Note 5 - Significant Risks and Uncertainties

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Concentration Risk Disclosure [Text Block]

Note

5.

Significant Risks and Uncertainties

(

a) Major Customers.

For the

three

months ended

December 31, 2018

and

2017,

approximately

93%

and

91%

of consolidated net sales, respectively, were derived from

two

customers.  These

two

customers are in the Company’s Contract Manufacturing Segment and net sales to these

two

customers represented approximately

75%

and

20%

in the

three

months ended December

31,

2018

and

79%

and

16%

in the

three

months ended

December 31, 201

7,

respectively.  In each of the

six

months ended

December 31, 2018

and

2017,

approximately

91%

of consolidated net sales, were derived from the same

two

customers and net sales to these

two

customers represented approximately

70%

and

24%

in the

six

months ended December

31,

2018

and

71%

and

23%

of net sales in the

six

months ended

December 31, 201

7,

respectively.  Accounts receivable from these

two

major customers represented approximately

90%

and

87%

of total net accounts receivable as of

December 31

and

June 30, 2018,

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

10%

of net sales.

(

b

) Other Business Risks.

Approximately

69%

of 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, 2018

and will expire on

August 31, 2021.