Note 11 - Segment Information

9 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

11.     Segment Information

The Company reports net revenue and operating income from continuing operations by reportable segment. Reportable segments are components of the Company for which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker in deciding how to allocate resources and in assessing performance.

The Company provides similar merchandising and marketing services throughout the world, operating within two reportable segments, its Domestic Merchandising Services Division and its International Merchandising Services Division. The Company uses those divisions to improve its administration and operational and strategic focuses, and it tracks and reports certain financial information separately for each of those divisions. The Company measures the performance of its domestic and international divisions and subsidiaries using the same metrics. The primary measurement utilized by management is operating profits, historically the key indicator of long-term growth and profitability, as the Company is focused on reinvesting the operating profits of each of its international subsidiaries back into its local markets in an effort to improve market share and continued expansion efforts.

Management evaluates performance based on profit or loss from operations, as follows (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Revenue:
United States	$	11,666		$	11,327		$	35,265		$	32,390
International		19,343			16,426			54,704			47,762
Total revenue	$	31,009		$	27,753		$	89,969		$	80,152
Operating income (loss):
United States	$	557		$	99		$	852		$	383
International		(10	)		291			602			520
Total operating income	$	547		$	390		$	1,454		$	903
Interest expense:
United States	$	22		$	15		$	62		$	40
International		22			13			66			40
Total interest expense	$	44		$	28		$	128		$	80
Other (income) expense, net:
United States	$	–		$	–		$	–		$	(25	)
International		(89	)		(5	)		(202	)		(48	)
Total other (income) expense, net	$	(89	)	$	(5	)	$	(202	)	$	(73	)
Income before provision for income taxes:
United States	$	535		$	84		$	790		$	368
International		57			283			738			528
Total income before provision for income taxes	$	592		$	367		$	1,528		$	896
Income tax expense (benefit):
United States	$	93		$	(141	)	$	93		$	(9	)
International		(72	)		2			280			209
Total income tax expense (benefit)	$	21		$	(139	)	$	373		$	200
Net income from continuing operations:
United States	$	442		$	225		$	697		$	377
International		129			281			458			319
Total net income from continuing operations	$	571		$	506		$	1,155		$	696
Depreciation and amortization:
United States	$	321		$	307		$	964		$	858
International		109			81			296			239
Total depreciation and amortization	$	430		$	388		$	1,260		$	1,097
Capital expenditures:
United States	$	252		$	224		$	765		$	855
International		158			88			319			184
Total capital expenditures	$	410		$	312		$	1,084		$	1,039

Note: There were no inter-company sales for 2014 or 2013. 

	September 30,		December 31,
	2014		2013
Assets:
United States	$	17,186	$	17,651
International		20,969		16,627
Total assets	$	38,155	$	34,278

Geographic Data (in thousands)

	Three Months Ended September 30,										Nine Months Ended September 30,
	2014					2013					2014					2013
International revenue:			% of consolidated net revenue					% of consolidated net revenue					% of consolidated net revenue					% of consolidated net revenue
Mexico	$	4,983		16.1	%	$	4,002		14.4	%	$	14,181		15.8	%	$	11,277		14.1	%
South Africa		4,388		14.2			3,873		14.0			12,358		13.7			11,809		14.7
China		3,046		9.8			1,911		6.9			5,791		6.4			4,956		6.2
India		1,850		6.0			1,203		4.3			5,112		5.7			3,318		4.1
Canada		1,643		5.3			1,545		5.6			4,858		5.4			4,389		5.5
Australia		1,366		4.4			1,283		4.6			4,441		4.9			5,046		6.3
Japan		1,338		4.3			2,079		7.5			6,090		6.8			4,680		5.8
Turkey		729		2.4			530		1.9			1,873		2.1			2,287		2.9
Total international revenue	$	19,343		62.5	%	$	16,426		59.2	%	$	54,704		60.8	%	$	47,762		59.6	%

	September 30,		December 31,
	2014		2013
Long lived assets:
United States	$	6,213	$	6,222
International		3,557		2,410
Total long lived assets	$	9,770	$	8,632

On July 2014, the Company, through its subsidiary in Hong Kong, SPAR China Ltd., entered into an agreement to purchase certain business assets, fixed assets and merchandising teams of the following three companies in China: Shanghai Unilink Marketing Execution and Design Co. Ltd, Shanghai Gold Park Investment Management Co. Ltd, and Beijing Merchandising Sales and Marketing Co. Ltd (collectively Unilink). As consideration for the purchase, Unilink received cash and 20% ownership in SPAR Shanghai. As a result of this transaction, current ownership interest in SPAR Shanghai is SPAR 51%, Shanghai Wedone Marketing Consulting Co. Ltd 29% and Unilink 20%. The Company consolidated operations beginning August 1, 2014.