Note 9 - Segment Information

9 Months Ended

Jul. 31, 2023

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

Note 9 – Segment information

We aggregate operating divisions into two reporting segments that have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. Based upon this evaluation, as of July 31, 2023, we had two reportable segments – RF Connector and Cable Assembly (“RF Connector”) segment and Custom Cabling Manufacturing and Assembly (“Custom Cabling”) segment.

The RF Connector segment consists of two divisions and the Custom Cabling segment consists of four divisions. The six divisions that met the quantitative thresholds for segment reporting are the RF Connector and Cable Assembly division (“RF Connector division”), Cables Unlimited, Rel-Tech, C Enterprises, Schrofftech, and Microlab. While each segment has similar products and services, there was little overlapping of these services to their customer base. The biggest difference in segments is in the channels of sales: sales of product and services for the RF Connector segment were primarily through the distribution channel, while the Custom Cabling segment sales were through a combination of distribution and direct to the end user.

Management identifies segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector and Microlab divisions constitutes the RF Connector segment, and the Cables Unlimited, Rel-Tech, C Enterprises, and Schrofftech divisions constitute the Custom Cabling segment.

We evaluate the performance of each segment based on income or loss before income taxes. We charge depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, right of use assets, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.

All of our operations are conducted in the United States; however, we derive a portion of our revenue from export sales. We attribute sales to geographic areas based on the location of the customers. The following table presents the sales by geographic area for the three and nine months ended July 31, 2023 and 2022 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2023		2022		2023		2022
United States	$	13,955	$	19,925	$	50,967	$	56,292
Foreign Countries:
Canada		703		2,218		1,875		3,179
Italy		300		1,214		1,692		1,387
Mexico		-		29		3		106
All Other		694		456		1,757		1,301
		1,697		3,917		5,327		5,973
Totals	$	15,652	$	23,842	$	56,294	$	62,265

Net sales, (loss) income before (benefit) provision for income taxes and other related segment information for the three months ended July 31, 2023 and 2022 are as follows (in thousands):

	RF Connector			Custom Cabling
	and			Manufacturing and
	Cable Assembly			Assembly			Corporate			Total
2023
Net sales	$	7,799		$	7,853		$	-		$	15,652
(Loss) income before benefit for income taxes		(1,103	)		(713	)		(311	)		(2,127	)
Depreciation and amortization		488			143			-			631
Total assets		49,175			20,528			8,353			78,056
2022
Net sales	$	10,495		$	13,347		$	-		$	23,842
Income (loss) before provision for income taxes		988			600			(677	)		911
Depreciation and amortization		390			147			-			537
Total assets		48,351			26,553			12,291			87,195

Net sales, (loss) income before (benefit) provision for income taxes and other related segment information for the nine months ended July 31, 2023 and 2022 are as follows (in thousands):

	RF Connector			Custom Cabling
	and			Manufacturing and
	Cable Assembly			Assembly			Corporate			Total
2023
Net sales	$	25,507		$	30,787		$	-		$	56,294
(Loss) income before benefit from income taxes		(1,162	)		(823	)		(1,047	)		(3,032	)
Depreciation and amortization		1,359			436			-			1,795
Total assets		49,175			20,528			8,353			78,056
2022
Net sales	$	21,928		$	40,337		$	-		$	62,265
Income (loss) before benefit from income taxes		1,621			1,721			(2,149	)		1,193
Depreciation and amortization		720			435			-			1,155
Total assets		48,351			26,553			12,291			87,195