XML 21 R11.htm IDEA: XBRL DOCUMENT v3.21.2
SEGMENT INFORMATION
 9 Months Ended
Sep. 25, 2021
SEGMENT INFORMATION  
NOTE 6 - SEGMENT INFORMATION

NOTE 6 – SEGMENT INFORMATION

 

Our segments are strategic business units that offer our services and products to customers in their respective industry segments. The operating performance of our segments is regularly reviewed with operational leaders in charge of these segments, the chief executive officer (“CEO”), the chief financial officer (“CFO”) and others. This group represents the chief operating decision maker (“CODM”) for ENGlobal.

 

We have identified four strategic markets where we have a long history of delivering project solutions and can provide complete project execution. These four targeted markets include: (i) Renewables, (ii) Automation, (iii) Oil, Gas, and Petrochemicals, and (iv) Government Services.

 

Within the Renewables group, our focus is to design and build production facilities for hydrogen and associated products, together with converting existing production facilities to produce products from renewable feedstock sources. These projects often utilize technologies that are more fuel efficient, and therefore reduce the associated carbon footprint of the facility. Our scope of work on these projects will typically include front-end development, engineering, procurement, mechanical fabrication, automation and commissioning services, and may be performed in conjunction with a construction partner.

 

Our Automation group provides the design and programming of automated control systems as well as designs, fabricates, integrates and commissions modular systems that include remote instrumentation control stations, on-line process analytical data, continuous emission monitoring, and electric power distribution. Often these packaged systems are housed in a fabricated metal enclosure, modular building or freestanding metal rack, which are commonly included in our scope of work. We provide automation engineering, procurement, fabrication, systems integration, programing and on-site commissioning services to our clients for both new and existing facilities.

 

Our Oil, Gas, and Petrochemicals group focuses on providing engineering, procurement and automation services as well as fabricated products to downstream refineries and petrochemical facilities as well as midstream pipeline, storage and other transportation related companies. These services are often applied to small capital improvement and maintenance projects within refineries and petrochemical facilities. For our transportation clients, we work on facilities that include pumping, compression, gas processing, metering, storage terminals, product loading and blending systems. In addition, this group designs, programs and maintains supervisory control and data acquisition (“SCADA”) systems for our transportation clients. This group also provides engineering, fabrication and automation services to clients who have operations in the U.S. oil and gas exploration and development markets. The operations are usually associated with the completion, purification, storage and transmission of the oil and gas from the well head to the terminal or pipeline destination.

 

Our Government Services group provides services related to the engineering, design, installation and maintenance of automated fuel handling and tank gauging systems for the U.S. military across the globe.

 

We have two reportable segments: Commercial and Government Services. Our Renewables, Automation, and Oil, Gas, and Petrochemical groups are aggregated into one reportable segment, Commercial.

 

Revenues, operating income, and identifiable assets for each segment are set forth in the following table. The amount identified as Corporate includes those activities that are not allocated to the operating segments and includes costs related to business development, executive functions, finance, accounting, safety, human resources and information technology. The segment information for the three months and nine months ended September 26, 2020 and as of December 26, 2020 has been recast to align with our current reportable segments.

Segment information is as follows (dollars in thousands):

 

 

 

Commercial

 

 

Government Services

 

 

Corporate

 

 

Consolidated

 

For the three months ended September 25, 2021:

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$3,935

 

 

$1,986

 

 

$—

 

 

$5,921

 

Gross profit (loss)

 

 

(1,089)

 

 

275

 

 

 

—

 

 

 

(814 )

Gross profit (loss) margin

 

 

(27.7 )%

 

 

13.8%

 

 

 

 

 

 

(13.7 )%

SG&A

 

 

1,534

 

 

 

280

 

 

 

1,275

 

 

 

3,089

 

Operating loss

 

 

(2,623)

 

 

(5)

 

 

(1,275)

 

 

(3,903)

Other income, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,371

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(46 )

Tax expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(21 )

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,401

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

Government Services

 

 

Corporate

 

 

Consolidated

 

For the three months ended September 26, 2020:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$13,867

 

 

$1,862

 

 

$—

 

 

$15,729

 

Gross profit

 

 

985

 

 

 

159

 

 

 

—

 

 

 

1,144

 

Gross profit margin

 

 

7.1%

 

 

8.5%

 

 

 

 

 

 

7.3%

SG&A

 

 

826

 

 

 

165

 

 

 

1,183

 

 

 

2,174

 

Operating income (loss)

 

 

159

 

 

 

(6 )

 

 

(1,183 )

 

 

(1,030)

Other income, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(62 )

Tax expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(22 )

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,110)

 

 

 

Commercial

 

 

Government Services

 

 

Corporate

 

 

Consolidated

 

For the nine months ended September 25, 2021:

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$23,141

 

 

$6,308

 

 

$—

 

 

$29,449

 

Gross profit (loss)

 

 

(375 )

 

 

647

 

 

 

—

 

 

 

272

 

Gross profit margin

 

 

(1.6 )%

 

 

10.3%

 

 

 

 

 

 

0.9%

SG&A

 

 

5,643

 

 

 

677

 

 

 

3,594

 

 

 

9,914

 

Operating loss

 

 

(6,018 )

 

 

(30 )

 

 

(3,594 )

 

 

(9,642)

Other income, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,061

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(161 )

Tax expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(67 )

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,809)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

Government Services

 

 

Corporate

 

 

Consolidated

 

For the nine months ended September 26, 2020:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$45,180

 

 

$7,691

 

 

$—

 

 

$52,871

 

Gross profit

 

 

5,740

 

 

 

1,117

 

 

 

—

 

 

 

6,857

 

Gross profit margin

 

 

12.7%

 

 

14.5%

 

 

 

 

 

 

13.0%

SG&A

 

 

2,488

 

 

 

485

 

 

 

3,648

 

 

 

6,621

 

Operating income (loss)

 

 

3,252

 

 

 

632

 

 

 

(3,648)

 

 

236

 

Other income, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(103 )

Tax expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(80 )

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

59

 

Total assets by segment are as follows (dollars in thousands):

 

Total Assets by Segment

 

As of

September 25,

2021

 

 

As of

December 26,

2020

 

 

 

(dollars in thousands)

 

Commercial

 

$8,725

 

 

$11,130

 

Government Services

 

 

3,398

 

 

 

3,151

 

Corporate

 

 

30,214

 

 

 

16,157

 

Consolidated

 

$42,337

 

 

$30,438