Note

Business Segment Information

In determining the segment information, Avalon considered its operating and management structure and the types of information subject to regular review by its “chief operating decision maker.” Using the criteria of FASB ASC

280

Segment Reporting

, Avalon’s reportable segments include waste management services and golf and related operations. Avalon accounts for intersegment net operating revenues as if the transactions were to

third

parties. The segment disclosures are presented on this basis for all periods presented.

Avalon’s primary business segment, the waste management services segment, provides hazardous and nonhazardous brokerage and management services to industrial, commercial, municipal and governmental customers, captive landfill management for an industrial customer and salt water injection well operations.

Avalon’s golf and related operations segment consists of

three

golf courses and associated clubhouses which provide dining and banquet facilities, a hotel which provides lodging, dining, banquet and conference facilities, a recreation center and a travel agency. Revenue for the golf and related operations segment consists primarily of membership dues, greens fees, cart rentals, room rentals, merchandise sales, tennis and fitness activities, spa services and food and beverage sales.

Avalon does

not

have significant operations located outside the United States and, accordingly, geographical segment information is

not

presented.

For the

six

months ended

June 30, 2018,

one

customer accounted for

10%

of Avalon’s consolidated or reportable segment net operating revenues. For the

six

months ended

June 30, 2017,

one

customer accounted for

10%

of the waste management services segment’s net operating revenues to external customers and

of the consolidated net operating revenues.

The accounting policies of the segments are consistent with those described for the consolidated financial statements in the summary of significant accounting policies included in Avalon’s

2017

Annual Report to Shareholders. Avalon measures segment profit for internal reporting purposes as income (loss) before taxes.

Business segment information including the reconciliation of segment income before taxes to income (loss) before taxes is as follows (in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
Net operating revenues from:
Waste management services:
External customer revenues	$	11,510		$	9,490		$	19,968		$	17,103
Intersegment revenues		-			-			-			-
Total waste management services		11,510			9,490			19,968			17,103

Golf and related operations:
External customer revenues		5,195			5,087			8,253			8,176
Intersegment revenues		16			11			41			37
Total golf and related operations		5,211			5,098			8,294			8,213

Segment operating revenues		16,721			14,588			28,262			25,316
Intersegment eliminations		(16	)		(11	)		(41	)		(37	)
Total net operating revenues	$	16,705		$	14,577		$	28,221		$	25,279

Income (loss) before income taxes:
Waste management services	$	977		$	685		$	1,524		$	1,228
Golf and related operations		381			221			-			(376	)
Segment income before income taxes		1,358			906			1,524			852
Corporate interest expense		(161	)		(164	)		(320	)		(328	)
Corporate other income, net		11			2			13			4
General corporate expenses		(673	)		(703	)		(1,577	)		(1,486	)
Income (loss) before income taxes	$	535		$	41		$	(360	)	$	(958	)

	June 30,			December 31,
	2018			2017
Identifiable assets:
Waste management services	$	27,861		$	26,449
Golf and related operations		47,468			45,188
Corporate		48,361			49,549
Subtotal		123,690			121,186
Elimination of intersegment receivables		(56,119	)		(55,808	)
Total	$	67,571		$	65,378

In comparing the total assets at

June 30, 2018

with those at

December 31, 2017,

the increase in total assets of the waste management services segment of

$1.4

million is primarily a result of an increase in intersegment transactions, which are eliminated in consolidation, and to a lesser extent an increase in accounts receivable partially offset by a lower net book value of property and equipment as a result of current year depreciation on the salt water injection wells. The increase in total assets of the golf and related operations segment of

$2.3

million is primarily due to the acquisition of the Boardman Tennis Center facility and an increase in accounts receivable partially offset by current year depreciation on property and equipment. The decrease in corporate total assets of

$1.2

million is primarily due to a decrease in restricted cash that was released from restriction and subsequently utilized to fund the acquisition of the Boardman Tennis Center facility and a decrease in intersegment transactions, which are eliminated in consolidation, partially offset by an increase in operating cash and cash equivalents.