Quarterly report pursuant to Section 13 or 15(d)

SEGMENT INFORMATION

v3.7.0.1
SEGMENT INFORMATION
6 Months Ended
May 31, 2017
SEGMENT INFORMATION [Text Block]

NOTE 3 - SEGMENT INFORMATION

            The Chief Executive Officer ("CEO") is the Company’s chief operating decision-maker ("CODM").

            Based on the Company's organizational structure, its business activities and information reviewed by the CODM for the purposes of allocating resources and assessing performance, management has determined that there are two operating segments.

CDMO

            The CDMO activity is comprised of a specialization in cell therapy development for advanced therapeutic products and providing two types of services to its customers: (i) process and assay development services and (ii) cGMP contract manufacturing services. The CDMO activities include the operations of MaSTherCell.

CTB

            The Cellular Therapy Business (“CTB”) activity is based on the technology licensed by the Israeli Subsidiary, that demonstrates the capacity to induce a shift in the developmental fate of cells from the liver and differentiating (converting) them into “pancreatic beta cell-like” insulin producing cells for patients with Type 1 Diabetes.

            The Company assesses the performance based on a measure of "Adjusted EBIT" (earnings before financial expenses and tax, and excluding share-based compensation expenses and non-recurring income or expenses). The measure of assets has not been disclosed for each segment.

            Segment data for the six months ended May 31, 2017 is as follows:

                Corporate        
                and        
    CDMO     CTB     Eliminations     Consolidated  
    (in thousands)  
Revenues from external customers $ 4,749     -     (599 )   4,150  
Cost of revenues   (2,919 )         308     (2,611 )
Research and development expenses, net         (1,244 )   291     (953 )
Operating expenses   725     (4,790 )   -     (4,065 )
Depreciation and amortization expenses   (1,200 )   (7 )   -     (1,207 )
Segment Performance $ (1,355 )   (6,041 )   -     (4,686 )
Stock-based compensation               (2,708 )   (2,708 )
Financial income (expenses), net*               (1,896 )   (1,896 )
Share in losses of associated company               (196 )   (196 )
Loss before income taxes               -     (9,486 )

            * Excluding $1,624 thousand stock based compensation included in financial expenses.

            Segment data for the six months ended May 31, 2016 is as follows:

                Corporate        
                and        
    CDMO     CTB     Eliminations     Consolidated  
    (in thousands)  
Net revenues from external customers $ 2,974   $     $ (322 ) $ 2,652  
Cost of revenues   (3,220 )         299     (2,921 )
Research and development expenses, net         (674 )   23     (651 )
Operating expenses   (1,065 )   (851 )         (1,916 )
                         
                      (1,335 )
Depreciation and amortization expense   (1,333 )   (2 )            
Segment Performance $ (2,644 ) $ (1,527 )         (4,171 )
                         
Share-based compensation               (1,657 )   (1,657 )
Financial income, net               1,219     1,219  
Loss before income taxes                   $ (4,609 )

            Segment data for the three months ended May 31, 2017 is as follows:

                Corporate        
                and        
    CDMO     CTB     Eliminations     Consolidated  
    (in thousands)  
Net revenues from external customers $ 2,605     -     (307 )   2,298  
Cost of revenues   (1,058 )   -     141     (917 )
Research and development expenses, net         (643 )   166     (477 )
Operating expenses   (987 )   (1,200 )         (2,187 )
                         
                -     (615 )
Depreciation and amortization expense   (608 )   (7 )            
Segment Performance $ (48 )   1,850     -     (1,898 )
                         
Share-based compensation               (1,489 )   (1,489 )
Financial income (expenses), net*               2,491     2,491  
Share in losses of associated company               (107 )   (107 )
Loss before income taxes                     (1,003 )

  * Excluding $1,084 thousand stock based compensation included in financial expenses.

            Segment data for the three months ended May 31, 2016 is as follows:

                Corporate        
                and        
    CDMO     CTB     Eliminations     Consolidated  
    (in thousands)  
Revenues from external customers $ 1,403   $     $ (271 ) $ 1,132  
Cost of revenues   (1,932 )         180     (1,752 )
Research and development expenses, net         (376 )   91     (285 )
Operating expenses   (458 )   (429 )         (887 )
                         
                         
                         
Depreciation and amortization expense   (693 )   (1 )         (694 )
Segment Performance $ (1,680 ) $ (806 )         (2,486 )
                         
Share-based compensation               (1,487 )   (1,487 )
Financial income (expenses), net               (553 )   (553 )
Loss before income taxes                   $ (4,526 )

            Geographic, Product and Customer Information

            Substantially all the Company's revenues and long lived assets are located in Belgium.

            Revenues from single customers from the CDMO segment that exceed 10% of total net revenues are:

    Three Months Ended     Six Months Ended        
    May 31, 2017     May 31, 2016     May 31,     May 31, 2016  
                2017        
    (in thousands)  
Customer A $ 771   $ 830   $     $ 1,594  
                         
Customer B   -     420           981  
                         
Customer C   803           1,095        
                         
Customer D $ 703   $     $ 958   $