Quarterly report pursuant to Section 13 or 15(d)

Segment Reporting

v3.7.0.1
Segment Reporting
6 Months Ended
May 31, 2017
Segment Reporting [Abstract]  
Segment Reporting

Note 6 – Segment Reporting

During the third quarter of fiscal 2015, the Company purchased certain assets and assumed certain liabilities and contracts that CytoMedical used in the operation of its cord blood business (See Note 2). The Company evaluated and determined that this acquisition qualifies as a separate segment.

The Company is organized in two reportable segments:

 

  1. The cellular processing and cryogenic storage of umbilical cord blood and cord tissue stem cells for family use. Revenue is generated from the initial processing and testing fees and the annual storage fees charged each year for storage (the “Umbilical cord blood and cord tissue stem cell service”).

 

  2. The manufacture of PrepaCyte® CB units, the processing technology used to process umbilical cord blood stem cells. Revenue is generated from the sales of the PrepaCyte® CB units (the “PrepaCyte® CB”).

 

The following table shows, by segment: net revenue, cost of sales, operating profit, depreciation and amortization, interest expense, income tax benefit (expense) and other comprehensive income for the three months and six months ended May 31, 2017:

 

     For the three months
ended May 31, 2017
     For the six months
ended May 31, 2017
 

Net revenue

     

Umbilical cord blood and cord tissue stem cell service

   $ 6,174,896      $ 11,786,720  

PrepaCyte®-CB

     61,855        226,655  
  

 

 

    

 

 

 

Total net revenue

   $ 6,236,751      $ 12,013,375  
  

 

 

    

 

 

 

Cost of sales

     

Umbilical cord blood and cord tissue stem cell service

   $ 1,517,078      $ 2,909,873  

PrepaCyte®-CB

     74,888        198,190  
  

 

 

    

 

 

 

Total cost of sales

   $ 1,591,966      $ 3,108,063  
  

 

 

    

 

 

 

Depreciation and amortization

     

Umbilical cord blood and cord tissue stem cell service

   $ 22,873      $ 45,439  

PrepaCyte®-CB

     9,063        18,127  
  

 

 

    

 

 

 

Total depreciation and amortization

   $ 31,936      $ 63,566  
  

 

 

    

 

 

 

Operating income (loss)

     

Umbilical cord blood and cord tissue stem cell service

   $ 1,214,346      $ 2,298,038  

PrepaCyte®-CB

     (22,096      10,338  
  

 

 

    

 

 

 

Total operating income

   $ 1,192,250      $ 2,308,376  
  

 

 

    

 

 

 

Interest expense

     

Umbilical cord blood and cord tissue stem cell service

   $ 325,314      $ 622,358  

PrepaCyte®-CB

     —          —    
  

 

 

    

 

 

 

Total interest expense

   $ 325,314      $ 622,358  
  

 

 

    

 

 

 

Income tax expense

     

Umbilical cord blood and cord tissue stem cell service

   $ (331,737    $ (637,454

PrepaCyte®-CB

     —          —    
  

 

 

    

 

 

 

Total income tax expense

   $ (331,737    $ (637,454
  

 

 

    

 

 

 

The following table shows the assets by segment as of May 31, 2017 and November 30, 2016:

 

     As of May 31, 2017      As of November 30,
2016
 

Assets

     

Umbilical cord blood and cord tissue stem cell service

   $ 20,562,496      $ 18,960,261  

PrepaCyte®-CB

     474,121        578,207  
  

 

 

    

 

 

 

Total assets

   $ 21,036,617      $ 19,538,468  
  

 

 

    

 

 

 

 

The following table shows, by segment: net revenue, cost of sales, operating profit, depreciation and amortization, interest expense, income tax benefit (expense) and other comprehensive income for the three months and six months ended May 31, 2016:

 

     For the three months
ended May 31, 2016
     For the six months
ended May 31, 2016
 

Net revenue

     

Umbilical cord blood and cord tissue stem cell service

   $ 5,706,677      $ 10,727,136  

PrepaCyte®-CB

     66,379        198,118  
  

 

 

    

 

 

 

Total net revenue

   $ 5,773,056      $ 10,925,254  
  

 

 

    

 

 

 

Cost of sales

     

Umbilical cord blood and cord tissue stem cell service

   $ 1,345,370      $ 2,590,393  

PrepaCyte®-CB

     85,730        188,998  
  

 

 

    

 

 

 

Total cost of sales

   $ 1,431,100      $ 2,779,391  
  

 

 

    

 

 

 

Depreciation and amortization

     

Umbilical cord blood and cord tissue stem cell service

   $ 28,555      $ 57,233  

PrepaCyte®-CB

     13,317        26,187  
  

 

 

    

 

 

 

Total depreciation and amortization

   $ 41,872      $ 83,420  
  

 

 

    

 

 

 

Operating income (loss)

     

Umbilical cord blood and cord tissue stem cell service

   $ 915,052      $ 1,056,069  

PrepaCyte®-CB

     (32,668      (17,263
  

 

 

    

 

 

 

Total operating income

   $ 882,384      $ 1,038,806  
  

 

 

    

 

 

 

Interest expense

     

Umbilical cord blood and cord tissue stem cell service

   $ 335,589      $ 582,532  

PrepaCyte®-CB

     7,874        22,265  
  

 

 

    

 

 

 

Total interest expense

   $ 343,463      $ 604,797  
  

 

 

    

 

 

 

Income expense

     

Umbilical cord blood and cord tissue stem cell service

   $ (201,735    $ (201,735

PrepaCyte®-CB

     —          —    
  

 

 

    

 

 

 

Total income expense

   $ (201,735    $ (201,735