Quarterly report pursuant to sections 13 or 15(d)

Operating Segments

v2.3.0.11
Operating Segments
 6 Months Ended
Jun. 30, 2012
Operating Segments [Abstract]  
Operating Segments
11.
Operating Segments

In accordance to 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 Officer 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 two reporting segments, which are based on a service offering approach.  This however, excludes corporate headquarters, which does not generate revenue, and our discontinued operations, which includes all facilities as discussed in "Note 10 - Discontinued Operations and Divestitures."

Our reporting segments are defined as follows:

TREATMENT SEGMENT which includes:
-
nuclear, low-level radioactive, mixed (waste containing both hazardous and low-level radioactive constituents), hazardous and non-hazardous waste treatment, processing and disposal services primarily through four uniquely licensed and permitted treatment and storage facilities; and
-
research and development 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 includes:
o
professional radiological measurement and site survey of large government and commercial installations using advance 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; and
o
augmented engineering services (through our Schreiber, Yonley & Associates subsidiary - "SYA") providing consulting environmental services to industrial and government customers:
●
including air, water, and hazardous waste permitting, air, soil and water sampling, compliance reporting, emission reduction strategies, compliance auditing, and various compliance and training activities; and
●
engineering and compliance support to other segments.
-
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.
 
The table below presents certain financial information of our operating segment as of and for the three and six months ended June 30, 2012 and 2011 (in thousands).

Segment Reporting for the Quarter Ended June 30, 2012
Treatment
Services
Segments
Total
Corporate (2)
Consolidated Total
Revenue from external customers
$
10,037
$
23,941
$
33,978
(3)
$
-
$
33,978
Intercompany revenues
549
49
598
-
-
Gross profit
1,088
2,686
3,774
-
3,774
Interest income
-
-
-
7
7
Interest expense
3
-
3
196
199
Interest expense-financing fees
-
-
-
26
26
Depreciation and amortization
1,125
692
1,817
18
1,835
Segment profit (loss)
72
869
941
(2,070
)
(1,129
)
Segment assets(1)
78,982
41,988
120,970
31,231
(4)
152,201
Expenditures for segment assets
74
103
177
2
179
Total long-term debt
108
9
117
17,346
17,463
Segment Reporting for the Quarter Ended June 30, 2011
Treatment
Services
Segments
Total
Corporate (2)
Consolidated Total
Revenue from external customers
$
17,631
 
$
11,282
$
28,913
(3)
$
-
$
28,913
Intercompany revenues
376
87
463
-
-
Gross profit
5,972
2,077
8,049
-
8,049
Interest income
-
-
-
13
13
Interest expense
31
1
32
151
183
Interest expense-financing fees
-
-
-
54
54
Depreciation and amortization
1,137
10
1,147
29
1,176
Segment profit (loss)
3,261
1,177
4,438
(1,886
)
2,552
Segment assets(1)
98,239
2,974
101,213
31,069
(4)
132,282
Expenditures for segment assets
947
5
952
20
972
Total long-term debt
205
15
220
9,037
(5)
9,257
Segment Reporting for the Six Months Ended June 30, 2012
Treatment
Services
Segments
Total
Corporate (2)
Consolidated Total
Revenue from external customers
$
22,879
$
49,172
$
72,051
(3)
$
-
$
72,051
Intercompany revenues
1,158
117
1,275
-
-
Gross profit
3,809
4,266
8,075
-
8,075
Interest income
-
-
-
21
21
Interest expense
5
6
11
409
420
Interest expense-financing fees
-
-
-
60
60
Depreciation and amortization
2,255
1,152
3,407
36
3,443
Segment profit (loss)
1,164
925
2,089
(4,074
)
(1,985
)
Segment assets(1)
78,982
41,988
120,970
31,231
(4)
152,201
Expenditures for segment assets
242
141
383
4
387
Total long-term debt
108
9
117
17,346
17,463
Segment Reporting for the Six Months Ended June 30, 2011
Treatment
Services
Segments
Total
Corporate (2)
Consolidated Total
Revenue from external customers
$
29,966
 
$
22,562
$
52,528
(3)
$
-
$
52,528
Intercompany revenues
794
156
950
-
-
Gross profit
6,932
4,147
11,079
-
11,079
Interest income
-
-
-
26
26
Interest expense
64
1
65
294
359
Interest expense-financing fees
-
-
-
156
156
Depreciation and amortization
2,278
20
2,298
34
2,332
Segment profit (loss)
3,379
2,305
5,684
(3,665
)
2,019
Segment assets(1)
98,239
2,974
101,213
31,069
(4)
132,282
Expenditures for segment assets
1,659
6
1,665
24
1,689
Total long-term debt
205
15
220
9,037
(5)
9,257
 
(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 following customers accounted for 10% or more of the total revenues generated from continuing operations for the three and six months ended June 30, 2012 and the corresponding period of 2011: (1) Revenues from CH Plateau Remediation Company ("CHPRC") totaled $6,323,000 or 18.5% and 12,633,000 or 17.5% for the three and six months ended June 30, 2012, respectively and $17,171,000 or 59.4% and 30,833,000 or 58.7% for the corresponding period of 2011, respectively (2) Revenues generated directly from the U.S. Department of Energy ("DOE") accounted for $9,709,000 or 28.6% and $19,408,000 or 26.9% for the three and six months ended June 30, 2012, respectively and $0 or 0% and $0 or 0% for the corresponding period of 2011, respectively.  The increase in revenue generated directly from the DOE was attributable to the acquisition of SEC in October 31, 2011.

(4)
Amount includes assets from discontinued operations of $2,381,000 and $7,590,000 as of June 30, 2012 and 2011, respectively.

(5)
Net of debt discount of ($32,000) in connection with Warrants and Common Stock issued on May 8, 2009 in connection with a $3,000,000 promissory note entered into by the Company and Mr. William Lampson and Mr. Diehl Rettig on May 8, 2009.  The promissory note and the Warrants were modified on April 18, 2011.  The promissory note was paid off and the debt discount became fully amortized in April 2012.  See Note 8 - "Promissory Note and Installment Agreement" for additional information.