BUSINESS SEGMENTS

9 Months Ended

Mar. 31, 2014

Notes to Financial Statements

BUSINESS SEGMENTS (IN THOUSANDS, EXCEPT EARNINGS PER SHARE AND NUMBER OF SHARES)

In fiscal 2014, the Company operates in four segments: the testing service industry (which performs structural and electronic tests of semiconductor devices), the designing and manufacturing of equipment (which equipment tests the structural integrity of integrated circuits and other products), distribution of various products from other manufacturers in Singapore and Southeast Asia, and the real estate segment in China. In the fourth quarter of fiscal 2013, the Company discontinued operations in the fabrication segment.

The real estate segment recorded other income of $51 and $153, respectively, for the three and nine months ended March 31, 2014 as compared to $66 and $197, respectively, for the same periods in the last fiscal year. Due to the short-term nature of the investment, the amount was classified as a loan receivables based on ASC Topic 310-10-25 Receivables, hence the investment income was also classified under other income, which is not part of the below table.

The revenue allocated to individual countries was based on where the customers were located. The allocation of the cost of equipment, the current year investment in new equipment and depreciation expense have been made on the basis of the primary purpose for which the equipment was acquired.

All inter-segment revenue was from the manufacturing segment to the testing and distribution segments. Total inter-segment revenue was $319 and $515 for the three and nine months ended March 31, 2014, respectively, as compared to $257 and $655, respectively, for the same periods in the last fiscal year.  Corporate assets mainly consisted of cash and prepaid expenses. Corporate expenses mainly consisted of stock option expenses, salaries, insurance, professional expenses and directors' fees. In fiscal 2014, corporate expenses are allocated to the four segments, in fiscal 2013, Corporate expenses were allocated to the five then operating segments. The following tables report segment operating (loss) / income and include Corporate expenses allocated to the segments, which expenses are eliminated in the consolidation.

The following segment information is unaudited for the nine months ended March 31, 2014:

Business Segment Information:

	Nine months			Operating					Depr.
	Ended	Net		(Loss)			Total		and			Capital
	March 31,	Revenue		Income			Assets		Amort.			Expenditures
Manufacturing	2014	$	11,589	$	(671	)	$	8,554	$	118		$	242
	2013		11,157		(733	)		9,770		124			27
Testing Services	2014		13,244		797			21,220		1,598			2,054
	2013		11,085		(23	)		17,902		1,671			1,339
Distribution	2014		1,906		194			529		-			-
	2013		916		119			333		2			1
Real Estate	2014		136		(68	)		3,724		82			1
	2013		96		(177	)		4,051		82			-
Fabrication	2014		-		-			101		-			-
Services*	2013		-		(60	)		269		-			-
Corporate &	2014		-		(350	)		68			-		-
Unallocated	2013		-		(64	)		131			-		-
Total Company	2014	$	26,875	$	(98	)	$	34,196	$	1,798		$	2,297
	2013	$	23,254	$	(938	)	$	32,456	$	1,879		$	1,367

The following segment information is unaudited for the three months ended March 31, 2014:

Business Segment Information:

	Three months				Operating					Depr.
	Ended	Net			(Loss)			Total		and		Capital
	March 31,	Revenue			Income			Assets		Amort.		Expenditures
Manufacturing	2014	$	3,020		$	(343	)	$	8,554	$	41	$	21
	2013		2,786			(302	)		9,770		34		8
Testing Services	2014		4,599			406			21,220		531		554
	2013		3,407			(93	)		17,902		551		594
Distribution	2014		374			(5	)		529		-		-
	2013		232			35			333		-		-
Real Estate	2014		46			(23	)		3,724		28		1
	2013		33			(56	)		4,051		28		-
Fabrication	2014			-		-			101		-		-
Services*	2013			-		(25	)		269		-		-
Corporate &	2014			-		(14	)		68		-		-
Unallocated	2013			-		(72	)		131		-		-
Total Company	2014	$	8,039		$	21		$	34,196	$	600	$	576
	2013	$	6,458		$	(513	)	$	32,456	$	613	$	602

* Fabrication services is a discontinued operation (Note 16)