Note 14 - Business Segment Reporting

6 Months Ended

Nov. 24, 2013

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

14.          Business Segment Reporting

The Company manages its business operations through three strategic business units. Based upon the information reported to the chief operating decision maker, who is the Chief Executive Officer, the Company has the following reportable segments: the Food Products Technology segment, the Food Export segment and the Hyaluronan-based Biomaterials segment.

The Food Products Technology segment markets and packs specialty packaged whole and fresh-cut fruit and vegetables, the majority of which incorporate the BreatheWay specialty packaging for the retail grocery, club store and food services industry. In addition, the Food Products Technology segment sells BreatheWay packaging to partners for non-vegetable products. The Food Export segment consists of revenues generated from the purchase and sale of primarily whole commodity fruit and vegetable products to Asia and domestically. The HA-based Biomaterials segment sells products utilizing hyaluronan, a naturally occurring polysaccharide that is widely distributed in the extracellular matrix of connective tissues in both animals and humans, for medical use primarily in the Ophthalmic, Orthopedic and Veterinary markets. Corporate licenses Landec’s patented Intellicoat® seed coatings to the farming industry and licenses the Company’s Intelimer polymers for personal care products and other industrial products. The Corporate segment also includes general and administrative expenses, non-Food Products Technology and non HA-based Biomaterials interest income and income tax expenses. Beginning in fiscal year 2013, the Food Products Technology, the Food Export and the Hyaluronan-based Biomaterials segments include charges for corporate services and tax sharing allocated from the Corporate segment. All of the assets of the Company are located within the United States of America.

The Company’s international sales were as follows (in millions):

	Three Months Ended				Six Months Ended
	November 24, 2013		November 25, 2012		November 24, 2013		November 25, 2012
Taiwan	$	12.6	$	12.9	$	24.6	$	25.8
Canada	$	10.2	$	6.1	$	19.6	$	12.3
China	$	3.7	$	2.8	$	5.3	$	3.7
Indonesia	$	2.4	$	7.4	$	4.9	$	13.5
Japan	$	2.1	$	2.8	$	5.3	$	5.9
Belgium	$	0.8	$	1.6	$	2.0	$	4.6
All Other Countries	$	4.9	$	4.6	$	10.2	$	8.8

Operations by segment consisted of the following (in thousands):

Three Months Ended Nov. 24, 2013	Food Products Technology		Food Export		HA-based Biomaterials		Corporate			TOTAL
Net sales	$	88,090	$	23,031	$	8,777	$	128		$	120,026
International sales	$	10,345	$	22,940	$	3,366	$	—		$	36,651
Gross profit	$	8,220	$	1,820	$	3,625	$	69		$	13,734
Net income (loss)	$	2,005	$	727	$	611	$	108		$	3,451
Depreciation and amortization	$	1,304	$	1	$	604	$	36		$	1,945
Dividend income	$	281	$	—	$	—	$	—		$	281
Interest income	$	2	$	—	$	44	$	—		$	46
Interest expense	$	356	$	—	$	80	$	—		$	436
Income tax expense	$	1,461	$	205	$	172	$	36		$	1,874
Three Months Ended Nov. 25, 2012
Net sales	$	78,592	$	28,115	$	7,740	$	207		$	114,654
International sales	$	5,959	$	28,055	$	4,222	$	—		$	38,236
Gross profit	$	13,102	$	2,034	$	3,116	$	207		$	18,459
Net income (loss)	$	9,212	$	866	$	338	$	(1,503	)	$	8,913
Depreciation and amortization	$	1,174	$	1	$	592	$	38		$	1,805
Dividend income	$	281	$	—	$	—	$	—		$	281
Interest income	$	7	$	—	$	26	$	—		$	33
Interest expense	$	427	$	—	$	71	$	—		$	498
Income tax expense	$	1,761	$	288	$	113	$	758		$	2,920
Six Months Ended Nov. 24, 2013
Net sales	$	167,526	$	44,430	$	17,363	$	186		$	229,505
International sales	$	19,823	$	44,329	$	7,743	$	—		$	71,895
Gross profit	$	17,101	$	3,025	$	6,013	$	127		$	26,266
Net income (loss)	$	9,271	$	1,003	$	235	$	(2,306	)	$	8,203
Depreciation and amortization	$	2,526	$	2	$	1,188	$	71		$	3,787
Dividend income	$	563	$	—	$	—	$	—		$	563
Interest income	$	5	$	—	$	100	$	—		$	105
Interest expense	$	732	$	—	$	135	$	—		$	867
Income tax expense	$	1,966	$	283	$	66	$	2,034		$	4,349
Six Months Ended Nov. 25, 2012
Net sales	$	147,223	$	53,473	$	15,713	$	319		$	216,728
International sales	$	12,182	$	53,366	$	9,024	$	—		$	74,572
Gross profit	$	23,045	$	3,376	$	5,482	$	319		$	32,222
Net income (loss)	$	15,128	$	1,175	$	26	$	(3,050	)	$	13,279
Depreciation and amortization	$	2,410	$	2	$	1,175	$	74		$	3,661
Dividend income	$	563	$	—	$	—	$	—		$	563
Interest income	$	8	$	—	$	50	$	—		$	58
Interest expense	$	882	$	—	$	157	$	—		$	1,039
Income tax expense	$	3,733	$	391	$	9	$	1,351		$	5,484

During the six months ended November 24, 2013 and November 25, 2012, sales to the Company’s top five customers accounted for 43% and 36%, respectively, of revenues. The Company’s top two customers from the Food Products Technology segment accounted for 20% and 11% for six months ended November 24, 2013 and 13% and 10% for the six months ended November 25, 2012. The Company expects that, for the foreseeable future, a limited number of customers may continue to account for a significant portion of its net revenues.