| Segment |
12. Segment
The Company reports segment information based on the
“management” approach. The management approach designates the internal reporting used by management for making decisions and
assessing performance as the source of the Company’s reportable segments.
The Company reported its financial performance based
on the following segments: Gas-powered Boats, Franchise and Electric Boats.
The Company evaluates the performance of its reportable
segments based on net sales and operating income. Net sales for business segments are generally based on the sale of boats and the sale
of franchises. Income (loss) from operations for each segment includes net sales to third parties, related cost of sales and operating
expenses directly attributable to the segment. Operating income for each segment excludes other income and expense. The Company does not
include intercompany transfers between segments for management reporting purposes.
The following table shows information by reportable
segments for the three and nine months ended September 30, 2022 and 2021:
| Reconciliation of operating profit (loss) from segments to consolidated |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Nine Months Ended September 30, 2022 |
|
Gas-Powered Boats |
|
Franchise |
|
Electric Boat and Development |
|
Total |
| Net sales |
|
$ |
23,218,666 |
|
|
$ |
(1,032 |
) |
|
$ |
— |
|
|
$ |
23,217,634 |
|
| Cost of products sold |
|
|
13,910,332 |
|
|
|
1,027 |
|
|
|
90,635 |
|
|
|
14,001,994 |
|
Operating expense
|
|
|
9,468,564 |
|
|
|
34,507 |
|
|
|
2,089,661 |
|
|
|
11,592,732 |
|
| Loss from operations |
|
|
(160,230 |
) |
|
|
(36,566 |
) |
|
|
(2,180,296 |
) |
|
|
(2,377,092 |
) |
| Other expense |
|
|
(181,113 |
) |
|
|
(30,059 |
) |
|
|
(28,944 |
) |
|
|
(240,116 |
) |
| Net loss |
|
$ |
(341,343 |
) |
|
$ |
(66,625 |
) |
|
$ |
(2,209,240 |
) |
|
$ |
(2,617,208 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Nine Months Ended September 30, 2021 |
|
Gas-Powered Boats |
|
Franchise |
|
Electric Boat and Development |
|
Total |
| Net sales |
|
$ |
10,623,460 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
10,623,460 |
|
| Cost of products sold |
|
|
6,209,334 |
|
|
|
— |
|
|
|
— |
|
|
|
6,209,334 |
|
Operating expense
|
|
|
4,581,634 |
|
|
|
— |
|
|
|
117,197 |
|
|
|
4,698,831 |
|
| Loss from operations |
|
|
(167,508 |
) |
|
|
— |
|
|
|
(117,197 |
) |
|
|
(284,705 |
) |
| Other income (expense) |
|
|
153,101 |
|
|
|
— |
|
|
|
(68,873 |
) |
|
|
84,228 |
|
| Net loss |
|
$ |
(14,407 |
) |
|
$ |
— |
|
|
$ |
(186,070 |
) |
|
$ |
(200,477 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Three Months Ended September 30, 2022 |
|
Gas-Powered Boats |
|
Franchise |
|
Electric Boat and Development |
|
Total |
| Net sales |
|
$ |
8,812,021 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
8,812,021 |
|
| Cost of products sold |
|
|
5,411,404 |
|
|
|
— |
|
|
|
66,543 |
|
|
|
5,477,947 |
|
| Operating expense |
|
|
3,210,920 |
|
|
|
529 |
|
|
|
979,585 |
|
|
|
4,191,034 |
|
| Income (loss) from operations |
|
|
189,697 |
|
|
|
(529 |
) |
|
|
(1,046,128 |
) |
|
|
(856,960 |
) |
| Other (expense) income |
|
|
(29,671 |
) |
|
|
(3,943 |
) |
|
|
3,465 |
|
|
|
(30,149 |
) |
| Net income (loss) |
|
$ |
160,025 |
|
|
$ |
(4,471 |
) |
|
$ |
(1,042,663 |
) |
|
$ |
(887,109 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Three Months Ended September 30, 2021 |
|
Gas-Powered Boats |
|
Franchise |
|
Electric Boat and Development |
|
Total |
| Net sales |
|
$ |
4,118,246 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
4,118,246 |
|
| Cost of products sold |
|
|
2,508,170 |
|
|
|
— |
|
|
|
— |
|
|
|
2,508,170 |
|
| Operating expense |
|
|
1,850,380 |
|
|
|
— |
|
|
|
82,230 |
|
|
|
1,932,610 |
|
| Loss from operations |
|
|
(240,304 |
) |
|
|
— |
|
|
|
(82,230 |
) |
|
|
(322,534 |
) |
| Other loss |
|
|
(57,452 |
) |
|
|
— |
|
|
|
(3,291 |
) |
|
|
(60,743 |
) |
| Net loss |
|
$ |
(297,756 |
) |
|
$ |
— |
|
|
$ |
(85,521 |
) |
|
$ |
(383,277 |
) |
Property and equipment, net classified by business
were as follows:
| Schedule of segment reporting information by segment |
|
|
|
|
|
|
|
| |
September 30, |
|
December 31, |
| |
2022 |
|
2021 |
| Gas-Powered Boats |
$ |
4,143,587 |
|
|
$ |
2,547,410 |
|
| Franchise |
$ |
— |
|
|
$ |
100,196 |
|
| Electric-Boats |
$ |
631,252 |
|
|
$ |
235,565 |
|
|