Quarterly report pursuant to Section 13 or 15(d)

Note 14 - Segment Reporting

v3.19.1
Note 14 - Segment Reporting
 3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]
Note
14:
Segment Reporting
 
An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the Chief Operating Decision Maker (“CODM”) to evaluate performance and make operating decisions. The Company has identified its CODM as the Chief Executive Officer.
  
The Company has
two
operating business segments. The Corporate Clinics segment is comprised of the operating activities of the company-owned or managed clinics. As of
March 31, 2019,
the Company operated or managed
50
clinics under this segment. The Franchise Operations segment is comprised of the operating activities of the franchise business unit. As of
March 31, 2019,
the franchise system consisted of
404
clinics in operation. Corporate is a non-operating segment that develops and implements strategic initiatives and supports the Company’s
two
operating business segments by centralizing key administrative functions such as finance and treasury, information technology, insurance and risk management, legal and human resources. Corporate also provides the necessary administrative functions to support the Company as a publicly-traded company. A portion of the expenses incurred by Corporate are allocated to the operating segments.  
  
The tables below present financial information for the Company’s
two
operating business segments (in thousands).
 
    Three Months Ended
March 31,
    2019   2018
        (as adjusted)
Revenues:        
Corporate clinics   $
5,639
     $
4,805
  
Franchise operations    
5,040
      
3,841
  
Total revenues   $
10,679
     $
8,646
  
                 
Segment operating (loss) income:                
Corporate clinics   $
946
     $
466
  
Franchise operations    
2,389
      
1,815
  
Total segment operating income   $
3,335
     $
2,281
  
                 
Depreciation and amortization:                
Corporate clinics   $
313
     $
303
  
Franchise operations    
–
      
–
  
Corporate administration    
53
      
84
  
Total depreciation and amortization   $
366
     $
387
  
                 
Reconciliation of total segment operating income (loss) to consolidated earnings (loss) before income taxes (in thousands):                
Total segment operating (loss) income   $
3,335
     $
2,281
  
Unallocated corporate    
(2,286
 )    
(2,365
 )
Consolidated income (loss) from operations    
1,049
      
(84
 )
Bargain purchase gain    
19
      
–
  
Other (expense) income, net    
(117
 )    
(11
 )
Income (loss) before income tax expense   $
951
     $
(95
 )
 
 
 
 
    March 31,
2019		   December 31,
2018
Segment assets:  
 
  
(as adjusted)
Corporate clinics   $
18,278
     $
8,827
 
Franchise operations    
4,646
      
4,455
 
Total segment assets   $
22,924
     $
13,283
 
                 
Unallocated cash and cash equivalents and restricted cash   $
8,197
     $
8,855
 
Unallocated property and equipment    
1,874
      
487
 
Other unallocated assets    
945
      
803
 
Total assets   $
33,940
     $
23,428
 
 
“Unallocated cash and cash equivalents and restricted cash” relates primarily to corporate cash and cash equivalents and restricted cash (see Note
1
), “unallocated property and equipment” relates primarily to corporate fixed assets, and “other unallocated assets” relates primarily to deposits, prepaid and other assets.