Annual report pursuant to Section 13 and 15(d)

Note 14 - Segment Reporting

v3.10.0.1
Note 14 - Segment Reporting
 12 Months Ended
Dec. 31, 2018
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
December 31, 2018,
the Company operated or managed
48
clinics under this segment. The Franchise Operations segment is comprised of the operating activities of the franchise business unit. As of
December 31, 2018,
the franchise system consisted of
394
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). The prior period comparatives have been adjusted to reflect the changes from ASC
606.
  
    Year Ended
December 31,
    2018   2017
        (as adjusted)
Revenues:        
Corporate clinics   $
14,673
     $
11,124
  
Franchise operations    
17,116
      
13,794
  
Total revenues   $
31,789
     $
24,918
  
                 
Segment operating (loss) income:                
Corporate clinics   $
1,537
     $
(1,704
 )
Franchise operations    
8,084
      
6,086
  
Total segment operating (loss) income   $
9,621
     $
4,382
  
                 
Depreciation and amortization:                
Corporate clinics   $
1,105
     $
1,608
  
Franchise operations    
–
      
–
  
Corporate administration    
451
      
409
  
Total depreciation and amortization   $
1,556
     $
2,017
  
                 
Reconciliation of total segment operating income (loss) to consolidated earnings (loss) before income taxes (in thousands):                
Total segment operating (loss) income   $
9,621
     $
4,382
  
Unallocated corporate    
(9,416
 )    
(7,714
 )
Consolidated loss from operations    
205
      
(3,332
 )
Bargain purchase gain    
58
      
–
  
Other (expense) income, net    
(48
 )    
(64
 )
Loss before income tax expense   $
215
     $
(3,396
 )
 
For the year ended
December 31, 2017,
$418,000
of loss on disposition/impairment has been reclassified from unallocated corporate to the corporate clinic segment operating loss to align with current year presentation.
 
    December 31,
2018		   December 31,
2017
Segment assets:  
 
  
(as adjusted)
Corporate clinics   $
8,926
     $
8,998
 
Franchise operations    
4,455
      
3,888
 
Total segment assets   $
13,381
     $
12,886
 
                 
Unallocated cash and restricted cash   $
8,855
     $
4,320
 
Unallocated property and equipment    
487
      
765
 
Other unallocated assets    
803
      
465
 
Total assets   $
23,526
     $
18,436
 
 
“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.