Segment information

3 Months Ended

Jan. 31, 2019

Note 9 - Segment information

The Company aggregates operating divisions into operating segments that have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; (5) if applicable, the nature of the regulatory environment. Based upon this evaluation, as of January 31, 2019, the Company had two segments – RF Connector and Cable Assembly (“RF Connector segment”) and Custom Cabling Manufacturing and Assembly (“Custom Cabling segment”).

The RF Connector segment consisted of one division and the Custom Cabling segment was composed of two divisions. The three divisions that met the quantitative thresholds for segment reporting are the RF Connector and Cable Assembly division (“RF Connector division”), Cables Unlimited, and Rel-Tech. While each segment had similar products and services, with one major exception, there was little overlapping of these services to their customer base. In addition, sales or product and services for the RF Connector segment were primarily through the distribution channel while the Custom Cabling segment sales were through a combination of distribution and direct to the end customer.

Management identifies the Company’s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector division constitutes the RF Connector segment, and the Cables Unlimited and Rel-Tech divisions constitute the Custom Cabling segment.

As reviewed by the Company’s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.

Substantially all of the Company’s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. The following table presents the sales of the Company by geographic area for the three months ended January 31, 2019 and 2018 (in thousands):

	Three Months Ended January 31,
	2019		2018

United States	$	10,470	$	7,764
Foreign Countries:
Canada		165		153
Mexico		-		39
All Other		12		10
		177		202

Totals	$	10,647	$	7,966

Net sales, income from continuing operations before provision for income taxes and other related segment information for the three months ended January 31, 2019 and 2018 are as follows (in thousands):

	RF Connector			Custom Cabling
	and			Manufacturing and
2019	Cable Assembly			Assembly		Corporate		Total
Net sales	$	3,258		$	7,389	$	-	$	10,647
Income from continuing operations before provision for income taxes		280			506		22		808
Depreciation and amortization		45			92		-		137
Total assets		6,635			11,026		14,846		32,507

2018
Net sales	$	2,630		$	5,336	$	-	$	7,966
Income (loss) from continuing operations before provision for income taxes		(157	)		514		3		360
Depreciation and amortization		44			83		-		127
Total assets		6,074			8,264		12,513		26,851