Segment, Customer and Geographical Reporting

6 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Note 9 – Segment, Customer and Geographical Reporting

Segment Financial Information

Dynasil’s business is comprised of four segments: contract research (“Contract Research”), optics (“Optics”), instruments (“Instruments”) and biomedical (“Biomedical”). Within these segments, there is a segregation of reportable units based upon the organizational structure used to evaluate performance and make decisions on resource allocation, as well as availability and materiality of separate financial results consistent with that structure. The Contract Research segment is one of the largest small business participants in U.S. government-funded research. The Optics segment manufactures optical materials, components and coatings. The Instruments segment manufactures specialized instruments used in various applications in the medical, industrial, and homeland security/defense sectors. The Biomedical segment, through Xcede Technologies, Inc., a majority owned, joint venture (“Xcede”), is focused on developing a tissue sealant technology for a wide spectrum of applications though no assurance can be given that this technology will become successfully commercialized.

As discussed in Note 2, substantially all the operating assets of the Instruments segment were sold in the three months ended December 31, 2013.

The Company’s segment information for the three months ended March 31, 2014 and 2013 is summarized below:

Results of Operations for the Three Months Ended March 31,
2014
	Contract Research		Optics		Instruments		Biomedical		Total
Revenue	$	5,614,060	$	4,788,669	$	-	$	3,729	$	10,406,458
Gross Profit		2,441,719		1,919,261		(5,822)		3,729		4,358,887
Impairment of goodwill		-		-		-		-		-
Operating Income (Loss)		241,938		522,112		(75,585)		(221,238)		467,227
Depreciation and Amortization		69,949		183,499		-		15,000		268,448
Capital expenditures		12,028		396,530		-		-		408,558
Intangibles, Net		315,651		857,579		-		148,331		1,321,561
Goodwill		4,938,625		1,333,603		-		-		6,272,228
Total Assets	$	10,230,207	$	13,815,832	$	455,096	$	332,338	$	24,833,473

Results of Operations for the Three Months Ended March 31,
2013
	Contract Research		Optics		Instruments		Biomedical		Total
Revenue	$	5,487,850	$	3,931,766	$	1,014,320	$	50,594	$	10,484,530
Gross Profit		2,647,870		1,481,948		461,101		50,594		4,641,513
Impairment of goodwill		-		-		6,763,072		-		6,763,072
Operating Income (Loss)		232,015		2,336		(7,270,801)		(211,564)		(7,248,014)
Depreciation and Amortization		79,637		184,696		164,384		15,000		443,717
Capital expenditures		(187,425)		87,536		-		-		(99,889)
Intangibles, Net		349,786		866,488		2,349,767		209,997		3,776,038
Goodwill		4,938,625		1,197,017		-		-		6,135,642
Total Assets	$	13,332,151	$	9,748,703	$	4,862,956	$	334,658	$	28,278,468

The Company’s segment information for the six months ended March 31, 2014 and 2013 is summarized below:

Results of Operations for the Six Months Ended March 31,
2014
	Contract Research		Optics		Instruments		Biomedical		Total
Revenue	$	11,454,502	$	8,887,177	$	772,578	$	3,729	$	21,117,986
Gross Profit		4,971,257		3,516,521		317,908		3,729		8,809,415
Impairment of goodwill		-		-		-		-		-
Operating Income (Loss)		590,332		920,544		966,178		(395,610)		2,081,444
Depreciation and Amortization		139,496		361,607		2,003		31,667		534,773
Capital expenditures		12,028		527,448		-		-		539,476
Intangibles, Net		315,651		857,579		-		148,331		1,321,561
Goodwill		4,938,625		1,333,603		-		-		6,272,228
Total Assets	$	10,230,207	$	13,815,832	$	455,096	$	332,338	$	24,833,473

Results of Operations for the Six Months Ended March 31,
2013
	Contract Research		Optics		Instruments		Biomedical		Total
Revenue	$	10,398,690	$	8,183,706	$	2,298,358	$	157,051	$	21,037,805
Gross Profit		4,861,923		3,061,891		1,066,902		157,051		9,147,767
Impairment of goodwill		-		-		6,763,072		-		6,763,072
Operating Income (Loss)		231,409		388,012		(7,726,495)		(332,227)		(7,439,301)
Depreciation and Amortization		142,419		370,324		327,432		30,000		870,175
Capital expenditures		(1,095)		209,682		7,092		-		215,679
Intangibles, Net		349,786		866,488		2,349,767		209,997		3,776,038
Goodwill		4,938,625		1,197,017		-		-		6,135,642
Total Assets	$	13,332,151	$	9,748,703	$	4,862,956	$	334,658	$	28,278,468

Customer Financial Information

For the three and six months ended March 31, 2014 and 2013, the top three customers for the Contract Research segment were various agencies of the U.S. Government. For the three months ended March 31, 2014 and 2013, these customers made up 69% and 64%, respectively, of Contract Research revenue. For the six months ended March 31, 2014 and 2013, these customers made up 67% and 63%, respectively, of Contract Research revenue.

For the three and six months ended March 31, 2014 and 2013, there was no customer in the Optics segment whose revenue represented more than 10% of the total segment revenue.

For the three months ended March 31, 2014, there was no revenue in the Instruments segment. For the three months ended March 31, 2013, the top three customers for the Instruments segment made up 30% of Instruments revenue. For the six months ended March 31, 2014 and 2013, the top three customers for the Instruments segment made up 24% and 32%, respectively, of Instruments revenue.

For the both three and six months ended March 31, 2014 and 2013, the Biomedical segment had one customer whose revenue represented 100% of the total segment revenue.

Geographic Financial Information

Revenue by geographic location in total and as a percentage of total revenue, for the three months ended March 31, 2014 and 2013 are as follows:

	Three Months Ended					Three Months Ended
	March 31, 2014					March 31, 2013
Geographic Location	Revenue		% of Total			Revenue		% of Total
United States	$	8,621,552		83	%	$	8,572,033		82	%
Europe		844,963		8	%		847,662		8	%
Other		939,943		9	%		1,064,835		10	%
	$	10,406,458		100	%	$	10,484,530		100	%

Revenue by geographic location in total and as a percentage of total revenue, for the six months ended March 31, 2014 and 2013 are as follows:

	Six Months Ended					Six Months Ended
	March 31, 2014					March 31, 2013
Geographic Location	Revenue		% of Total			Revenue		% of Total
United States	$	17,529,282		83	%	$	17,066,521		81	%
Europe		1,674,400		8	%		1,736,003		8	%
Other		1,914,304		9	%		2,235,281		11	%
	$	21,117,986		100	%	$	21,037,805		100	%