XML 37 R21.htm IDEA: XBRL DOCUMENT v3.22.2.2
SEGMENTS AND CONCENTRATIONS
 12 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
SEGMENTS AND CONCENTRATIONS

NOTE 15        SEGMENTS AND CONCENTRATIONS

 

Segments

 

The Company has three reportable segments: OEM distribution, retail distribution and design. See Note 2 for more information on the composition and accounting policies of our reportable segments.

 

Our chief operating decision maker (“CODM”) regularly reviews revenue and operating income for each segment to assess financial results and allocate resources. For our OEM and retail distribution segments, we exclude general and administrative and general corporate expenses from their measure of profitability as these expenses are not allocated to the segments and therefore not included in the measure of profitability used by the CODM. For the design segment, general and administrative expenses directly attributable to that segment are included in its measure of profitability as these expenses are included in the measure of its profitability reviewed by the CODM. We do not include intercompany activity in our segment results shown below to be consistent with the information that is presented to the CODM. Segment assets consist of accounts receivable and inventory, which are regularly reviewed by the CODM, as well as goodwill and intangible assets resulting from design segment acquisitions.

 

Information by segment and related reconciliations are shown in tables below: 

          
   Revenues 
   Fiscal 2022   Fiscal 2021 
OEM distribution  $18,036,000   $19,290,000 
Retail distribution   4,130,000    3,183,000 
Design   20,171,000    16,549,000 
Total segment revenues  $42,337,000   $39,022,000 

 

   Operating Income/(Loss) 
   Fiscal 2022   Fiscal 2021 
OEM distribution  $905,000   $1,479,000 
Retail distribution   (1,809,000)   (779,000)
Design   2,148,000    603,000 
Total segment operating income   1,244,000    1,303,000 
General corporate expenses   (2,484,000)   (2,068,000)
Total loss from operations   (1,240,000)   (765,000)
Other expense/(income), net   136,000    (1,289,000)
(Loss)/income before income taxes  $(1,376,000)  $524,000 

 

   Depreciation and Amortization 
   Fiscal 2022   Fiscal 2021 
OEM distribution  $8,000   $7,000 
Retail distribution   –    1,000 
Design   301,000    319,000 
Total  $309,000   $327,000 

 

          
   Segment Assets 
   September 30, 
   2022   2021 
OEM distribution  $4,276,000   $5,898,000 
Retail distribution   3,816,000    2,178,000 
Design   6,116,000    5,824,000 
Total segment assets   14,208,000    13,900,000 
General corporate assets   6,731,000    5,956,000 
Total assets  $20,939,000   $19,856,000 

 

Geographic Concentrations

 

The Company’s long-lived assets consist of property and equipment and operating lease right of use assets, all of which are located in the United States. The following table sets forth our consolidated net revenues by country for Fiscal 2022 and Fiscal 2021:  

          
   Revenues 
   Fiscal 2022   Fiscal 2021 
United States  $29,490,000   $25,670,000 
China   5,325,000    5,640,000 
Germany   2,976,000    2,787,000 
Poland   2,643,000    3,111,000 
Other foreign countries   1,903,000    1,814,000 
Total  $42,337,000   $39,022,000 

 

Customer Concentrations

 

In Fiscal 2022 and Fiscal 2021, the Company had certain customers in the OEM distribution segment whose individual percentage of the Company’s consolidated revenues was 10% or greater. Revenues from two of these customers or their affiliates or contract manufacturers represented 23.0% of the Company’s consolidated net revenues in Fiscal 2022 and revenues from three of these customers or their affiliates or contract manufacturers represented 36.8% of the Company’s consolidated net revenues in Fiscal 2021.

 

In Fiscal 2022, the Company had one customer in the design segment whose individual percentage of the Company’s consolidated revenues was 10% or greater. Revenues from this customer represented 10.6% of the Company’s consolidated net revenues in Fiscal 2022. There were no customers in the design segment whose individual percentage of the Company’s consolidated net revenues was 10% or greater in Fiscal 2021.

 

At September 30, 2022 and 2021, the Company had customers in the OEM distribution segment whose accounts receivable balances accounted for 10% or more of the Company’s consolidated accounts receivable. Accounts receivable from two customers or their affiliates or contract manufacturers represented 28.1% of the Company’s consolidated accounts receivable at September 30, 2022 and accounts receivable from three customers or their affiliates or contract manufacturers represented 44.0% of the Company’s consolidated accounts receivable at September 30, 2021.

 

Supplier Concentration

 

The Company’s OEM and retail distribution segments procure substantially all their products through independent suppliers in China through Forward China. Depending on the product, Forward China may require several different suppliers to furnish component parts or pieces.