G. 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® 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 the allocation of certain corporate level expenses. 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 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. Transfers of raw materials between segments are recorded at cost. The accounting policies of our segments are the same as those described in the summary of significant accounting policies in Note A above and in the consolidated financial statements included in our

2018

Annual Report.

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

	Three Months Ended March 31,				Nine months Ended March 31,
	2019		2018		2019		2018
Net Sales
Private label contract manufacturing	$	31,758	$	25,648	$	94,505	$	77,225
Patent and trademark licensing		3,697		6,167		13,525		15,999
Total Net Sales	$	35,455	$	31,815	$	108,030	$	93,224

	Three Months Ended March 31,						Nine months Ended March 31,
	2019			2018			2019			2018
Income from Operations
Private label contract manufacturing	$	3,534		$	2,229		$	9,534		$	7,870
Patent and trademark licensing		470			2,023			3,745			3,715
Income from operations of reportable segments		4,004			4,252			13,279			11,585
Corporate expenses not allocated to segments		(2,169	)		(1,729	)		(6,513	)		(4,898	)
Total Income from Operations	$	1,835		$	2,523		$	6,766		$	6,687

	March 31, 2019		June 30, 2018
Total Assets
Private-label contract manufacturing	$	77,968	$	69,037
Patent and trademark licensing		20,488		16,170
	$	98,456	$	85,207

Our private-label contract manufacturing products are sold both in the U.S. and in markets outside the U.S., including Europe, Canada, Australia, New Zealand, and Asia. Our primary markets outside the U.S. are Europe and Asia. 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,
	2019		2018		2019		2018

United States	$	16,222	$	17,235	$	52,417	$	48,855
Markets outside of the United States		19,233		14,580		55,613		44,369
Total	$	35,455	$	31,815	$	108,030	$	93,224

Products manufactured by our Swiss subsidiary ("NAIE") accounted for

74%

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

three

months ended

March 31, 2019,

and

78%

for the

nine

months ended

March 31, 2019.

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 were sold in U.S. markets during the

three

month or

nine

month periods ended

March 31, 2019

and

2018.

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 9		June 30, 2018		March 31, 201 9		June 30, 2018		March 31, 2019		March 31, 2018
United States	$	10,978	$	10,887	$	57,040	$	51,562	$	1,295	$	966
Europe		9,904		8,403		41,416		33,645		2,854		1,971
	$	20,882	$	19,290	$	98,456	$	85,207	$	4,149	$	2,937