REPORTABLE SEGMENTS

An operating segment is defined as a component of an enterprise which has discrete financial information that is evaluated regularly by the Company’s Chief Executive Officer to decide how to allocate resources and to access performance.

In accordance with ASC

280

10,

Segment Reporting

, the Company has

two

segments of business. The Company’s reportable segments are: (i) The Traditional Business and (ii) Journal Technologies. All inter-segment transactions were eliminated.

Summarized financial information concerning the Company’s reportable segments and Corporate income and expenses is shown in the following table:

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate			Total
Fiscal 2018
Revenues
Advertising, net	$	9,112,000		$	---		$	---		$	9,112,000
Circulation		5,401,000			---			---			5,401,000
Advertising service fees and other		2,659,000			---			---			2,659,000
Licensing and maintenance fees		---			17,225,000			---			17,225,000
Consulting fees		---			2,832,000			---			2,832,000
Other public service fees		---			3,474,000			---			3,474,000
Operating expenses		16,840,000			37,923,000			---			54,763,000
Income (loss) from operations		332,000			(14,392,000	)		---			(14,060,000	)
Dividends and interest income		---			---			4,808,000			4,808,000
Other income		---			---			37,000			37,000
Interest expense on note payable collateralized by real estate		(95,000	)		---			---			(95,000	)
Interest expense on margin loans		---			---			(651,000	)		(651,000	)
Capital gains on sales of marketable securities and others		---			---			3,182,000			3,182,000
Other-than-temporary impairment losses on investments		---			---			(4,560,000	)		(4,560,000	)
Pretax (loss) income		237,000			(14,392,000	)		2,816,000			(11,339,000	)
Income tax benefit		490,000			695,000			18,355,000			19,540,000
Net (loss) income		727,000			(13,697,000	)		21,171,000			8,201,000
Total assets		19,602,000			29,885,000			214,511,000			263,998,000
Capital expenditures		212,000			---			---			212,000
Amortization of intangible assets		---			3,058,000			---			3,058,000

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate			Total
Fiscal 2017
Revenues
Advertising, net	$	9,104,000		$	---		$	---		$	9,104,000
Circulation		5,654,000			---			---			5,654,000
Advertising service fees and other		2,812,000			---			---			2,812,000
Licensing and maintenance fees		---			16,037,000			---			16,037,000
Consulting fees		---			4,476,000			---			4,476,000
Other public service fees		---			3,301,000			---			3,301,000
Operating expenses		17,852,000			36,699,000			---			54,551,000
Loss from operations		(282,000	)		(12,885,000	)		---			(13,167,000	)
Dividends and interest income		---			---			4,844,000			4,844,000
Other income		22,000			---			12,000			34,000
Interest expense on note payable collateralized by real estate		(100,000	)		---			---			(100,000	)
Interest expense on margin loans		---			---			(422,000	)		(422,000	)
Interest and penalty expense reversal for uncertain and unrecognized tax benefits		---			743,000			---			743,000
Pretax (loss) income		(360,000	)		(12,142,000	)		4,434,000			(8,068,000	)
Income tax benefit (expense)		(2,000	)		7,910,000			(758,000	)		7,150,000
Net (loss) income		(362,000	)		(4,232,000	)		3,676,000			(918,000	)
Total assets		16,606,000			33,461,000			230,641,000			280,708,000
Capital expenditures		160,000			93,000			---			253,000
Amortization of intangible assets		---			4,895,000			---			4,895,000

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate			Total
Fiscal 2016
Revenues
Advertising, net	$	9,854,000		$	---		$	---		$	9,854,000
Circulation		5,912,000			---			---			5,912,000
Advertising service fees and other		2,651,000			---			---			2,651,000
Licensing and maintenance fees		---			14,758,000			---			14,758,000
Consulting fees		---			4,085,000			---			4,085,000
Other public service fees		---			4,352,000			---			4,352,000
Operating expenses		17,240,000			31,012,000			---			48,252,000
Income (loss) from operations		1,177,000			(7,817,000	)		---			(6,640,000	)
Dividends and interest income		---			---			4,085,000			4,085,000
Other income		52,000			---			9,000			61,000
Interest expense on note payable collateralized by real estate		(88,000	)		---			---			(88,000	)
Interest expense on margin loans		---			---			(284,000	)		(284,000	)
Interest expense accrued for uncertain and unrecognized tax benefits		---			(112,000	)		---			(112,000	)
Pretax income (loss)		1,141,000			(7,929,000	)		3,810,000			(2,978,000	)
Income tax benefit (expense)		(530,000	)		3,140,000			(675,000	)		1,935,000
Net income (loss)		611,000			(4,789,000	)		3,135,000			(1,043,000	)
Total assets		17,644,000			39,786,000			168,016,000			225,446,000
Capital expenditures, including purchase of Logan building		3,662,000			117,000			---			3,779,000
Amortization of intangible assets		142,000			4,895,000			---			5,037,000

During fiscal

2018,

2017

and

2016,

the Traditional Business had total operating revenues of

$17,172,000,

$17,570,000

and

$18,417,000

of which

$11,771,000,

$11,916,000

and

$12,505,000,

respectively, were recognized after services were provided while

$5,401,000,

$5,654,000

and

$5,912,000,

respectively, were recognized ratably over the subscription terms. Total operating revenues for the Company’s software business were

$23,531,000,

$23,814,000

and

$23,195,000,

of which

$7,437,000,

$8,618,000

and

$9,735,000,

respectively, were recognized upon completion of services while

$16,094,000,

$15,196,000

and

$13,460,000,

respectively, were recognized ratably over the subscription periods.