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 (together “Marine Engineering Business” or “Services Segment”) operate as contractors, and the balance
of our operations are comprised of product sales (“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 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, 2017.
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, 2018 and 2017 respectively.
The Company’s reportable business
segments operate in three geographic locations. Those geographic locations are:
* United States
* Europe
* Australia
Information concerning principal geographic
areas according to the area where the activity has taken place for the three and nine months ended July 31, 2018 and 2017, respectively
is presented below:
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax Refund |
|
|
- |
|
|
|
- |
|
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) from Operations |
|
|
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 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) before income taxes |
|
|
1,486,915 |
|
|
|
22,956 |
|
|
|
(388,582 |
) |
|
|
1,121,289 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Refund |
|
|
3,513 |
|
|
|
- |
|
|
|
- |
|
|
|
3,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) |
|
$ |
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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) Income |
|
|
(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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Refund (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 |
|
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) from Operations |
|
|
3,571,727 |
|
|
|
1,284,935 |
|
|
|
-596,931 |
|
|
|
4,259,731 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
|
|
204,653 |
|
|
|
261 |
|
|
|
- |
|
|
|
204,914 |
|
Interest Expense |
|
|
(538,088 |
) |
|
|
(214,674 |
) |
|
|
256,332 |
|
|
|
(496,430 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Other Income (expense) |
|
|
(333,435 |
) |
|
|
(214,413 |
) |
|
|
256,332 |
|
|
|
(291,516 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
3,238,292 |
|
|
|
1,070,522 |
|
|
|
(340,599 |
) |
|
|
3,968,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Refund (expense) |
|
|
3,513 |
|
|
|
- |
|
|
|
- |
|
|
|
3,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income |
|
$ |
3,241,805 |
|
|
$ |
1,070,522 |
|
|
$ |
(340,599 |
) |
|
$ |
3,971,728 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 |
|
$ |
1,680,852 |
|
|
$ |
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 |
|
|
|
USA |
|
|
Europe |
|
|
Australia |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External Revenues by Geographic Locations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2018 |
|
$ |
2,060,203 |
|
|
$ |
3,718,877 |
|
|
$ |
(607 |
) |
|
$ |
5,778,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended July 31, 2017 |
|
$ |
1,550,141 |
|
|
$ |
2,942,364 |
|
|
$ |
551,085 |
|
|
$ |
5,043,590 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2018 |
|
$ |
5,082,194 |
|
|
$ |
7,017,581 |
|
|
$ |
255,651 |
|
|
$ |
12,355,426 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended July 31, 2017 |
|
$ |
6,825,815 |
|
|
$ |
7,574,299 |
|
|
$ |
1,280,437 |
|
|
$ |
15,680,551 |
|
|