SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2021

SEGMENT INFORMATION

SEGMENT INFORMATION

NOTE 11 — SEGMENT INFORMATION

We determine our business segments based upon an internal reporting structure. Our financial performance is based on the following segments: DGSE and ECHG.

The DGSE segment includes Dallas Gold & Silver Exchange, which has six retail stores in the Dallas/Fort Worth Metroplex, and Charleston Gold & Diamond Exchange, which has one retail store in Charleston, South Carolina.

The ECHG segment includes Echo, ITAD USA, CEX, Teladvance and Avail DE. These five companies were added during Fiscal 2019 and Fiscal 2021, and are involved in recycling and the reuse of electronic waste.

We allocate our corporate costs and expenses, including rental income and expenses relating to our corporate headquarters, to our business segments. The corporate building’s income and expenses are included in selling, general and administrative expenses, depreciation and amortization, other income, interest expense and income tax expense. The Company’s management team evaluates the operating performance of each segment and makes decisions about the allocation of resources according to each segment profit. The allocations are generally amounts agreed upon by management, which may differ from an arms-length transaction.

The following table segments the financial results of DGSE and ECHG for the years ended December 31, 2021 and 2020:

	For the Years Ended
	December 31, 2021								December 31, 2020
	DGSE		ECHG			Consolidated			DGSE		ECHG		Consolidated
Revenue:
Sales	$	96,719,259	$	44,246,819		$	140,966,078		$	85,661,391	$	28,260,624	$	113,922,015
Cost of goods sold		84,111,097		25,633,822			109,744,919			75,291,521		15,561,531		90,853,052
Gross profit		12,608,162		18,612,997			31,221,159			10,369,870		12,699,093		23,068,963
Expenses:
Selling, general and administrative expenses		7,628,377		13,169,718			20,798,095			6,933,259		8,620,015		15,553,274
Depreciation and amortization		389,703		536,392			926,095			321,833		406,793		728,626
		8,018,080		13,706,110			21,724,190			7,255,092		9,026,808		16,281,900
Operating income		4,590,082		4,906,887			9,496,969			3,114,778		3,672,285		6,787,063
Other income :
Other income from loan forgiveness		675,210		992,990			1,668,200			-		-		-
Other income (expense)		238,585		(538,020	)		(299,435	)		113,974		193,023		306,997
Interest expense		288,236		415,815			704,051			209,295		411,204		620,499
Income before income taxes		5,215,641		4,946,042			10,161,683			3,019,457		3,454,104		6,473,561
Income tax expense		45,124		67,684			112,808			40,283		49,335		89,618
Income from continuing operations	$	5,170,517	$	4,878,358		$	10,048,875		$	2,979,174	$	3,404,769	$	6,383,943