Note 13 - Business Segment Information

9 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

Note 13. 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 four golf courses and associated clubhouses which provide dining and banquet facilities, a hotel which provides lodging and resort related amenities including dining, banquet and conference facilities and a multipurpose recreation center. 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, salon and spa services and food and beverage sales.

Avalon does not have operations located outside the United States and, accordingly, geographical segment information is not presented. For the nine months ended September 30, 2023, one customer accounted for 15% of the waste management services segment’s net operating revenues to external customers and 7% of the consolidated net operating revenues. For the nine months ended September 30, 2022, one customer accounted for 10% of the waste management services segment’s net operating revenues to external customers and 6% 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 2022 Annual Report to Shareholders. Avalon measures segment profit for internal reporting purposes as income (loss) before income taxes.

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

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2023			2022			2023			2022
Net operating revenues from:
Waste management services:
External customer revenues	$	11,744		$	15,036		$	34,694		$	35,092
Golf and related operations:
External customer revenues		12,159			10,677			28,204			24,452
Intersegment revenues		14			25			64			56
Total golf and related operations		12,173			10,702			28,268			24,508
Segment operating revenues		23,917			25,738			62,962			59,600
Intersegment eliminations		(14	)		(25	)		(64	)		(56	)
Total net operating revenues	$	23,903		$	25,713		$	62,898		$	59,544

Income (loss) before income taxes:
Waste management services	$	1,180		$	1,454		$	2,973		$	3,143
Golf and related operations		1,214			1,223			312			976
Segment income before income taxes		2,394			2,677			3,285			4,119
Corporate interest expense		(530	)		(402	)		(1,573	)		(937	)
Corporate other income, net		12			-			35			1
General corporate expenses		(1,009	)		(1,148	)		(2,829	)		(2,999	)
Income (loss) before income taxes	$	867		$	1,127		$	(1,082	)	$	184

	September 30,			December 31,
	2023			2022
Identifiable assets:
Waste management services	$	36,929		$	35,198
Golf and related operations		64,844			63,355
Corporate		62,894			65,630
Subtotal		164,667			164,183
Elimination of intersegment receivables		(74,619	)		(74,433	)
Total	$	90,048		$	89,750

In comparing total assets at September 30, 2023 with those at December 31, 2022, the increase in the total assets of the waste management services segment of approximately $1.7 million was primarily a result of an increase in intersegment transactions, which are eliminated in consolidation, partially offset by a decrease in accounts receivable. The increase in total assets of the golf and related operations segment of $1.5 million was primarily due to an increase in capital expenditures associated with The Grand Resort and Avalon Field Club at New Castle.