v3.25.2
Segment Information
 12 Months Ended
Apr. 30, 2025
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]

13. Segment Information

 

The Company operates under two reportable segments based on the geographic locations of its subsidiaries:

 

(1)

FEI-NY – operates out of New York and its operations consist principally of precision time and frequency control products used in three principal markets - communication satellites (both commercial and U.S. Government-funded); terrestrial cellular telephone or other ground-based telecommunication stations; and other components and systems for the U.S. military.

 

The FEI-NY segment also includes the operations of the Company’s wholly-owned subsidiary, FEI-Elcom. FEI-Elcom, in addition to its own product line, provides design and technical support for the FEI-NY segment’s satellite business.

 

(2) FEI-Zyfer – operates out of California and its products incorporate Global Positioning System (GPS) technologies into systems and subsystems for secure communications, both government and commercial, and other locator applications. This segment also provides sales and support for the Company’s wireline telecommunications family of products, including US5G, which are sold in the U.S. market.

 

The Company measures segment performance based on the operating income generated by the geographic location of its subsidiaries rather than on the specific types of customers or end-users. Consequently, the Company determined that the segments indicated above most appropriately reflect the way the Company’s management views the business.

 

The accounting policies of the two segments are the same as those described in Note 1. Our Chief Executive Officer (“CEO”) serves as our CODM who evaluates the segment performance and allocates resources to them based on operating income which is defined as income before investment income, interest expense, other expenses, and income taxes. Operating income by segment is used to monitor segment results compared to prior periods, forecasted results, and the annual plan. All acquired assets, including intangible assets, are included in the assets of both reporting segments.

 

The tables below present segment revenue, significant segment expenses which consist of segment cost of revenue and segment research and development costs, and segment operating income for each reportable segment and on a consolidated basis as reported in the consolidated statements of operations for the fiscal years ended April 30, 2025 and 2024 (in thousands):

 

   For the Fiscal Years Ended
April 30,		 
   2025   2024 
Revenues:        
FEI-NY  $53,269   $40,261 
FEI-Zyfer   18,660    18,138 
Less intersegment revenues   (2,118)   (3,125)
Consolidated revenues  $69,811   $55,274 

 

Cost of revenues:          
FEI-NY  $29,331   $27,225 
FEI-Zyfer   12,598    12,414 
Less intersegment cost of revenues   (2,215)   (2,948)
Consolidated cost of revenues  $39,714   $36,691 

 

Research and development expenses:          
FEI-NY  $3,374   $2,678 
FEI-Zyfer   2,702    702 
Consolidated research and development expenses  $6,076   $3,380 

 

Operating income:          
FEI-NY  $11,514   $2,410 
FEI-Zyfer   743    3,295 
Less intersegment   98    (179)
Corporate   (623)   (507)
Consolidated operating income  $11,732   $5,019 

 

Other segment items included in the determination of operating income includes SG&A of $9.1 million and $8.0 million for the fiscal years ended April 30, 2025 and 2024, respectively, for the FEI-NY segment, and $2.6 million and $1.7 million for the fiscal years ended April 30, 2025 and 2024, respectively, for the FEI-Zyfer segment.

The tables below present the identifiable assets of each reportable segment and on a consolidated basis as reported in the consolidated balance sheets as of April 30, 2025 and 2024 and the depreciation and amortization charges related to these identifiable assets for the fiscal years ended then ended (in thousands):

 

    April 30, 2025     April 30, 2024  
             
Identifiable assets:            
FEI-NY   $ 39,125     $ 36,512  
FEI-Zyfer     23,865       15,696  
less intersegment balances     (140 )     (237 )
Corporate     30,887       31,282  
Consolidated identifiable assets   $ 93,737     $ 83,253  

 

   For the Fiscal Years Ended
April 30,		 
   2025   2024 
Depreciation and amortization:          
FEI-NY  $1,932   $1,944 
FEI-Zyfer   123    180 
Corporate   -    - 
Consolidated depreciation and amortization expense  $2,055   $2,124 

 

Major Customers

 

The Company’s products are sold to both commercial and governmental customers. For the fiscal years ended April 30, 2025 and 2024, approximately 94% and 98%, respectively, of the Company’s sales were made under contracts to the U.S. Government or subcontracts for U.S. Government end-use.

 

In the fiscal year ended April 30, 2025, revenues from one customer of the FEI-NY segment, which accounted for more than 10% of that segment’s revenues, was $26.9 million. In the fiscal year ended April 30, 2024, revenues from four customers of the FEI-NY segment, which each accounted for more than 10% of that segment’s revenues, were $7.5 million, $10.9 million, $4.7 million, and $4.5 million. In the FEI-Zyfer segment, two customers, which each accounted for more than 10% of that segment’s revenues, were $2.9 million and $3.4 million in the fiscal year ended April 30, 2025. In the FEI-Zyfer segment, two customers, which each accounted for more than 10% of that segment’s revenues, were $4.2 million and $5.2 million in the fiscal year ended April 30, 2024.

 

The loss by the Company of any one of these customers would have a material adverse effect on the Company’s business. The Company believes its relationship with these customers is mutually satisfactory. Sales to the major customers referenced above can include commercial and governmental end users.

Foreign Sales

 

Revenues in each of the Company’s segments include sales to foreign governments or to companies located in foreign countries. For the fiscal years ended April 30, 2025 and 2024, revenues, based on the location of the procurement entity were derived from the following locations (in thousands):

 

   For the Fiscal Years Ended
April 30,		 
   2025   2024 
Domestic  $65,362   $53,185 
Foreign   4,449    2,089 
   $69,811   $55,274 

 

During the fiscal year ended April 30, 2025, material foreign sales to one Asian country amounted to approximately $3.5 million. During the fiscal year ended April 30, 2024, there were no material foreign sales to one specific foreign country.