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Segments
 3 Months Ended
Mar. 31, 2023
Segment Reporting [Abstract]  
Segments

Note 12 - Segments

 

With each acquisition, we assess the need to disclose discrete information related to our operating segments. Because of the similarities of certain of our acquisitions that provide certification and verification services, we aggregate operations into one verification and certification reportable segment. The operating segments included in the aggregated verification and certification segment include IMI Global, WFCFO and Validus. The factors considered in determining this aggregated reporting segment include the economic similarity of the businesses, the nature of services provided, production processes, types of customers and distribution methods.

 

The Company also determined that it has a software and related consulting reportable segment. SureHarvest, which includes Postelsia, is the sole operating unit under the software and related consulting reportable segment. This segment includes software and related consulting service revenues.

 

The Company’s chief operating decision maker (the Company’s CEO) allocates resources and assesses the performance of its operating segments. Segment management makes decisions, measures performance, and manages the business utilizing internal reporting operating segment information. Performance of operating segments are based on net sales, gross profit, selling, general and administrative expenses and most importantly, operating income.

 

 

Where Food Comes From, Inc.

Notes to the Consolidated Financial Statements

(Unaudited)

 

The Company eliminates intercompany transfers between segments for management reporting purposes. The following table shows information for reportable operating segments (amounts in thousands):

 

                                 
   Three months ended March 31, 2023   Three months ended March 31, 2022 
   Verification and Certification Segment   Software Sales and Related Consulting Segment   Eliminations and Other   Consolidated Totals   Verification and Certification Segment   Software Sales and Related Consulting Segment   Eliminations and Other   Consolidated Totals 
Assets:                                        
Goodwill  $1,947   $999   $-   $2,946   $1,947   $999   $-   $2,946 
All other assets, net   7,179    2,609    4,568    14,356    14,860    3,815    (1,267)   17,408 
Total assets  $9,126   $3,608   $4,568   $17,302   $16,807   $4,814   $(1,267)  $20,354 
                                         
Revenues:                                        
Verification and certification service revenue  $3,806   $-   $-   $3,806   $3,784   $-   $-   $3,784 
Product sales   971    -    -    971    1,007    -    -    1,007 
Software and related consulting revenue   -    490    -    490    -    1,365    -    1,365 
Total revenues  $4,777   $490   $-   $5,267   $4,791   $1,365   $-   $6,156 
Costs of revenues:                                        
Costs of verification and certification services   2,196    -    -    2,196    2,036    -    -    2,036 
Costs of products   568    -    -    568    537    -    -    537 
Costs of software and related consulting   -    360    -    360    -    1,186    -    1,186 
Total costs of revenues   2,764    360    -    3,124    2,573    1,186    -    3,759 
Gross profit   2,013    130    -    2,143    2,218    179    -    2,397 
Depreciation & amortization   130    42    -    172    145    50    -    195 
Other operating expenses   1,746    70    -    1,816    1,513    66    -    1,579 
Segment operating income/(loss)  $137   $18   $-   $155   $560   $63   $-   $623 
Other items to reconcile segment operating income (loss) to net income/(loss):                                        
Other income / (expense)   57    (1)   -    56    49    (12)   -    37 
Income tax expense   -    -    (90)   (90)   -    -    (163)   (163)
Net income/(loss)  $194   $17   $(90)  $121   $609   $51   $(163)  $497