Business Segments and Geographic Data

9 Months Ended

Sep. 30, 2014

Business Segments and Geographic Data [Abstract]

Business Segments and Geographic Data

Note 14

Business Segments and Geographic Data:

Following the acquisition of LCA-Vision, the Company’s business was aligned into four operating segments based upon the Company’s management structure, products and services offered, markets served and types of customers, as follows: The Consumer segment derives its revenues from the design, development, manufacturing and selling of long-term hair reduction and acne consumer products. The Physician Recurring segment derives its revenues from the XTRAC procedures performed by dermatologists, the sales of skincare products, the sales of surgical disposables and accessories to hospitals and surgery centers and on the repair, maintenance and replacement parts on our various products. The Professional segment generates revenues from the sale of equipment, such as lasers, medical and esthetic light and heat-based products and LED products. The Clinics segment generates revenues from services performed and products sold in our vision centers. 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. Unallocated assets include cash and cash equivalents, prepaid expenses and deposits.

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

	Three Months Ended September 30, 2014 (unaudited)
	Consumer			Physician Recurring			Professional			Clinics			Total
Revenues	$	24,938		$	8,823		$	1,850		$	18,092		$	53,703
Costs of revenues		4,363			3,094			1,258			14,246			22,961
Gross profit		20,575			5,729			592			3,846			30,742
Gross profit %		82.5	%		64.9	%		32.0	%		21.3	%		57.2	%
Allocated operating expenses:
Engineering and product development		306			314			201			-			821
Selling and marketing expenses		20,001			3,843			204			4,792			28,840
Unallocated operating expenses		-			-			-			-			11,678
		20,307			4,157			405			4,792			41,339
Income (loss) from operations		268			1,572			187			(946	)		(10,597	)
Interest  and other financing expense, net		-			-			-			-			(3,824	)
Net income (loss) before taxes	$	268		$	1,572		$	187		$	(946	)	$	(14,421	)

	Three Months Ended September 30, 2013 (unaudited)
	Consumer			Physician Recurring			Professional			Clinics			Total
Revenues	$	36,910		$	7,359		$	1,624		$	-		$	45,893
Costs of revenues		4,730			3,272			1,064			-			9,066
Gross profit		32,180			4,087			560			-			36,827
Gross profit %		87.2	%		55.5	%		34.5	%		N/	A		80.2	%
Allocated operating expenses:
Engineering and product development		279			341			185			-			805
Selling and marketing expenses		26,958			3,370			645			-			30,973
Unallocated operating expenses		-			-			-			-			5,972
		27,237			3,711			830			-			37,750
Income (loss) from operations		4,943			376			(270	)		-			(923	)
Interest and other financing expense, net		-			-			-			-			473
Net income (loss) before taxes	$	4,943		$	376		$	(270	)	$	-		$	(450	)

	Nine Months Ended September 30, 2014 (unaudited)
	Consumer			Physician Recurring			Professional			Clinics			Total
Revenues	$	94,261		$	24,649		$	5,753		$	31,235		$	155,898
Costs of revenues		14,596			9,349			3,884			23,129			50,958
Gross profit		79,665			15,300			1,869			8,106			104,940
Gross profit %		84.5	%		62.1	%		32.5	%		26.0	%		67.3	%
Allocated operating expenses:
Engineering and product development		898			881			560			-			2,339
Selling and marketing expenses		70,382			12,122			935			7,447			90,886
Unallocated operating expenses		-			-			-			-			30,717
		71,280			13,003			1,495			7,447			123,942
Income (loss) from operations		8,385			2,297			374			659			(19,002	)
Interest and other financing expense, net		-			-			-			-			(4,145	)
Net income (loss) before taxes	$	8,385		$	2,297		$	374		$	659		$	(23,147	)

	Nine Months Ended September 30, 2013 (unaudited)
	Consumer			Physician Recurring			Professional			Clinics			Total
Revenues	$	134,643			20,690		$	5,841		$	-		$	161,174
Costs of revenues		19,422			9,217			3,683			-			32,322
Gross profit		115,221			11,473			2,158			-			128,852
Gross profit %		85.6	%		55.5	%		36.9	%		N/	A		79.9	%
Allocated operating expenses:
Engineering and product development		775			982			635			-			2,392
Selling and marketing expenses		79,293			9,777			1,697			-			90,767
Unallocated operating expenses		-			-			-			-			17,899
		80,068			10,759			2,332			-			111,058
Income (loss) from operations		35,153			714			(174	)		-			17,794
Interest  and other financing income, net		-			-			-			-			470
Net income before taxes	$	35,153		$	714		$	(174	)	$	-		$	18,264

For the three and nine months ended September 30, 2014 and 2013 (unaudited), net revenues by geographic area were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
North America 1	$	43,792	$	35,239	$	125,568	$	122,170
Asia Pacific 2		2,248		1,778		7,263		16,980
Europe (including Israel)		7,423		8,083		21,915		19,577
South America		240		793		1,152		2,447
	$	53,703	$	45,893	$	155,898	$	161,174
1 United States	$	41,338	$	30,287	$	114,718	$	98,832
1 Canada	$	2,454	$	4,952	$	10,850	$	23,338
2  Japan	$	435	$	205	$	1,423	$	11,455

As of September 30, 2014 and December 31, 2013, long-lived assets by geographic area were as follows:

	September 30, 2014		December 31, 2013
	(unaudited)
North America	$	27,399	$	9,119
Asia Pacific		249		-
Europe (including Israel)		1,197		1,370
South America		4		-
	$	28,849	$	10,489

The Company discusses segmental details in its Management Discussion and Analysis found elsewhere in this Quarterly Report on Form 10-Q.