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Note 11 - Business Segment Reporting
 3 Months Ended
Aug. 31, 2014
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]

11.

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. All of the assets of the Company are located within the United States of America.


The Company’s international sales were as follows (in millions):


   

Three Months Ended

 
   

August 31, 2014

   

August 25, 2013

 

Canada

  $ 17.7     $ 9.4  

Taiwan

  $ 16.2     $ 12.0  

China

  $ 4.4     $ 1.6  

Japan

  $ 2.8     $ 3.2  

Indonesia

  $ 1.6     $ 2.5  

Belgium

  $ —     $ 1.2  

All Other Countries

  $ 3.7     $ 5.3  

Operations and identifiable assets by business segment consisted of the following (in thousands):


Three Months Ended August 31, 2014

 

Food Products

Technology

   

Food Export

   

HA-based

Biomaterials

   

Corporate

   

TOTAL

 

Net sales

  $ 100,106     $ 26,597     $ 6,811     $ 100     $ 133,614  

International sales

  $ 18,151     $ 26,587     $ 1,634     $ —     $ 46,372  

Gross profit

  $ 11,854     $ 1,186     $ 1,048     $ 100     $ 14,188  

Net income (loss)

  $ 3,646     $ 271     $ (1,542 )   $ (22 )   $ 2,353  

Depreciation and amortization

  $ 1,010     $ 1     $ 471     $ 31     $ 1,513  

Dividend Income

  $ 281     $ —     $ —     $ —     $ 281  

Interest income

  $ 11     $ —     $ 71     $ 11     $ 93  

Interest expense

  $ 338     $ —     $ 45     $ —     $ 383  

Income tax expense (benefit)

  $ 870     $ 44     $ (251 )   $ 638     $ 1,301  
                                         

Three Months Ended August 25, 2013

                                       

Net sales

  $ 79,436     $ 21,398     $ 8,587     $ 58     $ 109,479  

International sales

  $ 9,478     $ 21,389     $ 4,377     $ —     $ 35,244  

Gross profit

  $ 8,881     $ 1,205     $ 2,388     $ 58     $ 12,532  

Net income (loss)

  $ 7,266     $ 276     $ (376 )   $ (2,414 )   $ 4,752  

Depreciation and amortization

  $ 1,222     $ 1     $ 584     $ 35     $ 1,842  

Dividend Income

  $ 281     $ —     $ —     $ —     $ 281  

Interest income

  $ 4     $ —     $ 56     $ —     $ 60  

Interest expense

  $ 376     $ —     $ 55     $ —     $ 431  

Income tax expense (benefit)

  $ 505     $ 78     $ (106 )   $ 1,998     $ 2,475  

During the three months ended August 31, 2014 and August 25, 2013, sales to the Company’s top five customers accounted for 46% and 44%, 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 11% of revenues, respectively, for the three months ended August 31, 2014 and 20% and 12% of revenues, respectively, for the three months ended August 25, 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.