
    
4,015
 
    
3,069
 
 
 
—
     
7,084
 
 
 
—
 
    
7,084
 
Research and development
    
504
 
    
38
     
1,489
     
2,031
 
    
15
 
    
2,046
 
Interest income
    
3
 
 
 
—
 
 
 
—
     
3
 
    
107
 
    
110
 
Interest expense
    
(29
)
    
(2
 )
 
 
—
     
(31
)
    
(458
)
    
(489
 )
Interest expense-financing fees
 
 
—
 
 
 
—
 
 
 
—
 
 
 
—
 
    
(108
)
    
(108
 )
Depreciation and amortization
    
3,451
 
    
632
 
 
 
—
     
4,083
 
    
82
 
    
4,165
 
Segment (loss) income before income taxes
    
(10,119
)
(6)
    
744
     
(1,489
 )    
(10,864
)
    
(5,393
)
    
(16,257
 )
Income tax (benefit) expense
   
(3,013
)
(6)
 
 
—
 
 
 
—
     
(3,013
)
    
19
 
    
(2,994
 )
Segment (loss) income
   
(7,106
)
    
744
     
(1,489
 )    
(7,851
)
    
(5,412
)
    
(13,263
 )
Segment assets
(1)
    
32,482
 
    
8,105
     
382
     
40,969
 
    
24,366
(4)
    
65,335
 
Expenditures for segment assets
    
418
 
    
17
     
1
     
436
 
 
 
—
 
    
436
 
Total debt
 
 
—
 
 
 
—
 
 
 
—
 
 
 
—
 
    
8,833
(5)
    
8,833
 
 
Segment Reporting as of and for the year ended
December
31,
2015
 
   
Treatment
    
Services
    
Medical
    
Segments
Total
    
Corporate
  
(2)
  
Consolidated
Total
  
Revenue from external customers
   $
41,318
    $
21,065
 
 
 
—
    $
62,383
(3)
   $
—
 
   $
62,383
 
Intercompany revenues
    
113
     
25
 
 
 
—
     
138
 
 
 
—
 
 
 
—
 
Gross profit
    
10,910
     
3,441
 
 
 
—
     
14,351
 
 
 
—
 
    
14,351
 
Research and development
    
179
 
 
 
—
     
2,114
     
2,293
 
    
9
 
    
2,302
 
Interest income
    
6
 
 
 
—
 
 
 
—
     
6
 
    
47
 
    
53
 
Interest expense
    
(38
 )
 
 
—
 
 
 
—
     
(38
)
    
(451
)
    
(489
 )
Interest expense-financing fees
    
(2
 )
 
 
—
 
 
 
—
     
(2
)
    
(226
)
    
(228
 )
Depreciation and amortization
    
2,949
     
725
 
 
 
—
     
3,674
 
    
43
 
    
3,717
 
Segment income (loss) before income taxes
    
7,101
     
1,178
     
(2,114
 )    
6,165
 
    
(5,685
)
    
480
 
Income tax expense
   
538
 
 
 
—
 
 
 
—
     
538
 
    
5
 
    
543
 
Segment income (loss)
    
6,563
     
1,178
     
(2,114
 )    
5,627
 
    
(5,690
)
    
(63
 )
Segment assets
(1)
    
46,307
     
9,481
     
1,793
     
57,581
 
    
25,332
(4)
    
82,913
 
Expenditures for segment assets
    
579
     
33
 
 
 
—
     
612
 
    
11
 
    
623
 
Total debt
    
23
 
 
 
—
 
 
 
—
     
23
 
    
9,813
(5)
    
9,836
 
 
 
(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 the federal government, either directly as a prime contractor or indirectly for others as a subcontractor to the federal government, representing approximately
$27,354,000
or
53.4%
of total revenue from continuing operations during
2016
and
$36,105,000
or
57.9%
of total revenue from continuing operations during
2015.
The following reflects such revenue generated by our
two
segments:
 
   
2016
    
2015
  
Treatment
   $
21,434,000
    $
30,130,000
 
Services
    
5,920,000
     
5,975,000
 
Total
   $
27,354,000
    $
36,105,000
 
 
(4)
Amount includes assets from our discontinued operations of
$434,000
and
$565,000,
as of
December
31,
2016
and
2015,
respectively.
 
(5)
Net of debt discount of
($0)
and
($50,000)
for
2016
and
2015,
respectively, and net of debt issuance costs of
($151,000)
and
($152,000)
for
2016
and
2015,
respectively (see “Note
10
– “Long-Term Debt” for additional information).
 
(6)
Amounts include tangible and intangible asset impairment losses of
$1,816,000
and
$8,288,000,
respectively for the Company’s M&EC subsidiary recorded in the
second
quarter of
2016
(see “Note
3
– M&EC Facility”). Also includes a tax benefit of approximately
$3,203,000
recorded resulting from the intangible impairment loss recorded for our M&EC subsidiary.