SEGMENT REPORTING

6 Months Ended

Jun. 30, 2014

Notes to Financial Statements

Note 11. SEGMENT REPORTING

Note 10. SEGMENT REPORTING

In accordance with FASB ASC 280, “Segment Reporting”, the Company discloses financial and descriptive information about its reportable operating segments. Operating segments are components of an enterprise about which separate financial information is available and regularly evaluated by the chief operating decision maker in deciding how to allocate resources and in assessing performance.

The Company is operating in four segments. AIM manufactures components and subassemblies for the defense and aerospace industry.  NTW is a manufacturer of aerospace components, principally landing gear for F-16 and F-18 fighter aircraft. WMI provides specialty welding services and metal fabrications to the defense and commercial aerospace industry and the results of Woodbine are included within the WMI segment beginning on April 1, 2014, the date it was acquired.  Eur-Pac’s primary business is “kitting” of supplies for all branches of the United States Defense Department including ordnance parts, hose assemblies, hydraulic, mechanical and electrical assemblies. The results of Eur-Pac are included from its date of acquisition. While each of these segments service the same industries and a similar customer base, we evaluate the performance of each segment separately in deciding how to allocate resources and in accessing profitability.

Beginning on January 1, 2013, the Company began to allocate all of the corporate selling and general and administrative costs of AIRI to each of its three subsidiaries. For both 2014 and 2013, these are allocated 50% to AIM and 25% to each of WMI and NTW.  There was no corporate allocation made to Eur-Pac during 2014.

Financial information about the Company's operating segments for the three months ended June 30, 2014 and 2013 are as follows:

Three Months Ended June 30,
	2014			2013
	(Unaudited)			(Unaudited)
AIM
Net Sales	$	7,135,000		$	8,188,000
Gross Profit		1,285,000			1,599,000
Pre Tax Income		157,000			594,000
Assets		22,243,000			23,645,000
WMI
Net Sales		3,763,000			3,307,000
Gross Profit		1,108,000			894,000
Pre Tax (Loss) Income		(202,000	)		7,000
Assets		18,375,000			9,477,000
NTW
Net Sales		2,185,000			3,144,000
Gross Profit		819,000			1,137,000
Pre Tax (Loss) Income		(73,000	)		228,000
Assets		11,597,000			13,247,000
Eur-Pac
Net Sales		277,000			-
Gross Profit		141,000			-
Pre Tax Income		91,000			-
Assets		2,252,000			-
Corporate
Net Sales		-			-
Gross Profit		-			-
Pre Tax Loss		(82,000	)		(173,000
Assets		17,254,000			11,074,000
Consolidated
Net Sales		13,360,000			14,639,000
Gross Profit		3,353,000			3,630,000
Pre Tax (Loss) Income		(109,000	)		656,000
(Benefit from) Provision for Taxes		(725,000	)		430,000
Net Income		616,000			226,000
Elimination of Assets		(13,314,000	)		(6,596,000
Assets		58,407,000			50,847,000

Financial information about the Company's operating segments for the six months ended June 30, 2014 and 2013 are as follows:

Six Months Ended June 30,
	2014			2013
	(Unaudited)			(Unaudited)
AIM
Net Sales	$	14,266,000		$	15,666,000
Gross Profit		2,571,000			3,059,000
Pre Tax Income		485,000			1,088,000
Assets		22,243,000			23,645,000
WMI
Net Sales		7,076,000			6,446,000
Gross Profit		1,945,000			1,743,000
Pre Tax Loss		(533,000	)		(5,000	)
Assets		18,375,000			9,477,000
NTW
Net Sales		7,194,000			6,853,000
Gross Profit		2,741,000			2,476,000
Pre Tax Income		946,000			721,000
Assets		11,597,000			13,247,000
Eur-Pac
Net Sales		277,000			-
Gross Profit		141,000			-
Pre Tax Income		91,000			-
Assets		2,252,000			-
Corporate
Net Sales		-			-
Gross Profit		-			-
Pre Tax Loss		(173,000	)		(380,000	)
Assets		17,254,000			11,074,000
Consolidated
Net Sales		28,813,000			28,965,000
Gross Profit		7,398,000			7,278,000
Pre Tax Income		816,000			1,424,000
(Benefit from) Provision for Taxes		(141,000	)		919,000
Net Income		957,000			505,000
Elimination of Assets		(13,314,000	)		(6,596,000	)
Assets		58,407,000			50,847,000