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SEGMENT REPORTING
 9 Months Ended
Sep. 30, 2023
Segment Reporting [Abstract]  
SEGMENT REPORTING

NOTE 9— SEGMENT REPORTING

 

As of September 30, 2023, the Company operates in two reportable operating segments, both of which are performed through the Company’s OmniMetrix subsidiary:

 

  ● Power Generation (“PG”). OmniMetrix’s PG services provide wireless remote monitoring and control systems and IoT applications for residential and commercial/industrial power generation equipment. This includes OmniMetrix’s AIRGuard product, which remotely monitors and controls industrial air compressors, and its Smart Annunciator product, which is typically sold to commercial customers that require a visual representation of the generator’s status and has a touchscreen display that indicates the current state of that generator.
     
  ● Cathodic Protection (“CP”). OmniMetrix’s CP services provide remote monitoring and control products for cathodic protection systems on oil and gas pipelines serving the gas utilities market and pipeline operators. The CP product lineup includes solutions to remotely monitor and control rectifiers, test stations and bonds. OmniMetrix also offers the industry’s first RADTM (Remote AC Mitigation Disconnect) that mounts onto existing Solid-state Decouplers in the field and can remotely disconnect/connect these AC mitigation tools, which can drastically reduce a company’s expense while increasing employee safety.

 

 

The Company’s reportable segments are strategic business units, offering different products and services, and are managed separately as each business requires different technology and marketing strategies.

 

The following tables represent segmented data for the nine-month and three-month periods ended September 30, 2023 and 2022 (in thousands):

 

   PG   CP   Total 
Nine months ended September 30, 2023:               
Revenues from external customers  $4,994   $815   $5,809 
Segment gross profit   3,876    480    4,356 
Depreciation and amortization   99    16    115 
Segment income (loss) before income taxes  $891   $(35)  $856 
                
Nine months ended September 30, 2022:               
Revenues from external customers  $4,335   $820   $5,155 
Segment gross profit   3,256    463    3,719 
Depreciation and amortization   72    13    85 
Segment income (loss) before income taxes*  $340   $(103)  $237 
                
Three months ended September 30, 2023:               
Revenues from external customers  $1,798   $289   $2,087 
Segment gross profit   1,381    169    1,550 
Depreciation and amortization   36    5    41 
Segment income before income taxes  $361   $5   $366 
                
Three months ended September 30, 2022:               
Revenues from external customers  $1,510   $273   $1,783 
Segment gross profit   1,092    123    1,215 
Depreciation and amortization   31    5    36 
Segment income (loss) before income taxes  $78   $(58)  $20 

 

*Software impairment of $51,000 is not related to a specific segment and, thus, is not included in the “Total net income before income taxes for reportable segments” for the nine months ended September 30, 2022

 

The Company does not currently break out total assets by reportable segment as there is a high level of shared utilization between the segments. Further, the Chief Decision Maker does not review the assets by segment.

 

Reconciliation of Segment Income (Loss) to Consolidated Net Income (Loss) Before Income Taxes

 

   2023   2022   2023   2022 
  

Nine months ended

September 30,

  

Three months ended

September 30,

 
   2023   2022   2023   2022 
Total net income before income taxes for reportable segments  $856   $237   $366   $20 
Unallocated software impairment        (51)   

 

      
Unallocated cost of corporate headquarters   (814)   (741)   (339)   (230)
Consolidated net income (loss) before income taxes  $42   $(555)  $27   $(210)