Business Segments

12 Months Ended

Dec. 31, 2022

Business Segments

Business Segments

10.    Business Segments

The Company operates in two business segments, Advanced Technology Group (“ATG”) and Consumer Products Group (“CPG”). The Company’s reportable segments are strategic business units that offer different products and services. The segments are composed of separate corporations and operations are managed separately. Operations in ATG primarily involve the design, manufacture, and marketing of servo-control components (i.e., torque motors, control valves, actuators, etc.) for prime government contractors, commercial and industrial applications. CPG’s operations involve the design, manufacture and marketing a variety of cutlery products for use by consumers and government agencies. The Company derives its primary sales revenue from domestic customers, although a portion of finished products are for foreign end use.

Information regarding the Company’s operations in these segments is summarized as follows ($000’s omitted):

	($000's omitted except per share data)
	ATG						CPG						Consolidated
	Years Ended						Years Ended						Years Ended
	December 31,						December 31,						December 31,
	2022			2021			2022			2021			2022			2021
Revenues from unaffiliated customers	$	35,185		$	31,677		$	8,636		$	8,881		$	43,821		$	40,558
Cost of goods sold, inclusive of dep. and amort.		(31,055)			(25,929)			(6,822)			(8,641)			(37,877)			(34,570)
Gross profit		4,130			5,748			1,814			240			5,944			5,988
Gross margin %		11.7	%		18.1	%		21.0	%		2.7	%		13.6	%		14.8	%
Operating expenses:
Selling, general and administrative		(6,592)			(7,661)			(1,835)			(1,762)			(8,427)			(9,423)
Legal settlement awards		—			(1,800)			—			(90)			—			(1,890)
Total operating costs and expenses		(6,592)			(9,461)			(1,835)			(1,852)			(8,427)			(11,313)
Operating (loss)		(2,462)			(3,713)			(21)			(1,612)			(2,483)			(5,325)
Other (expense)/income:
Other income: employee retention credit (ERC)		—			4,584			—			1,038			—			5,622
Other income: Paycheck Protection Program loan forgiveness		—			4,000			—			—			—			4,000
Interest expense		(239)			(185)			(1)			(2)			(240)			(187)
Gain on sale of equipment		36			(98)			—			—			36			(98)
Total other (expense)/income		(203)			8,301			(1)			1,036			(204)			9,337
(Loss)/income before income tax provision		(2,665)			4,588			(22)			(576)			(2,687)			4,012
Income tax benefit/ (provision)		565			(78)			5			121			570			43
Net (loss)/income	$	(2,100)		$	4,510		$	(17)		$	(455)		$	(2,117)		$	4,055
Total assets	$	35,766		$	40,870		$	9,528		$	9,223		$	45,294		$	50,293
Capital expenditures	$	1,234		$	263		$	85		$	4		$	1,319		$	267
Foreign derived sales	$	10,541		$	7,933		$	433		$	511		$	10,974		$	8,444