v3.26.1
Note 16 - Segment Information
6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Segment Reporting [Text Block]

16. SEGMENT INFORMATION

 

Our business operations (being the development, manufacture and sale of products that improve the health and productivity of dairy and beef cattle) are described in Note 1, “Basis of Presentation and Significant Accounting Policies”. Our chief operating decision-maker (CODM), our President and CEO, regularly evaluates two operating segments: i) Scours and ii) Mastitis for purposes of deciding how to allocate resources and assess performance. Our CODM primarily evaluates performance based on product sales as well as net operating income (loss). No operating segments have been aggregated; therefore, our two operating segments are the Company's two reportable segments. 

 

Scours segment - consists of the First Defense® product line. The core technology underlying the Scours segment is focused on polyclonal antibodies.

 

Mastitis segment - includes our CMT product line, consisting of reagents and equipment used for rapid cow-side testing to identify mastitic quarters by detecting elevated somatic cell counts. This segment also includes our Re-Tain® product in development for the treatment of subclinical mastitis based on the bacteriocin nisin. On December 23, 2025, we made the decision to cease our efforts to obtain FDA approval of Re-Tain® while continuing the stability testing and investigational studies to evaluate Re-Tain® performance. 

 

Other - includes unallocated administrative and overhead expenses and other products.

 

  

Three Months Ended June 30, 2026

 
  

Scours

  

Mastitis

  

Other

  

Total

 

Product sales

 $7,110,769  $75,344  $  $7,186,113 

Costs of goods sold

  4,686,934   61,957      4,748,891 

Gross profit

  2,423,835   13,387      2,437,222 
                 
Administrative expenses        1,271,909   1,271,909 

Sales and marketing expenses

  1,110,727         1,110,727 

Product development expenses (income), net(1)

  143,438   (52,495)  28,709   119,652 
Other operating income(2)     (2,000,000)     (2,000,000)

Operating expenses (income)

  1,254,165   (2,052,495)  1,300,618   502,288 
                 

NET OPERATING INCOME (LOSS)

 $1,169,670  $2,065,882  $(1,300,618) $1,934,934 

(1) Includes a $0.1 million reversal of an annual regulatory sponsor fee that we were no longer required to obtain as a result of the decision to cease focus on Re-Tain®.

(2) Includes a $2.0 million settlement with a former contract manufacturer that compensated the Company for operating costs incurred in product development and contract performance related to the development of the Company’s Re-Tain® product. See Note 9 for additional discussion.

  

Three Months Ended June 30, 2025

 
  

Scours

  

Mastitis

  

Other

  

Total

 

Product sales

 $6,398,517  $46,363  $  $6,444,880 

Costs of goods sold

  3,589,893   37,063      3,626,956 

Gross profit

  2,808,624   9,300      2,817,924 
                 
Administrative expenses        720,418   720,418 

Sales and marketing expenses

  634,846   61,240      696,086 

Product development expenses

  93,011   710,745   28,102   831,858 

Operating expenses

  727,857   771,985   748,520   2,248,362 
                 

NET OPERATING INCOME (LOSS)

 $2,080,767  $(762,685) $(748,520) $569,562 

 

  

Scours

  

Mastitis

  

Other

  

Total

 

Total Assets as of June 30, 2026(1)

 $37,524,605  $122,726  $8,982,465  $46,629,796 

Total Assets as of December 31, 2025(1)

 $38,245,418  $134,138  $4,152,891  $42,532,447 

Depreciation expense during the three months ended June 30, 2026

 $463,271  $  $7,350  $470,621 

Depreciation and amortization expense during the three months ended June 30, 2025

 $345,512  $314,175  $19,350  $679,037 

Capital Expenditures during the three months ended June 30, 2026

 $727,931  $  $6,008  $733,939 

Capital Expenditures during the three months ended June 30, 2025

 $151,808  $1,079  $2,271  $155,158 

(1) Total assets for our Scours segment as of June 30, 2026 and December 31, 2025, includes property, plant and equipment, net of approximately $12,000,000 and $12,300,000, respectively, of idle assets, which primarily related to one of our manufacturing facilities that was previously utilized for Re-Tain® that we now plan to refit for use in producing First Defense® products.  

 

  

Six Months Ended June 30, 2026

 
  

Scours

  

Mastitis

  

Other

  

Total

 

Product sales

 $17,418,544  $124,864  $  $17,543,408 

Costs of goods sold

  10,354,685   94,057      10,448,742 

Gross profit

  7,063,859   30,807      7,094,666 
                 
Administrative expenses        2,409,586   2,409,586 

Sales and marketing expenses

  2,336,687   6,803      2,343,490 

Product development expenses

  241,531   115,904   79,905   437,340 
Other operating income(1)     (2,000,000)     (2,000,000)

Operating expenses (income)

  2,578,218   (1,877,293)  2,489,491   3,190,416 
                 

NET OPERATING INCOME (LOSS)

 $4,485,641  $1,908,100  $(2,489,491) $3,904,250 

(1) Includes a $2.0 million settlement with a former contract manufacturer that compensated the Company for operating costs incurred in product development and contract performance related to the development of the Company’s Re-Tain® product. See Note 9 for additional discussion.

 

  

Six Months Ended June 30, 2025

 
  

Scours

  

Mastitis

  

Other

  

Total

 

Product sales

 $14,427,003  $85,051  $  $14,512,054 

Costs of goods sold

  8,264,436   75,722      8,340,158 

Gross profit

  6,162,567   9,329      6,171,896 
                 
Administrative expenses        1,343,260   1,343,260 

Sales and marketing expenses

  1,421,983   130,761      1,552,744 

Product development expenses

  186,496   1,339,657   62,552   1,588,705 

Operating expenses

  1,608,479   1,470,418   1,405,812   4,484,709 
                 

NET OPERATING INCOME (LOSS)

 $4,554,088  $(1,461,089) $(1,405,812) $1,687,187 

 

  

Scours

  

Mastitis

  

Other

  

Total

 

Depreciation expense during the six months ended June 30, 2026

 $981,288  $  $17,627  $998,915 

Depreciation and amortization expense during the six months ended June 30, 2025

 $698,034  $628,834  $38,942  $1,365,810 

Capital Expenditures during the six months ended June 30, 2026

 $886,663  $8,526  $15,980  $911,169 

Capital Expenditures during the six months ended June 30, 2025

 $474,185  $7,752  $2,271  $484,208