Enzo Biochem, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Segment reporting

Segment reporting

6 Months Ended

Jan. 31, 2020

Segment Reporting Disclosure [Text Block]

Note 11 – Segment reporting

The Company has three reportable segments: Products, Clinical Services and Therapeutics. The Company’s Products segment develops, manufactures, and markets products to research and pharmaceutical customers. The Clinical Services segment provides diagnostic services to the health care community. The Company’s Therapeutics segment conducts research and development activities for therapeutic drug candidates. The Company evaluates segment performance based on segment income (loss) before taxes. Costs excluded from segment income (loss) before taxes and reported as “Other” consist of corporate general and administrative costs which are not allocable to the three reportable segments.

Legal and related expenses incurred to defend the Company’s intellectual property, which may result in settlements recognized in another segment and other general corporate matters are considered a component of the Other segment. Legal and related expense specific to other segments’ activities have been allocated to those segments.

Legal settlements, net, represent activities for which royalties would have been received in the Company’s Products segment. Management of the Company assesses assets on a consolidated basis only and therefore, assets by reportable segment have not been included in the reportable segments below. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.

The following financial information represents the operating results of the reportable segments of the Company:

Three months ended January 31, 2020	Clinical Services			Products		Therapeutics			Other			Consolidated
Revenues	$	12,513		$	6,871		—			—		$	19,384

Operating costs and expenses:
Cost of revenues		10,243			3,332		—			—			13,575
Research and development		373			503	$	189			—			1,065
Selling, general and administrative		5,895			2,530		—		$	2,268			10,693
Legal and related expenses		38			1		—			2,021			2,060
Total operating costs and expenses		16,549			6,366		189			4,289			27,393

Operating income (loss)		(4,036	)		505		(189	)		(4,289	)		(8,009	)

Other income (expense):
Interest		(10	)		16		—			165			171
Other		16			7		—			49			72
Foreign exchange loss		—			79		—			—			79
Income (loss) before income taxes	$	(4,030	)	$	607	$	(189	)	$	(4,075	)	$	(7,687	)

Depreciation and amortization included above	$	392		$	253	$	—		$	65		$	710

Share-based compensation included in above:
Selling, general and administrative		33			22		—			247			302
Total	$	33		$	22	$	—		$	247		$	302

Capital expenditures	$	142		$	18	$	—		$	—		$	160

Three months ended January 31, 2019	Clinical Services			Products			Therapeutics			Other			Consolidated
Revenues	$	12,000		$	7,327			—			—		$	19,327

Operating costs and expenses:
Cost of revenues		11,025			3,723			—			—			14,748
Research and development		—			611		$	222			—			833
Selling, general and administrative		6,200			2,981			—		$	2,316			11,497
Legal fee expense		38			1			—			1,103			1,142
Total operating costs and expenses		17,263			7,316			222			3,419			28,220

Operating income (loss)		(5,263	)		11			(222	)		(3,419	)		(8,893	)

Other income (expense):
Interest		(15	)		14			—			228			227
Other		(29	)		(4	)		—			165			132
Foreign exchange loss		—			126			—			—			126
(Loss) income before income taxes	$	(5,307	)	$	147		$	(222	)	$	(3,026	)	$	(8,408	)

Depreciation and amortization included above	$	374		$	343		$	—		$	51		$	768

Share-based compensation included in above:
Selling, general and administrative		40			26			—			225			291
Total	$	40		$	26		$	—		$	225		$	291

Capital expenditures	$	409		$	26		$	—		$	6,147		$	6,582

Six months ended January 31, 2020	Clinical Services			Products			Therapeutics			Other			Consolidated
Revenues	$	25,293		$	14,298			—			—		$	39,591

Operating costs and expenses:
Cost of revenues		21,218			6,878			—			—			28,096
Research and development		723			1,019		$	377			—			2,119
Selling, general and administrative		12,110			5,287			—		$	4,435			21,832
Legal and related expenses		88			1			—			3,667			3,756
Total operating costs and expenses		34,139			13,185			377			8,102			55,803

Operating income (loss)		(8,846	)		1,113			(377	)		(8,102	)		(16,212	)

Other income (expense):
Interest		(22	)		34			—			396			408
Other		19			(5	)		—			185			199
Foreign exchange loss		—			270			—			—			270
Income (loss) before income taxes	$	(8,849	)	$	1,412		$	(377	)	$	(7,521	)	$	(15,335	)

Depreciation and amortization included above	$	801		$	503		$	—		$	130		$	1,434

Share-based compensation included in above:
Selling, general and administrative		67			44			—			410			521
Total	$	67		$	44		$	—		$	410		$	521

Capital expenditures	$	289		$	145		$	—		$	—		$	434

Six months ended January 31, 2019	Clinical Services			Products			Therapeutics			Other			Consolidated
Revenues	$	26,297		$	14,290			—			—		$	40,587

Operating costs and expenses:
Cost of revenues		21,993			6,994			—			—			28,987
Research and development		—			1,118		$	443			—			1,561
Selling, general and administrative		12,260			5,905			—		$	4,302			22,467
Legal fee expense		74			8			—			2,361			2,443
Total operating costs and expenses		34,327			14,025			443			6,663			55,458

Operating income (loss)		(8,030	)		265			(443	)		(6,663	)		(14,871	)

Other income (expense):
Interest		(33	)		30			—			504			501
Other		11			—			—			168			179
Foreign exchange loss (gain)		—			(198	)		—			—			(198	)
(Loss) income before income taxes	$	(8,052	)	$	97		$	(443	)	$	(5,991	)	$	(14,389	)

Depreciation and amortization included above	$	777		$	685		$	—		$	72		$	1,534

Share-based compensation included in above:
Selling, general and administrative		78			50			—			398			526
Total	$	78		$	50		$	—		$	398		$	526

Capital expenditures	$	763		$	78		$	—		$	6,147		$	6,988