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Note 14 - Business Segment Reporting
 9 Months Ended
Feb. 23, 2014
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]

14.          Business Segment Reporting


The Company manages its business operations through three strategic business units. Based upon the information reported to the chief operating decision maker, who is the Chief Executive Officer, the Company has the following reportable segments: the Food Products Technology segment, the Food Export segment and the Hyaluronan-based Biomaterials segment.


The Food Products Technology segment markets and packs specialty packaged whole and fresh-cut fruit and vegetables, the majority of which incorporate the BreatheWay specialty packaging for the retail grocery, club store and food services industry. In addition, the Food Products Technology segment sells BreatheWay packaging to partners for non-vegetable products. The Food Export segment consists of revenues generated from the purchase and sale of primarily whole commodity fruit and vegetable products to Asia and domestically. The HA-based Biomaterials segment sells products utilizing hyaluronan, a naturally occurring polysaccharide that is widely distributed in the extracellular matrix of connective tissues in both animals and humans, for medical use primarily in the Ophthalmic, Orthopedic and Veterinary markets. Corporate licenses Landec’s patented Intellicoat® seed coatings to the farming industry and licenses the Company’s Intelimer polymers for personal care products and other industrial products. The Corporate segment also includes general and administrative expenses, non-Food Products Technology and non HA-based Biomaterials interest income and income tax expenses. Beginning in fiscal year 2013, the Food Products Technology, the Food Export and the Hyaluronan-based Biomaterials segments include charges for corporate services and tax sharing allocated from the Corporate segment. All of the assets of the Company are located within the United States of America.


The Company’s international sales by geography are based on the billing address of the customer and were as follows (in millions):


   

Three Months Ended

   

Nine Months Ended

 
   

February 23, 2014

   

February 24, 2013

   

February 23, 2014

   

February 24, 2013

 

Taiwan

  $ 2.6     $ 2.9     $ 27.2     $ 28.7  

Canada

  $ 12.1     $ 7.4     $ 31.8     $ 19.7  

China

  $ 1.3     $ 0.9     $ 6.6     $ 4.5  

Indonesia

  $ 2.2     $ 4.1     $ 7.1     $ 17.6  

Japan

  $ 1.8     $ 1.5     $ 7.1     $ 7.4  

Belgium

  $ 11.1     $ 10.6     $ 13.1     $ 15.2  

All Other Countries

  $ 2.2     $ 6.9     $ 12.3     $ 15.7  

Operations by segment consisted of the following (in thousands):


Three Months Ended Febr. 23, 2014

 

Food Products Technology

   

Food Export

   

HA-based Biomaterials

   

Corporate

   

TOTAL

 

Net sales

  $ 95,431     $ 10,676     $ 20,176     $ 96     $ 126,379  

International sales

  $ 12,013     $ 10,676     $ 10,613     $ —     $ 33,302  

Gross profit

  $ 7,282     $ 990     $ 11,787     $ 96     $ 20,155  

Net income (loss)

  $ 131     $ 206     $ 7,192     $ (1,129 )   $ 6,400  

Depreciation and amortization

  $ 1,040     $ 1     $ 504     $ 32     $ 1,577  

Dividend income

  $ 281     $ —     $ —     $ —     $ 281  

Interest income

  $ 3     $ —     $ 74     $ 1     $ 78  

Interest expense

  $ 332     $ —     $ 58     $ —     $ 390  

Income tax expense

  $ 468     $ 58     $ 2,028     $ 1,125     $ 3,679  
                                         

Three Months Ended Febr. 24, 2013

                                       

Net sales

  $ 86,707     $ 13,381     $ 17,331     $ 448     $ 117,867  

International sales

  $ 7,293     $ 13,381     $ 13,579     $ —     $ 34,253  

Gross profit

  $ 5,846     $ 1,031     $ 10,243     $ 388     $ 17,508  

Net income (loss)

  $ 338     $ 228     $ 5,687     $ (1,464 )   $ 4,789  

Depreciation and amortization

  $ 1,224     $ 1     $ 602     $ 39     $ 1,866  

Dividend income

  $ 281     $ —     $ —             $ 281  

Interest income

  $ 4     $ —     $ 42     $ —     $ 46  

Interest expense

  $ 421     $ —     $ 66     $ —     $ 487  

Income tax expense

  $ 113     $ 76     $ 1,895     $ 670     $ 2,754  
                                         

Nine Months Ended Febr. 23, 2014

                                       

Net sales

  $ 262,957     $ 55,106     $ 37,539     $ 282     $ 355,884  

International sales

  $ 31,836     $ 55,005     $ 18,356     $ —     $ 105,197  

Gross profit

  $ 24,383     $ 4,015     $ 17,800     $ 223     $ 46,421  

Net income (loss)

  $ 9,402     $ 1,209     $ 7,427     $ (3,435 )   $ 14,603  

Depreciation and amortization

  $ 3,566     $ 3     $ 1,692     $ 103     $ 5,364  

Dividend income

  $ 844     $ —     $ —     $ —     $ 844  

Interest income

  $ 8     $ —     $ 174     $ 1     $ 183  

Interest expense

  $ 1,064     $ —     $ 193     $ —     $ 1,257  

Income tax expense

  $ 2,434     $ 341     $ 2,094     $ 3,159     $ 8,028  
                                         

Nine Months Ended Febr. 24, 2013

                                       

Net sales

  $ 233,931     $ 66,854     $ 33,043     $ 767     $ 334,595  

International sales

  $ 19,475     $ 66,747     $ 22,603     $ —     $ 108,825  

Gross profit

  $ 28,891     $ 4,407     $ 15,725     $ 707     $ 49,730  

Net income (loss)

  $ 15,466     $ 1,403     $ 5,713     $ (4,514 )   $ 18,068  

Depreciation and amortization

  $ 3,634     $ 3     $ 1,777     $ 113     $ 5,527  

Dividend income

  $ 844     $ —     $ —     $ —     $ 844  

Interest income

  $ 12     $ —     $ 92     $ —     $ 104  

Interest expense

  $ 1,303     $ —     $ 223     $ —     $ 1,526  

Income tax expense

  $ 3,846     $ 467     $ 1,904     $ 2,021     $ 8,238  

During the nine months ended February 23, 2014 and February 24, 2013, sales to the Company’s top five customers accounted for 43% and 39%, respectively, of revenues. The Company’s top two customers, Costco Wholesale Corporation and Wal-Mart Stores, Inc., from the Food Products Technology segment accounted for 20% and 12%, respectively, for nine months ended February 23, 2014 and 14% and 12%, respectively, for the nine months ended February 24, 2013. The Company expects that, for the foreseeable future, a limited number of customers may continue to account for a significant portion of its net revenues.