| Segment Information |
NOTE 11 – SEGMENT INFORMATION
The Company classifies its businesses into the four segments as follows:
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·
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Suttle manufactures and markets connectivity infrastructure products for broadband and voice communications;
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·
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Transition Networks manufactures media converters, NIDs, NICs, Ethernet switches and other connectivity products that offer the ability to affordably integrate the benefits of fiber optics into any data network;
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·
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JDL Technologies provides technology solutions that address prevalent IT challenges, including virtualization and cloud solutions, managed services, wired and wireless network design and implementation, and converged infrastructure configuration and deployment; and
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·
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Net2Edge develops, manufactures and sells products that enable telecommunications carriers to connect legacy networks to high-speed services.
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Management has chosen to organize the enterprise and disclose reportable segments based on our products and services. Intersegment revenues are eliminated upon consolidation.
Information concerning the Company’s continuing operations in the various segments for the three and six month periods ended June 30, 2018 and 2017 is as follows:
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Transition
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JDL
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Intersegment
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Suttle
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Networks
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Technologies
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Net2Edge
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Other
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Eliminations
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Total
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Three Months Ended June 30, 2018
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Sales
|
$
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5,873,000
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$
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7,834,000
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$
|
913,000
|
$
|
681,000
|
$
|
-
|
$
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(263,000)
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$
|
15,038,000
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Cost of sales
|
|
5,414,000
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|
4,327,000
|
|
841,000
|
|
501,000
|
|
-
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(30,000)
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|
11,053,000
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Gross profit (loss)
|
|
459,000
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|
3,507,000
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|
72,000
|
|
180,000
|
|
-
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(233,000)
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3,985,000
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Selling, general and
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|
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administrative expenses
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2,154,000
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3,488,000
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478,000
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820,000
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-
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(233,000)
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6,707,000
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Operating (loss) income
|
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(1,695,000)
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|
19,000
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(406,000)
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(640,000)
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-
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-
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(2,722,000)
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Other income (expense)
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(4,000)
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6,000
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3,000
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20,000
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44,000
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|
-
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|
69,000
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Income (loss) before income tax
|
$
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(1,699,000)
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$
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25,000
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$
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(403,000)
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$
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(620,000)
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$
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44,000
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$
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-
|
$
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(2,653,000)
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Depreciation and amortization
|
$
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386,000
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$
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100,000
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$
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41,000
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$
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14,000
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$
|
-
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$
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-
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$
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541,000
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|
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Capital expenditures
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$
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232,000
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$
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18,000
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$
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-
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$
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98,000
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$
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-
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$
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-
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$
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348,000
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Assets
|
$
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15,748,000
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$
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15,058,000
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$
|
912,000
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$
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2,468,000
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$
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20,780,000
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$
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(27,000)
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$
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54,939,000
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Transition
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JDL
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Intersegment
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Suttle
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Networks
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Technologies
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Net2Edge
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Other
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Eliminations
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Total
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Three Months Ended June 30, 2017
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Sales
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$
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8,580,000
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$
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9,500,000
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$
|
4,026,000
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$
|
180,000
|
$
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-
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$
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(218,000)
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$
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22,068,000
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Cost of sales
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|
7,767,000
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5,206,000
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3,065,000
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40,000
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-
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(20,000)
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|
16,058,000
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Gross profit
|
|
813,000
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|
4,294,000
|
|
961,000
|
|
140,000
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|
-
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(198,000)
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|
6,010,000
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Selling, general and
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|
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|
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|
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administrative expenses
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2,325,000
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|
3,933,000
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|
557,000
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|
701,000
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-
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(198,000)
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|
7,318,000
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Impairment loss
|
|
-
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|
-
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|
1,463,000
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|
154,000
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|
-
|
|
-
|
|
1,617,000
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Restructuring expense
|
|
1,142,000
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|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,142,000
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Operating (loss) income
|
|
(2,654,000)
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|
361,000
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(1,059,000)
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|
(715,000)
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-
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-
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(4,067,000)
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Other income (expense)
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(69,000)
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|
(1,000)
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-
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(2,000)
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21,000
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|
-
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(51,000)
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Income (loss) before income tax
|
$
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(2,723,000)
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$
|
360,000
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$
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(1,059,000)
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$
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(717,000)
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$
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21,000
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$
|
-
|
$
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(4,118,000)
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|
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|
|
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|
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Depreciation and amortization
|
$
|
579,000
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$
|
173,000
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$
|
77,000
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$
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20,000
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$
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-
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$
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-
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$
|
849,000
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|
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|
|
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Capital expenditures
|
$
|
25,000
|
$
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25,000
|
$
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3,000
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$
|
43,000
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$
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4,000
|
$
|
-
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$
|
100,000
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|
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|
|
|
|
|
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Assets
|
$
|
31,292,000
|
$
|
15,262,000
|
$
|
4,122,000
|
$
|
1,294,000
|
$
|
15,699,000
|
$
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(27,000)
|
$
|
67,642,000
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|
|
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|
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|
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Transition
|
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JDL
|
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|
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Intersegment
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Suttle
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Networks
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Technologies
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Net2Edge
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Other
|
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Eliminations
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Total
|
|
Six Months Ended June 30, 2018
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|
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Sales
|
$
|
12,846,000
|
$
|
16,988,000
|
$
|
1,622,000
|
$
|
846,000
|
$
|
-
|
$
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(490,000)
|
$
|
31,812,000
|
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Cost of sales
|
|
11,012,000
|
|
9,554,000
|
|
1,568,000
|
|
563,000
|
|
-
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(49,000)
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|
22,648,000
|
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Gross profit
|
|
1,834,000
|
|
7,434,000
|
|
54,000
|
|
283,000
|
|
-
|
|
(441,000)
|
|
9,164,000
|
|
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative expenses
|
|
4,410,000
|
|
7,203,000
|
|
964,000
|
|
1,724,000
|
|
-
|
|
(441,000)
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|
13,860,000
|
|
Operating (loss) income
|
|
(2,576,000)
|
|
231,000
|
|
(910,000)
|
|
(1,441,000)
|
|
-
|
|
-
|
|
(4,696,000)
|
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Other income
|
|
20,000
|
|
4,000
|
|
3,000
|
|
12,000
|
|
152,000
|
|
-
|
|
191,000
|
|
Income (loss) before income tax
|
$
|
(2,556,000)
|
$
|
235,000
|
$
|
(907,000)
|
$
|
(1,429,000)
|
$
|
152,000
|
$
|
-
|
$
|
(4,505,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
$
|
799,000
|
$
|
241,000
|
$
|
105,000
|
$
|
28,000
|
$
|
-
|
$
|
-
|
$
|
1,173,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Capital expenditures
|
$
|
459,000
|
$
|
38,000
|
$
|
-
|
$
|
115,000
|
$
|
-
|
$
|
-
|
$
|
612,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transition
|
|
JDL
|
|
|
|
|
|
Intersegment
|
|
|
|
|
|
Suttle
|
|
Networks
|
|
Technologies
|
|
Net2Edge
|
|
Other
|
|
Eliminations
|
|
Total
|
|
Six Months Ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
|
17,352,000
|
$
|
18,504,000
|
$
|
6,891,000
|
$
|
537,000
|
$
|
-
|
$
|
(416,000)
|
$
|
42,868,000
|
|
Cost of sales
|
|
15,480,000
|
|
10,325,000
|
|
4,969,000
|
|
140,000
|
|
-
|
|
(22,000)
|
|
30,892,000
|
|
Gross profit
|
|
1,872,000
|
|
8,179,000
|
|
1,922,000
|
|
397,000
|
|
-
|
|
(394,000)
|
|
11,976,000
|
|
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative expenses
|
|
4,536,000
|
|
7,672,000
|
|
1,133,000
|
|
1,408,000
|
|
-
|
|
(394,000)
|
|
14,355,000
|
|
Impairment loss
|
|
-
|
|
-
|
|
1,463,000
|
|
154,000
|
|
-
|
|
-
|
|
1,617,000
|
|
Restructuring expense
|
|
1,530,000
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,530,000
|
|
Operating (loss) income
|
|
(4,194,000)
|
|
507,000
|
|
(674,000)
|
|
(1,165,000)
|
|
-
|
|
-
|
|
(5,526,000)
|
|
Other income (expense)
|
|
(80,000)
|
|
(7,000)
|
|
-
|
|
33,000
|
|
16,000
|
|
-
|
|
(38,000)
|
|
Income (loss) before income tax
|
$
|
(4,274,000)
|
$
|
500,000
|
$
|
(674,000)
|
$
|
(1,132,000)
|
$
|
16,000
|
$
|
-
|
$
|
(5,564,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
$
|
1,170,000
|
$
|
360,000
|
$
|
154,000
|
$
|
38,000
|
$
|
-
|
$
|
-
|
$
|
1,722,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
$
|
48,000
|
$
|
25,000
|
$
|
5,000
|
$
|
60,000
|
$
|
-
|
$
|
-
|
$
|
138,000
|
|