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Segment and Geographic Information
 12 Months Ended
May 27, 2023
Segment Reporting [Abstract]  
Segment and Geographic Information
10.
SEGMENT AND GEOGRAPHIC INFORMATION

As described in Note 1, Description of the Company and Note 2, Basis of Presentation, the Company began reporting the results for its new Green Energy Solutions ("GES") segment in the first quarter of fiscal 2023 due to its focus on power applications that support the green energy market. The GES segment has been carved out of our existing Power and Microwave Technologies (“PMT”) segment. Accordingly, the Company is reporting its financial performance based on four operating and reportable segments. The results for fiscal 2022 and fiscal 2021 presented herein were adjusted to reflect the presentation of the new GES segment separately from the PMT segment.

The Company's four operating and reportable segments for fiscal 2023, fiscal 2022 and fiscal 2021 were defined as follows:

Power and Microwave Technologies combines our core engineered solutions capabilities, power grid and microwave tube business with new disruptive RF, Wireless and Power technologies. As a designer, manufacturer, technology partner and authorized distributor, PMT’s strategy is to provide specialized technical expertise and engineered solutions based on our core engineering and manufacturing capabilities on a global basis. We provide solutions and add value through design-in support, systems integration, prototype design and manufacturing, testing, logistics and aftermarket technical service and repair—all through our existing global infrastructure. PMT’s focus is on products for power, RF and microwave applications for customers in 5G, aviation, broadcast, communications, industrial, marine, medical, military, scientific and semiconductor markets. PMT focuses on various applications including broadcast transmission, CO2 laser cutting, diagnostic imaging, dielectric and induction heating, high energy transfer, high voltage switching, plasma, power conversion, radar and radiation oncology. PMT also offers its customers technical services for both microwave and industrial equipment.

Green Energy Solutions combines our key technology partners and engineered solutions capabilities to design and manufacture innovative products for the fast-growing energy storage market and power management applications. As a designer, manufacturer, technology partner and authorized distributor, GES’s strategy is to provide specialized technical expertise and engineered solutions using our core design engineering and manufacturing capabilities on a global basis. We provide solutions and add value through design-in support, systems integration, prototype design and manufacturing, testing, logistics and aftermarket technical service and repair—all through our existing global infrastructure. GES’s focus is on products for numerous green energy applications such as wind, solar, hydrogen and Electric Vehicles, and other power management applications that support green solutions such as synthetic diamond manufacturing.

Canvys provides customized display solutions serving the corporate enterprise, financial, healthcare, industrial and medical original equipment manufacturers markets. Our engineers design, manufacture, source and support a full spectrum of solutions to match the needs of our customers. We offer long term availability and proven custom display solutions that include touch screens, protective panels, custom enclosures, All-In-One computers, specialized cabinet finishes and application specific software packages and certification services. We partner with both private label manufacturing companies and leading branded hardware vendors to offer the highest quality display and touch solutions and customized computing platforms.

Healthcare manufactures, repairs, refurbishes and distributes high value replacement parts and equipment for the healthcare market including hospitals, medical centers, asset management companies, independent service organizations and multi-vendor service providers. Products include diagnostic imaging replacement parts for CT and MRI systems; replacement CT and MRI tubes; CT service training; MRI coils, cold heads and RF amplifiers; hydrogen thyratrons, klystrons, magnetrons; flat panel detector upgrades; pre-owned CT systems; and additional replacement solutions currently under development for the diagnostic imaging service market. Through a combination of newly developed products and partnerships, service offerings and training programs, we believe we can help our customers improve efficiency while lowering the cost of healthcare delivery.

The CEO, who is the chief operating decision maker, evaluates performance and allocates resources primarily based on the gross profit of each segment.

Operating results by segment are summarized in the following table (in thousands):

 

 

 

Fiscal Year Ended

 

 

 

May 27, 2023

 

 

May 28, 2022

 

 

May 29, 2021

 

PMT

 

 

 

 

 

 

 

 

 

Net Sales

 

$

164,299

 

 

$

155,445

 

 

$

128,980

 

Gross Profit

 

 

54,089

 

 

 

50,810

 

 

 

43,546

 

 

 

 

 

 

 

 

 

 

 

GES

 

 

 

 

 

 

 

 

 

Net Sales

 

$

47,596

 

 

$

22,611

 

 

$

8,300

 

Gross Profit

 

 

13,719

 

 

 

7,231

 

 

 

2,405

 

 

 

 

 

 

 

 

 

 

 

Canvys

 

 

 

 

 

 

 

 

 

Net Sales

 

$

39,331

 

 

$

35,187

 

 

$

29,319

 

Gross Profit

 

 

12,375

 

 

 

11,252

 

 

 

10,274

 

 

 

 

 

 

 

 

 

 

 

Healthcare

 

 

 

 

 

 

 

 

 

Net Sales

 

$

11,432

 

 

$

11,377

 

 

$

10,338

 

Gross Profit

 

 

3,506

 

 

 

2,407

 

 

 

2,600

 

A reconciliation of assets to the relevant consolidated amount is as follows (in thousands):

 

 

 

May 27, 2023

 

 

May 28, 2022

 

Segment assets

 

$

149,976

 

 

$

120,696

 

Cash and cash equivalents

 

 

24,981

 

 

 

35,495

 

Investments - current

 

 

—

 

 

 

5,000

 

Other current assets (1)

 

 

2,771

 

 

 

2,686

 

Net property, plant and equipment

 

 

14,124

 

 

 

9,435

 

Operating lease ROU asset

 

 

1,403

 

 

 

1,894

 

Financing lease ROU asset

 

 

—

 

 

 

215

 

Other non-current assets

 

 

267

 

 

 

—

 

Other assets - non-current deferred income taxes

 

 

4,526

 

 

 

4,398

 

     Total assets

 

$

198,048

 

 

$

179,819

 
(1)
Other current assets include miscellaneous receivables and prepaid expenses.

Assets are not disclosed by reportable segment as the Company does not track assets by reportable segment and certain assets are not specific to any reportable segment.

Capital expenditures for our Healthcare segment during fiscal 2023 and fiscal 2022 were approximately $0.6 million and $1.0 million, respectively. In addition, we also had capital expenditures during fiscal 2023 and fiscal 2022 related to the Company’s ERP system as well as facilities that were not specific to any particular reportable segment.

Geographic net sales information is primarily grouped by customer destination into five areas: North America; Asia/Pacific; Europe; Latin America; and Other.

Net sales and gross profit by geographic region are summarized in the following table (in thousands):

 

 

 

Fiscal Year Ended

 

 

 

May 27, 2023

 

 

May 28, 2022

 

 

May 29, 2021

 

Net Sales

 

 

 

 

 

 

 

 

 

North America

 

$

112,214

 

 

$

98,527

 

 

$

73,625

 

Asia/Pacific

 

 

59,557

 

 

 

49,235

 

 

 

40,839

 

Europe

 

 

62,017

 

 

 

64,435

 

 

 

52,549

 

Latin America

 

 

28,924

 

 

 

12,439

 

 

 

9,651

 

Other (1)

 

 

(54

)

 

 

(16

)

 

 

273

 

Total

 

$

262,658

 

 

$

224,620

 

 

$

176,937

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

 

 

 

 

 

 

 

 

North America

 

$

43,580

 

 

$

36,548

 

 

$

28,639

 

Asia/Pacific

 

 

18,775

 

 

 

15,728

 

 

 

13,520

 

Europe

 

 

18,760

 

 

 

19,215

 

 

 

16,958

 

Latin America

 

 

7,735

 

 

 

4,340

 

 

 

3,405

 

Other (1)

 

 

(5,161

)

 

 

(4,131

)

 

 

(3,697

)

Total

 

$

83,689

 

 

$

71,700

 

 

$

58,825

 
(1)
Other includes primarily net sales not allocated to a specific geographical region, unabsorbed value-add cost and other unallocated expenses.

We sell our products to customers in diversified industries and perform periodic credit evaluations of our customers’ financial condition. Terms are generally on open account, payable net 30 days in North America, and vary throughout Asia/Pacific, Europe and Latin America. Estimates of credit losses are recorded in the financial statements based on monthly reviews of outstanding accounts.

Net assets by geographic region are summarized in the following table (in thousands):

 

 

 

Fiscal Year Ended

 

 

 

May 27, 2023

 

 

May 28, 2022

 

Net Assets

 

 

 

 

 

 

North America

 

$

106,528

 

 

$

90,979

 

Asia/Pacific

 

 

12,347

 

 

 

11,514

 

Europe

 

 

37,843

 

 

 

30,873

 

Latin America

 

 

2,602

 

 

 

2,481

 

Total

 

$

159,320

 

 

$

135,847

 

 

The Company had long-lived assets of $22.7 million as of May 27, 2023 and $19.0 million as of May 28, 2022. The long-lived assets, which include our fixed assets and intangibles, were primarily in the U.S. There were approximately $0.3 million of long-lived assets that belong to our foreign affiliates as of May 27, 2023 and $0.4 million as of May 28, 2022.

The Company had depreciation and amortization expense of $3.7 million, $3.4 million and $3.4 million for fiscal 2023, fiscal 2022 and fiscal 2021, respectively. The depreciation and amortization, which includes our fixed assets and intangibles, were primarily in the U.S. Depreciation and amortization expense that belongs to our foreign affiliates was approximately $0.1 million for fiscal 2023, $0.1 million for fiscal 2022 and $0.3 million for fiscal 2021, respectively.