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Income Taxes
 9 Months Ended
Sep. 30, 2025
Segment Reporting [Abstract]  
Income Taxes

 

11. Operating Segments

 

In accordance with ASC 280, “Segment Reporting”, the Company defines an operating segment as a business activity: (1) from which we may earn revenue and incur expenses; (2) whose operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance; and (3) for which discrete financial information is available.

 

 

The Company has two reporting segments, consisting of the Treatment and Services Segments, which are primarily based on a service offering approach and defined as follow:

 

TREATMENT SEGMENT, which includes:

 

-nuclear, low-level radioactive, mixed waste (containing both hazardous and low-level radioactive constituents), hazardous and non-hazardous waste treatment, processing and disposal services primarily through four uniquely licensed and permitted treatment and storage facilities; and
-Research and Development (“R&D”) activities to identify, develop and implement innovative waste processing techniques for problematic waste streams.

 

SERVICES SEGMENT, which includes:

 

-Technical services, which include:

 

○professional radiological measurement and site survey of large government and commercial installations using advanced methods, technology and engineering;
○integrated Occupational Safety and Health services including industrial hygiene (“IH”) assessments; hazardous materials surveys, e.g., exposure monitoring; lead and asbestos management/abatement oversight; indoor air quality evaluations; health risk and exposure assessments; health & safety plan/program development, compliance auditing and training services; and Occupational Safety and Health Administration (“OSHA”) citation assistance;
○global technical services providing consulting, engineering, project management, waste management, environmental, and decontamination and decommissioning (“D&D”) field, technical, and management personnel and services to commercial and government customers; and
○on-site waste management services to commercial and governmental customers.

 

-Nuclear services, which include:

 

○technology-based services including engineering, D&D, specialty services and construction, logistics, transportation, processing and disposal;
○remediation of nuclear licensed and federal facilities and the remediation cleanup of nuclear legacy sites. Such service capabilities include project investigation; radiological engineering; partial and total plant D&D; facility decontamination, dismantling, demolition, and planning; site restoration; logistics; transportation; and emergency response; and

 

-A company owned equipment calibration and maintenance laboratory that services, maintains, calibrates, and sources (i.e., rental) health physics, IH and customized nuclear, environmental, and occupational safety and health (“NEOSH”) instrumentation.

 

The Company’s reporting segments exclude our corporate headquarter which serves to support its two reporting segments through various functions, such as our executives, finance, treasury, human resources, accounting, and legal departments. Financial results for the corporate headquarter are not considered by the CODM in evaluating the performance of the reportable segments. Our reporting segment also excludes our discontinued operations (see “Note 10 – Discontinued Operations”) which do not generate revenues.

 

The Company’s CODM is represented by its Chief Executive Officer (“CEO”) and COO (or “CODM group”). The CODM group evaluates the performance of the Treatment and Services segments and allocates resources (including financial or capital resources) to each reporting segment based on revenue and income (loss) from operations by comparing actual results for these metrics to budgeted and forecasted amounts for these metrics on a monthly, quarterly and year-to-date basis. The Company’s CODM group does not evaluate and allocate resources for the reportable segments using assets; therefore, the Company does not disclose assets for its reporting segments.

 

The table below summarizes income (loss) from operations for the Company’s two reporting segments and its corporate headquarter and provides reconciliation of such financial metric to the Company’s consolidated totals for the three and nine months ended September 30, 2025, and 2024 for our continuing operations. Significant segment expenses that are included in the measure of segment profit or losses for each reportable segment and regularly provided to the CODM group include payroll and benefit, material and supplies, disposal, transportation and subcontract expenses and are reflected separately, where applicable (in thousands).

 

 

 Schedule of Segment Reporting Information

Segment Reporting for the Three Months Ended September 30, 2025

 

                          
   Treatment   Services   Segments Total   Corporate (1)   Consolidated Total 
Revenue from external customers  $13,114   $4,340   $17,454   $—   $17,454 
Cost of Goods Sold:                         
Payroll and benefits expenses   4,809    2,358    7,167    —    7,167 
Material and supplies expenses   2,158    —    2,158    —    2,158 
Disposal expenses   1,075    —    1,075    —    1,075 
Transportation expenses   361    —    361    —    361 
Subcontract expenses   —    118    118    —    118 
Other cost of goods sold (2)   2,445    1,573    4,018    —    4,018 
Total cost of goods sold   10,848    4,049    14,897    —    14,897 
Gross profit   2,266    291    2,557    —    2,557 
SG&A:                         
Payroll and benefits   947    547    1,494    997    2,491 
Other SG&A (3)   386    199    585    1,007    1,592 
Total SG&A   1,333    746    2,079    2,004    4,083 
Research and development   257    2    259    83    342 
Loss on disposal of property and equipment   4    —    4    —    4 
Income (loss) from operations  $672   $(457)  $215   $(2,087)   (1,872)
Interest income                       266 
Interest expense                       (116)
Interest expense-financing fees                       (22)
Other expense                       (18)
Loss from continuing operations before taxes                       (1,762)
Income tax expense                       — 
Loss from continuing operations, net of taxes                      $(1,762)

 

Segment Reporting for the Three Months Ended September 30, 2024

 

                          
   Treatment   Services   Segments Total   Corporate (1)   Consolidated Total 
Revenue from external customers  $9,064   $7,748   $16,812   $—   $16,812 
Cost of goods sold:                         
Payroll and benefit expenses   4,275    2,636    6,911    —    6,911 
Material and supplies expenses   1,035    —    1,035    —    1,035 
Disposal expenses   788    —    788    —    788 
Transportation expenses   322    —    322    —    322 
Subcontract expenses   —    2,135    2,135    —    2,135 
Other cost of goods sold (2)   2,234    2,053    4,287    —    4,287 
Total cost of goods sold   8,654    6,824    15,478    —    15,478 
Gross profit   410    924    1,334    —    1,334 
SG&A:                         
Payroll and benefits   743    643    1,386    848    2,234 
Other SG&A (3)   341    172    513    885    1,398 
Total SG&A   1,084    815    1,899    1,733    3,632 
Research and development   205    34    239    64    303 
(Loss) income from operations  $(879)  $75   $(804)  $(1,797)   (2,601)
Interest income                       292 
Interest expense                       (121)
Interest expense-financing fees                       (18)
Other income                       59 
Loss from continuing operations before taxes                       (2,389)
Income tax expense                       6,417 
Loss from continuing operations, net of taxes                      $(8,806)

 

 

Segment Reporting for the Nine Months Ended September 30, 2025

 

                          
   Treatment   Services   Segments Total   Corporate (1)   Consolidated Total 
Revenue from external customers  $33,696   $12,263   $45,959   $—   $45,959 
Cost of Goods Sold:                         
Payroll and benefits expenses   13,988    6,245    20,233    —    20,233 
Material and supplies expenses   4,744    —    4,744    —    4,744 
Disposal expenses   2,391    —    2,391    —    2,391 
Transportation expenses   1,222    —    1,222    —    1,222 
Subcontract expenses   —    1,184    1,184    —    1,184 
Other cost of goods sold (2)   7,269    4,155    11,424    —    11,424 
Total cost of goods sold   29,614    11,584    41,198    —    41,198 
Gross profit   4,082    679    4,761    —    4,761 
SG&A:                         
Payroll and benefits   2,763    1,732    4,495    2,869    7,364 
Other SG&A (3)   1,276    573    1,849    3,015    4,864 
Total SG&A   4,039    2,305    6,344    5,884    12,228 
Research and development   780    29    809    228    1,037 
Loss (gain) on disposal of property and equipment   3    (5)   (2)   —    (2)
Loss from operations  $(740)  $(1,650)  $(2,390)  $(6,112)   (8,502)
Interest income                       901 
Interest expense                       (351)
Interest expense-financing fees                       (63)
Other income                       171 
Loss from continuing operations before taxes                       (7,844)
Income tax expense                       — 
Loss from continuing operations, net of taxes                      $(7,844)

 

Segment Reporting for the Nine Months Ended September 30, 2024

 

                          
   Treatment   Services   Segments Total   Corporate (1)   Consolidated Total 
Revenue from external customers  $26,116   $18,299   $44,415   $—   $44,415 
Cost of goods sold:                         
Payroll and benefit expenses   11,970    7,065    19,035    —    19,035 
Material and supplies expenses   2,876    —    2,876    —    2,876 
Disposal expenses   4,211    —    4,211    —    4,211 
Transportation expenses   837    —    837    —    837 
Subcontract expenses   —    6,498    6,498    —    6,498 
Other cost of goods sold (2)   7,061    4,489    11,550    —    11,550 
Total cost of goods sold   26,955    18,052    45,007    —    45,007 
Gross (loss) profit   (839)   247    (592)   —    (592)
SG&A:                         
Payroll and benefits   2,145    1,799    3,944    2,517    6,461 
Other SG&A (3)   1,079    474    1,553    2,617    4,170 
Total SG&A   3,224    2,273    5,497    5,134    10,631 
Research and development   609    87    696    176    872 
Loss on disposal of property and equiment   —    1    1    —    1 
Loss from operations  $(4,672)  $(2,114)  $(6,786)  $(5,310)   (12,096)
Interest income                       679 
Interest expense                       (346)
Interest expense-financing fees                       (47)
Other income                       61 
Loss from continuing operations before taxes                       (11,749)
Income tax expense                       4,300 
Loss from continuing operations, net of taxes                      $(16,049)

 

(1)Amounts reflect the activity for corporate headquarters not included in the segment reporting information.

 

(2)Other cost of goods sold for each reportable segment includes:

Treatment - lab, regulatory, repair and maintenance, depreciation and amortization, travel, outside services and general expenses.

Services - material and supplies, disposal, transportation, lab, regulatory, repair and maintenance, depreciation and amortization, travel, outside services and general expenses.

 

(3)Other SG&A for each reportable segment and Corporate includes:

Treatment-depreciation and amortization, travel, outside services, repair and maintenance and general expenses.

Services- travel, outside services, repair and maintenance and general expenses.

Corporate-repair and maintenance, depreciation and amortization, travel, public company, outside services and general expenses.

 

 

The following table presents depreciation and amortization for the three and nine months ended September 30, (in thousand):

 Schedule of Depreciation and Amortization

                     
   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
   2025   2024   2025   2024 
Treatment  $387   $370   $1,158   $1,104 
Services   28    44    109    133 
Total segment   415    414    1,267    1,237 
Corporate   11    19    32    58 
Total  $426   $433   $1,299   $1,295 

 

The following table presents capital expenditures for the three and nine months ended September 30, (in thousand):

 

Schedule of Capital Expenditures

                     
   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
   2025   2024   2025   2024 
Treatment  $1,145   $1,203   $2,525   $1,820 
Services   31    180    83    404 
Total segment   1,176    1,383    2,608    2,224 
Corporate   —    —    —    — 
Total  $1,176(1)  $1,383(2)  $2,608(1)  $2,224(2)

 

(1)Net of financed amount of $30 and $162 for the three and nine months ended September 30, 2025, respectively.

 

(2)Net of financed amount of $361 and $406 for the three and nine months ended September 30, 2024, respectively.

 

12. Income Taxes

 

The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes.

 

The Company had income tax expenses of $0 and $6,417,000 for continuing operations for the three months ended September 30, 2025, and the corresponding period of 2024, respectively, and income tax expenses of $0 and $4,300,000 for continuing operations for the nine months ended September 30, 2025, and the corresponding period of 2024, respectively. The Company’s effective tax rates were approximately 0% and 268.6% for the three months ended September 30, 2025, and the corresponding period of 2024, respectively, and 0% and 36.6% for the nine months ended September 30, 2025, and the corresponding period of 2024, respectively. The Company’s effective tax rate for the each of the periods above was impacted by the Company’s recognition of a full valuation allowance against its U.S federal and state deferred tax assets in the quarter ended September 30, 2024.

 

On July 4, 2025, the United States enacted tax reform legislation through the One Big Beautiful Bill Act (“OBBBA”), which changes existing U.S. tax laws, including extending or making permanent certain provisions of the Tax Cuts and Jobs Act, repealing certain clean energy initiatives, in addition to other changes. The Company has evaluated the provisions of the OBBBA and determined that the enactment of the legislation had no material impact to the Company’s condensed consolidated financial statements for the interim period ended September 30, 2025. Additionally, the Company does not expect OBBBA to have a material impact to the Company’s full year 2025 effective tax rate and its consolidated financial statements for the year ended December 31, 2025, due to the Company’s valuation allowance position, among other things. The Company continues to monitor the potential future impacts of the OBBBA on the Company’s consolidated financial statements.