Business Segments

3 Months Ended

Mar. 31, 2020

Note 13

Business Segments:

The Company has organized its business into two operating segments to present its organization based upon the Company’s management structure, products and services offered, markets served and types of customers, as follows: The Dermatology Recurring Procedures segment derives its revenues from the usage of its equipment by dermatologists to perform XTRAC procedures. The Dermatology Procedures Equipment segment generates revenues from the sale of equipment, such as lasers and lamp products. Management reviews financial information presented on an operating segment basis for the purposes of making certain operating decisions and assessing financial performance.

Unallocated operating expenses include costs that are not specific to a particular segment but are general to the group; included are expenses incurred for administrative and accounting staff, general liability and other insurance, professional fees and other similar corporate expenses. Interest expense and other income (expense), net, are also not allocated to the operating segments.

The following tables reflect results of operations from our business segments for the periods indicated below:

Three Months Ended March 31, 2020

	Dermatology Recurring Procedures			Dermatology Procedures Equipment			TOTAL
Revenues	$	5,701		$	1,029		$	6,730
Costs of revenues		1,802			529			2,331
Gross profit		3,899			500			4,399
Gross profit %		68.4	%		48.6	%		65.4	%

Allocated operating expenses:
Engineering and product development		274			18			292
Selling and marketing		2,797			156			2,953

Unallocated operating expenses		-			-			2,102
		3,071			174			5,347
Income (loss) from operations		828			326			(948	)

Interest income, net		-			-			1

Income (loss) before income taxes	$	828		$	326		$	(947	)

Three Months Ended March 31, 2019

	Dermatology Recurring Procedures			Dermatology Procedures Equipment			TOTAL
Revenues	$	5,312		$	2,171		$	7,483
Costs of revenues		1,793			1,081			2,874
Gross profit		3,519			1,090			4,609
Gross profit %		66.2	%		50.2	%		61.6	%

Allocated operating expenses:
Engineering and product development		242			62			304
Selling and marketing		2,768			298			3,066

Unallocated operating expenses		-			-			2,480
		3,010			360			5,850
Income (loss) from operations		509			730			(1,241	)

Interest expense, net		-			-			(135	)

Income (loss) before income taxes	$	509		$	730		$	(1,376	)