Operating Segments

6 Months Ended

Jun. 30, 2025

11.

Operating Segments

In accordance with ASC 280, “Segment Reporting”, the Company defines an operating segment as a business activity: (1) from which we may earn revenue and incur expenses; (2) whose operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance; and (3) for which discrete financial information is available.

The Company has two reporting segments, consisting of the Treatment and Services Segments, which are primarily based on a service offering approach and defined as follow:

TREATMENT SEGMENT, which includes:

	-	nuclear, low-level radioactive, mixed waste (containing both hazardous and low-level radioactive constituents), hazardous and non-hazardous waste treatment, processing and disposal services primarily through four uniquely licensed and permitted treatment and storage facilities; and

	-	R&D activities to identify, develop and implement innovative waste processing techniques for problematic waste streams.

SERVICES SEGMENT, which includes:

Technical services, which include:

	○	professional radiological measurement and site survey of large government and commercial installations using advanced methods, technology and engineering;
	○	integrated Occupational Safety and Health services including industrial hygiene (“IH”) assessments; hazardous materials surveys, e.g., exposure monitoring; lead and asbestos management/abatement oversight; indoor air quality evaluations; health risk and exposure assessments; health & safety plan/program development, compliance auditing and training services; and Occupational Safety and Health Administration (“OSHA”) citation assistance;
	○	global technical services providing consulting, engineering, project management, waste management, environmental, and decontamination and decommissioning (“D&D”) field, technical, and management personnel and services to commercial and government customers; and
	○	on-site waste management services to commercial and governmental customers.

Nuclear services, which include:

	○	technology-based services including engineering, D&D, specialty services and construction, logistics, transportation, processing and disposal;
	○	remediation of nuclear licensed and federal facilities and the remediation cleanup of nuclear legacy sites. Such services capability includes: project investigation; radiological engineering; partial and total plant D&D; facility decontamination, dismantling, demolition, and planning; site restoration; logistics; transportation; and emergency response; and

A company owned equipment calibration and maintenance laboratory that services, maintains, calibrates, and sources (i.e., rental) health physics, IH and customized nuclear, environmental, and occupational safety and health (“NEOSH”) instrumentation.

The Company’s reporting segments exclude our corporate headquarter which serves to support its two reporting segments through various functions, such as our executives, finance, treasury, human resources, accounting, and legal departments. Financial results for the corporate headquarter are not considered by the CODM in evaluating the performance of the reportable segments. Our reporting segment also excludes our discontinued operations (see “Note 10 – Discontinued Operations”) which do not generate revenues.

The Company’s CODM is represented by its chief executive officer and chief operating officer (or “CODM group”). The CODM group evaluates the performance of the Treatment and Services segments and allocates resources (including financial or capital resources) to each reporting segment based on revenue and (loss) income from operations by comparing actual results for these metrics to budgeted and forecasted amounts for these metrics on a monthly, quarterly and year-to-date basis. The Company’s CODM group does not evaluate and allocate resources for the reportable segments using assets; therefore, the Company does not disclose assets for its reporting segments.

The table below summarizes loss from operations for the Company’s two reporting segments and its corporate headquarter and provides reconciliation of such financial metric to the Company’s consolidated totals for the three and six months ended June 30, 2025, and 2024 for our continuing operations. Significant segment expenses that are included in the measure of segment profit or losses for each reportable segment and regularly provided to the CODM group include payroll and benefit, material and supplies, disposal, transportation and subcontract expenses and are reflected separately, where applicable (in thousands).

Segment Reporting for the Three Months Ended June 30, 2025


	Treatment			Services			Segments Total			Corporate ⁽¹⁾			Consolidated Total
Revenue from external customers	$	11,397		$	3,189		$	14,586		$	—		$	14,586
Cost of Goods Sold:
Payroll and benefits expenses		4,742			1,874			6,616			—			6,616
Material and supplies expenses		1,235			—			1,235			—			1,235
Disposal expenses		1,095			—			1,095			—			1,095
Transportation expenses		366			—			366			—			366
Subcontract expenses		—			158			158			—			158
Other cost of goods sold ⁽²⁾		2,393			1,176			3,569			—			3,569
Total cost of goods sold		9,831			3,208			13,039			—			13,039
Gross profit (loss)		1,566			(19	)		1,547			—			1,547
Selling, general and administrative expenses (“SG&A”):
Payroll and benefits		942			647			1,589			940			2,529
Other SG&A ⁽³⁾		408			176			584			1,017			1,601
Total SG&A		1,350			823			2,173			1,957			4,130
Research and development		232			4			236			76			312
Gain on disposal of property and equipment		(1	)		—			(1	)		—			(1	)
Loss from operations	$	(15	)	$	(846	)	$	(861	)	$	(2,033	)		(2,894	)
Interest income														301
Interest expense														(124	)
Interest expense-financing fees														(21	)
Other income														155
Loss from continuing operations before taxes														(2,583	)
Income tax expense														—
Loss from continuing operations, net of taxes													$	(2,583	)

Segment Reporting for the Three Months Ended June 30, 2024


	Treatment			Services			Segments Total			Corporate ⁽¹⁾			Consolidated Total
Revenue from external customers	$	8,343		$	5,643		$	13,986		$	—		$	13,986
Cost of goods sold:
Payroll and benefit expenses		3,943			1,977			5,920			—			5,920
Material and supplies expenses		1,078			—			1,078			—			1,078
Disposal expenses		1,854			—			1,854			—			1,854
Transportation expenses		217			—			217			—			217
Subcontract expenses		—			2,554			2,554			—			2,554
Other cost of goods sold ⁽²⁾		2,448			1,221			3,669			—			3,669
Total cost of goods sold		9,540			5,752			15,292			—			15,292
Gross loss		(1,197	)		(109	)		(1,306	)		—			(1,306	)
SG&A:
Payroll and benefits		732			501			1,233			835			2,068
Other SG&A ⁽³⁾		343			165			508			879			1,387
Total SG&A		1,075			666			1,741			1,714			3,455
Research and development		186			24			210			63			273
Loss on disposal of property and equiment		—			1			1			—			1
Loss from operations	$	(2,458	)	$	(800	)	$	(3,258	)	$	(1,777	)		(5,035	)
Interest income														213
Interest expense														(109	)
Interest expense-financing fees														(16	)
Other income														1
Loss from continuing operations before taxes														(4,946	)
Income tax benefit														(1,161	)
Loss from continuing operations, net of taxes													$	(3,785	)

Segment Reporting for the Six Months Ended June 30, 2025


	Treatment			Services			Segments Total			Corporate⁽¹⁾			Consolidated Total
Revenue from external customers	$	20,583		$	7,922		$	28,505		$	—		$	28,505
Cost of Goods Sold:
Payroll and benefits expenses		9,179			3,887			13,066			—			13,066
Material and supplies expenses		2,586			—			2,586			—			2,586
Disposal expenses		1,316			—			1,316			—			1,316
Transportation expenses		861			—			861			—			861
Subcontract expenses		—			1,066			1,066			—			1,066
Other cost of goods sold ⁽²⁾		4,825			2,581			7,406			—			7,406
Total cost of goods sold		18,767			7,534			26,301			—			26,301
Gross profit		1,816			388			2,204			—			2,204
SG&A:
Payroll and benefits		1,815			1,185			3,000			1,871			4,871
Other SG&A ⁽³⁾		891			374			1,265			2,009			3,274
Total SG&A		2,706			1,559			4,265			3,880			8,145
Research and development		523			27			550			145			695
Gain on disposal of property and equipment		(1	)		(5	)		(6	)		—			(6	)
Loss from operations	$	(1,412	)	$	(1,193	)	$	(2,605	)	$	(4,025	)		(6,630	)
Interest income														636
Interest expense														(236	)
Interest expense-financing fees														(41	)
Other income														188
Loss from continuing operations before taxes														(6,083	)
Income tax expense														—
Loss from continuing operations, net of taxes													$	(6,083	)

Segment Reporting for the Six Months Ended June 30, 2024


	Treatment			Services			Segments Total			Corporate⁽¹⁾			Consolidated Total
Revenue from external customers	$	17,052		$	10,551		$	27,603		$	—		$	27,603
Cost of goods sold:
Payroll and benefit expenses		7,695			4,429			12,124			—			12,124
Material and supplies expenses		1,841			—			1,841			—			1,841
Disposal expenses		3,423			—			3,423			—			3,423
Transportation expenses		515			—			515			—			515
Subcontract expenses		—			4,364			4,364			—			4,364
Other cost of goods sold ⁽²⁾		4,827			2,435			7,262			—			7,262
Total cost of goods sold		18,301			11,228			29,529			—			29,529
Gross loss		(1,249	)		(677	)		(1,926	)		—			(1,926	)
SG&A:
Payroll and benefits		1,402			1,156			2,558			1,669			4,227
Other SG&A ⁽³⁾		738			302			1,040			1,732			2,772
Total SG&A		2,140			1,458			3,598			3,401			6,999
Research and development		404			52			456			113			569
Loss on disposal of property and equiment		—			1			1			—			1
Loss from operations	$	(3,793	)	$	(2,188	)	$	(5,981	)	$	(3,514	)		(9,495	)
Interest income														387
Interest expense														(225	)
Interest expense-financing fees														(29	)
Other income														2
Loss from continuing operations before taxes														(9,360	)
Income tax benefit														(2,117	)
Loss from continuing operations, net of taxes													$	(7,243	)

⁽¹⁾	Amounts reflect the activity for corporate headquarters not included in the segment reporting information.
⁽²⁾	Other cost of goods sold for each reportable segment includes: Treatment - lab, regulatory, repair and maintenance, depreciation and amortization, travel, outside services and general expenses. Services - material and supplies, disposal, transportation, lab, regulatory, repair and maintenance, depreciation and amortization, travel, outside services and general expenses.
⁽³⁾	Other SG&A for each reportable segment and Corporate includes:
	Treatment-depreciation and amortization, travel, outside services, repair and maintenance and general expenses.
	Services- travel, outside services, repair and maintenance and general expenses.
	Corporate-repair and maintenance, depreciation and amortization, travel, public company, outside services and general expenses.

The following table presents depreciation and amortization for the three and six months ended June 30, (in thousand):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2025		2024		2025		2024
Treatment	$	389	$	367	$	771	$	733
Services		38		44		81		89
Total segment		427		411		852		822
Corporate		10		19		21		40
Total	$	437	$	430	$	873	$	862
Depreciation and amortization	$	437	$	430	$	873	$	862

The following table presents capital expenditures for the three and six months ended June 30, (in thousand):

Schedule of Capital Expenditures


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2025			2024			2025			2024
Treatment	$	893		$	457		$	1,380		$	617
Services		16			140			52			224
Total segment		909			597			1,432			841
Corporate		—			—			—			—
Total	$	909	⁽¹⁾	$	597	⁽²⁾	$	1,432	⁽¹⁾	$	841	⁽²⁾
Capital expenditures	$	909	⁽¹⁾	$	597	⁽²⁾	$	1,432	⁽¹⁾	$	841	⁽²⁾

⁽¹⁾

Net of financed amount of $0 and $132 for the three and six months ended June 30, 2025, respectively.

⁽²⁾

Net of financed amount of $0 and $44 for the three and six months ended June 30, 2024, respectively.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-21

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-21

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 31
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-31

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-15

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-42

Reference 7: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 48
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-48

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 270
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482964/270-10-50-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (ee)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 11: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 12: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 54
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-54

Reference 13: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 47
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-47

Reference 14: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 54
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-54

Reference 15: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 47
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-47

Reference 16: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 54
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-54

Reference 17: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 47
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482785/280-10-55-47

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 34
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-34

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 26C
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-26C

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 26B
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-26B

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-40

Reference 23: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/280/tableOfContent

Reference 24: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 26
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-26

Reference 25: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-41

+ Details

PERMA FIX ENVIRONMENTAL SERVICES INC 10-Q