| Segment Reporting |
Note 6– Segment
Reporting
During the third quarter of fiscal 2018, the Company purchased the
assets and assumed contracts that Cord:Use 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 three 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”).
|
| |
3. |
The cellular processing and cryogenic storage of
umbilical cord blood stem cells for public use. Revenue is
generated from the sale of the cord blood units to the National
Marrow Donor Program (“NMDP”), which distributes the
cord blood units to transplant centers located in the United
States, and around the world.
|
The following table shows, by segment: net revenue, cost of sales,
operating profit, depreciation and amortization, interest expense,
income tax (expense) benefit, other comprehensive loss, and assets
for the years ended November 30, 2018 and 2017:
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For the years ended November 30, |
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| |
|
2018 |
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2017 |
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Net revenue:
|
|
|
|
|
|
|
|
|
|
Umbilical cord blood and cord tissue stem cell service
|
|
$ |
28,817,872 |
|
|
$ |
24,942,089 |
|
|
PrepaCyte CB
|
|
|
104,323 |
|
|
|
442,190 |
|
|
Public cord blood banking
|
|
|
296,295 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
Total net revenue
|
|
$ |
29,218,490 |
|
|
$ |
25,384,279 |
|
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|
|
|
|
|
|
|
Cost of sales:
|
|
|
|
|
|
|
|
|
|
Umbilical cord blood and cord tissue stem cell service
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|
$ |
7,744,208 |
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|
$ |
6,257,628 |
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PrepaCyte CB
|
|
|
169,397 |
|
|
|
466,763 |
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|
Public cord blood banking
|
|
|
626,057 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
Total cost of sales
|
|
$ |
8,539,662 |
|
|
$ |
6,724,391 |
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|
|
|
|
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|
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Operating profit:
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|
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|
|
|
|
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Umbilical cord blood and cord tissue stem cell service
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|
$ |
5,620,394 |
|
|
$ |
5,067,228 |
|
|
PrepaCyte CB
|
|
|
(101,329 |
) |
|
|
(61,002 |
) |
|
Public cord blood banking
|
|
|
(329,762 |
) |
|
|
— |
|
|
|
|
|
|
|
|
|
|
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Total operating profit
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|
$ |
5,189,303 |
|
|
$ |
5,006,226 |
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|
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|
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Depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
Umbilical cord blood and cord tissue stem cell service
|
|
$ |
281,072 |
|
|
$ |
193,741 |
|
|
PrepaCyte CB
|
|
|
36,254 |
|
|
|
36,254 |
|
|
Public cord blood banking
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
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Total depreciation and amortization
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|
$ |
317,326 |
|
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$ |
229,995 |
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|
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Interest expense:
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|
|
|
|
|
|
|
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Umbilical cord blood and cord tissue stem cell service
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|
$ |
1,546,900 |
|
|
$ |
1,302,650 |
|
|
PrepaCyte CB
|
|
|
— |
|
|
|
— |
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|
Public cord blood banking
|
|
|
— |
|
|
|
— |
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|
|
|
|
|
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Total interest expense
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|
$ |
1,546,900 |
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|
$ |
1,302,650 |
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Income tax (expense) benefit:
|
|
|
|
|
|
|
|
|
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Umbilical cord blood and cord tissue stem cell service
|
|
$ |
(4,472,504 |
) |
|
$ |
(1,308,603 |
) |
|
PrepaCyte CB
|
|
|
— |
|
|
|
— |
|
|
Public cord blood banking
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
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Total income tax (expense) benefit
|
|
$ |
(4,472,504 |
) |
|
$ |
(1,308,603 |
) |
|
|
|
|
|
|
|
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Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
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Umbilical cord blood and cord tissue stem cell service
|
|
$ |
300,119 |
|
|
$ |
6,457 |
|
|
PrepaCyte CB
|
|
|
— |
|
|
|
— |
|
|
Public cord blood banking
|
|
|
— |
|
|
|
— |
|
|
|
|
|
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Total other comprehensive income (loss)
|
|
$ |
300,119 |
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|
$ |
6,457 |
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The following table shows the assets by segment as of
November 30 2018 and November 30, 2017:
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Assets:
|
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|
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|
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|
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Umbilical cord blood and cord tissue stem cell service
|
|
$ |
26,239,260 |
|
|
$ |
23,360,714 |
|
|
PrepaCyte CB
|
|
|
319,802 |
|
|
|
549,283 |
|
|
Public cord blood banking
|
|
|
15,831,081 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
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Total assets
|
|
$ |
42,390,143 |
|
|
$ |
23,909,997 |
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