G. Segment Information

Our business consists of

two

segments for financial reporting purposes, 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 related royalty income from our license and supply agreements associated with the sale and use of beta-alanine under our CarnoSyn® and SR CarnoSyn® trade names.

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 level expense allocations. Operating income or loss for each segment does

not

include corporate general and administrative expenses, interest expense and other miscellaneous income and expense items. Corporate general and administrative expenses, which are

not

allocated to any segment, include, but are

not

limited to: human resources, corporate legal, finance, information technology, and other corporate level related expenses. 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

2017

Annual Report.

Our operating results by business segment were as follows (in thousands):

	Three Months Ended March 31 ,				Nine Months Ended March 31 ,
	2018		2017		2018		2017
Net Sales
Private label contract manufacturing	$	25,648	$	18,544	$	77,225	$	69,787
Patent and trademark licensing		6,167		6,591		15,999		19,974
Total Net Sales	$	31,815	$	25,135	$	93,224	$	89,761

	Three Months Ended March 31 ,						Nine Months Ended March 31 ,
	2018			2017			2018			2017
Income from Operations
Private label contract manufacturing	$	2,229		$	749		$	7,870		$	6,182
Patent and trademark licensing		2,023			1,786			3,715			6,026
Income from operations of reportable segments		4,252			2,353			11,585			12,208
Corporate expenses not allocated to segments		(1,729	)		(1,542	)		(4,898	)		(4,566	)
Total Income from Operations	$	2,523		$	993		$	6,687		$	7,642

Total Assets	March 31 , 201 8		June 30, 201 7
Private label contract manufacturing	$	73,959	$	60,489
Patent and Trademark Licensing		14,138		12,122
Total	$	88,097	$	72,611

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

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 ,
	2018		2017		2018		2017

United States	$	17,235	$	14,605	$	48,855	$	43,484
Markets outside of the United States		14,580		10,530		44,369		46,277
Total	$	31,815	$	25,135	$	93,224	$	89,761

Products manufactured by NAIE accounted for

89%

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

three

months ended

March 31, 2018,

and

82%

for the

nine

months ended

March 31, 2018.

Products manufactured by NAIE accounted for

62%

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

three

months ended

March 31, 2017,

and

55%

for the

nine

months ended

March 31, 2017.

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

three

month or

nine

month periods ended

March 31, 2018

and

2017.

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 8		June 30, 201 7		March 31 , 201 8		June 30, 201 7		March 31 , 201 8		March 31 , 201 7
United States	$	10,650	$	10,753	$	53,982	$	47,777	$	966	$	2,090
Europe		8,182		7,383		34,115		24,834		1,971		2,242
	$	18,832	$	18,136	$	88,097	$	72,611	$	2,937	$	4,332