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Segment Information
 9 Months Ended
Sep. 30, 2023
Segment Information [Abstract]  
SEGMENT INFORMATION

17. SEGMENT INFORMATION

 

Our business operations (being the development, acquisition, manufacture and sale of products that improve the health and productivity of dairy and beef cattle) are described in Note 1. Pursuant to Codification Topic 280, Segment Reporting, we operate in the following two reportable business segments: i) Scours and ii) Mastitis. The Scours segment consists of the First Defense® product line. The core technology underlying the Scours segment is derived around polyclonal antibodies. The Mastitis segment includes our products, CMT and Re-Tain®. Re-Tain® is projected to be the driver of this segment when approved for sale. The core technology underlying the Mastitis segment is derived around a bacteriocin called Nisin. The category we define as “Other” includes unallocated administrative and overhead expenses and other products. The significant accounting policies of these segments are described in Note 2. Product sales are the primary factor we use in determining our reportable segments. The governing regulatory authority (USDA for First Defense® or FDA for Re-Tain®) is also a factor in determining our reportable segments. Management monitors and evaluates segment performance from sales to net operating income (loss) closely. We are not organized by geographic region. No segments have been aggregated. The revenues and expenses allocated to each segment are in some cases direct and in other cases involve reasonable and consistent estimations by management. Each operating segment is defined as the component of our business for which financial information is available and evaluated regularly by our chief operating decision-maker in deciding how to allocate resources and in assessing performance. Our chief operating decision-maker is our President and CEO.

 

  

During the Three-Month

Period Ended September 30, 2023

 
   Scours   Mastitis   Other   Total 
Product sales  $5,360,063   $36,437   $
—
   $5,396,500 
Costs of goods sold   4,095,164    34,455    
—
    4,129,619 
Gross margin   1,264,899    1,982    
—
    1,266,881 
                     
Product development expense   
—
    1,082,346    36,143    1,118,489 
Sales and marketing expenses   641,682    175,804    
—
    817,486 
Administrative expenses   
—
    
—
    514,952    514,952 
Operating expenses   641,682    1,258,150    551,095    2,450,927 
                     
NET OPERATING INCOME (LOSS)  $623,217   $(1,256,168)  $(551,095)  $(1,184,046)

 

  

During the Three-Month

Period Ended September 30, 2022

 
   Scours   Mastitis   Other   Total 
Product sales  $4,751,049   $44,976   $
—
   $4,796,025 
Costs of goods sold   2,898,897    45,441    5,636    2,949,974 
Gross margin   1,852,152    (465)   (5,636)   1,846,051 
                     
Product development expenses   6,421    1,246,243    17,097    1,269,761 
Sales and marketing expenses   369,439    357,299    
—
    726,738 
Administrative expenses   
—
    
—
    466,342    466,342 
Operating expenses   375,860    1,603,542    483,439    2,462,841 
                     
NET OPERATING INCOME (LOSS)  $1,476,292   $(1,604,007)  $(489,075)  $(616,790)

 

   Scours   Mastitis   Other   Total 
Total Assets as of September 30, 2023  $24,119,683   $18,132,922   $2,292,417   $44,545,022 
Total Assets as of September 30, 2022  $18,678,408   $18,634,760   $9,088,393   $46,401,561 
Depreciation and amortization expense during the three-month period ended September 30, 2023  $355,673   $328,381   $25,044   $709,098 
Depreciation and amortization expense during the three-month period ended September 30, 2022  $302,235   $316,317   $15,688   $634,240 
Capital Expenditures during the three-month period ended September 30, 2023  $341,386   $79,129   $
—
   $420,515 
Capital Expenditures during the three-month period ended September 30, 2022  $665,825   $21,032   $47,452   $734,309 

 

  

During the Nine-Month Period

Ended September 30, 2023

 
   Scours   Mastitis   Other   Total 
Product sales  $12,253,555   $122,153   $
—
   $12,375,708 
Costs of goods sold   9,652,292    111,872    
—
    9,764,164 
Gross margin   2,601,263    10,281    
—
    2,611,544 
                     
Product development expenses   2,543    3,220,075    105,779    3,328,397 
Sales and marketing expenses   1,890,404    526,297    
—
    2,416,701 
Administrative expenses   
—
    
—
    1,611,026    1,611,026 
Operating expenses   1,892,947    3,746,372    1,716,805    7,356,124 
                     
NET OPERATING INCOME (LOSS)  $708,316   $(3,736,091)  $(1,716,805)  $(4,744,580)

 

  

During the Nine-Month Period

Ended September 30, 2022

 
   Scours   Mastitis   Other   Total 
Product sales  $14,537,390   $118,237   $1,455   $14,657,082 
Costs of goods sold   7,870,420    104,092    25,967    8,000,479 
Gross margin   6,666,970    14,145    (24,512)   6,656,603 
                     
Product development expenses   23,025    3,331,311    90,128    3,444,464 
Sales and marketing expenses   1,127,676    1,069,801    
—
    2,197,477 
Administrative expenses   
—
    
—
    1,679,851    1,679,851 
Operating expenses   1,150,701    4,401,112    1,769,979    7,321,792 
                     
NET OPERATING INCOME (LOSS)  $5,516,269   $(4,386,967)  $(1,794,491)  $(665,189)

 

   Scours   Mastitis   Other   Total 
Total Assets as of September 30, 2023  $24,119,683   $18,132,922   $2,292,417   $44,545,022 
Total Assets as of September 30, 2022  $18,678,408   $18,634,760   $9,088,393   $46,401,561 
Depreciation and amortization expense during the nine-month period ended September 30, 2023  $1,020,909   $969,666   $64,066   $2,054,641 
Depreciation and amortization expense during the nine-month period ended September 30, 2022  $894,856   $947,067   $47,144   $1,889,067 
Capital Expenditures during the nine-month period ended September 30, 2023  $1,038,033   $773,136   $
—
   $1,811,169 
Capital Expenditures during the nine-month period ended September 30, 2022  $2,050,107   $387,536   $47,452   $2,485,095 

  

   During the Year Ended December 31, 2022 
   Scours   Mastitis   Other   Total 
Product sales  $18,411,949   $154,558   $1,455   $18,567,962 
Costs of goods sold   10,754,189    136,347    28,647    10,919,183 
Gross margin   7,657,760    18,211    (27,192)   7,648,779 
                     
Product development expenses   66,346    4,317,921    109,605    4,493,872 
Sales and marketing expenses   1,871,926    1,318,107    
—
    3,190,033 
Administrative expenses   
—
    
—
    2,263,817    2,263,817 
Operating expenses   1,938,272    5,636,028    2,373,422    9,947,722 
                     
NET OPERATING INCOME (LOSS)  $5,719,488   $(5,617,817)  $(2,400,614)  $(2,298,943)

  

   During the Year Ended December 31, 2021 
   Scours   Mastitis   Other   Total 
Product sales  $18,933,092   $143,280   $166,597   $19,242,969 
Costs of goods sold   10,411,936    99,957    75,147    10,587,040 
Gross margin   8,521,156    43,323    91,450    8,655,929 
                     
Product development expenses   25,374    3,887,781    255,363    4,168,518 
Sales and marketing expenses   1,942,391    561,535    
—
    2,503,926 
Administrative expenses   
—
    
—
    1,726,100    1,726,100 
Operating expenses   1,967,765    4,449,316    1,981,463    8,398,544 
                     
NET OPERATING INCOME (LOSS)  $6,553,391   $(4,405,993)  $(1,890,013)  $257,385 

  

   Scours   Mastitis   Other   Total 
Total Assets as of December 31, 2022  $20,539,523   $18,315,492   $6,005,634   $44,860,649 
Total Assets as of December 31, 2021  $14,860,769   $19,122,265   $10,482,654   $44,465,688 
Depreciation and amortization expense during the year ended December 31, 2022  $1,169,011   $1,263,318   $62,912   $2,495,241 
Depreciation and amortization expense during the year ended December 31, 2021  $1,032,735   $1,374,171   $62,075   $2,468,981 
Capital Expenditures during the year ended December 31, 2022  $3,513,336   $414,486   $47,452   $3,975,274 
Capital Expenditures during the year ended December 31, 2021  $1,632,855   $975,794   $
—
   $2,608,649