Segment Analysis |
NOTE 13 – SEGMENT ANALYSIS
We are
operating in two reportable segments, which are managed separately based upon fundamental differences in their operations. Coda
Octopus Martech and Coda Octopus Colmek operate as engineering contractors and the balance of our operations are comprised of product
sales.
Segment
operating income is total segment revenue reduced by operating expenses identifiable with the business segment. Corporate includes
general corporate administrative costs.
The Company
evaluates performance and allocates resources based upon operating income. The accounting policies of the reportable segments are
the same as those described in the summary of accounting policies, as outlined in the October 31, 2016 financial statements.
There
are inter-segment sales which have been eliminated in our financial statements but are disclosed in the tables below for information
purposes.
The Company’s
reportable business segments operate in three geographic locations. Those geographic locations are:
* United
States
* Europe
* Australia
The following
tables summarize segment asset and operating balances by reportable segment for the three months and nine months ended July 31,
2017 and 2016 respectively.
|
|
Marine Technology Business (Products) |
|
|
Marine Engineering Business (Services) |
|
|
Overhead |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from External Customers |
|
$ |
3,439,587 |
|
|
$ |
1,604,003 |
|
|
$ |
- |
|
|
$ |
5,043,590 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues |
|
|
1,054,369 |
|
|
|
928,392 |
|
|
|
- |
|
|
|
1,982,761 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
|
2,385,218 |
|
|
|
675,611 |
|
|
|
- |
|
|
|
3,060,829 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & Development |
|
|
200,118 |
|
|
|
- |
|
|
|
- |
|
|
|
200,118 |
|
Selling, General & Administrative |
|
|
781,908 |
|
|
|
637,465 |
|
|
|
297,891 |
|
|
|
1,717,264 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
982,026 |
|
|
|
637,465 |
|
|
|
297,891 |
|
|
|
1,917,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss) |
|
|
1,403,192 |
|
|
|
38,146 |
|
|
|
(297,891 |
) |
|
|
1,143,447 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
|
|
89,670 |
|
|
|
261 |
|
|
|
- |
|
|
|
89,931 |
|
Interest Expense |
|
|
(5,947 |
) |
|
|
(15,451 |
) |
|
|
(90,691 |
) |
|
|
(112,089 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
|
|
83,723 |
|
|
|
(15,190 |
) |
|
|
(90,691 |
) |
|
|
(22,158) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
1,486,915 |
|
|
|
22,956 |
|
|
|
(388,582 |
) |
|
|
1,121,289 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit (expense) |
|
|
3,513 |
|
|
|
- |
|
|
|
- |
|
|
|
3,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income |
|
$ |
1,490,428 |
|
|
$ |
22,956 |
|
|
$ |
(388,582 |
) |
|
$ |
1,124,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets |
|
$ |
12,300,376 |
|
|
$ |
12,529,169 |
|
|
$ |
1,093,219 |
|
|
$ |
25,922,764 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities |
|
|
1,103,023 |
|
|
|
1,638,002 |
|
|
|
8,287,374 |
|
|
|
11,028,399 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from Intercompany Sales - eliminated from sales above |
|
|
1,002,339 |
|
|
|
36,030 |
|
|
|
369,625 |
|
|
|
1,407,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
130,048 |
|
|
|
101,442 |
|
|
|
3,211 |
|
|
|
234,701 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of Long-lived Assets |
|
|
252,653 |
|
|
|
45,841 |
|
|
|
- |
|
|
|
298,494 |
|
|
|
Marine Technology Business (Products) |
|
|
Marine Engineering Business (Services) |
|
|
Overhead |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from External Customers |
|
$ |
2,427,570 |
|
|
$ |
1,851,090 |
|
|
$ |
- |
|
|
$ |
4,278,660 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues |
|
|
622,195 |
|
|
|
810,478 |
|
|
|
- |
|
|
|
1,432,673 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
|
1,805,375 |
|
|
|
1,040,612 |
|
|
|
- |
|
|
|
2,845,987 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & Development |
|
|
292,855 |
|
|
|
- |
|
|
|
- |
|
|
|
292,855 |
|
Selling, General & Administrative |
|
|
422,096 |
|
|
|
578,297 |
|
|
|
284,523 |
|
|
|
1,284,916 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
714,951 |
|
|
|
578,297 |
|
|
|
284,523 |
|
|
|
1,577,771 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss) |
|
|
1,090,424 |
|
|
|
462,315 |
|
|
|
(284,523 |
) |
|
|
1,268,216 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
|
|
50,226 |
|
|
|
(111 |
) |
|
|
- |
|
|
|
50,115 |
|
Interest Expense |
|
|
(330,306 |
) |
|
|
(110,113 |
) |
|
|
222,948 |
|
|
|
(217,471 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
|
|
(280,080 |
) |
|
|
(110,224 |
) |
|
|
222,948 |
|
|
|
(167,356 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) before income taxes |
|
|
810,344 |
|
|
|
352,091 |
|
|
|
(61,575 |
) |
|
|
1,100,860 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit (expense) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) |
|
$ |
810,344 |
|
|
$ |
352,091 |
|
|
$ |
(61,575 |
) |
|
$ |
1,100,860 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets |
|
$ |
11,883,612 |
|
|
$ |
9,613,958 |
|
|
$ |
155,302 |
|
|
$ |
21,652,872 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities |
|
|
1,218,381 |
|
|
|
640,083 |
|
|
|
10,808,862 |
|
|
|
12,667,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from Intercompany Sales - eliminated from sales above |
|
|
286,892 |
|
|
|
(63,221 |
) |
|
|
118,875 |
|
|
|
342,546 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
121,600 |
|
|
|
81,129 |
|
|
|
3,199 |
|
|
|
205,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of Long-lived Assets |
|
|
(76,401 |
) |
|
|
(8,648 |
) |
|
|
3,600 |
|
|
|
(81,449 |
) |
|
|
Marine Technology Business (Products) |
|
|
Marine Engineering Business (Services) |
|
|
Overhead |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from External Customers |
|
$ |
9,189,731 |
|
|
$ |
6,490,820 |
|
|
$ |
- |
|
|
$ |
15,680,551 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues |
|
|
2,753,297 |
|
|
|
3,226,449 |
|
|
|
- |
|
|
|
5,979,746 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
|
6,436,434 |
|
|
|
3,264,371 |
|
|
|
- |
|
|
|
9,700,805 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & Development |
|
|
699,106 |
|
|
|
- |
|
|
|
- |
|
|
|
699,106 |
|
Selling, General & Administrative |
|
|
2,165,601 |
|
|
|
1,979,436 |
|
|
|
596,931 |
|
|
|
4,741,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
2,864,707 |
|
|
|
1,979,436 |
|
|
|
596,931 |
|
|
|
5,441,074 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss) |
|
|
3,571,727 |
|
|
|
1,284,935 |
|
|
|
(596,931 |
) |
|
|
4,259,731 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
|
|
204,653 |
|
|
|
261 |
|
|
|
- |
|
|
|
204,914 |
|
Interest (Expense) Income |
|
|
(538,088 |
) |
|
|
(214,674 |
) |
|
|
256,332 |
|
|
|
(496,430 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
|
|
(333,435 |
) |
|
|
(214,413 |
) |
|
|
256,332 |
|
|
|
(291,516 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) before income taxes |
|
|
3,238,292 |
|
|
|
1,070,522 |
|
|
|
(340,599 |
) |
|
|
3,968,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit (expense) |
|
|
3,513 |
|
|
|
- |
|
|
|
- |
|
|
|
3,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income |
|
$ |
3,241,805 |
|
|
$ |
1,070,522 |
|
|
$ |
(340,599 |
) |
|
$ |
3,971,728 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from Intercompany Sales - eliminated from sales above |
|
|
1,680,852 |
|
|
|
265,985 |
|
|
|
607,375 |
|
|
|
2,554,212 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
377,311 |
|
|
|
244,223 |
|
|
|
9,528 |
|
|
|
631,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of Long-lived Assets |
|
|
2,541,716 |
|
|
|
94,874 |
|
|
|
12,470 |
|
|
|
2,649,060 |
|
|
|
Marine Technology Business (Products) |
|
|
Marine Engineering Business (Services) |
|
|
Overhead |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from External Customers |
|
$ |
7,816,669 |
|
|
$ |
6,983,805 |
|
|
$ |
- |
|
|
$ |
14,800,474 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues |
|
|
2,690,603 |
|
|
|
3,520,070 |
|
|
|
- |
|
|
|
6,210,673 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
|
5,126,066 |
|
|
|
3,463,735 |
|
|
|
- |
|
|
|
8,589,801 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & Development |
|
|
708,146 |
|
|
|
- |
|
|
|
- |
|
|
|
708,146 |
|
Selling, General & Administrative |
|
|
1,905,381 |
|
|
|
2,180,426 |
|
|
|
362,202 |
|
|
|
4,448,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
2,613,527 |
|
|
|
2,180,426 |
|
|
|
362,202 |
|
|
|
5,156,155 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss) |
|
|
2,512,539 |
|
|
|
1,283,309 |
|
|
|
(362,202 |
) |
|
|
3,433,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
|
|
149,990 |
|
|
|
5,787 |
|
|
|
- |
|
|
|
155,777 |
|
Interest Expense |
|
|
(615,383 |
) |
|
|
(223,931 |
) |
|
|
222,805 |
|
|
|
(616,509 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
|
|
(465,393 |
) |
|
|
(218,144 |
) |
|
|
222,805 |
|
|
|
(460,732 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) before income taxes |
|
|
2,047,146 |
|
|
|
1,065,165 |
|
|
|
(139,397 |
) |
|
|
2,972,914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit (expense) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) |
|
$ |
2,047,146 |
|
|
$ |
1,065,165 |
|
|
$ |
(139,397 |
) |
|
$ |
2,972,914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from Intercompany Sales - eliminated from sales above |
|
|
643,294 |
|
|
|
178,132 |
|
|
|
362,875 |
|
|
|
1,184,301 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
247,235 |
|
|
|
255,848 |
|
|
|
9,631 |
|
|
|
512,714 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of Long-lived Assets |
|
|
642,906 |
|
|
|
13,150 |
|
|
|
12,468 |
|
|
|
668,524 |
|
Information concerning principal
geographic areas is presented below according to the area where the activity has taken place for the three and nine months ended
July 31, 2017 and 2016 respectively:
|
|
USA |
|
|
Europe |
|
|
Australia |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External Revenues by Geographic Locations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2017 |
|
$ |
1,550,141 |
|
|
$ |
2,942,365 |
|
|
$ |
551,085 |
|
|
$ |
5,043,591 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2016 |
|
$ |
1,983,771 |
|
|
$ |
1,970,478 |
|
|
$ |
324,411 |
|
|
$ |
4,278,660 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2017 |
|
$ |
6,825,815 |
|
|
$ |
7,574,299 |
|
|
$ |
1,280,437 |
|
|
$ |
15,680,551 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2016 |
|
$ |
6,939,673 |
|
|
$ |
6,733,926 |
|
|
$ |
1,126,875 |
|
|
$ |
14,800,474 |
|
|