. Segment Information

Our business consists of

two

segments for financial reporting purposes. The

two

segments are identified as (i) private label contract manufacturing, which primarily relates to the provision of private label contract manufacturing services to companies that market and distribute nutritional supplements and other health care products, and (ii) patent and trademark licensing, which primarily includes direct raw material sales and royalty income from our license and supply agreements associated with the sale and use of beta-alanine under our CarnoSyn® trade name.

We evaluate performance based on a number of factors. The primary performance measures for each segment are net sales and income or loss from operations before corporate allocations. Operating income or loss for each segment does not include corporate gen

eral and administrative expenses, interest expense and other miscellaneous income and expense items. Corporate general and administrative expenses include, but are not limited to: human resources, corporate legal, finance, information technology, and other corporate level related expenses, which are not allocated to any segment. The accounting policies of our segments are the same as those described in Note A above and in the consolidated financial statements included in our

2016

Annual Report.

Our operating results

by business segment were as follows (in thousands):

	Three Months Ended March 31,				Nine Months Ended March 31,
	201 7		2016		201 7		2016
Net Sales
Private label contract manufacturing	$	18,544	$	24,493	$	69,787	$	62,377
Patent and trademark licensing		6,591		5,513		19,974		16,125
	$	25,135	$	30,006	$	89,761	$	78,502

	Three Months Ended March 31,						Nine Months Ended March 31,
	2017			2016			2017			2016
Income from Operations
Private label contract manufacturing	$	749		$	2,915		$	6,182		$	7,518
Patent and trademark licensing		1,786			1,750			6,026			4,440
Income from operations of reportable segments		2,535			4,665			12,208			11,958
Corporate expenses not allocated to segments		(1,542	)		(1,560	)		(4,566	)		(4,390	)
	$	993		$	3,105		$	7,642		$	7,568

	March 31,		June 30,
	201 7		201 6
Total Assets
Private label contract manufacturing	$	58,867	$	66,375
Patent and trademark licensing		11,120		7,800
	$	69,987	$	74,175

Our private label contract manufacturing products are sold both in the U.S. and in markets outside the U.S., including Europe,

Australia, Asia, Canada, Mexico, and South Africa. Our primary market outside the U.S. is Europe. Our patent and trademark licensing activities are primarily based in the U.S. and our branded products were only sold in the U.S.

Net sales by geographic region, based on the customers

’ location, were as follows (in thousands):

	Three Months Ended March 31,				Nine Months Ended March 31,
	2017		2016		2017		2016
Net Sales
United States	$	14,605	$	13,374	$	43,484	$	38,665
Markets outside the United States		10,530		16,632		46,277		39,837
	$	25,135	$	30,006	$	89,761	$	78,502

Products manufactured by NAIE accounted for

approximately

62%

of consolidated net sales in markets outside the U.S. for the

three

months ended

March

31,

2017

and

57%

for the

three

months ended

March

31,

2016.

Products manufactured by NAIE accounted for

55%

of consolidated net sales in markets outside the U.S. for the

nine

months ended

March

31,

2017

and

67%

for the

nine

months ended

March

31,

2016.

products manufactured by NAIE were sold in the U.S. during the

nine

months ended

March

31,

2017

and

2016.

Assets and capital expenditures by geographic region, based on the location of the company or subsidiary at which they were located or made, were as follows (in thousands):

	Long-Lived Assets				Total Assets				Capital Expenditures
									Nine Months Ended
	March 31, 201 7		June 30, 201 6		March 31, 201 7		June 30, 201 6		March 31, 2017		March 31, 2016
United States	$	10,827	$	9,678	$	45,599	$	49,755	$	2,090	$	5,004
Europe		6,961		5,489		24,388		24,420		2,242		1,955
	$	17,788	$	15,167	$	69,987	$	74,175	$	4,332	$	6,959