Quarterly report pursuant to Section 13 or 15(d)

Segment Analysis

v3.19.2
Segment Analysis
9 Months Ended
Jul. 31, 2019
Segment Reporting [Abstract]  
Segment Analysis

NOTE 14 – SEGMENT ANALYSIS

 

We operate in two reportable segments, which are managed separately based upon fundamental differences in their operations. Coda Octopus Martech and Coda Octopus Colmek (together “Marine Engineering Business” or “Service Segments”) operate as contractors and Coda Octopus Products operations are comprised primarily of product sales, rental of equipment and/or software and associated services (“Marine Technology Business” or “Products Segment”).

 

Segment operating income is total segment revenue reduced by operating expenses identifiable with the business segment. Corporate includes general corporate administrative costs (“Overheads”).

 

The Company evaluates performance and allocates resources based upon segment operating income. The accounting policies of the reportable segments are the same as those described in the summary of accounting policies in our Consolidated Financial Statements of October 31, 2018.

 

There are inter-segment sales which have been eliminated in our financial statements but are disclosed in the tables below for information purposes.

 

The following table summarizes segment asset and operating balances by reportable segment as of and for the three and nine months ended July 31, 2019 and 2018, respectively.

 

The Company’s reportable business segments operate in four geographic locations:

 

  Americas
     
  Europe
     
  Australia/Asia
     
  Middle East/Africa

 

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, 2019 and 2018 respectively:

 

    Marine Technology Business (Products)     Marine Engineering Business (Services)     Overhead     Total  
                         
Three Months Ended July 31, 2019                                
                                 
Revenues from External Customers   $ 3,231,510     $ 3,436,988     $ -     $ 6,668,498  
                                 
Cost of Revenues     592,585       1,528,095       -       2,120,680  
                                 
Gross Profit     2,638,925       1,908,893       -       4,547,818  
                                 
Research & Development     503,540       32,991       95,159       631,690  
Selling, General & Administrative     590,981       659,398       525,530       1,775,909  
                                 
Total Operating Expenses     1,094,521       692,389       620,689       2,407,599  
                                 
Income (Loss) from Operations     1,544,404       1,216,504       (620,689 )     2,140,219  
                                 
Other Income (Expense)                                
                                 
Other Income     6,398       -       -       6,398  
Interest Expense     (2,197 )     (2,150 )     (15,928 )     (20,275 )
                                 
Total Other Income (Expense)     4,201       (2,150 )     (15,928 )     (13,877 )
                                 
Net Income (Loss) before Income Taxes     1,548,605       1,214,354       (636,617 )     2,126,342  
                                 
Income Tax Benefit (Expense)                                
Current Tax Benefit (Expense)     (5,172 )     4,460       674       (38 )
Deferred Tax (Expense)     (47,768 )     (214,144 )     (88,705 )     (350,617 )
                                 
Total Income Tax (Expense)     (52,940 )     (209,684 )     (88,031 )     (350,655 )
                                 
Net Income (Loss)   $ 1,495,665     $ 1,004,670     $ (724,648 )   $ 1,775,687  
                                 
Supplemental Disclosures                                
                                 
Total Assets   $ 18,200,970     $ 13,876,685     $ 1,266,254     $ 33,343,909  
                                 
Total Liabilities   $ 2,169,195     $ 870,492     $ 1,388,509     $ 4,428,196  
                                 
Revenues from Intercompany Sales - eliminated from sales above   $ 136,128     $ 75,729     $ 675,000     $ 886,857  
                                 
Depreciation and Amortization   $ 132,392     $ 63,724     $ 4,078     $ 200,194  
                                 
(Sales) Purchases of Long-lived Assets   $ (262,062 )   $ 5,937     $ 34,303     $ (221,822 )

  

    Marine Technology Business (Products)     Marine Engineering Business (Services)     Overhead     Total  
                         
Three Months Ended July 31, 2018                                
                                 
Revenues from External Customers   $ 3,926,491     $ 1,851,982     $ -     $ 5,778,473  
                                 
Cost of Revenues     650,669       933,531       -       1,584,200  
                                 
Gross Profit     3,275,822       918,451       -       4,194,273  
                                 
Research & Development     440,202       90,190       -       530,392  
Selling, General & Administrative     723,155       566,692       350,995       1,640,842  
                                 
Total Operating Expenses     1,163,357       656,882       350,995       2,171,234  
                                 
Income (Loss) from Operations     2,112,465       261,569       (350,995 )     2,023,039  
                                 
Other Income (Expense)                                
                                 
Other Income     3,941       31       -       3,972  
Interest Expense     (2,480 )     (15,802 )     (11,139 )     (29,421 )
                                 
Total Other Income (Expense)     1,461       (15,771 )     (11,139 )     (25,449 )
                                 
Net Income (Loss) before Income Taxes     2,113,926       245,798       (362,134 )     1,997,590  
                                 
Current Tax Benefit     -       -       20       20  
                                 
Net Income (Loss)   $ 2,113,926     $ 245,798     $ (362,114 )   $ 1,997,610  
                                 
Supplemental Disclosures                                
                                 
Total Assets   $ 14,016,131     $ 11,378,558     $ 553,927     $ 25,948,616  
                                 
Total Liabilities   $ 865,138     $ 1,660,291     $ 1,891,374     $ 4,416,803  
                                 
Revenues from Intercompany Sales - eliminated from sales above   $ 44,180     $ 183,800     $ 675,000     $ 902,980  
                                 
Depreciation and Amortization   $ 137,426     $ 66,435     $ 5,728     $ 209,589  
                                 
Purchases of Long-lived Assets   $ 232,575     $ (6,122 )   $ 30,667     $ 257,120  

 

    Marine Technology Business (Products)     Marine Engineering Business (Services)     Overhead     Total  
                         
Nine Months Ended July 31, 2019                                
                                 
Revenues from External Customers   $ 9,481,229     $ 9,729,049     $ -     $ 19,210,278  
                                 
Cost of Revenues     1,798,800       4,605,926       -       6,404,726  
                                 
Gross Profit     7,682,429       5,123,123       -       12,805,552  
                                 
Research & Development     1,533,544       130,205       284,494       1,948,243  
Selling, General & Administrative     2,089,442       1,864,503       1,137,921       5,091,866  
                                 
Total Operating Expenses     3,622,986       1,994,708       1,422,415       7,040,109  
                                 
Income (Loss) from Operations     4,059,443       3,128,415       (1,422,415 )     5,765,443  
                                 
Other Income (Expense)                                
                                 
Other Income     65,467       -       -       65,467  
Interest (Expense)     (8,063 )     (11,849 )     (49,771 )     (69,683 )
                                 
Total Other Income (Expense)     57,404       (11,849 )     (49,771 )     (4,216 )
                                 
Net Income (Loss) before Income Taxes     4,116,847       3,116,566       (1,472,186 )     5,761,227  
                                 
Income Tax Benefit (Expense)                                
Current Tax Benefit     20,496       39,445       18,013       77,954  
Deferred Tax (Expense)     (199,073 )     (447,540 )     (204,374 )     (850,987 )
                                 
Total Income Tax (Expense)     (178,577 )     (408,095 )     (186,361 )     (773,033 )
                                 
Net Income (Loss)   $ 3,938,270     $ 2,708,471     $ (1,658,547 )   $ 4,988,194  
                                 
Supplemental Disclosures                                
                                 
Total Assets   $ 18,200,970     $ 13,876,685     $ 1,266,254     $ 33,343,909  
                                 
Total Liabilities   $ 2,169,195     $ 870,492     $ 1,388,509     $ 4,428,196  
                                 
Revenues from Intercompany Sales - eliminated from sales above   $ 1,044,595     $ 304,658     $ 2,025,000     $ 3,374,253  
                                 
Depreciation and Amortization   $ 391,516     $ 191,402     $ 11,688     $ 594,606  
                                 
Purchases of Long-lived Assets   $ 1,803,206     $ 40,383     $ 34,303     $ 1,877,892  

 

    Marine Technology Business (Products)     Marine Engineering Business (Services)     Overhead     Total  
                         
Nine Months Ended July 31, 2018                                
                                 
Revenues from External Customers   $ 8,142,724     $ 4,212,702     $ -     $ 12,355,426  
                                 
Cost of Revenues     1,298,022       2,173,143       -       3,471,165  
                                 
Gross Profit     6,844,702       2,039,559       -       8,884,261  
                                 
Research & Development     1,385,994       455,414       -       1,841,408  
Selling, General & Administrative     2,150,168       1,813,357       1,208,704       5,172,229  
                                 
Total Operating Expenses     3,536,162       2,268,771       1,208,704       7,013,637  
                                 
Income (Loss) from Operations     3,308,540       (229,212 )     (1,208,704 )     1,870,624  
                                 
Other Income (Expense)                                
                                 
Other Income     92,514       2,128       -       94,642  
Interest Expense     (9,289 )     (45,503 )     (158,118 )     (212,910 )
                                 
Total Other Income (Expense)     83,225       (43,375 )     (158,118 )     (118,268 )
                                 
Net Income (Loss) before Income Taxes     3,391,765       (272,587 )     (1,366,822 )     1,752,356  
                                 
Current Tax Benefit (Expense)     (6,596 )     -       6,586       (10 )
                                 
Net Income (Loss)   $ 3,385,169     $ (272,587 )   $ (1,360,236 )   $ 1,752,346  
                                 
Supplemental Disclosures                                
                                 
Total Assets   $ 14,016,131     $ 11,378,558     $ 553,927     $ 25,948,616  
                                 
Total Liabilities   $ 865,138     $ 1,660,291     $ 1,891,374     $ 4,416,803  
                                 
Revenues from Intercompany Sales - eliminated from sales above   $ 831,352     $ 196,103     $ 2,025,000     $ 3,052,455  
                                 
Depreciation and Amortization   $ 374,076     $ 218,649     $ 12,920     $ 605,645  
                                 
Purchases of Long-lived Assets   $ 486,604     $ 43,839     $ 55,452     $ 585,895  

 

  For the Three Months Ended July 31, 2019  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Disaggregation of Total Net Sales                        
                         
Americas                        
Equipment Sales   $ 493,261     $ -     $ 493,261  
Equipment Rentals     221,567       -       221,567  
Software Sales     -       -       -  
Engineering Parts     -       2,259,717       2,259,717  
Services     95,698       767,024       862,722  
Europe                        
Equipment Sales     418,557       3,235       421,792  
Equipment Rentals     322,887       -       322,887  
Software Sales     19,259       -       19,259  
Engineering Parts     -       347,459       347,459  
Services     150,216       59,553       209,769  
                         
Australia/Asia                        
Equipment Sales     648,640       -       648,640  
Equipment Rentals     260,474       -       260,474  
Software Sales     81,541       -       81,541  
Services     204,273       -       204,273  
                         
Middle East & Africa                        
Equipment Sales     290,386       -       290,386  
Equipment Rentals     -       -       -  
Software Sales     21,261       -       21,261  
Services     3,490       -       3,490  
                         
Total Net Sales   $ 3,231,510     $ 3,436,988     $ 6,668,498  

 

    For the Three Months Ended July 31, 2019  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Geographic Area                        
Americas   $ 810,526     $ 3,026,741     $ 3,837,267  
Europe     910,919       410,247       1,321,166  
Australia/Asia     1,194,928       -       1,194,928  
Middle East & Africa     315,137       -       315,137  
                         
Total Net Sales   $ 3,231,510     $ 3,436,988     $ 6,668,498  

 

   

For the Three Months Ended July 31, 2019

 
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Product Line                        
Equipment Sales   $ 1,850,844     $ 3,235     $ 1,854,079  
Equipment Rentals     804,928       -       804,928  
Software Sales     122,061       -       122,061  
Engineering Parts     -       2,607,176       2,607,176  
Services     453,677       826,577       1,280,254  
                         
Total Net Sales   $ 3,231,510     $ 3,436,988     $ 6,668,498  

 

    For the Three Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Disaggregation of Total Net Sales                  
                   
Americas                        
Equipment Sales   $ 118,488     $ -     $ 118,488  
Equipment Rentals     323,763       -       323,763  
Software Sales     18,625       -       18,625  
Engineering Parts     -       1,456,962       1,456,962  
Services     134,870       7,496       142,366  
Europe                        
Equipment Sales     109,410       -       109,410  
Equipment Rentals     737,126       -       737,126  
Software Sales     29,256       -       29,256  
Engineering Parts     -       387,524       387,524  
Services     323,022       -       323,022  
                         
Australia/Asia                        
Equipment Sales     1,175,276       -       1,175,276  
Equipment Rentals     (3,245 )     -       (3,245 )
Software Sales     211,193       -       211,193  
Services     136,395       -       136,395  
                         
Middle East & Africa                        
Equipment Sales     584,417       -       584,417  
Equipment Rentals     -       -       -  
Software Sales     14,223       -       14,223  
Services     13,672       -       13,672  
                         
Total Net Sales   $ 3,926,491     $ 1,851,982     $ 5,778,473  

 

    For the Three Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Geographic Area                        
Americas   $ 595,746     $ 1,464,458     $ 2,060,204  
Europe     1,198,814       387,524       1,586,338  
Australia/Asia     1,519,619       -       1,519,619  
Middle East & Africa     612,312       -       612,312  
                         
Total Net Sales   $ 3,926,491     $ 1,851,982     $ 5,778,473  

 

    For the Three Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Product Line                        
Equipment Sales   $ 1,987,591     $ -     $ 1,987,591  
Equipment Rentals     1,057,644       -       1,057,644  
Software Sales     273,297       -       273,297  
Engineering Parts     -       1,844,486       1,844,486  
Services     607,959       7,496       615,455  
                         
Total Net Sales   $ 3,926,491     $ 1,851,982     $ 5,778,473  

 

    For the Nine Months Ended July 31, 2019  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Disaggregation of Total Net Sales                        
                         
Americas                        
Equipment Sales   $ 560,339     $ 57,545     $ 617,884  
Equipment Rentals     446,594       -       446,594  
Software Sales     7,250       -       7,250  
Engineering Parts     -       6,827,221       6,827,221  
Services     915,837       1,646,694       2,562,531  
Europe                        
Equipment Sales     1,189,162       114,214       1,303,376  
Equipment Rentals     974,394       -       974,394  
Software Sales     167,903       -       167,903  
Engineering Parts     -       1,023,822       1,023,822  
Services     628,235       59,553       687,788  
                         
Australia/Asia                        
Equipment Sales     2,707,978       -       2,707,978  
Equipment Rentals     518,392       -       518,392  
Software Sales     283,419       -       283,419  
Services     543,314       -       543,314  
                         
Middle East & Africa                        
Equipment Sales     300,859       -       300,859  
Equipment Rentals     36,130       -       36,130  
Software Sales     58,826       -       58,826  
Services     142,597       -       142,597  
                         
Total Net Sales   $ 9,481,229     $ 9,729,049     $ 19,210,278  

 

    For the Nine Months Ended July 31, 2019  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Geographic Area                        
Americas   $ 1,930,020     $ 8,531,460     $ 10,461,480  
Europe     2,959,694       1,197,589       4,157,283  
Australia/Asia     4,053,103       -       4,053,103  
Middle East & Africa     538,412       -       538,412  
                         
Total Net Sales   $ 9,481,229     $ 9,729,049     $ 19,210,278  

 

    For the Nine Months Ended July 31, 2019  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Product Line                        
Equipment Sales   $ 4,758,338     $ 171,759     $ 4,930,097  
Equipment Rentals     1,975,510       -       1,975,510  
Software Sales     517,398       -       517,398  
Engineering Parts     -       7,851,043       7,851,043  
Services     2,229,983       1,706,247       3,936,230  
                         
Total Net Sales   $ 9,481,229     $ 9,729,049     $ 19,210,278  

 

    For the Nine Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Disaggregation of Total Net Sales                        
                         
Americas                        
Equipment Sales   $ 712,945     $ -     $ 712,945  
Equipment Rentals     457,690       -       457,690  
Software Sales     52,145       -       52,145  
Engineering Parts     -       2,826,029       2,826,029  
Services     730,453       95,082       825,535  
Europe                        
Equipment Sales     1,030,167       192,078       1,222,245  
Equipment Rentals     1,065,417       -       1,065,417  
Software Sales     176,657       -       176,657  
Engineering Parts     -       1,099,513       1,099,513  
Services     611,154       -       611,154  
                         
Australia/Asia                        
Equipment Sales     1,590,510       -       1,590,510  
Equipment Rentals     69,019       -       69,019  
Software Sales     369,167       -       369,167  
Services     221,940       -       221,940  
                         
Middle East & Africa                        
Equipment Sales     905,933       -       905,933  
Equipment Rentals     11,444       -       11,444  
Software Sales     75,519       -       75,519  
Services     62,564       -       62,564  
                         
Total Net Sales   $ 8,142,724     $ 4,212,702     $ 12,355,426  

 

    For the Nine Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Geographic Area                        
Americas   $ 1,953,233     $ 2,921,111     $ 4,874,344  
Europe     2,883,395       1,291,591       4,174,986  
Australia/Asia     2,250,636       -       2,250,636  
Middle East & Africa     1,055,460       -       1,055,460  
                         
Total Net Sales   $ 8,142,724     $ 4,212,702     $ 12,355,426  

 

    For the Nine Months Ended July 31, 2018  
    Marine     Marine        
    Technology     Engineering     Grand  
    Business     Business     Total  
Total Net Sales by Product Line                        
Equipment Sales   $ 4,239,555     $ 192,078     $ 4,431,633  
Equipment Rentals     1,603,570       -       1,603,570  
Software Sales     673,488       -       673,488  
Engineering Parts     -       3,925,542       3,925,542  
Services     1,626,111       95,082       1,721,193  
                         
Total Net Sales   $ 8,142,724     $ 4,212,702     $ 12,355,426