Segments

6 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

SEGMENTS

Note 25 – SEGMENTS

The Company operates within four main reportable segments: retail drugstores, online pharmacy, drug wholesale and herb farming. The retail drugstores segment sells prescription and over-the-counter ("OTC") medicines, TCM, dietary supplements, medical devices, and sundry items to retail customers. The online pharmacy sells OTC drugs, dietary supplements, medical devices and sundry items to customers through several third-party platforms such as Alibaba's Tmall, JD.com and Amazon.com, and the Company's own platform all over China. The drug wholesale segment includes supplying the Company's own retail drugstores with prescription and OTC medicines, TCM, dietary supplement, medical devices and sundry items (which sales have been eliminated as intercompany transactions), and also selling them to other drug vendors and hospitals. The Company's herb farming segment cultivates selected herbs for sales to other drug vendors. The Company is also involved in online sales and clinic services that do not meet the quantitative thresholds for reportable segments and are included in the retail drugstores segment. The segments' accounting policies are the same as those described in the summary of significant accounting policies. The Company evaluates performance based on profit or loss from operations before interest and income taxes not including nonrecurring gains and losses.

The Company's reportable business segments are strategic business units that offer different products and services. Each segment is managed separately because they require different operations and markets to distinct classes of customers.

The following table presents summarized information by segment of the continuing operations for the three months ended September 30, 2020.

	Retail drugstores			Online Pharmacy			Drug wholesale			Herb farming		Total
Revenue	$	17,930,496		$	5,347,012			7,565,037			-		30,842,545
Cost of goods		12,326,579			4,744,725			6,758,489			-		23,829,793
Gross profit	$	5,603,917		$	602,287			806,548			-		7,012,752
Selling expenses		5,437,046			621,883			416,583			-		6,475,512
General and administrative expenses		1,412,325			62,110			587,124			-		2,061,559
Loss from operations	$	(1,245,454	)	$	(81,706	)		(197,159	)		-		(1,524,319	)
Depreciation and amortization	$	491,356		$	-			6,259			-		497,615
Total capital expenditures	$	149,049		$	-						-		149,049

The following table presents summarized information by segment of the continuing operations for the three months ended September 30, 2019.

	Retail drugstores			Online Pharmacy			Drug wholesale			Herb farming		Total
Revenue	$	18,001,273		$	2,351,264			8,001,242			-		28,353,779
Cost of goods		12,471,047			2,032,464			7,156,904			-		21,660,415
Gross profit	$	5,530,226		$	318,800			844,338			-		6,693,364
Selling expenses		5,395,626			462,154			628,068			-		6,485,848
General and administrative expenses		1,259,535			60,476			503,924			-		1,823,935
Loss from operations	$	(1,124,935	)	$	(203,830	)		(287,654	)		-		(1,616,419	)
Depreciation and amortization	$	531,569		$	-			22,852			-		554,421
Total capital expenditures	$	236,961		$	-						-		236,961

The following table presents summarized information by segment of the continuing operations for the six months ended September 30, 2020.

	Retail drugstores			Online Pharmacy			Drug wholesale			Herb farming		Total
Revenue	$	36,740,970		$	10,259,846			14,896,041			-		61,896,857
Cost of goods		24,728,761			8,973,136			13,201,989			-		46,903,886
Gross profit	$	12,012,209		$	1,286,710			1,694,052			-		14,992,971
Selling expenses		10,414,093			1,326,759			1,007,067			-		12,747,919
General and administrative expenses		2,540,408			121,121			1,520,196			-		4,181,725
Loss from operations	$	(942,292	)	$	(161,170	)		(833,211	)		-		(1,936,673	)
Depreciation and amortization	$	1,241,854		$	-			16,301			-		1,258,155
Total capital expenditures	$	318,856		$	-						-		318,856

The following table presents summarized information by segment of the continuing operations for the six months ended September 30, 2019.

	Retail drugstores			Online pharmacy			Drug wholesale			Herb farming	Total
Revenue	$	34,736,261		$	4,794,869			14,103,433				53,634,563
Cost of goods		24,153,768			4,129,314			12,596,679				40,879,761
Gross profit	$	10,582,493		$	665,555			1,506,754				12,754,802
Selling expenses		10,231,292			935,534			1,287,573				12,454,399
General and administrative expenses		2,993,239			115,599			1,566,709				4,675,547
Loss from operations	$	(2,642,038	)	$	(385,578	)		(1,347,528	)			(4,375,144	)
Depreciation and amortization	$	1,036,032		$	-			31,338				1,067,370
Total capital expenditures	$	990,134		$	-							990,134

The Company does not have long-lived assets located outside the PRC. In accordance with the enterprise-wide disclosure requirements of FASB's accounting standard.

The Company's net revenue from external customers through its retail drugstores by main product category for the three and six months ended September 30, 2020 and 2019 were as follows:

	Three months ended September 30,				Six months ended September 30,
	2020		2019		2020		2019
Prescription drugs	$	5,982,706	$	6,022,934	$	13,389,480	$	11,718,220
OTC drugs		7,617,159		7,463,201		14,435,643		14,703,429
Nutritional supplements		1,664,265		1,676,974		3,012,034		2,908,107
TCM		1,054,378		1,954,500		2,003,390		3,058,550
Sundry products		338,112		290,750		760,663		588,948
Medical devices		1,273,876		592,914		3,139,760		1,759,007
Total	$	17,930,496	$	18,001,273	$	36,740,970	$	34,736,261

The Company's net revenue from external customers through online pharmacy by main product category is as follows:

	Three months ended September 30,				Six months ended September 30,
	2020		2019		2020		2019
Prescription drugs	$	1,758,516	$	-	$	3,628,159	$	-
OTC drugs		1,983,034		1,126,655		3,305,845		2,151,257
Nutritional supplements		208,062		136,513		429,093		243,707
TCM		72,349		21,969		95,548		35,650
Sundry products		411,494		374,457		958,214		813,193
Medical devices		913,557		691,670		1,842,987		1,551,062
Total	$	5,347,012	$	2,351,264	$	10,259,846	$	4,794,869

The Company's net revenue from external customers through wholesale by main product category is as follows:

	Three months ended September 30,				Six months ended September 30,
	2020		2019		2020		2019
Prescription drugs	$	5,850,267	$	6,816,035	$	11,816,415	$	11,696,526
OTC drugs		1,563,344		1,048,542		2,478,490		2,122,803
Nutritional supplements		27,104		35,048		86,945		56,739
TCM		78,333		81,130		107,300		179,958
Sundry products		18,760		5,338		21,357		11,020
Medical devices		27,229		15,149		385,534		36,387
Total	$	7,565,037	$	8,001,242	$	14,896,041	$	14,103,433