SEGMENT REPORTING AND CONCENTRATIONS

6 Months Ended

Jun. 30, 2016

SEGMENT REPORTING AND CONCENTRATIONS [Abstract]

SEGMENT REPORTING AND CONCENTRATIONS

NOTE C – SEGMENT REPORTING AND CONCENTRATIONS

Vasomedical, Inc. principally operates in three distinct business segments in the healthcare equipment and information technology industries.  We manage and evaluate our operations, and report our financial results, through these three business segments.

· IT segment, operating through a wholly-owned subsidiary VasoTechnology, Inc., primarily focuses on healthcare IT and managed network technology services;

· Professional sales service segment, operating through a wholly-owned subsidiary Vaso Diagnostics, Inc. d/b/a VasoHealthcare, primarily focuses on the sale of healthcare capital equipment for GEHC into the health provider middle market; and

· Equipment segment, operating through wholly-owned subsidiaries Vasomedical Global Corp. and Vasomedical Solutions, Inc., primarily focuses on the design, manufacture, sale and service of proprietary medical devices.

The chief operating decision maker is the Company’s Chief Executive Officer, who, in conjunction with upper management, evaluates segment performance based on operating income and adjusted EBITDA (net income (loss), plus interest expense (income), net; tax expense; depreciation and amortization; and non-cash stock-based compensation).  Administrative functions such as finance, human resources, and information technology are centralized and related expenses allocated to each segment.  Other costs not directly attributable to operating segments, such as audit, legal, director fees, investor relations, and others, as well as certain assets – primarily cash balances – are reported in the Corporate entity below.  There are no intersegment revenues.  Summary financial information for the segments is set forth below:

	(in thousands)
	As of or for the three months ended June 30, 2016 (unaudited)
	Professional Sales Service Segment		IT Segment			Equipment Segment			Corporate			Consolidated
Revenues from external customers	$	6,860	$	10,124		$	1,230		$	-		$	18,214
Operating income (loss)	$	1,422	$	(853	)	$	(13	)	$	(292	)	$	264
Total assets	$	10,565	$	25,699		$	7,900		$	5,912		$	50,076
Accounts and other receivables, net	$	5,393	$	2,832		$	720		$	-		$	8,945
Deferred commission expense	$	2,011	$	150		$	-		$	-		$	2,161
Other assets, net	$	2,644	$	265		$	79		$	825		$	3,813

	As of or for the three months ended June 30, 2015 (unaudited)
	Professional Sales Service Segment		IT Segment			Equipment Segment			Corporate			Consolidated
Revenues from external customers	$	7,036	$	2,811		$	996		$	-		$	10,843
Operating income (loss)	$	1,794	$	(366	)	$	(676	)	$	(546	)	$	206
Total assets	$	10,421	$	25,205		$	9,385		$	1,309		$	46,320
Accounts and other receivables, net	$	4,421	$	1,399		$	500		$	-		$	6,320
Deferred commission expense	$	2,388	$	19		$	-		$	-		$	2,407
Other assets, net	$	3,098	$	51		$	675		$	113		$	3,937

	As of or for the six months ended June 30, 2016 (unaudited)
	Professional Sales Service Segment		IT Segment			Equipment Segment			Corporate			Consolidated
Revenues from external customers	$	13,706	$	19,851		$	2,199		$	-		$	35,756
Operating income (loss)	$	3,410	$	(1,596	)	$	(711	)	$	(680	)	$	423
Total assets	$	10,565	$	25,699		$	7,900		$	5,912		$	50,076
Accounts and other receivables, net	$	5,393	$	2,832		$	720		$	-		$	8,945
Deferred commission expense	$	2,011	$	150		$	-		$	-		$	2,161
Other assets, net	$	2,644	$	265		$	79		$	825		$	3,813

	As of or for the six months ended June 30, 2015 (unaudited)
	Professional Sales Service Segment		IT Segment			Equipment Segment			Corporate			Consolidated
Revenues from external customers	$	13,427	$	2,811		$	2,059		$	-		$	18,297
Operating income (loss)	$	2,880	$	(721	)	$	(1,311	)	$	(928	)	$	(80	)
Total assets	$	10,421	$	25,205		$	9,385		$	1,309		$	46,320
Accounts and other receivables, net	$	4,421	$	1,399		$	500		$	-		$	6,320
Deferred commission expense	$	2,388	$	19		$	-		$	-		$	2,407
Other assets, net	$	3,098	$	51		$	675		$	113		$	3,937

For both the three and six months ended June 30, 2016, GE Healthcare accounted for 38% of revenue, and for the three and six months ended June 30, 2015, GE Healthcare accounted for 65% and 73% of revenue, respectively.  GE Healthcare also accounted for $5.0 million or 56%, and $8.1 million or 69%, of accounts and other receivables at June 30, 2016 and December 31, 2015, respectively.