Note 9 - Significant Risks and Uncertainties

12 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Concentration Risk Disclosure [Text Block]

Note

9

. Significant Risks and Uncertainties

(a)

Concentrations of Credit Risk-Cash.

The Company maintains balances at several financial institutions. Deposits at each institution are insured by the Federal Deposit Insurance Corporation up to

$250.

As of

June 30, 2017,

the Company had

no

uninsured deposits at these financial institutions.

(b) Concentrations of Credit Risk-Receivables.

The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk of its customers, establishes an allowance for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowances is limited. The Company does

not

require collateral in relation to its trade accounts receivable credit risk.

(c) Major Customers.

For the fiscal years ended

June 30, 2017

and

2016

approximately

91%

and 

90%,

respectively, of consolidated net sales, were derived from

two

customers. These

two

customers are in the Company’s Contract Manufacturing Segment and represent approximately

56%

and

39%

of this Segment’s net sales in each of the fiscal years ended

June 30, 2017

and

2016.

A

third

customer in the Branded Nutraceutical Segment, while

not

a significant customer of the Company’s consolidated net sales represented approximately

64%

and

51%

of net sales in the fiscal years ended

June 30, 2017

and

2016,

respectively of the Branded Nutraceutical Segment. Accounts receivable from these customers represented approximately

61%

and

87%

of total net accounts receivable as of

June 30, 2017

and

2016,

respectively. The loss of any of these major customers could have an adverse affect on the Company’s operations. Major customers are those customers who account for more than

10%

of net sales.

(d) Business Risks.

T

he Company insures its business and assets against insurable risks, to the extent that it deems appropriate, based upon an analysis of the relative risks and costs. The Company believes that the risk of loss from non-insurable events would

not

have a material adverse effect on the Company’s operations as a whole.

The raw materials used by the Company are primarily commodities and agricultural-based products. Raw materials used by the Company in the manufacture of its nutraceutical products are purchased from independent suppliers. Raw materials are available from numerous sources and the Company believes that it will continue to obtain adequate supplies.

Approximately

65%

the Company’s employees are covered by a union contract and are employed in its New Jersey facilities. The contract was renewed on

September 1, 2015

and will expire on

August 31, 2018.