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Segments
 9 Months Ended
Sep. 30, 2024
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 professional services reportable segment. SureHarvest, which includes Postelsia, is the sole operating segment. This segment includes consulting, data analysis and other reporting service revenues.

 

 

Where Food Comes From, Inc.

Notes to the Consolidated Financial Statements

(Unaudited)

 

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.

 

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 September 30, 2024   Three months ended September 30, 2023 
   Verification and Certification Segment   Consulting Segment   Eliminations and Other   Consolidated Totals   Verification and Certification Segment   Consulting Segment   Eliminations and Other   Consolidated Totals 
Assets:                                        
Goodwill  $1,947   $999   $-   $2,946   $1,947   $999   $-   $2,946 
All other assets, net   (536)   2,715    11,821    14,000    5,252    2,686    6,804    14,742 
Total assets  $1,411   $3,714   $11,821   $16,946   $7,199   $3,685   $6,804   $17,688 
                                         
Revenues:                                        
Verification and certification service revenue  $5,486   $-   $-   $5,486   $5,359   $-   $-   $5,359 
Product sales   1,329    -    -    1,329    1,221    -    -    1,221 
Professional services   -    292    -    292    -    431    -    431 
Total revenues  $6,815   $292   $-   $7,107   $6,580   $431   $-   $7,011 
Costs of revenues:                                        
Costs of verification and certification services   3,288    -    -    3,288    3,123    -    -    3,123 
Costs of products   841    -    -    841    681    -    -    681 
Costs of professional services   -    204    -    204    -    341    -    341 
Total costs of revenues   4,129    204    -    4,333    3,804    341    -    4,145 
Gross profit   2,686    88    -    2,774    2,776    90    -    2,866 
Depreciation & amortization   115    41    -    156    111    42    -    153 
Other operating expenses   1,978    32    -    2,010    1,682    85    -    1,767 
Segment operating income/(loss)  $593   $15   $-   $608   $983   $(37)  $-   $946 
Other items to reconcile segment operating income (loss) to net income/(loss):                                        
Other income / (expense)   65    -    -    65    65    (2)   -    63 
Income tax expense   -    -    (181)   (181)   -    -    (286)   (286)
Net income/(loss)  $658   $15   $(181)  $492   $1,048   $(39)  $(286)  $723 

 

 

Where Food Comes From, Inc.

Notes to the Consolidated Financial Statements

(Unaudited)

 

                                 
   Nine months ended September 30, 2024   Nine months ended September 30, 2023 
   Verification and Certification Segment   Consulting Segment   Eliminations and Other   Consolidated Totals   Verification and Certification Segment   Consulting Segment   Eliminations and Other   Consolidated Totals 
Assets:                                        
Goodwill  $1,947   $999   $-   $2,946   $1,947   $999   $-   $2,946 
All other assets, net   (536)   2,715    11,821    14,000    5,252    2,686    6,804    14,742 
Total assets  $1,411   $3,714   $11,821   $16,946   $7,199   $3,685   $6,804   $17,688 
                                         
Revenues:                                        
Verification and certification service revenue  $15,172   $-   $-   $15,172   $13,944   $-   $-   $13,944 
Product sales   2,881    -    -    2,881    3,130    -    -    3,130 
Professional services   -    1,031    -    1,031    -    1,330    -    1,330 
Total revenues  $18,053   $1,031   $-   $19,084   $17,074   $1,330   $-   $18,404 
Costs of revenues:                                        
Costs of verification and certification services   8,831    -    -    8,831    8,055    -    -    8,055 
Costs of products   1,744    -    -    1,744    1,804    -    -    1,804 
Costs of professional services   -    748    -    748    -    1,030    -    1,030 
Total costs of revenues   10,575    748    -    11,323    9,859    1,030    -    10,889 
Gross profit   7,478    283    -    7,761    7,215    300    -    7,515 
Depreciation & amortization   342    125    -    467    361    127    -    488 
Other operating expenses   5,691    151    -    5,842    5,027    226    -    5,253 
Segment operating income/(loss)  $1,445   $7   $-   $1,452   $1,827   $(53)  $-   $1,774 
Other items to reconcile segment operating income (loss) to net income/(loss):                                        
Other income / (expense)   172    1    -    173    187    (5)   -    182 
Income tax expense   -    -    (466)   (466)   -    -    (580)   (580)
Net income/(loss)  $1,617   $8   $(466)  $1,159   $2,014   $(58)  $(580)  $1,376