Annual report pursuant to Section 13 and 15(d)

Segment reporting

v3.3.0.814
Segment reporting
 12 Months Ended
Jul. 31, 2015
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]

Note 15 - Segment reporting


The Company has three reportable segments: Life Sciences, Clinical Labs and Therapeutics. The Company’s Life Sciences segment develops, manufactures, and markets products to research and pharmaceutical customers. The Clinical Labs 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 fee expense 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 fee 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 Life Sciences segment and expenses related to an investigation within the Clinical Labs 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:


Year ended July 31, 2015   Clinical
Labs		     Life
Sciences		     Therapeutics     Other     Consolidated  
Revenues:                                        
Clinical laboratory services   $ 63,414       —       —       —     $ 63,414  
Product revenues     —     $ 31,690       —       —       31,690  
Royalty and license fee income     —       2,495       —       —       2,495  
Total revenues     63,414       34,185       —       —       97,599  
                                         
Operating expenses:                                        
Cost of clinical laboratory services     39,589       —       —       —       39,589  
Cost of product revenues     —       15,183       —       —       15,183  
Research and development     —       2,608     $ 742       —       3,350  
Selling, general and administrative     20,666       12,168       —     $ 8,235       41,069  
Provision for uncollectible accounts receivable     2,418       (134 )     —       —       2,284  
Legal fee expense     196       (67 )     —       8,659       8,788  
Legal settlements, net     —       (11,458 )     —       —       (11,458 )
Total operating expenses     62,869       18,300       742       16,894       98,805  
                                         
Operating income (loss)     545       15,885       (742 )     (16,894 )     (1,206 )
                                         
Other income (expense)                                        
Interest     (86 )     10       —       (169 )     (245 )
Other     28       9       —       58       95  
Foreign exchange gain     —       (936 )     —       —       (936 )
                                         
Income (loss) before taxes   $ 487     $ 14,968     $ (742 )   $ (17,005 )   $ (2,292 )
                                         
Depreciation and amortization included above   $ 1,443     $ 2,254     $ 3     $ 89     $ 3,789  
                                         
Share-based compensation included in above:                                        
Cost of clinical laboratory services   $ 5     $ —       —       —     $ 5  
Research and development     —       2       —       —       2  
Selling, general and administrative     43       15       —     $ 364       422  
Total   $ 48     $ 17       —     $ 364     $ 429  
                                         
Capital expenditures   $ 1,557     $ 226       —       —     $ 1,783  

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


Year ended July 31, 2014   Clinical
Labs		     Life
Sciences		     Therapeutics     Other     Consolidated  
Revenues:                                        
Clinical laboratory services   $ 58,689       —       —       —     $ 58,689  
Product revenues     —     $ 32,850       —       —       32,850  
Royalty and license fee income     —       4,408       —       —       4,408  
Total revenues     58,689       37,258       —       —       95,947  
                                         
Operating expenses:                                        
Cost of clinical laboratory services     38,948       —       —       —       38,948  
Cost of product revenues     —       15,320       —       —       15,320  
Research and development     14       2,350     $ 777       —       3,141  
Selling, general and administrative     20,460       13,374       —     $ 7,967       41,801  
Provision for uncollectible accounts receivable     3,115       (52 )     —       —       3,063  
Legal fee expense     736       940       —       5,278       6,954  
Legal settlements, net     2,000       (5,100 )                     (3,100 )
Total operating expenses     65,273       26,832       777       13,245       106,127  
                                         
Operating (loss) income     (6,584 )     10,426       (777 )     (13,245 )     (10,180 )
                                         
Other income (expense)                                        
Interest     (43 )     9       —       (174 )     (208 )
Other     56       95       —       43       194  
Foreign exchange gain     —       289       —       —       289  
                                         
(Loss) income before income taxes   $ (6,571 )   $ 10,819     $ (777 )   $ (13,376 )   $ (9,905 )
                                         
Depreciation and amortization included above   $ 1,415     $ 2,455     $ 7     $ 94     $ 3,971  
                                         
Share-based compensation included in above:                                        
Cost of clinical laboratory services   $ 8     $ 1       —       —     $ 9  
Research and development     —       1       —       —       1  
Selling, general and administrative     36       6       —     $ 542       584  
Total   $ 44     $ 8       —     $ 542     $ 594  
                                         
Capital expenditures   $ 643     $ 195       —       —     $ 838  

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


Year ended July 31, 2013   Clinical
Labs		     Life
Sciences		     Therapeutics     Other     Consolidated  
Revenues:                                        
Clinical laboratory services   $ 55,889       —       —       —     $ 55,889  
Product revenues     —     $ 32,526       —       —       32,526  
Royalty and license fee income     —       5,292       —       —       5,292  
Total revenues     55,889       37,818       —       —       93,707  
                                         
Operating expenses:                                        
Cost of clinical laboratory services     38,251       —       —       —       38,251  
Cost of product revenues     —       16,584       —       —       16,584  
Research and development     294       2,356     $ 1,239       —       3,889  
Selling, general and administrative     19,942       15,511       —     $ 8,201       43,654  
Provision for uncollectible accounts receivable     4,232       264       —       —       4,496  
Legal fee expense     316       57       —       5,440       5,813  
                                         
Total operating expenses     63,035       34,772       1,239       13,641       112,687  
                                         
Operating (loss) income     (7,146 )     3,046       (1,239 )     (13,641 )     (18,980 )
                                         
Other income (expense)                                        
Interest     (46 )     13       —       (21 )     (54 )
Other     49       (71 )     —       27       5  
Foreign exchange gain     —       80       —       —       80  
                                         
(Loss) income before income taxes   $ (7,143 )   $ 3,066     $ (1,239 )   $ (13,635 )   $ (18,949 )
                                         
Depreciation and amortization included above   $ 1,377     $ 3,102     $ 22     $ 104     $ 4,605  
                                         
Share-based compensation included in above:                                        
Cost of clinical laboratory services   $ 9       1       —       —     $ 10  
Research and development     —     $ 2       —       —       2  
Selling, general and administrative     36       10       —     $ 487       533  
Total   $ 45     $ 13       —     $ 487     $ 545  
                                         
Capital expenditures   $ 757     $ 231       —       —     $ 988  

Geographic financial information is as follows:


Net sales to unaffiliated customers:   2015     2014     2013  
United States   $ 87,875     $ 84,389     $ 80,559  
Switzerland     3,131       4,130       5,499  
United Kingdom     1,904       2,023       2,324  
Other international countries     4,689       5,405       5,325  
Total   $ 97,599     $ 95,947     $ 93,707  
                         
Long-lived assets at July 31,                        
United States   $ 19,799     $ 20,854     $ 23,136  
Switzerland     1,224       1,629       1,984  
United Kingdom     357       462       491  
Other international countries     175       345       401  
Total   $ 21,555     $ 23,290     $ 26,012  

The Company’s reportable segments are determined based on the services they perform, the products they sell, and the royalties and license fee income they earn, not on the geographic area in which they operate. The Company’s Clinical Labs segment operates 100% in the United States with all revenue derived there. The Life Sciences segment earns product revenue both in the United States and foreign countries and royalty and license fee income in the United States. The following is a summary of the Life Sciences segment revenues attributable to customers located in the United States and foreign countries:


    2015     2014     2013  
United States   $ 24,461     $ 25,700     $ 24,669  
Foreign countries     9,724       11,558       13,149  
    $ 34,185     $ 37,258     $ 37,818