| Operating segments |
NOTE 13 - OPERATING SEGMENTS The Company classifies its business interests into three reportable segments: Rocky Mountain Chocolate Factory, Inc. Franchising, Manufacturing, and Retail Stores. These categories, along with unallocated expenses, are the basis upon which the Company’s Chief Operating Decision Maker (CODM), the interim chief executive officer, evaluates the Company’s performance. The CODM uses the segment information in the annual planning process and considers actual versus plan variances in evaluating the performance of the segments. The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 1 to these condensed consolidated financial statements. The Company evaluates performance and allocates resources based on the segment operating profit or loss, which excludes unallocated corporate general and administrative costs and income tax expense or benefit. The Company’s reportable segments are strategic businesses that utilize common information systems and corporate administration. All inter-segment sales prices are market based. Each segment is managed separately because of the differences in required infrastructure and the differences in products and services:
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Three Months Ended |
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May 31, 2026 |
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($'s in thousands) |
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Franchising |
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Manufacturing |
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Retail |
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Unallocated |
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Total |
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Total revenues |
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$ |
1,232 |
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$ |
4,523 |
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$ |
561 |
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$ |
- |
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$ |
6,316 |
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Intersegment revenues |
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- |
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(203 |
) |
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- |
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- |
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(203 |
) |
Revenue from external customers |
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1,232 |
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4,320 |
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561 |
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- |
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6,113 |
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Costs and Expenses |
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Cost of Sales |
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- |
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4,563 |
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139 |
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- |
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4,702 |
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Labor costs |
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485 |
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- |
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152 |
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|
503 |
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|
1,140 |
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Operating expenses |
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|
115 |
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- |
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|
165 |
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|
91 |
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|
371 |
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Professional fees |
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|
42 |
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- |
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- |
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493 |
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|
535 |
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Other general & administrative expenses |
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|
39 |
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- |
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- |
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193 |
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232 |
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|
681 |
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4,563 |
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456 |
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1,280 |
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6,980 |
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Depreciation and amortization, exclusive of depreciation and amortization expense of $227 included in cost of sales (manufacturing segment) |
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24 |
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- |
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11 |
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|
104 |
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|
139 |
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Total costs and expenses |
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705 |
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4,563 |
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467 |
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1,384 |
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7,119 |
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Segment profit (loss) |
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527 |
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(243 |
) |
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|
94 |
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(1,384 |
) |
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(1,006 |
) |
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Other income (expense) |
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Interest expense |
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- |
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- |
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- |
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(208 |
) |
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(208 |
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Interest income |
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- |
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- |
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- |
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46 |
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|
46 |
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Other income (expense), net |
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- |
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- |
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- |
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(162 |
) |
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(162 |
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Income (loss) before income taxes |
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527 |
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(243 |
) |
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94 |
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(1,546 |
) |
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(1,168 |
) |
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Income tax provision |
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- |
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- |
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- |
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- |
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- |
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Consolidated net income (loss) |
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$ |
527 |
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$ |
(243 |
) |
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$ |
94 |
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$ |
(1,546 |
) |
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$ |
(1,168 |
) |
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Other Segment Disclosures |
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Total assets |
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1,811 |
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12,968 |
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2,227 |
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2,257 |
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19,263 |
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Capital expenditures |
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- |
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228 |
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25 |
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|
26 |
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|
279 |
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Three Months Ended |
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May 31, 2025 |
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($'s in thousands) |
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Franchising |
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Manufacturing |
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Retail |
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Unallocated |
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Total |
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Total revenues |
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$ |
1,655 |
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$ |
4,542 |
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$ |
319 |
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$ |
- |
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$ |
6,516 |
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Intersegment revenues |
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- |
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(143 |
) |
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- |
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- |
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(143 |
) |
Revenue from external customers |
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1,655 |
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|
4,399 |
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|
319 |
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- |
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6,373 |
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Costs and Expenses |
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Cost of Sales |
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- |
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4,307 |
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|
85 |
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- |
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4,392 |
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Labor costs |
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|
496 |
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- |
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|
84 |
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|
446 |
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|
1,026 |
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Operating expenses |
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|
93 |
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- |
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|
122 |
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|
21 |
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|
236 |
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Professional fees |
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|
94 |
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- |
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- |
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|
296 |
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|
|
390 |
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Other general & administrative expenses |
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|
118 |
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|
- |
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|
- |
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|
238 |
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|
356 |
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|
801 |
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|
4,307 |
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|
291 |
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|
1,001 |
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|
6,400 |
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Depreciation and amortization, exclusive of depreciation and amortization expense of $228 included in cost of sales (manufacturing segment) |
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|
15 |
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- |
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3 |
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|
100 |
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|
118 |
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Total costs and expenses |
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|
816 |
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4,307 |
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|
294 |
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|
1,101 |
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|
6,518 |
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Segment profit (loss) |
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|
839 |
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|
92 |
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|
25 |
|
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(1,101 |
) |
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(145 |
) |
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Other income (expense) |
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Interest expense |
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|
- |
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|
- |
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|
- |
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(188 |
) |
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|
(188 |
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Interest income |
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|
- |
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- |
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|
- |
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|
9 |
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|
9 |
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Other income (expense), net |
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|
- |
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|
- |
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|
- |
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(179 |
) |
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(179 |
) |
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Income (loss) before income taxes |
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|
839 |
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|
|
92 |
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|
25 |
|
|
|
(1,280 |
) |
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|
(324 |
) |
|
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|
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Income tax provision |
|
|
- |
|
|
|
- |
|
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|
- |
|
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|
- |
|
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|
- |
|
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Consolidated net income (loss) |
|
$ |
839 |
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|
$ |
92 |
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|
$ |
25 |
|
|
$ |
(1,280 |
) |
|
$ |
(324 |
) |
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Other Segment Disclosures |
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|
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Total assets |
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|
1,936 |
|
|
|
13,947 |
|
|
|
776 |
|
|
|
3,437 |
|
|
|
20,096 |
|
Capital expenditures |
|
|
- |
|
|
|
98 |
|
|
|
- |
|
|
|
70 |
|
|
|
168 |
|
|