Note 6 - Segment Information

12 Months Ended

Oct. 31, 2024

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

Note 6 – Segment information

We aggregate operating divisions into two reporting segments that have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. Based upon this evaluation, as of October 31, 2024, we had two reportable segments – RF Connector and Cable Assembly (“RF Connector”) segment and Custom Cabling Manufacturing and Assembly (“Custom Cabling”) segment.

On August 1, 2023, C Enterprises moved and transitioned its physical operations into the RF Connector office in San Diego, CA.  Given the synergies in consolidating both the operating divisions into one building for purposes of management and resource allocation, C Enterprises has now been included in the RF Connector segment.  Further, since the acquisition of C Enterprises in 2019, the customer base for the division has shifted more towards distribution as opposed to direct to end customer which is more aligned with the RF Connector segment.  The segment change of including C Enterprise as part of the RF Connector segment was made retroactive to the beginning of our fiscal year starting November 1, 2022 and reclassified for fiscal 2022 for comparative purposes. Prior to the transition, C Enterprises was included in the Custom Cabling segment.

The RF Connector segment consists of three divisions and the Custom Cabling segment consists of three divisions. While each segment has similar products and services, there was little overlapping of these services to their customer base. The biggest difference in our reporting segments is in the channels of sales: sales or product and services for the RF Connector segment were primarily through the distribution channel, while the Custom Cabling segment sales were through a combination of distribution and direct to the end customer.

Management identifies segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector, C Enterprises and Microlab divisions constitutes the RF Connector segment, and the Cables Unlimited, Rel-Tech, and Schrofftech divisions constitute the Custom Cabling segment.

As reviewed by our chief operating decision maker, we evaluate the performance of each reporting segment based on income or loss before income taxes. We charge depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, right-of-use assets, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.

All of our operations are conducted in the United States; however, we derive a portion of our revenue from export sales. We attribute sales to geographic areas based on the location of the customers. The following table presents the sales by geographic area for the years ended October 31, 2024 and 2023 (in thousands):

	2024		2023
United States	$	58,843	$	65,781
Foreign Countries:
Canada		3,825		2,183
Italy		248		1,802
China		531		310
United Kingdom		523		393
All Other		887		1,699
		6,014		6,387
Totals	$	64,857	$	72,168

Net sales, income (loss) before provision (benefit) for income taxes and other related segment information for the years ended October 31, 2024 and 2023 are as follows (in thousands): 

	RF Connector			Custom Cabling
	and			Manufacturing and
2024	Cable Assembly			Assembly			Corporate			Total
Net sales	$	37,871		$	26,986		$	-		$	64,857
(Loss) income before provision (benefit) from income taxes		(3,720	)		1,097			(1,180	) (1)		(3,803	)
Depreciation and amortization		2,132			404			-			2,536
Total assets		47,537			20,552			2,957			71,046
Expenditures for Segment Assets		704			34			-			738
2023
Net sales	$	45,941		$	26,227		$	-		$	72,168
Loss before benefit from income taxes		(1,463	)		(1,479	)		(1,307	) (1)		(4,250	)
Depreciation and amortization		1,932			501			-			2,433
Total assets		55,466			17,009			9,803			82,278
Expenditures for Segment Assets		2,396			87			-			2,483

(1) Corporate charges are primarily interest expense and non-cash and other one-time expense