Quarterly report pursuant to Section 13 or 15(d)

SEGMENT INFORMATION

v3.19.1
SEGMENT INFORMATION
 3 Months Ended
Mar. 31, 2019
Segment Reporting [Abstract]  
SEGMENT INFORMATION
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SEGMENT INFORMATION
The Company operates in two distinct business segments: a consumer products segment in manufacturing, marketing and selling hemp-based CBD products to a range of market sectors; and a specialty pharmaceutical segment focused on developing and commercializing novel therapeutics utilizing CBD. The Company’s segments maintain separate financial information for which operating results are evaluated on a regular basis by the Company’s senior management in deciding how to allocate resources and in assessing performance. The Company evaluates its consumer products segment based on net product sales, gross profit and operating income or loss. The Company currently evaluates its specialty pharmaceutical segment based on the progress of its clinical development programs.
The following table presents information by reportable operating segment for the three months ended March 31, 2019 and 2018 (in thousands):
 
Consumer Products Segment
 
Specialty Pharmaceutical Segment
 
Consolidated Totals
Three months ended March 31, 2019:
 

 
 

 
 

Product sales, net
$
14,911

 
$
—

 
$
14,911

 
 
 
 
 
 
Gross profit
$
10,559

 
$
—

 
$
10,559

Research and development
699

 
643

 
1,342

Selling, general and administrative
18,585

 
10

 
18,595

Operating loss
$
(8,725
)
 
$
(653
)
 
$
(9,378
)
 
 
 
 
 
 
Three months ended March 31, 2018:
 
 
 
 
 
Product sales, net
$
8,071

 
$
—

 
$
8,071

 
 
 
 
 
 
Gross profit
$
5,562

 
$
—

 
$
5,562

Research and development
117

 
37

 
154

Selling, general and administrative
4,726

 
14

 
4,740

Operating income (loss)
$
719

 
$
(51
)
 
$
668

 
 
 
 
 
 

The Company's specialty and pharmaceutical segment includes goodwill of $2.8 million as of March 31, 2019 and December 31, 2018. In addition, the Company's intangible assets of $3.8 million as of March 31, 2019 and December 31, 2018 are included in the specialty pharmaceutical segment. All other assets are included in the consumer products segment as of March 31, 2019 and December 31, 2018.