0001437749-23-023646.txt : 20230814 0001437749-23-023646.hdr.sgml : 20230814 20230814160032 ACCESSION NUMBER: 0001437749-23-023646 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 51 CONFORMED PERIOD OF REPORT: 20230630 FILED AS OF DATE: 20230814 DATE AS OF CHANGE: 20230814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EMERSON RADIO CORP CENTRAL INDEX KEY: 0000032621 STANDARD INDUSTRIAL CLASSIFICATION: HOUSEHOLD AUDIO & VIDEO EQUIPMENT [3651] IRS NUMBER: 223285224 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07731 FILM NUMBER: 231169491 BUSINESS ADDRESS: STREET 1: 959 ROUTE 46 EAST STREET 2: SUITE 210 CITY: PARSIPPANY STATE: NJ ZIP: 07054 BUSINESS PHONE: 973-428-2000 MAIL ADDRESS: STREET 1: 959 ROUTE 46 EAST STREET 2: SUITE 210 CITY: PARSIPPANY STATE: NJ ZIP: 07054 FORMER COMPANY: FORMER CONFORMED NAME: MAJOR ELECTRONICS CORP DATE OF NAME CHANGE: 19770921 10-Q 1 msn20230630_10q.htm FORM 10-Q msn20230630_10q.htm
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Table of Contents



UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2023

 

Or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                      to                     

 

Commission file number 001-07731


EMERSON RADIO CORP.

(Exact name of registrant as specified in its charter)


 

Delaware

22-3285224

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

  

959 Route 46 East, Suite 210, Parsippany, NJ

07054

(Address of principal executive offices)

(Zip code)

 

(973) 428-2000

(Registrants telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Common Stock, par value $.01 per share

MSN

NYSE American


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     ☒   Yes     ☐   No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     ☒   Yes     ☐   No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

    

Non-accelerated filer

Smaller reporting company

    
  

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).        Yes     ☒   No

 

Indicate the number of shares outstanding of common stock as of August 14, 2023: 21,042,652.

 



 

 
 

PART I FINANCIAL INFORMATION

 

 

Item 1. Financial Statements.

 

EMERSON RADIO CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 
         

Net revenues:

        

Net product sales

 $1,732  $1,004 

Licensing revenue

  77   70 

Net revenues

  1,809   1,074 

Costs and expenses:

        

Cost of sales

  1,470   879 

Selling, general and administrative expenses

  1,198   1,344 

Total costs and expenses

  2,668   2,223 

Operating loss

  (859)  (1,149)

Other (loss) income:

        

Interest income, net

  294   50 

Income from governmental assistance programs

     22 

Loss before income taxes

  (565)  (1,077)

Provision for income tax expense

      

Net loss

  (565)  (1,077)

Basic loss per share

 $(0.03) $(0.05)

Diluted loss per share

 $(0.03) $(0.05)

Weighted average shares outstanding

        

Basic

  21,042,652   21,042,652 

Diluted

  21,042,652   21,042,652 

 

The accompanying notes are an integral part of the consolidated financial statements.

 

 

 

EMERSON RADIO CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands except share data)

 

  

June 30, 2023

  

March 31, 2023

 
         

ASSETS

        

Current Assets:

        

Cash and cash equivalents

 $24,671  $25,268 

Accounts receivable, net

  1,189   1,165 

Licensing receivable

  8   245 

Inventory

  3,707   3,813 

Prepaid purchases

  364   247 

Prepaid expenses and other current assets

  296   357 

Total Current Assets

  30,235   31,095 

Non-Current Assets:

        

Property and equipment, net

  47   1 

Right-of-use asset-operating leases

  166   200 

Right-of-use asset-finance leases

  1   1 

Other assets

  84   74 

Total Non-Current Assets

  298   276 

Total Assets

 $30,533  $31,371 

LIABILITIES AND SHAREHOLDERS’ EQUITY

        

Current Liabilities:

        

Accounts payable and other current liabilities

  705   641 

Due to affiliate

  1   1 

Short-term operating lease liability

  142   139 

Short-term finance lease liability

  1   1 

Income tax payable, current portion

  401   401 

Advanced deposits

  3,162   3,316 

Deferred revenue

     149 

Total Current Liabilities

  4,412   4,648 

Non-Current Liabilities:

        

Long-term operating lease liability

  25   62 

Long-term finance lease liability

      

Income tax payable

  1,202   1,202 

Total Non-Current Liabilities

  1,227   1,264 

Total Liabilities

 $5,639  $5,912 

Shareholders’ Equity:

        

Series A Preferred shares — 10,000,000 shares authorized; 3,677 shares issued and outstanding; liquidation preference of $3,677,000

  3,310   3,310 

Common shares — $0.01 par value, 75,000,000 shares authorized; 52,965,797 shares issued at June 30, 2023 and March 31, 2023, respectively; 21,042,652 shares outstanding at June 30, 2023 and March 31, 2023, respectively

  529   529 

Additional paid-in capital

  79,792   79,792 

Accumulated deficit

  (25,536)  (24,971)

Treasury stock, at cost (31,923,145 shares at June 30, 2023 and March 31, 2023, respectively)

  (33,201)  (33,201)

Total Shareholders’ Equity

  24,894   25,459 

Total Liabilities and Shareholders’ Equity

 $30,533  $31,371 

 

The accompanying notes are an integral part of the consolidated financial statements.

 

 

 

EMERSON RADIO CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 

Cash Flows from Operating Activities:

        

Net (loss)

 $(565) $(1,077)

Adjustments to reconcile net loss to net cash (used) by operating activities:

        

Amortization of right-of-use assets

  34   53 

Depreciation and amortization

  4    

Asset valuation allowance

  22   (35)

Changes in assets and liabilities:

        

Accounts receivable

  (46)  768 

Licensing receivable

  237    

Inventory

  106   (321)

Prepaid purchases

  (117)  (140)

Prepaid expenses and other current assets

  61   122 

Other assets

  (10)   

Accounts payable and other current liabilities

  64   89 

Short term lease liabilities

  3   (22)

Long term lease liabilities

  (37)  (35)

Advanced deposits

  (154)   

Deferred revenue

  (149)  (70)

Net cash (used) by operating activities

  (547)  (668)

Cash Flows From Investing Activities:

        

Additions to property and equipment

  (50)   

Disposals of property and equipment

      

Net cash (used) by investing activities

  (50)   

Cash Flows from Financing Activities:

        
       

Net cash provided by financing activities

      

Net (decrease) in cash and cash equivalents

  (597)  (668)

Cash and cash equivalents at beginning of the year

  25,268   25,576 

Cash and cash equivalents at end of the year

 $24,671  $24,908 

Supplemental disclosures:

        

Cash paid for:

        

Interest

 $2  $3 

Income taxes

 $  $ 

 

The accompanying notes are an integral part of the consolidated financial statements.

 

 

 

EMERSON RADIO CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY

(Unaudited)

(In thousands)

 

      

Common Stock

  

Additional

          

Total

 
  

Preferred

  

Number

  

Par

  

Paid-In

  

Accumulated

  

Treasury

  

Shareholders’

 
  

Stock

  

of Shares

  

Value

  

Capital

  

Deficit

  

Stock

  

Equity

 

Balance — March 31, 2023

 $3,310   52,965,797  $529  $79,792  $(24,971) $(33,201) $25,459 

Net loss

              (565)     (565)

Balance — June 30, 2023

 $3,310   52,965,797  $529  $79,792  $(25,536) $(33,201) $24,894 

 

 

 

 

      

Common Stock

  

Additional

          

Total

 
  

Preferred

  

Number

  

Par

  

Paid-In

  

Accumulated

  

Treasury

  

Shareholders’

 
  

Stock

  

of Shares

  

Value

  

Capital

  

Deficit

  

Stock

  

Equity

 

Balance — March 31, 2022

 $3,310   52,965,797  $529  $79,792  $(23,611) $(33,201) $26,819 

Net loss

              (1,077)     (1,077)

Balance — June 30, 2022

 $3,310   52,965,797  $529  $79,792  $(24,688) $(33,201) $25,742 

 

The accompanying notes are an integral part of the consolidated financial statements.

 

 

EMERSON RADIO CORP. AND SUBSIDIARIES

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

 

 

NOTE 1 BACKGROUND AND BASIS OF PRESENTATION

 

The consolidated financial statements include the accounts of Emerson Radio Corp. and its subsidiaries (“Emerson” or the “Company”). The Company designs, sources, imports and markets certain houseware and consumer electronic products, and licenses the Company’s trademarks for a variety of products.

 

The unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the Company’s consolidated financial position as of  June 30, 2023 and the results of operations for the three month periods ended June 30, 2023 and June 30, 2022. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements not misleading have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of the unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes; actual results could materially differ from those estimates. The unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly do not include all of the disclosures normally made in the Company’s annual consolidated financial statements. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended  March 31, 2023 (“fiscal 2023”), included in the Company’s Annual Report on Form 10-K, as amended, for fiscal 2023.

 

The results of operations for the three month period ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the full year ending March 31, 2024 (“fiscal 2024”).

 

Whenever necessary, reclassifications are made to conform the prior year’s consolidated financial statements to the current year’s presentation.

 

Recently Issued Accounting Pronouncements

 

The following Accounting Standards Updates (“ASUs”) were issued by the Financial Accounting Standards Board (“FASB”) which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.

 

Accounting Standards Update 2019-12 Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (Issued December 2019)

 

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020. This standard took effect in the first quarter ( June 2021) of the Company’s fiscal year ending March 31, 2022. The adoption of ASU 2019-12 had no material impact on the Company’s consolidated financial statements and related disclosures.

 

Accounting Standards Update 2016-13 Financial Instruments Credit Losses (Issued June 2016)

 

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU 2016-13 requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for fiscal years and interim periods beginning after December 15, 2022. Early adoption is permitted. The Company does not expect these amendments to have a material impact on its financial statements.

 

Revenue recognition: Sales to customers and related cost of sales are primarily recognized at the point in time when control of goods transfers to the customer. Control is considered to be transferred when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits of that good. Under the Direct Import Program, title passes in the country of origin when the goods are passed over the rail of the customer’s vessel. Under the Domestic Program, title passes primarily at the time of shipment. Estimates for future expected returns are based upon historical return rates and netted against revenues.

 

7

 

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Revenue is recorded net of customer discounts, promotional allowances, volume rebates and similar charges. When the Company offers the right to return product, historical experience is utilized to establish a liability for the estimate of expected returns. Sales and other tax amounts collected from customers for remittance to governmental authorities are excluded from revenue.

 

Management must make estimates of potential future product returns related to current period product revenue. Management analyzes historical returns, current economic trends and changes in customer demand for the Company’s products when evaluating the adequacy of the reserve for sales returns. Management judgments and estimates must be made and used in connection with establishing the sales return reserves in any accounting period. Additional reserves may be required if actual sales returns increase above the historical return rates. Conversely, the sales return reserve could be decreased if the actual return rates are less than the historical return rates, which were used to establish the reserve.

 

Sales allowances, marketing support programs, promotions and other volume-based incentives which are provided to retailers and distributors are accounted for on an accrual basis as a reduction to net revenues in the period in which the related sales are recognized in accordance with ASC topic 606, “Revenue from Contracts with Customers” (“ASC 606”).

 

At the time of sale, the Company reduces recognized gross revenue by allowances to cover, in addition to estimated sales returns as required by ASC 606, (i) sales incentives offered to customers that meet the criteria for accrual and (ii) an estimated amount to recognize additional non-offered deductions it anticipates and can reasonably estimate will be taken by customers, which it does not expect to recover. Accruals for the estimated amount of future non-offered deductions are required to be made as contra-revenue items, because that percentage of shipped revenue fails to meet the collectability criteria within ASC 606.

 

If additional marketing support programs, promotions and other volume-based incentives are required to promote the Company’s products subsequent to the initial sale, then additional reserves may be required and are accrued for when such support is offered.

 

The Company offers limited warranties for its consumer electronics, comparable to those offered to consumers by the Company’s competitors in the United States. Such warranties typically consist of a one year period for microwaves and a 90 day period for audio products, under which the Company pays for labor and parts, or offers a new or similar unit in exchange for a non-performing unit.

 

Licensing: In addition to the distribution of products, the Company grants licenses for the right to access the Company’s intellectual property, specifically the Company’s trademarks, for a stated term for the manufacture and/or sale of consumer electronics and other products under agreements which require payment of either (i) a non-refundable minimum guaranteed royalty or, (ii) the greater of (a) the actual royalties due (based on a contractual calculation, normally comprised of actual product sales by the licensee multiplied by a stated royalty rate, or “Sales Royalties”) or (b) a minimum guaranteed royalty amount. In the case of the foregoing clause (i), such amounts are recognized as revenue on a straight-line basis over the term of the license agreement. In the case of the foregoing clause (ii), Sales Royalties in excess of guaranteed minimums are accounted for as variable fees and are not recognized as revenue until the Company has ascertained that the licensee’s sales of products have exceeded the guaranteed minimum. In effect, the Company recognizes the greater of Sales Royalties earned to date or the straight-line amount of minimum guaranteed royalties to date. In the case where a royalty is paid to the Company in advance, the royalty payment is initially recorded as a liability and recognized as revenue as the royalties are deemed to be earned according to the principles outlined above.

 

 

NOTE 2 EARNINGS PER SHARE

 

The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts). Weighted average shares includes the impact of shares held in treasury.

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 
         

Numerator:

        

Net loss

 $(565) $(1,077)

Denominator:

        

Denominator for basic and diluted loss per share — weighted average shares

  21,042,652   21,042,652 

Net loss per share:

        

Basic and diluted loss per share

 $(0.03) $(0.05)

 

 

NOTE 3 SHAREHOLDERS EQUITY

 

Outstanding capital stock at June 30, 2023 consisted of common stock and Series A preferred stock. The Series A preferred stock is non-voting, has no dividend preferences and has not been convertible since March 31, 2002; however, it retains a liquidation preference.

 

At June 30, 2023, the Company had no options, warrants or other potentially dilutive securities outstanding.

 

8

 
 

NOTE 4 INVENTORY

 

Inventories, which consist primarily of finished goods, are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. As of June 30, 2023 and March 31, 2023, inventories consisted of the following (in thousands):

 

  

June 30, 2023

  

March 31, 2023

 

Finished goods

 $3,707  $3,813 

 

 

NOTE 5 INCOME TAXES

 

At June 30, 2023, the Company had $16.3 million of U.S. federal net operating loss (“NOL”) carry forwards. These losses do not expire but are limited to utilization of 80% of taxable income in any one year. At June 30, 2023, the Company had approximately $19.5 million of U.S. state NOL carry forwards. The tax benefits related to these state NOL carry forwards and future deductible temporary differences are recorded to the extent management believes it is more likely than not that such benefits will be realized.

 

The income of foreign subsidiaries before taxes was $302,000 for the three month period ended June 30, 2023 as compared to income of foreign subsidiaries before taxes of $83,000 for the three month period ended June 30, 2022

 

The Company analyzed the future reasonability of recognizing its deferred tax assets at June 30, 2023. As a result, the Company concluded that a 100% valuation allowance of $4,906,000 would be recorded against the assets.

 

Although the Company generated a net operating loss, it recorded income tax expense of $8,650 during the three month period ended June 30, 2023, primarily resulting from state income taxes. During the three month period ended June 30, 2022, the Company recorded income tax expense of $10,500, primarily resulting from state income taxes. After the adoption of ASU 2019-12 “Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes” during fiscal 2022, these non-income based state taxes are now reported within selling, general and administrative expenses.

 

The Company is subject to examination and assessment by tax authorities in numerous jurisdictions. As of June 30, 2023, the Company’s open tax years for examination for U.S. federal tax are 2017-2023, and for U.S. states’ tax are 2015-2023. Based on the outcome of tax examinations or due to the expiration of statutes of limitations, it is reasonably possible that the unrecognized tax benefits related to uncertain tax positions taken in previously filed returns may be different from the liabilities that have been recorded for these unrecognized tax benefits. As a result, the Company may be subject to additional tax expense.

 

As of June 30, 2023, the Company is asserting under ASC 740-30 that all of the unremitted earnings of its foreign subsidiaries are indefinitely invested. The Company evaluates this assertion each period based on a number of factors, including the operating plans, budgets, and forecasts for both the Company and its foreign subsidiaries; the long-term and short-term financial requirements in the U.S. and in each foreign jurisdiction; and the tax consequences of any decision to repatriate earnings of foreign subsidiaries to the U.S.

 

As of June 30, 2023 and March 31, 2023, the Company had a federal tax liability of approximately $1,603,000 related to the repatriation of the Company’s undistributed earnings of its foreign subsidiaries as required by the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). As of June 30, 2023 and March 31, 2023, the Company’s short term portion was approximately $401,000 and the long term portion was approximately $1,202,000.

 

The liability is payable over 8 years. The first five installments are each equal to 8%, the sixth is equal to 15%, the seventh is equal to 20% and the final installment is equal to 25% of the liability. As of June 30, 2023, the Company has paid five of the eight installments. Each installment must be remitted on or before July 15th of the year in which such installment is due. On July 12, 2023, the Company paid its sixth installment of approximately $401,000.

 

 

NOTE 6 RELATED PARTY TRANSACTIONS

 

From time to time, Emerson engages in business transactions with its controlling shareholder, Nimble Holdings Company Limited (“Nimble”), formerly known as The Grande Holdings Limited (“Grande”), and one or more of Nimble’s direct and indirect subsidiaries, or with entities related to the Company’s Chairman of the Board of Directors. Set forth below is a summary of such transactions.

 

Controlling Shareholder

 

S&T International Distribution Limited (“S&T”), which is a wholly owned subsidiary of Grande N.A.K.S. Ltd., which is a wholly owned subsidiary of Nimble, collectively have, based on a Schedule 13D/A filed with the SEC on February 15, 2019, the shared power to vote and direct the disposition of 15,243,283 shares, or approximately 72.4%, of the Company’s outstanding common stock as of June 30, 2023. Accordingly, the Company is a “controlled company” as defined in Section 801(a) of the NYSE American Company Guide.

 

9

 

Related Party Transactions

 

Charges of rental and utility fees on office space in Hong Kong

 

During the three month period ended June 30, 2023, the Company was billed approximately $40,000 for rental and utility fees from Vigers Appraisal and Consulting Ltd (“VACL”), which is a company related to the Company’s Chairman of the Board of Directors. As of June 30, 2023 the Company owed approximately $800 to VACL related to these charges.  

 

 

NOTE 7 SHORT TERM DEPOSITS

 

As of June 30, 2023 and March 31, 2023, the Company held $22.9 million and $23.1 million, respectively, in term deposits. Such term deposits had maturity dates of 90 days or less and, as a result, were classified as cash equivalents.  

 

 

NOTE 8 CONCENTRATION RISK

 

Customer Concentration

 

For the three month period ended June 30, 2023, the Company’s three largest customers accounted for approximately 88% of the Company’s net revenues, of which Walmart accounted for approximately 43%, Amazon accounted for approximately 28% and Fred Meyer accounted for approximately 17%. No other customer accounted for greater than 10% of the Company's net revenues during the period.

 

For the three month period ended June 30, 2022, the Company’s three largest customers accounted for approximately 73% of the Company’s net revenues, of which Walmart accounted for approximately 42%, Fred Meyer accounted for approximately 19% and Amazon accounted for approximately 12%. No other customer accounted for greater than 10% of the Company's net revenues during the period.

 

A significant decline in net sales to any of the Company’s key customers would have a material adverse effect on the Company’s business, financial condition and results of operation.             

 

Product Concentration

 

For the three month period ended June 30, 2023, the Company’s gross product sales included microwave ovens, which generated approximately 36% of the Company’s gross product sales and audio products, which generated approximately 60% of the Company’s gross product sales. No other products accounted for greater than 10% of the Company's gross product sales during the period.

 

For the three month period ended June 30, 2022, the Company’s gross product sales included microwave ovens, which generated approximately 42% of the Company’s gross product sales and audio products, which generated approximately 57% of the Company’s gross product sales. No other products accounted for greater than 10% of the Company's gross product sales during the period.    

 

Concentrations of Credit Risk

 

As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 48%, 25% and 20%, respectively, as of June 30, 2023. No other customers accounted for greater than 10% of the Company's total trade accounts receivable, net of specific reserves. As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 43%, 35% and 11%, respectively, as of March 31, 2023. No other customers accounted for greater than 10% of the Company's total trade accounts receivable, net of specific reserves. The Company periodically performs credit evaluations of its customers but generally does not require collateral, and the Company provides for any anticipated credit losses in the financial statements based upon management’s estimates and ongoing reviews of recorded allowances. Due to the high concentration of the Company’s net trade accounts receivables among just two customers, any significant failure by one of these customers to pay the Company the amounts owing against these receivables would result in a material adverse effect on the Company’s business, financial condition and results of operations.

 

The Company maintains its cash accounts with major U.S. and foreign financial institutions. The Company’s cash and restricted cash balances on deposit in the U.S. as of June 30, 2023 and March 31, 2023 were insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per qualifying bank account in accordance with FDIC rules. The Company’s cash, cash equivalents and restricted cash balances in excess of these FDIC-insured limits were approximately $24.4 million and approximately $25.0 million at June 30, 2023 and March 31, 2023, respectively.

 

Supplier Concentration

 

During the three month period ended June 30, 2023, the Company procured 100% of its products for resale from its three largest factory suppliers, of which approximately 57% was supplied by its largest supplier and approximately 22% and 21%, respectively, by the other two suppliers. During the three month period ended June 30, 2022, the Company procured 100% of its products for resale from its two largest factory suppliers, of which approximately 76% was supplied by its largest supplier and approximately 24% by the other.    

 

10

 
 

NOTE 9 LEASES

 

The Company leases office space in the U.S. and in Hong Kong as well as a copier in the U.S. These leases have remaining non-cancellable lease terms of twelve to fourteen months. The Company has elected not to separate lease and non-lease components for all leased assets. The Company did not identify any events or conditions during the quarter ended June 30, 2023 to indicate that a reassessment or re-measurement of the Company’s existing leases was required.

 

As of June 30, 2023, the Company’s current operating lease liabilities and finance lease liabilities were $142,000 and $1,000, respectively and its non-current operating lease liabilities and finance lease liabilities were $25,000 and nil, respectively. The Company’s operating and finance lease right-of-use asset balances are presented in non-current assets. The net balance of the Company’s operating and finance lease right-of-use assets as of June 30, 2023 was $166,000 and $1,000, respectively.

 

In January 2023, the Company relocated its headquarters to a temporary office space, while its new landlord awaited the proper permits to build out the agreed-upon space. The Company has subsequently moved into the agreed-upon space and the commencement date of the new lease is July 1, 2023.

 

The components of lease costs, which were included in operating expenses in the Company’s condensed consolidated statements of operations, were as follows:

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 
  

(in thousands)

 

Lease cost

        

Operating lease cost

 $37  $59 

Finance lease cost

      

Amortization of right-of-use assets

      

Interest on lease liabilities

      

Variable lease costs

      

Total lease cost

  37   59 
         

The supplemental cash flow information related to leases are as follows:

        
         

Cash paid for amounts included in the measurement of lease liabilities:

        

Operating cash flows from operating leases

  37   59 

Operating cash flows from finance leases

      

Financing cash flows from finance leases

      
         

Right-of-use assets obtained in exchange for lease obligations:

        

Operating leases

      

Finance leases

      

 

Information relating to the lease term and discount rate are as follows:

 

Weighted average remaining lease term (in months)

 

As of June 30, 2023

  

As of June 30, 2022

 

Operating leases

  13.5   22.5 

Finance leases

  11.2   23.2 
         

Weighted average discount rate

        

Operating leases

  7.50%  7.50%

Finance leases

  7.50%  7.50%

 

As of  June 30, 2023 the maturities of lease liabilities were as follows:

 

(in thousands)

 

Operating Leases

  

Finance Leases

 
         

2024

 $112  $1 

2025

  62    

2026

      

2027

      

Thereafter

      

Total lease payments

 $174  $1 

Less: Imputed interest

  (7)   

Total

 $167  $1 

 

11

 
 

NOTE 10 GOVERNMENTAL ASSISTANCE PROGRAMS  

 

During the three month periods ended June 30, 2023 and June 30, 2022, the Company’s Hong Kong subsidiary recorded nil and $22,000, respectively, under the governmental program called the Employment Support Scheme (“ESS”). The proceeds were required to be used for payroll expenses and the Company was subject to government-appointed random reviews to verify the information submitted by the applicant. 

 

The income realized from the amount granted under the ESS program is presented as Other Income under the description called “Income from governmental assistance programs” in the Consolidated Statements of Operations.

 

 

NOTE 11 LEGAL PROCEEDINGS

 

On April 19, 2022, the US District Court for the District of Delaware (the "District Court") granted judgment in favor of the Company in its trademark infringement lawsuit against air conditioning and heating products provider Emerson Quiet Kool and wholesaler Home Easy (the “defendants”). Among other things, the court order issues an injunction and directs the US Patent and Trademark Office to cancel the defendants’ existing and proposed “Emerson Quiet Kool” trademarks and prohibits defendants from registering or applying to register the same mark or any other mark or name containing the word “Emerson” going forward. The judgment also awards $6.5 million to the Company. The defendants have to date conditionally made payments, including certain advances and a portion of their liability, which are reflected as advanced deposits in the Consolidated Balance Sheets, in connection with ongoing negotiations among the parties. The aggregate amount of the payments is $4.1 million, which has been reduced by approximately $784,000 for legal fees incurred in fiscal 2023 and approximately $154,000 for legal fees incurred in fiscal 2024, in pursuit of the advanced deposits. On July 11, 2023, the US Court of Appeals for the Third Circuit affirmed the District Court's default judgement against Emerson Quiet Kool. There is no guarantee that the Company will be able to collect the entire judgment or that a negotiated resolution regarding these matters will ever be agreed among the parties or, if agreed, how soon the parties will be able to do so.  

 

12

 
 

Item 2. Managements Discussion and Analysis of Results of Operations and Financial Condition.

 

The following discussion of the Company’s operations and financial condition should be read in conjunction with the Financial Statements and notes thereto included elsewhere in this Quarterly Report.

 

In the following discussions, most percentages and dollar amounts have been rounded to aid presentation. Accordingly, all amounts are approximations.

 

Forward-Looking Information

 

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

Forward-looking statements include statements with respect to the Company’s beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond the Company’s control, and which may cause the Company’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.

 

All statements other than statements of historical fact are statements that could be forward-looking statements. The reader can identify these forward-looking statements through the Company’s use of words such as “may,” “will,” “can,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “seek,” “estimate,” “continue,” “plan,” “project,” “predict,” “could,” “intend,” “target,” “potential,” and other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation:

 

 

the Company’s ability to generate sufficient revenue to achieve and maintain profitability;

 

 

the Company’s ability to obtain new customers and retain key existing customers, including the Company’s ability to maintain purchase volumes of the Company’s products by its key customers;

 

 

the Company’s ability to obtain new licensees and distribution relationships and maintain relationships with its existing licensees and distributors;

 

 

the Company’s ability to resist price increases from its suppliers or pass through such increases to its customers;

 

 

changes in consumer spending for retail products, such as the Company’s products, and in consumer practices, including sales over the Internet;

 

 

the Company’s ability to maintain effective internal controls or compliance by its personnel with such internal controls;  

 

 

the Company’s ability to successfully manage its operating cash flows to fund its operations;

 

 

the Company’s ability to anticipate market trends, enhance existing products or achieve market acceptance of new products;

 

 

the Company’s ability to accurately forecast consumer demand and adequately manage inventory;

 

 

the Company’s dependence on a limited number of suppliers for its components and raw materials;

 

 

the Company’s dependence on third party manufacturers to manufacture and deliver its products;

 

 

increases in shipping costs for the Company’s products or other service issues with the Company’s third-party shippers;

 

 

the Company’s dependence on a third party logistics provider for the storage and distribution of its products in the United States;

 

 

the ability of third party sales representatives to adequately promote, market and sell the Company’s products;

 

 

the Company’s ability to maintain, protect and enhance its intellectual property;

 

 

the effects of competition;

 

 

the Company’s ability to distribute its products in a timely fashion, including as a result of labor disputes and public health threats and social unrest;

 

 

evolving cybersecurity threats to the Company’s information technology systems or those of its customers or suppliers;

 

 

 

changes in foreign laws and regulations and changes in the political and economic conditions in the foreign countries in which the Company operates;

 

 

changes in accounting policies, rules and practices;

 

 

changes in tax rules and regulations or interpretations;

 

 

changes in U.S. and foreign trade regulations and tariffs, including potential increases of tariffs on goods imported into the U.S., and uncertainty regarding the same;

 

 

limited access to financing or increased cost of financing;

 

 

the effects of currency fluctuations between the U.S. dollar and Chinese renminbi relative to the dollar and increases in costs of production in China; and

 

 

the other factors listed under “Risk Factors” in the Company’s Annual Report on Form 10-K, as amended, for the fiscal year ended March 31, 2023 and other filings with the SEC.

 

All forward-looking statements are expressly qualified in their entirety by this cautionary notice. The reader is cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this report or the date of the document incorporated by reference into this report. The Company has no obligation, and expressly disclaims any obligation, to update, revise or correct any of the forward-looking statements, whether as a result of new information, future events or otherwise. The Company has expressed its expectations, beliefs and projections in good faith and it believes it has a reasonable basis for them. However, the Company cannot assure the reader that its expectations, beliefs or projections will result or be achieved or accomplished.

 

Results of Operations

 

The following table summarizes certain financial information for the three month period ended June 30, 2023 (fiscal 2024) and June 30, 2022 (fiscal 2023) (in thousands):

 

   

Three Months Ended June 30,

 
   

2023

   

2022

 

Net product sales

  $ 1,732     $ 1,004  

Licensing revenue

    77       70  

Net revenues

    1,809       1,074  

Cost of sales

    1,470       879  

Selling, general and administrative expenses

    1,198       1,344  

Operating loss

    (859 )     (1,149 )

Interest income, net

    294       50  

Income from governmental assistance programs

          22  

Loss before income taxes

    (565 )     (1,077 )

Provision for income taxes

           

Net loss

  $ (565 )   $ (1,077 )

 

Net product sales — Net product sales for the three month period ended June 30, 2023 were $1.7 million as compared to $1.0 million for the three month period ended June 30, 2022, an increase of  $0.7 million, or 72.5%. The Company’s sales during the three month periods ended June 30, 2023 and June 30, 2022 were highly concentrated among the Company’s three largest customers – Wal-Mart, Amazon and Fred Meyer – comprising in the aggregate approximately 92% and 78%, respectively, of the Company’s total net product sales for such periods.

 

 

Net product sales are comprised primarily of the sales of houseware and audio products which bear the Emerson® brand name. Net product sales may be periodically impacted by adjustments made to the Company’s sales allowance and marketing support accrual to record unanticipated customer deductions from accounts receivable or to reduce the accrual by any amounts which were accrued in the past but not taken by customers through deductions from accounts receivable within a certain time period. In the aggregate, these adjustments had the effect of increasing net product sales and operating income by approximately $3,000 and nil for the three month periods ended June 30, 2023 and June 30, 2022, respectively. The major elements which contributed to the overall increase in net product sales were as follows:

 

i)    Houseware products:Net sales increased $0.2 million, or 55.4%, to $0.7 million for the three month period ended June 30, 2023 as compared to $0.5 million for the three month period ended June 30, 2022, driven by increased net sales of microwave ovens. 

 

ii)   Audio products: Net sales increased $0.5 million, or 86.0%, to $1.1 million for the three month period ended June 30, 2023 as compared to $0.6 million for the three month period ended June 30, 2022, resulting from increased net sales of clock radios. 

 

Business operations — The Company expects to continue to expand its existing distribution channels and to develop and promote new products with retailers in the U.S. The Company is also continuing to invest in products and marketing activities to expand its sales through internet and ecommerce channels. These efforts require investments in appropriate human resources, media marketing and development of products in various categories in addition to the traditional home appliances and audio products on which the Company has historically focused. The Company also is continuing its efforts to identify strategic courses of action related to its licensing activities, including seeking new licensing relationships. The Company has engaged each of Leveraged Marketing Corporation of America and Global Licensing Services Pte Limited as an agent to assist in identifying and procuring potential licensees.

 

Emerson’s success is dependent on its ability to anticipate and respond to changing consumer demands and trends in a timely manner, as well as expanding into new markets and sourcing new products that are profitable to the Company. Geo-political factors may also affect the Company’s operations and demand for the Company’s products, which are subject to customs requirements and to tariffs and quotas set by governments through mutual agreements and bilateral actions. The Company expects that U.S. tariffs on categories of products that the Company imports from China, and China’s retaliatory tariffs on certain goods imported from the United States, as well as modifications to international trade policy, will continue to affect its product costs going forward. If no mitigation steps are taken, or the mitigation is unsuccessful, the combination of tariffs will result in significantly increased annualized costs to the Company as all of the Company’s products are currently manufactured by suppliers in China. Although the Company is monitoring the trade and political environment and working to mitigate the possible effect of tariffs with its suppliers as well as its customers through pricing and sourcing strategies, the Company cannot be certain how its customers and competitors will react to the actions taken. In addition, heightened tensions between the United States and China over Hong Kong and any resulting retaliatory policies may affect our operations in Hong Kong. At this time, the Company is unable to quantify possible effects on its costs arising from the new tariffs, which are expected to increase the Company’s inventory costs and associated costs of sales as tariffs are incurred, and some costs may be passed through to the Company’s customers as product price increases in the future. However, if the Company is unable to successfully pass through the additional costs or otherwise mitigate the effects of these tariffs, or if the higher prices reduce demand for the Company’s products, it will have a negative effect on the Company’s product sales and gross margins.

 

Starting in the fourth quarter of fiscal 2020, the global COVID-19 pandemic has presented significant challenges and impacted the Company’s business and operating results, and the operations and production capabilities of the Company’s suppliers in China. The pandemic has directly and indirectly disrupted certain sales and supply chain activities. Global component shortages, in particular semiconductor chips, arising from changes in consumer demand and reduced manufacturing capacity related to the COVID-19 pandemic may cause price fluctuations and longer lead times in the supply of these components. Although the Company is seeking alternate suppliers for these components, developing alternate sources of supply will be time consuming, difficult and costly, and may require the re-tooling of products to accommodate components from different suppliers. In addition to increasing cost trends, the Company’s suppliers are not equipped to hold meaningful amounts of inventory and could pause manufacturing, which could ultimately impact the Company’s ability to fulfill customer orders on a timely basis. These impacts on the Company’s supply chain may continue to impact the Company’s ability to meet product demand, which could result in additional costs, customer dissatisfaction in the event of inventory shortages or may otherwise adversely impact the Company’s business and results of operations.

 

In light of the adverse macroeconomic conditions domestically and internationally, the Company has implemented certain cost-reduction actions intended to reduce expenditures. However, the environment remains uncertain. Demand for the Company’s products remains competitive and retailers continue to carefully manage inventory. Accordingly, the current results and financial condition discussed herein may not be indicative of future operating results and trends.

 

 

For more information on risks associated with the Company’s operations, including tariffs, please see the risk factors within Part I, Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K, as amended, for the year ended March 31, 2023.

 

Legal Proceedings On April 19, 2022, the US District Court for the District of Delaware (the "District Court") granted judgment in favor of the Company in its trademark infringement lawsuit against air conditioning and heating products provider Emerson Quiet Kool and wholesaler Home Easy (the “defendants”). Among other things, the court order issues an injunction and directs the US Patent and Trademark Office to cancel the defendants’ existing and proposed “Emerson Quiet Kool” trademarks and prohibits defendants from registering or applying to register the same mark or any other mark or name containing the word “Emerson” going forward. The judgment also awards $6.5 million to the Company. The defendants have to date conditionally made payments, including certain advances and a portion of their liability, which are reflected as advanced deposits in the Consolidated Balance Sheets, in connection with ongoing negotiations among the parties. The aggregate amount of the payments is $4.1 million, which has been reduced by approximately $784,000 for legal fees incurred in fiscal 2023 and approximately $154,000 for legal fees incurred in fiscal 2024, in pursuit of the advanced deposits. Only July 11, 2023, the US Court of Appeals for the Third Circuit affirmed the District Court's default judgement against Emerson Quiet Kool. There is no guarantee that the Company will be able to collect the entire judgment or that a negotiated resolution regarding these matters will ever be agreed among the parties or, if agreed, how soon the parties will be able to do so.

 

Licensing revenue — Licensing revenue for the three month period ended June 30, 2023 was $77,000 as compared to $70,000 for the three month period ended June 30, 2022, an increase of $7,000, or 6.5%. The increase in licensing revenue was due to the signing of new licensing agreements in fiscal 2023, one of which was terminated in June 2023.

 

Net revenues — Net revenues were $1.8 million for the three month period ended June 30, 2023 as compared to $1.1 million for the three month period ended June 30, 2022, an increase of $0.7 million, or 68.4%. The increase in net revenues can be attributed to the introduction of new models to the marketplace as well as increased demand from the Company's key customers.

 

Cost of sales — Cost of sales increased $0.6 million, or 67.2% to $1.5 million for the three month period ended June 30, 2023 as compared to $0.9 million for the three month period ended June 30, 2022. The increase in absolute terms for the three month period ended June 30, 2023 as compared to the three month period ended June 30, 2022 was primarily related to an increase in net product sales partially offset by lower year-over-year gross cost of sales as a percentage of gross sales.

 

The Company purchases the products it sells from a limited number of factory suppliers. In each of the three month periods ended June 30, 2023 and June 30, 2022, the Company purchased 100% of its products from its three largest suppliers.

 

Selling, general and administrative expenses (S,G&A) — S,G&A was $1.2 million for the three month period ended June 30, 2023 as compared to $1.3 million for the three month period ended June 30, 2022, a decrease of $0.1 million or 10.9%. S,G&A, as a percentage of net revenues, was 66.2% for the three month period ended June 30, 2023 as compared to 125.1% for the three month period ended June 30, 2022. The Company benefitted from a decrease in legal fees of $318,000, a decrease in insurance expense of $37,000 and a decrease in rent expense of $21,000. Legal fees for the three month period ended June 30, 2023 were $113,000 as compared to $431,000 for the three month period ended June 30, 2022. Insurance expense for the three month period ended June 30, 2023 were $115,000 as compared to $152,000 for the three month period ended June 30, 2022. Rent expense for the three month period ended June 30, 2023 was $37,000 as compared to $58,000 for the three month period ended June 30, 2022. These reductions in S,G&A were partially offset by an increase in bad debt expense of $102,000 related to the termination of one the Company's new licensees in June 2023.

 

Interest income, net — Interest income, net, was $294,000 for the three month period ended June 30, 2023 as compared to $50,000 for the three month period ended June 30, 2022, an increase of $244,000. The increase was primarily due to higher average interest rates earned on the Company’s short term investments.

 

Income from governmental assistance programs — For the three month periods ended June 30, 2023 and June 30, 2022 the Company recorded income of nil and approximately $22,000, respectively, under the ESS program. See “Note 10 – Governmental Assistance Programs”.

 

Provision (benefit) for income taxes — For the three month periods ended June 30, 2023 and June 30, 2022, the Company recorded income tax expense of nil. However the Company under the adoption of ASU 2019-12 “Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes” incurred $8,650 and $10,950, respectively, of non-income based state taxes, which are now reported as S,G &A. See “Note 5 – Income Taxes”.

 

Although the Company generated net losses during fiscal 2024 and fiscal 2023, it is unable to realize an income tax benefit due to valuation allowances recorded against its deferred tax assets.

 

Net (loss) — As a result of the foregoing factors, the Company realized a net loss of $565,000 for the three month period ended June 30, 2023 as compared to a net loss of $1,077,000 for the three month period ended June 30, 2022.

 

 

Liquidity and Capital Resources

 

As of June 30, 2023, the Company had cash and cash equivalents of approximately $24.7 million as compared to approximately $25.3 million at March 31, 2023. Cash and cash equivalents includes short term investments in deposits which were classified as cash equivalents of $22.9 million as of June 30, 2023 compared to $23.1 million of such deposits as of March 31, 2023. Working capital decreased to $25.7 million at June 30, 2023 as compared to $26.4 million at March 31, 2023. The decrease in cash and cash equivalents of approximately $0.6 million was due to the net loss generated during the period of $0.6 million, a decrease in advanced deposits of $0.2 million, a decrease in deferred revenue of $0.1 million and an increase in prepaid purchases of $0.1 million partially offset by a decrease in licensing receivable of $0.2 million, a decrease in inventory of $0.1 million and an increase in accounts payable and other current liabilities of $0.1 million.

 

Cash Flows

 

Net cash used by operating activities was approximately $0.5 million for the three month period ended June 30, 2023, resulting from the $0.6 million net loss generated during the period, a decrease in advanced deposits of $0.2 million, an increase in prepaid purchases of $0.1 million and a decrease in deferred revenue of $0.1 million partially offset by decrease in licensing receivable of $0.2 million, a decrease in inventory of $0.1 million, an increase in accounts payable and other current liabilities of $0.1 million and a decrease in prepaid expenses and other current assets of $0.1 million.

 

Net cash used by investing activities was $0.1 million for the three month period ended June 30, 2023 due to additions to property and equipment.

 

Net cash used by financing activities was nil for the three month period ended June 30, 2023.

 

Sources and Uses of Funds

 

The Company’s principal existing sources of cash are generated from operations and its existing short-term deposits. The Company believes that its existing cash balance and sources of cash will be sufficient to support existing operations over the next 12 months.

 

Off-Balance Sheet Arrangements

 

As of June 30, 2023, the Company did not have any off-balance sheet arrangements as defined under the rules of the SEC.

 

Recently Issued Accounting Pronouncements

 

The following ASUs were issued by the FASB which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.

 

Accounting Standards Update 2019-12 Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (Issued December 2019)

 

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020. This standard took effect in the first quarter (June 2021) of the Company’s fiscal year ending March 31, 2022. The adoption of ASU 2019-12 had no material impact on the Company’s consolidated financial statements and related disclosures.

 

Accounting Standards Update 2016-13 Financial Instruments Credit Losses (Issued June 2016)

 

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU 2016-13 requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for fiscal years and interim periods beginning after December 15, 2022. Early adoption is permitted. The Company does not expect these amendments to have a material impact on its financial statements.

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

Not applicable.

 

Item 4. Controls and Procedures.

 

(a) Disclosure controls and procedures

 

The Company maintains disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d — 15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Due to the inherent limitations of control systems, not all misstatements may be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. Our controls and procedures can only provide reasonable, not absolute, assurance that the above objectives have been met.

 

The Company’s management, with the participation of our Chief Executive Officer and Chief Financial Officer, concluded that disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of June 30, 2023, are effective to provide reasonable assurance that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

(b) Changes in Internal Controls Over Financial Reporting

 

There have been no changes in the Company’s internal control over financial reporting that occurred during the fiscal quarter ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

 

PART II OTHER INFORMATION

 

 

Item 1. Legal Proceedings.

 

The Company is, and from time to time may become, involved in legal proceedings, in most cases involving ordinary and routine claims incidental to its business. Management cannot estimate with certainty the Company’s ultimate legal and financial liability with respect to any such pending litigation matters. However, management believes, based on its examination of such matters, that the Company is not currently involved in any legal proceedings that, if determined adversely to the Company, would have a material adverse effect on the Company’s financial position, results of operations or cash flows. Information relating to our ongoing legal proceedings is described in Note 11 to our condensed consolidated financial statements in Part I, Item I of this Quarterly Report on Form 10-Q.

 

 

Item 1A. Risk Factors.

 

There have been no material changes to the risk factors contained in Part I, Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K, as amended, for the year ended March 31, 2023.

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

None

 

 

Item 3. Defaults Upon Senior Securities.

 

(a) None

 

(b) None

 

 

Item 4. Mine Safety Disclosure.

 

Not applicable.

 

 

Item 5. Other Information.

 

None

 

 

Item 6. Exhibits.

 

   

31.1

Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

   

31.2

Certification of the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

   

32

Certification of the Company’s Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

   

101.INS

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.*

   

101.SCH

Inline XBRL Taxonomy Extension Schema Document.*

   

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document.*

   

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document.*

   

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document.*

   

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document.*

   

104

Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

 


*

filed herewith

**

furnished herewith

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

EMERSON RADIO CORP.

 

(Registrant)

   
 

/s/ Christopher W. Ho

Date: August 14, 2023

Christopher W. Ho

 

Chief Executive Officer

(Principal Executive Officer)

   
 

/s/ Richard Li

Date: August 14, 2023

Richard Li

 

Chief Financial Officer

(Principal Financial and Accounting Officer)

 

 

20
EX-31.1 2 ex_537583.htm EXHIBIT 31.1 ex_537583.htm

Exhibit 31.1

 

Certification

 

Pursuant to Section 302 of the Sarbanes Oxley Act of 2002

 

I, Christopher W. Ho, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Emerson Radio Corp.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

 

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 14, 2023

/s/ Christopher W. Ho

 

Christopher W. Ho

 

Chief Executive Officer

 

 

A signed original of this written statement required by Section 302 has been provided to Emerson Radio Corp. and will be retained by Emerson Radio Corp. and furnished to the Securities and Exchange Commission or its staff upon request.

 

 
EX-31.2 3 ex_537584.htm EXHIBIT 31.2 ex_537584.htm

Exhibit 31.2

 

Certification

 

Pursuant to Section 302 of the Sarbanes Oxley Act of 2002

 

I, Richard Li, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Emerson Radio Corp.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

 

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 14, 2023

/s/ Richard Li

 

Richard Li

 

Chief Financial Officer

 

 

A signed original of this written statement required by Section 302 has been provided to Emerson Radio Corp. and will be retained by Emerson Radio Corp. and furnished to the Securities and Exchange Commission or its staff upon request.

 

 
EX-32 4 ex_537585.htm EXHIBIT 32 ex_537585.htm

Exhibit 32

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Emerson Radio Corp. (the “Company”) on Form 10-Q for the period ended June 30, 2023, filed with the Securities and Exchange Commission (the “Report”), Christopher W. Ho, Chief Executive Officer, and Richard Li, Chief Financial Officer, of the Company each hereby certifies pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as amended; and

 

(2) The information contained in the Report fairly presents, in all material respects, the consolidated financial condition of the Company as of the dates presented and the consolidated results of operations of the Company for the periods presented.

 

Dated: August 14, 2023

 

 

By:

 

/s/ Christopher W. Ho

     

Christopher W. Ho

     

Chief Executive Officer

     
 

By:

 

/s/ Richard Li

     

Richard Li

     

Chief Financial Officer

 

 

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and is not being filed as part of the Form 10-Q or as a separate disclosure document.

 

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Emerson Radio Corp. and will be retained by Emerson Radio Corp. and furnished to the Securities and Exchange Commission or its staff upon request.

 
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Document And Entity Information - shares
3 Months Ended
Jun. 30, 2023
Aug. 14, 2023
Document Information [Line Items]    
Entity Central Index Key 0000032621  
Entity Registrant Name EMERSON RADIO CORP  
Amendment Flag false  
Current Fiscal Year End Date --03-31  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2023  
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Jun. 30, 2023  
Document Transition Report false  
Entity File Number 001-07731  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 22-3285224  
Entity Address, Address Line One 959 Route 46 East, Suite 210  
Entity Address, City or Town Parsippany  
Entity Address, State or Province NJ  
Entity Address, Postal Zip Code 07054  
City Area Code 973  
Local Phone Number 428-2000  
Title of 12(b) Security Common Stock, par value $.01 per share  
Trading Symbol MSN  
Security Exchange Name NYSEAMER  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   21,042,652
XML 11 R2.htm IDEA: XBRL DOCUMENT v3.23.2
Consolidated Statements of Operations (Unaudited) - USD ($)
$ in Thousands
3 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Net revenues:    
Revenue $ 1,809 $ 1,074
Costs and expenses:    
Cost of sales 1,470 879
Selling, general and administrative expenses 1,198 1,344
Total costs and expenses 2,668 2,223
Operating loss (859) (1,149)
Other (loss) income:    
Interest income, net 294 50
Income from governmental assistance programs 0 22
Loss before income taxes (565) (1,077)
Provision for income tax expense 0 0
Net loss $ (565) $ (1,077)
Basic loss per share (in dollars per share) $ (0.03) $ (0.05)
Diluted loss per share (in dollars per share) $ (0.03) $ (0.05)
Weighted average shares outstanding    
Basic (in shares) 21,042,652 21,042,652
Diluted (in shares) 21,042,652 21,042,652
Product [Member]    
Net revenues:    
Revenue $ 1,732 $ 1,004
License [Member]    
Net revenues:    
Revenue $ 77 $ 70
XML 12 R3.htm IDEA: XBRL DOCUMENT v3.23.2
Consolidated Balance Sheets (Unaudited) - USD ($)
Jun. 30, 2023
Mar. 31, 2023
Current Assets:    
Cash and cash equivalents $ 24,671,000 $ 25,268,000
Accounts receivable, net 1,189,000 1,165,000
Licensing receivable 8,000 245,000
Inventory 3,707,000 3,813,000
Prepaid purchases 364,000 247,000
Prepaid expenses and other current assets 296,000 357,000
Total Current Assets 30,235,000 31,095,000
Non-Current Assets:    
Property and equipment, net 47,000 1,000
Right-of-use asset-operating leases 166,000 200,000
Right-of-use asset-finance leases 1,000 1,000
Other assets 84,000 74,000
Total Non-Current Assets 298,000 276,000
Total Assets 30,533,000 31,371,000
Current Liabilities:    
Accounts payable and other current liabilities 705,000 641,000
Short-term operating lease liability 142,000 139,000
Short-term finance lease liability 1,000 1,000
Income tax payable, current portion 401,000 401,000
Advanced deposits 3,162,000 3,316,000
Deferred revenue 0 149,000
Total Current Liabilities 4,412,000 4,648,000
Non-Current Liabilities:    
Long-term operating lease liability 25,000 62,000
Long-term finance lease liability 0 0
Income tax payable 1,202,000 1,202,000
Total Non-Current Liabilities 1,227,000 1,264,000
Total Liabilities 5,639,000 5,912,000
Shareholders’ Equity:    
Series A Preferred shares — 10,000,000 shares authorized; 3,677 shares issued and outstanding; liquidation preference of $3,677,000 3,310,000 3,310,000
Common shares — $0.01 par value, 75,000,000 shares authorized; 52,965,797 shares issued at June 30, 2023 and March 31, 2023, respectively; 21,042,652 shares outstanding at June 30, 2023 and March 31, 2023, respectively 529,000 529,000
Additional paid-in capital 79,792,000 79,792,000
Accumulated deficit (25,536,000) (24,971,000)
Treasury stock, at cost (31,923,145 shares at June 30, 2023 and March 31, 2023, respectively) (33,201,000) (33,201,000)
Total Shareholders’ Equity 24,894,000 25,459,000
Total Liabilities and Shareholders’ Equity 30,533,000 31,371,000
Related Party [Member]    
Current Liabilities:    
Due to affiliate $ 1,000 $ 1,000
XML 13 R4.htm IDEA: XBRL DOCUMENT v3.23.2
Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($)
$ in Millions
Jun. 30, 2023
Mar. 31, 2023
Preferred shares, shares authorized (in shares) 10,000,000 10,000,000
Preferred shares, shares issued (in shares) 3,677 3,677
Preferred shares, shares outstanding (in shares) 3,677 3,677
Preferred shares, liquidation preference $ 3,677 $ 3,677
Common shares, par value (in dollars per share) $ 0.01 $ 0.01
Common shares, shares authorized (in shares) 75,000,000 75,000,000
Common shares, shares issued (in shares) 52,965,797 52,965,797
Common shares, shares outstanding (in shares) 21,042,652 21,042,652
Treasury shares (in shares) 31,923,145 31,923,145
XML 14 R5.htm IDEA: XBRL DOCUMENT v3.23.2
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Thousands
3 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Cash Flows from Operating Activities:    
Net (loss) $ (565) $ (1,077)
Adjustments to reconcile net loss to net cash (used) by operating activities:    
Amortization of right-of-use assets 34 53
Depreciation and amortization 4 0
Asset valuation allowance 22 (35)
Changes in assets and liabilities:    
Accounts receivable (46) 768
Licensing receivable 237 0
Inventory 106 (321)
Prepaid purchases (117) (140)
Prepaid expenses and other current assets 61 122
Other assets (10) 0
Accounts payable and other current liabilities 64 89
Short term lease liabilities 3 (22)
Long term lease liabilities (37) (35)
Advanced deposits (154) 0
Deferred revenue (149) (70)
Net cash (used) by operating activities (547) (668)
Cash Flows From Investing Activities:    
Additions to property and equipment (50) 0
Disposals of property and equipment 0 0
Net cash (used) by investing activities (50) 0
Cash Flows from Financing Activities:    
Net cash provided by financing activities 0 0
Net (decrease) in cash and cash equivalents (597) (668)
Cash and cash equivalents at beginning of the year 25,268 25,576
Cash and cash equivalents at end of the year 24,671 24,908
Cash paid for:    
Interest 2 3
Income taxes $ 0 $ 0
XML 15 R6.htm IDEA: XBRL DOCUMENT v3.23.2
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($)
$ in Thousands
Preferred Stock [Member]
Common Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Treasury Stock, Common [Member]
Total
Balance at Mar. 31, 2022 $ 3,310 $ 529 $ 79,792 $ (23,611) $ (33,201) $ 26,819
Balance (in shares) at Mar. 31, 2022   52,965,797        
Net (loss) 0 $ 0 0 (1,077) 0 (1,077)
Balance at Jun. 30, 2022 3,310 $ 529 79,792 (24,688) (33,201) 25,742
Balance (in shares) at Jun. 30, 2022   52,965,797        
Balance at Mar. 31, 2023 3,310 $ 529 79,792 (24,971) (33,201) 25,459
Balance (in shares) at Mar. 31, 2023   52,965,797        
Net (loss) 0 $ 0 0 (565) 0 (565)
Balance at Jun. 30, 2023 $ 3,310 $ 529 $ 79,792 $ (25,536) $ (33,201) $ 24,894
Balance (in shares) at Jun. 30, 2023   52,965,797        
XML 16 R7.htm IDEA: XBRL DOCUMENT v3.23.2
Note 1 - Background and Basis of Presentation
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE 1 BACKGROUND AND BASIS OF PRESENTATION

 

The consolidated financial statements include the accounts of Emerson Radio Corp. and its subsidiaries (“Emerson” or the “Company”). The Company designs, sources, imports and markets certain houseware and consumer electronic products, and licenses the Company’s trademarks for a variety of products.

 

The unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the Company’s consolidated financial position as of  June 30, 2023 and the results of operations for the three month periods ended June 30, 2023 and June 30, 2022. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements not misleading have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of the unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes; actual results could materially differ from those estimates. The unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly do not include all of the disclosures normally made in the Company’s annual consolidated financial statements. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended  March 31, 2023 (“fiscal 2023”), included in the Company’s Annual Report on Form 10-K, as amended, for fiscal 2023.

 

The results of operations for the three month period ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the full year ending March 31, 2024 (“fiscal 2024”).

 

Whenever necessary, reclassifications are made to conform the prior year’s consolidated financial statements to the current year’s presentation.

 

Recently Issued Accounting Pronouncements

 

The following Accounting Standards Updates (“ASUs”) were issued by the Financial Accounting Standards Board (“FASB”) which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.

 

Accounting Standards Update 2019-12 Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (Issued December 2019)

 

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020. This standard took effect in the first quarter ( June 2021) of the Company’s fiscal year ending March 31, 2022. The adoption of ASU 2019-12 had no material impact on the Company’s consolidated financial statements and related disclosures.

 

Accounting Standards Update 2016-13 Financial Instruments Credit Losses (Issued June 2016)

 

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU 2016-13 requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for fiscal years and interim periods beginning after December 15, 2022. Early adoption is permitted. The Company does not expect these amendments to have a material impact on its financial statements.

 

Revenue recognition: Sales to customers and related cost of sales are primarily recognized at the point in time when control of goods transfers to the customer. Control is considered to be transferred when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits of that good. Under the Direct Import Program, title passes in the country of origin when the goods are passed over the rail of the customer’s vessel. Under the Domestic Program, title passes primarily at the time of shipment. Estimates for future expected returns are based upon historical return rates and netted against revenues.

 

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Revenue is recorded net of customer discounts, promotional allowances, volume rebates and similar charges. When the Company offers the right to return product, historical experience is utilized to establish a liability for the estimate of expected returns. Sales and other tax amounts collected from customers for remittance to governmental authorities are excluded from revenue.

 

Management must make estimates of potential future product returns related to current period product revenue. Management analyzes historical returns, current economic trends and changes in customer demand for the Company’s products when evaluating the adequacy of the reserve for sales returns. Management judgments and estimates must be made and used in connection with establishing the sales return reserves in any accounting period. Additional reserves may be required if actual sales returns increase above the historical return rates. Conversely, the sales return reserve could be decreased if the actual return rates are less than the historical return rates, which were used to establish the reserve.

 

Sales allowances, marketing support programs, promotions and other volume-based incentives which are provided to retailers and distributors are accounted for on an accrual basis as a reduction to net revenues in the period in which the related sales are recognized in accordance with ASC topic 606, “Revenue from Contracts with Customers” (“ASC 606”).

 

At the time of sale, the Company reduces recognized gross revenue by allowances to cover, in addition to estimated sales returns as required by ASC 606, (i) sales incentives offered to customers that meet the criteria for accrual and (ii) an estimated amount to recognize additional non-offered deductions it anticipates and can reasonably estimate will be taken by customers, which it does not expect to recover. Accruals for the estimated amount of future non-offered deductions are required to be made as contra-revenue items, because that percentage of shipped revenue fails to meet the collectability criteria within ASC 606.

 

If additional marketing support programs, promotions and other volume-based incentives are required to promote the Company’s products subsequent to the initial sale, then additional reserves may be required and are accrued for when such support is offered.

 

The Company offers limited warranties for its consumer electronics, comparable to those offered to consumers by the Company’s competitors in the United States. Such warranties typically consist of a one year period for microwaves and a 90 day period for audio products, under which the Company pays for labor and parts, or offers a new or similar unit in exchange for a non-performing unit.

 

Licensing: In addition to the distribution of products, the Company grants licenses for the right to access the Company’s intellectual property, specifically the Company’s trademarks, for a stated term for the manufacture and/or sale of consumer electronics and other products under agreements which require payment of either (i) a non-refundable minimum guaranteed royalty or, (ii) the greater of (a) the actual royalties due (based on a contractual calculation, normally comprised of actual product sales by the licensee multiplied by a stated royalty rate, or “Sales Royalties”) or (b) a minimum guaranteed royalty amount. In the case of the foregoing clause (i), such amounts are recognized as revenue on a straight-line basis over the term of the license agreement. In the case of the foregoing clause (ii), Sales Royalties in excess of guaranteed minimums are accounted for as variable fees and are not recognized as revenue until the Company has ascertained that the licensee’s sales of products have exceeded the guaranteed minimum. In effect, the Company recognizes the greater of Sales Royalties earned to date or the straight-line amount of minimum guaranteed royalties to date. In the case where a royalty is paid to the Company in advance, the royalty payment is initially recorded as a liability and recognized as revenue as the royalties are deemed to be earned according to the principles outlined above.

 

XML 17 R8.htm IDEA: XBRL DOCUMENT v3.23.2
Note 2 - Earnings Per Share
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Earnings Per Share [Text Block]

NOTE 2 EARNINGS PER SHARE

 

The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts). Weighted average shares includes the impact of shares held in treasury.

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 
         

Numerator:

        

Net loss

 $(565) $(1,077)

Denominator:

        

Denominator for basic and diluted loss per share — weighted average shares

  21,042,652   21,042,652 

Net loss per share:

        

Basic and diluted loss per share

 $(0.03) $(0.05)

 

XML 18 R9.htm IDEA: XBRL DOCUMENT v3.23.2
Note 3 - Shareholders' Equity
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Equity [Text Block]

NOTE 3 SHAREHOLDERS EQUITY

 

Outstanding capital stock at June 30, 2023 consisted of common stock and Series A preferred stock. The Series A preferred stock is non-voting, has no dividend preferences and has not been convertible since March 31, 2002; however, it retains a liquidation preference.

 

At June 30, 2023, the Company had no options, warrants or other potentially dilutive securities outstanding.

 

XML 19 R10.htm IDEA: XBRL DOCUMENT v3.23.2
Note 4 - Inventory
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Inventory Disclosure [Text Block]

NOTE 4 INVENTORY

 

Inventories, which consist primarily of finished goods, are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. As of June 30, 2023 and March 31, 2023, inventories consisted of the following (in thousands):

 

  

June 30, 2023

  

March 31, 2023

 

Finished goods

 $3,707  $3,813 

 

XML 20 R11.htm IDEA: XBRL DOCUMENT v3.23.2
Note 5 - Income Taxes
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

NOTE 5 INCOME TAXES

 

At June 30, 2023, the Company had $16.3 million of U.S. federal net operating loss (“NOL”) carry forwards. These losses do not expire but are limited to utilization of 80% of taxable income in any one year. At June 30, 2023, the Company had approximately $19.5 million of U.S. state NOL carry forwards. The tax benefits related to these state NOL carry forwards and future deductible temporary differences are recorded to the extent management believes it is more likely than not that such benefits will be realized.

 

The income of foreign subsidiaries before taxes was $302,000 for the three month period ended June 30, 2023 as compared to income of foreign subsidiaries before taxes of $83,000 for the three month period ended June 30, 2022

 

The Company analyzed the future reasonability of recognizing its deferred tax assets at June 30, 2023. As a result, the Company concluded that a 100% valuation allowance of $4,906,000 would be recorded against the assets.

 

Although the Company generated a net operating loss, it recorded income tax expense of $8,650 during the three month period ended June 30, 2023, primarily resulting from state income taxes. During the three month period ended June 30, 2022, the Company recorded income tax expense of $10,500, primarily resulting from state income taxes. After the adoption of ASU 2019-12 “Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes” during fiscal 2022, these non-income based state taxes are now reported within selling, general and administrative expenses.

 

The Company is subject to examination and assessment by tax authorities in numerous jurisdictions. As of June 30, 2023, the Company’s open tax years for examination for U.S. federal tax are 2017-2023, and for U.S. states’ tax are 2015-2023. Based on the outcome of tax examinations or due to the expiration of statutes of limitations, it is reasonably possible that the unrecognized tax benefits related to uncertain tax positions taken in previously filed returns may be different from the liabilities that have been recorded for these unrecognized tax benefits. As a result, the Company may be subject to additional tax expense.

 

As of June 30, 2023, the Company is asserting under ASC 740-30 that all of the unremitted earnings of its foreign subsidiaries are indefinitely invested. The Company evaluates this assertion each period based on a number of factors, including the operating plans, budgets, and forecasts for both the Company and its foreign subsidiaries; the long-term and short-term financial requirements in the U.S. and in each foreign jurisdiction; and the tax consequences of any decision to repatriate earnings of foreign subsidiaries to the U.S.

 

As of June 30, 2023 and March 31, 2023, the Company had a federal tax liability of approximately $1,603,000 related to the repatriation of the Company’s undistributed earnings of its foreign subsidiaries as required by the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). As of June 30, 2023 and March 31, 2023, the Company’s short term portion was approximately $401,000 and the long term portion was approximately $1,202,000.

 

The liability is payable over 8 years. The first five installments are each equal to 8%, the sixth is equal to 15%, the seventh is equal to 20% and the final installment is equal to 25% of the liability. As of June 30, 2023, the Company has paid five of the eight installments. Each installment must be remitted on or before July 15th of the year in which such installment is due. On July 12, 2023, the Company paid its sixth installment of approximately $401,000.

 

XML 21 R12.htm IDEA: XBRL DOCUMENT v3.23.2
Note 6 - Related Party Transactions
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Related Party Transactions Disclosure [Text Block]

NOTE 6 RELATED PARTY TRANSACTIONS

 

From time to time, Emerson engages in business transactions with its controlling shareholder, Nimble Holdings Company Limited (“Nimble”), formerly known as The Grande Holdings Limited (“Grande”), and one or more of Nimble’s direct and indirect subsidiaries, or with entities related to the Company’s Chairman of the Board of Directors. Set forth below is a summary of such transactions.

 

Controlling Shareholder

 

S&T International Distribution Limited (“S&T”), which is a wholly owned subsidiary of Grande N.A.K.S. Ltd., which is a wholly owned subsidiary of Nimble, collectively have, based on a Schedule 13D/A filed with the SEC on February 15, 2019, the shared power to vote and direct the disposition of 15,243,283 shares, or approximately 72.4%, of the Company’s outstanding common stock as of June 30, 2023. Accordingly, the Company is a “controlled company” as defined in Section 801(a) of the NYSE American Company Guide.

 

Related Party Transactions

 

Charges of rental and utility fees on office space in Hong Kong

 

During the three month period ended June 30, 2023, the Company was billed approximately $40,000 for rental and utility fees from Vigers Appraisal and Consulting Ltd (“VACL”), which is a company related to the Company’s Chairman of the Board of Directors. As of June 30, 2023 the Company owed approximately $800 to VACL related to these charges.  

 

XML 22 R13.htm IDEA: XBRL DOCUMENT v3.23.2
Note 7 - Short Term Deposits
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Investment [Text Block]

NOTE 7 SHORT TERM DEPOSITS

 

As of June 30, 2023 and March 31, 2023, the Company held $22.9 million and $23.1 million, respectively, in term deposits. Such term deposits had maturity dates of 90 days or less and, as a result, were classified as cash equivalents.  

 

XML 23 R14.htm IDEA: XBRL DOCUMENT v3.23.2
Note 8 - Concentration Risk
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Concentration Risk Disclosure [Text Block]

NOTE 8 CONCENTRATION RISK

 

Customer Concentration

 

For the three month period ended June 30, 2023, the Company’s three largest customers accounted for approximately 88% of the Company’s net revenues, of which Walmart accounted for approximately 43%, Amazon accounted for approximately 28% and Fred Meyer accounted for approximately 17%. No other customer accounted for greater than 10% of the Company's net revenues during the period.

 

For the three month period ended June 30, 2022, the Company’s three largest customers accounted for approximately 73% of the Company’s net revenues, of which Walmart accounted for approximately 42%, Fred Meyer accounted for approximately 19% and Amazon accounted for approximately 12%. No other customer accounted for greater than 10% of the Company's net revenues during the period.

 

A significant decline in net sales to any of the Company’s key customers would have a material adverse effect on the Company’s business, financial condition and results of operation.             

 

Product Concentration

 

For the three month period ended June 30, 2023, the Company’s gross product sales included microwave ovens, which generated approximately 36% of the Company’s gross product sales and audio products, which generated approximately 60% of the Company’s gross product sales. No other products accounted for greater than 10% of the Company's gross product sales during the period.

 

For the three month period ended June 30, 2022, the Company’s gross product sales included microwave ovens, which generated approximately 42% of the Company’s gross product sales and audio products, which generated approximately 57% of the Company’s gross product sales. No other products accounted for greater than 10% of the Company's gross product sales during the period.    

 

Concentrations of Credit Risk

 

As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 48%, 25% and 20%, respectively, as of June 30, 2023. No other customers accounted for greater than 10% of the Company's total trade accounts receivable, net of specific reserves. As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 43%, 35% and 11%, respectively, as of March 31, 2023. No other customers accounted for greater than 10% of the Company's total trade accounts receivable, net of specific reserves. The Company periodically performs credit evaluations of its customers but generally does not require collateral, and the Company provides for any anticipated credit losses in the financial statements based upon management’s estimates and ongoing reviews of recorded allowances. Due to the high concentration of the Company’s net trade accounts receivables among just two customers, any significant failure by one of these customers to pay the Company the amounts owing against these receivables would result in a material adverse effect on the Company’s business, financial condition and results of operations.

 

The Company maintains its cash accounts with major U.S. and foreign financial institutions. The Company’s cash and restricted cash balances on deposit in the U.S. as of June 30, 2023 and March 31, 2023 were insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per qualifying bank account in accordance with FDIC rules. The Company’s cash, cash equivalents and restricted cash balances in excess of these FDIC-insured limits were approximately $24.4 million and approximately $25.0 million at June 30, 2023 and March 31, 2023, respectively.

 

Supplier Concentration

 

During the three month period ended June 30, 2023, the Company procured 100% of its products for resale from its three largest factory suppliers, of which approximately 57% was supplied by its largest supplier and approximately 22% and 21%, respectively, by the other two suppliers. During the three month period ended June 30, 2022, the Company procured 100% of its products for resale from its two largest factory suppliers, of which approximately 76% was supplied by its largest supplier and approximately 24% by the other.    

 

XML 24 R15.htm IDEA: XBRL DOCUMENT v3.23.2
Note 9 - Leases
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Lessee Lease Disclosure [Text Block]

NOTE 9 LEASES

 

The Company leases office space in the U.S. and in Hong Kong as well as a copier in the U.S. These leases have remaining non-cancellable lease terms of twelve to fourteen months. The Company has elected not to separate lease and non-lease components for all leased assets. The Company did not identify any events or conditions during the quarter ended June 30, 2023 to indicate that a reassessment or re-measurement of the Company’s existing leases was required.

 

As of June 30, 2023, the Company’s current operating lease liabilities and finance lease liabilities were $142,000 and $1,000, respectively and its non-current operating lease liabilities and finance lease liabilities were $25,000 and nil, respectively. The Company’s operating and finance lease right-of-use asset balances are presented in non-current assets. The net balance of the Company’s operating and finance lease right-of-use assets as of June 30, 2023 was $166,000 and $1,000, respectively.

 

In January 2023, the Company relocated its headquarters to a temporary office space, while its new landlord awaited the proper permits to build out the agreed-upon space. The Company has subsequently moved into the agreed-upon space and the commencement date of the new lease is July 1, 2023.

 

The components of lease costs, which were included in operating expenses in the Company’s condensed consolidated statements of operations, were as follows:

 

  

Three Months Ended June 30,

 
  

2023

  

2022

 
  

(in thousands)

 

Lease cost

        

Operating lease cost

 $37  $59 

Finance lease cost

      

Amortization of right-of-use assets

      

Interest on lease liabilities

      

Variable lease costs

      

Total lease cost

  37   59 
         

The supplemental cash flow information related to leases are as follows:

        
         

Cash paid for amounts included in the measurement of lease liabilities:

        

Operating cash flows from operating leases

  37   59 

Operating cash flows from finance leases

      

Financing cash flows from finance leases

      
         

Right-of-use assets obtained in exchange for lease obligations:

        

Operating leases

      

Finance leases

      

 

Information relating to the lease term and discount rate are as follows:

 

Weighted average remaining lease term (in months)

 

As of June 30, 2023

  

As of June 30, 2022

 

Operating leases

  13.5   22.5 

Finance leases

  11.2   23.2 
         

Weighted average discount rate

        

Operating leases

  7.50%  7.50%

Finance leases

  7.50%  7.50%

 

As of  June 30, 2023 the maturities of lease liabilities were as follows:

 

(in thousands)

 

Operating Leases

  

Finance Leases

 
         

2024

 $112  $1 

2025

  62    

2026

      

2027

      

Thereafter

      

Total lease payments

 $174  $1 

Less: Imputed interest

  (7)   

Total

 $167  $1 

 

XML 25 R16.htm IDEA: XBRL DOCUMENT v3.23.2
Note 10 - Governmental Assistance Programs
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Government Assistance [Text Block]

NOTE 10 GOVERNMENTAL ASSISTANCE PROGRAMS  

 

During the three month periods ended June 30, 2023 and June 30, 2022, the Company’s Hong Kong subsidiary recorded nil and $22,000, respectively, under the governmental program called the Employment Support Scheme (“ESS”). The proceeds were required to be used for payroll expenses and the Company was subject to government-appointed random reviews to verify the information submitted by the applicant. 

 

The income realized from the amount granted under the ESS program is presented as Other Income under the description called “Income from governmental assistance programs” in the Consolidated Statements of Operations.

 

XML 26 R17.htm IDEA: XBRL DOCUMENT v3.23.2
Note 11 - Legal Proceedings
3 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Legal Matters and Contingencies [Text Block]

NOTE 11 LEGAL PROCEEDINGS

 

On April 19, 2022, the US District Court for the District of Delaware (the "District Court") granted judgment in favor of the Company in its trademark infringement lawsuit against air conditioning and heating products provider Emerson Quiet Kool and wholesaler Home Easy (the “defendants”). Among other things, the court order issues an injunction and directs the US Patent and Trademark Office to cancel the defendants’ existing and proposed “Emerson Quiet Kool” trademarks and prohibits defendants from registering or applying to register the same mark or any other mark or name containing the word “Emerson” going forward. The judgment also awards $6.5 million to the Company. The defendants have to date conditionally made payments, including certain advances and a portion of their liability, which are reflected as advanced deposits in the Consolidated Balance Sheets, in connection with ongoing negotiations among the parties. The aggregate amount of the payments is $4.1 million, which has been reduced by approximately $784,000 for legal fees incurred in fiscal 2023 and approximately $154,000 for legal fees incurred in fiscal 2024, in pursuit of the advanced deposits. On July 11, 2023, the US Court of Appeals for the Third Circuit affirmed the District Court's default judgement against Emerson Quiet Kool. There is no guarantee that the Company will be able to collect the entire judgment or that a negotiated resolution regarding these matters will ever be agreed among the parties or, if agreed, how soon the parties will be able to do so.  

 

XML 27 R18.htm IDEA: XBRL DOCUMENT v3.23.2
Significant Accounting Policies (Policies)
3 Months Ended
Jun. 30, 2023
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]

The consolidated financial statements include the accounts of Emerson Radio Corp. and its subsidiaries (“Emerson” or the “Company”). The Company designs, sources, imports and markets certain houseware and consumer electronic products, and licenses the Company’s trademarks for a variety of products.

 

The unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the Company’s consolidated financial position as of  June 30, 2023 and the results of operations for the three month periods ended June 30, 2023 and June 30, 2022. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements not misleading have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of the unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes; actual results could materially differ from those estimates. The unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly do not include all of the disclosures normally made in the Company’s annual consolidated financial statements. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended  March 31, 2023 (“fiscal 2023”), included in the Company’s Annual Report on Form 10-K, as amended, for fiscal 2023.

 

The results of operations for the three month period ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the full year ending March 31, 2024 (“fiscal 2024”).

 

Whenever necessary, reclassifications are made to conform the prior year’s consolidated financial statements to the current year’s presentation.

 

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Issued Accounting Pronouncements

 

The following Accounting Standards Updates (“ASUs”) were issued by the Financial Accounting Standards Board (“FASB”) which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.

 

Accounting Standards Update 2019-12 Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (Issued December 2019)

 

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020. This standard took effect in the first quarter ( June 2021) of the Company’s fiscal year ending March 31, 2022. The adoption of ASU 2019-12 had no material impact on the Company’s consolidated financial statements and related disclosures.

 

Accounting Standards Update 2016-13 Financial Instruments Credit Losses (Issued June 2016)

 

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU 2016-13 requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for fiscal years and interim periods beginning after December 15, 2022. Early adoption is permitted. The Company does not expect these amendments to have a material impact on its financial statements.

 

Revenue [Policy Text Block]

Revenue recognition: Sales to customers and related cost of sales are primarily recognized at the point in time when control of goods transfers to the customer. Control is considered to be transferred when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits of that good. Under the Direct Import Program, title passes in the country of origin when the goods are passed over the rail of the customer’s vessel. Under the Domestic Program, title passes primarily at the time of shipment. Estimates for future expected returns are based upon historical return rates and netted against revenues.

 

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Revenue is recorded net of customer discounts, promotional allowances, volume rebates and similar charges. When the Company offers the right to return product, historical experience is utilized to establish a liability for the estimate of expected returns. Sales and other tax amounts collected from customers for remittance to governmental authorities are excluded from revenue.

 

Management must make estimates of potential future product returns related to current period product revenue. Management analyzes historical returns, current economic trends and changes in customer demand for the Company’s products when evaluating the adequacy of the reserve for sales returns. Management judgments and estimates must be made and used in connection with establishing the sales return reserves in any accounting period. Additional reserves may be required if actual sales returns increase above the historical return rates. Conversely, the sales return reserve could be decreased if the actual return rates are less than the historical return rates, which were used to establish the reserve.

 

Sales allowances, marketing support programs, promotions and other volume-based incentives which are provided to retailers and distributors are accounted for on an accrual basis as a reduction to net revenues in the period in which the related sales are recognized in accordance with ASC topic 606, “Revenue from Contracts with Customers” (“ASC 606”).

 

At the time of sale, the Company reduces recognized gross revenue by allowances to cover, in addition to estimated sales returns as required by ASC 606, (i) sales incentives offered to customers that meet the criteria for accrual and (ii) an estimated amount to recognize additional non-offered deductions it anticipates and can reasonably estimate will be taken by customers, which it does not expect to recover. Accruals for the estimated amount of future non-offered deductions are required to be made as contra-revenue items, because that percentage of shipped revenue fails to meet the collectability criteria within ASC 606.

 

If additional marketing support programs, promotions and other volume-based incentives are required to promote the Company’s products subsequent to the initial sale, then additional reserves may be required and are accrued for when such support is offered.

 

The Company offers limited warranties for its consumer electronics, comparable to those offered to consumers by the Company’s competitors in the United States. Such warranties typically consist of a one year period for microwaves and a 90 day period for audio products, under which the Company pays for labor and parts, or offers a new or similar unit in exchange for a non-performing unit.

 

Licensing: In addition to the distribution of products, the Company grants licenses for the right to access the Company’s intellectual property, specifically the Company’s trademarks, for a stated term for the manufacture and/or sale of consumer electronics and other products under agreements which require payment of either (i) a non-refundable minimum guaranteed royalty or, (ii) the greater of (a) the actual royalties due (based on a contractual calculation, normally comprised of actual product sales by the licensee multiplied by a stated royalty rate, or “Sales Royalties”) or (b) a minimum guaranteed royalty amount. In the case of the foregoing clause (i), such amounts are recognized as revenue on a straight-line basis over the term of the license agreement. In the case of the foregoing clause (ii), Sales Royalties in excess of guaranteed minimums are accounted for as variable fees and are not recognized as revenue until the Company has ascertained that the licensee’s sales of products have exceeded the guaranteed minimum. In effect, the Company recognizes the greater of Sales Royalties earned to date or the straight-line amount of minimum guaranteed royalties to date. In the case where a royalty is paid to the Company in advance, the royalty payment is initially recorded as a liability and recognized as revenue as the royalties are deemed to be earned according to the principles outlined above.

 

XML 28 R19.htm IDEA: XBRL DOCUMENT v3.23.2
Note 2 - Earnings Per Share (Tables)
3 Months Ended
Jun. 30, 2023
Notes Tables  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
  

Three Months Ended June 30,

 
  

2023

  

2022

 
         

Numerator:

        

Net loss

 $(565) $(1,077)

Denominator:

        

Denominator for basic and diluted loss per share — weighted average shares

  21,042,652   21,042,652 

Net loss per share:

        

Basic and diluted loss per share

 $(0.03) $(0.05)
XML 29 R20.htm IDEA: XBRL DOCUMENT v3.23.2
Note 4 - Inventory (Tables)
3 Months Ended
Jun. 30, 2023
Notes Tables  
Schedule of Inventory, Current [Table Text Block]
  

June 30, 2023

  

March 31, 2023

 

Finished goods

 $3,707  $3,813 
XML 30 R21.htm IDEA: XBRL DOCUMENT v3.23.2
Note 9 - Leases (Tables)
3 Months Ended
Jun. 30, 2023
Notes Tables  
Lease, Cost [Table Text Block]
  

Three Months Ended June 30,

 
  

2023

  

2022

 
  

(in thousands)

 

Lease cost

        

Operating lease cost

 $37  $59 

Finance lease cost

      

Amortization of right-of-use assets

      

Interest on lease liabilities

      

Variable lease costs

      

Total lease cost

  37   59 
         

The supplemental cash flow information related to leases are as follows:

        
         

Cash paid for amounts included in the measurement of lease liabilities:

        

Operating cash flows from operating leases

  37   59 

Operating cash flows from finance leases

      

Financing cash flows from finance leases

      
         

Right-of-use assets obtained in exchange for lease obligations:

        

Operating leases

      

Finance leases

      
Summary of Information Relating To Lease Term And Discount Rate [Table Text Block]

Weighted average remaining lease term (in months)

 

As of June 30, 2023

  

As of June 30, 2022

 

Operating leases

  13.5   22.5 

Finance leases

  11.2   23.2 
         

Weighted average discount rate

        

Operating leases

  7.50%  7.50%

Finance leases

  7.50%  7.50%
Operating and Finance Lease Liability Maturity [Table Text Block]

(in thousands)

 

Operating Leases

  

Finance Leases

 
         

2024

 $112  $1 

2025

  62    

2026

      

2027

      

Thereafter

      

Total lease payments

 $174  $1 

Less: Imputed interest

  (7)   

Total

 $167  $1 
XML 31 R22.htm IDEA: XBRL DOCUMENT v3.23.2
Note 1 - Background and Basis of Presentation (Details Textual)
3 Months Ended
Jun. 30, 2023
Microwave Ovens [Member]  
Product Warranty, Term (Year) 1 year
Audio Products [Member]  
Product Warranty, Term (Year) 90 days
XML 32 R23.htm IDEA: XBRL DOCUMENT v3.23.2
Note 2 - Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Numerator:    
Net (loss) $ (565) $ (1,077)
Weighted average shares outstanding    
Basic (in shares) 21,042,652 21,042,652
Net loss per share:    
Basic loss per share (in dollars per share) $ (0.03) $ (0.05)
XML 33 R24.htm IDEA: XBRL DOCUMENT v3.23.2
Note 3 - Shareholders' Equity (Details Textual)
shares in Thousands
Jun. 30, 2023
shares
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number (in shares) 0
Class of Warrant or Right, Outstanding (in shares) 0
Potentially Dilutive Securities Outstanding (in shares) 0
XML 34 R25.htm IDEA: XBRL DOCUMENT v3.23.2
Note 4 - Inventory - Schedule of Inventory (Details) - USD ($)
$ in Thousands
Jun. 30, 2023
Mar. 31, 2023
Finished goods $ 3,707 $ 3,813
XML 35 R26.htm IDEA: XBRL DOCUMENT v3.23.2
Note 5 - Income Taxes (Details Textual) - USD ($)
3 Months Ended
Jul. 12, 2023
Jun. 30, 2023
Jun. 30, 2022
Income (Loss) from Continuing Operations before Income Taxes, Foreign   $ 302,000 $ 83,000
Deferred Tax Asset, Valuation Allowance Percent   100.00%  
Deferred Tax Assets, Valuation Allowance   $ 4,906,000  
Taxes, Miscellaneous   8,650 $ 10,500
Tax Cuts and Jobs Act, Transition Tax for Accumulated Foreign Earnings, Liability   1,603,000  
Tax Cuts and Jobs Act, Transition Tax for Accumulated Foreign Earnings, Liability, Current   401,000  
Tax Cuts and Jobs Act, Transition Tax for Accumulated Foreign Earnings, Liability, Noncurrent   $ 1,202,000  
Federal Tax Liability Payable, Duration (Year)   8 years  
Percentage of Federal Tax Liability Payable in First Five Installments   8.00%  
Percentage of Federal Tax Liability Payable in Sixth Installment   15.00%  
Percentage of Federal Tax Liability Payable in Seventh Installment   20.00%  
Percentage of Federal Tax Liability Payable in Final Installment   25.00%  
Number of Installments of Federal Tax Liability Paid   5  
Subsequent Event [Member]      
Payments of Federal Tax Liability $ 401,000    
Domestic Tax Authority [Member]      
Operating Loss Carryforwards   $ 16.3  
Percentage of Net Operation Loss Carry Forwards, Utilization Limit Against Taxable Income   80.00%  
Open Tax Year   2017 2018 2019 2020 2021 2022 2023  
State and Local Jurisdiction [Member]      
Operating Loss Carryforwards   $ 19.5  
Open Tax Year   2015 2016 2017 2018 2019 2020 2022 2023  
XML 36 R27.htm IDEA: XBRL DOCUMENT v3.23.2
Note 6 - Related Party Transactions (Details Textual)
3 Months Ended
Jun. 30, 2023
USD ($)
shares
Majority Shareholder [Member]  
Ownership Interest, Number of Shares (in shares) | shares 15,243,283
Ownership Interest Percentage 72.40%
Vigers Appraisal And Consulting Ltd [Member]  
Income From Advanced Payment of Rental and Utility Fees $ 40,000
Accounts Payable $ 800
XML 37 R28.htm IDEA: XBRL DOCUMENT v3.23.2
Note 7 - Short Term Deposits (Details Textual) - USD ($)
$ in Millions
Jun. 30, 2023
Mar. 31, 2023
Cash Equivalents [Member]    
Certificates of Deposit, at Carrying Value $ 22.9 $ 23.1
XML 38 R29.htm IDEA: XBRL DOCUMENT v3.23.2
Note 8 - Concentration Risk (Details Textual)
3 Months Ended 9 Months Ended 12 Months Ended
Jun. 30, 2023
USD ($)
Jun. 30, 2022
Dec. 31, 2022
Mar. 31, 2023
USD ($)
Cash, Uninsured Amount $ 24,400,000     $ 25,000,000.0
Maximum [Member]        
Cash, FDIC Insured Amount $ 250,000      
Customer Concentration Risk [Member] | Revenue Benchmark [Member]        
Number of Customers 3 3    
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Three Largest Customers [Member]        
Concentration Risk, Percentage 88.00% 73.00%    
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Walmart [Member]        
Concentration Risk, Percentage 43.00% 42.00%    
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Amazon [Member]        
Concentration Risk, Percentage 28.00% 12.00%    
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Fred Meyer [Member]        
Concentration Risk, Percentage 17.00% 19.00%    
Customer Concentration Risk [Member] | Accounts Receivable [Member]        
Number of Customers 3     3
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer One [Member]        
Concentration Risk, Percentage     48.00% 43.00%
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer Two [Member]        
Concentration Risk, Percentage 25.00%     35.00%
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer Three [Member]        
Concentration Risk, Percentage 20.00%     11.00%
Product Concentration Risk [Member] | Revenue, Product and Service Benchmark [Member] | Microwave Ovens [Member]        
Concentration Risk, Percentage 36.00% 42.00%    
Product Concentration Risk [Member] | Revenue, Product and Service Benchmark [Member] | Audio Products [Member]        
Concentration Risk, Percentage 60.00% 57.00%    
Supplier Concentration Risk [Member] | Products for Resale [Member]        
Number of Factory Suppliers 3 2    
Supplier Concentration Risk [Member] | Products for Resale [Member] | Three Largest Factory Suppliers [Member]        
Concentration Risk, Percentage 100.00%      
Supplier Concentration Risk [Member] | Products for Resale [Member] | Largest Supplier [Member]        
Concentration Risk, Percentage 57.00% 76.00%    
Supplier Concentration Risk [Member] | Products for Resale [Member] | Supplier One [Member]        
Concentration Risk, Percentage 22.00% 24.00%    
Supplier Concentration Risk [Member] | Products for Resale [Member] | Supplier Two [Member]        
Concentration Risk, Percentage 21.00%      
Supplier Concentration Risk [Member] | Products for Resale [Member] | Two Largest Factory Suppliers [Member]        
Concentration Risk, Percentage   100.00%    
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Note 9 - Leases (Details Textual) - USD ($)
Jun. 30, 2023
Mar. 31, 2023
Operating Lease, Liability, Current $ 142,000 $ 139,000
Finance Lease, Liability, Current 1,000 1,000
Operating Lease, Liability, Noncurrent 25,000 62,000
Finance Lease, Liability, Noncurrent 0 0
Operating Lease, Right-of-Use Asset 166,000 200,000
Finance Lease, Right-of-Use Asset, after Accumulated Amortization $ 1,000 $ 1,000
Minimum [Member]    
Lessee, Operating Lease, Term of Contract (Month) 12 months  
Maximum [Member]    
Lessee, Operating Lease, Term of Contract (Month) 14 months  
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Note 9 - Leases - Summary of Components of Lease Costs (Details) - USD ($)
$ in Thousands
3 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Lease cost    
Operating lease cost $ 37 $ 59
Finance lease cost 0 0
Amortization of right-of-use assets 0 0
Interest on lease liabilities 0 0
Variable lease costs 0 0
Total lease cost 37 59
Cash paid for amounts included in the measurement of lease liabilities:    
Operating cash flows from operating leases 37 59
Operating cash flows from finance leases 0 0
Financing cash flows from finance leases 0 0
Right-of-use assets obtained in exchange for lease obligations:    
Operating leases 0 0
Finance leases $ 0 $ 0
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Note 9 - Leases - Summary of Information Relating to Lease Term and Discount Rate (Details)
Jun. 30, 2023
Jun. 30, 2022
Operating leases (Month) 13 months 15 days 22 months 15 days
Finance leases (Month) 11 months 6 days 23 months 6 days
Operating leases 7.50% 7.50%
Finance leases 7.50% 7.50%
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Note 9 - Leases - Summary of Maturities of Lease Liabilities (Details)
$ in Thousands
Jun. 30, 2023
USD ($)
2024, operating lease $ 112
2024, finance lease 1
2025, operating lease 62
2025, finance lease 0
2026, operating lease 0
2026, finance lease 0
2027, operating lease 0
2027, finance lease 0
Thereafter, operating lease 0
Thereafter, finance lease 0
Operating Leases, Total lease payments 174
Finance Leases, Total lease payments 1
Operating Leases, Less: Imputed interest (7)
Finance Leases, Less: Imputed interest 0
Operating Leases, Total 167
Finance Leases, Total $ 1
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Note 10 - Governmental Assistance Programs (Details Textual) - USD ($)
3 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Government Assistance, Amount $ 0 $ 22,000
Employment Support Scheme [Member]    
Government Assistance, Amount $ 0 $ 22,000
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Note 11 - Legal Proceedings (Details Textual) - USD ($)
3 Months Ended 12 Months Ended
Apr. 19, 2022
Jun. 30, 2023
Mar. 31, 2023
Loss Contingency, Damages Awarded, Value $ 6,500,000    
Loss Contingency, Damages Paid, Value     $ 4,100,000
Legal Fees   $ 154,000 $ 784,000
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-24688000 -33201000 25742000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>NOTE <em style="font: inherit;">1</em> </b>—<b> BACKGROUND AND BASIS OF PRESENTATION</b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"></p><p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The consolidated financial statements include the accounts of Emerson Radio Corp. and its subsidiaries (“Emerson” or the “Company”). The Company designs, sources, imports and markets certain houseware and consumer electronic products, and licenses the Company’s trademarks for a variety of products.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the Company’s consolidated financial position as of <em style="font: inherit;"> June 30, 2023</em> and the results of operations for the <em style="font: inherit;">three</em> month periods ended <em style="font: inherit;"> June 30, 2023 </em>and <em style="font: inherit;"> June 30, 2022</em>. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements <em style="font: inherit;">not</em> misleading have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of the unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes; actual results could materially differ from those estimates. The unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly do <em style="font: inherit;">not</em> include all of the disclosures normally made in the Company’s annual consolidated financial statements. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended <em style="font: inherit;"> March 31, 2023</em> (“fiscal <em style="font: inherit;">2023”</em>), included in the Company’s Annual Report on Form <em style="font: inherit;">10</em>-K, as amended, for fiscal <em style="font: inherit;">2023.</em></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The results of operations for the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em> are <em style="font: inherit;">not</em> necessarily indicative of the results of operations that <em style="font: inherit;"> may </em>be expected for any other interim period or for the full year ending <em style="font: inherit;"> March </em><em style="font: inherit;">31,</em> <em style="font: inherit;">2024</em> (“fiscal <em style="font: inherit;">2024”</em>).</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Whenever necessary, reclassifications are made to conform the prior year’s consolidated financial statements to the current year’s presentation.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p><p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"></p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b></b></p><p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>Recently Issued Accounting Pronouncements</b></p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;">The following Accounting Standards Updates (“ASUs”) were issued by the Financial Accounting Standards Board (“FASB”) which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;"><i><b>Accounting Standards Update <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> </b>“<b>Income Taxes (Topic <em style="font: inherit;">740</em>) </b>–<b> Simplifying the Accounting for Income Taxes</b>”<b> (Issued <em style="font: inherit;"> December 2019)</em></b></i></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt; text-indent: 25pt;">In <em style="font: inherit;"> December 2019, </em>the FASB issued ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12,</em> “Income Taxes (Topic <em style="font: inherit;">740</em>) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> removes certain exceptions to the general principles in Topic <em style="font: inherit;">740</em> and also clarifies and amends existing guidance to improve consistent application. ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> is effective for fiscal years beginning after <em style="font: inherit;"> December 15, 2020. </em>This standard took effect in the <em style="font: inherit;">first</em> quarter (<em style="font: inherit;"> June 2021) </em>of the Company’s fiscal year ending <em style="font: inherit;"> March 31, 2022. </em>The adoption of ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> had <em style="font: inherit;">no</em> material impact on the Company’s consolidated financial statements and related disclosures.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;"><i><b>Accounting Standards Update <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> </b>“<b>Financial Instruments </b>–<b> Credit Losses</b>”<b> (Issued <em style="font: inherit;"> June 2016)</em></b></i></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">In <em style="font: inherit;"> June 2016, </em>the FASB issued ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> is effective for fiscal years and interim periods beginning after <em style="font: inherit;"> December 15, 2022. </em>Early adoption is permitted. The Company does <em style="font: inherit;">not</em> expect these amendments to have a material impact on its financial statements.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p><p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"></p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"><b><i></i></b></p><p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"><b><i>Revenue recognition</i></b>: Sales to customers and related cost of sales are primarily recognized at the point in time when control of goods transfers to the customer. Control is considered to be transferred when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits of that good. Under the Direct Import Program, title passes in the country of origin when the goods are passed over the rail of the customer’s vessel. Under the Domestic Program, title passes primarily at the time of shipment. Estimates for future expected returns are based upon historical return rates and netted against revenues.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Revenue is recorded net of customer discounts, promotional allowances, volume rebates and similar charges. When the Company offers the right to return product, historical experience is utilized to establish a liability for the estimate of expected returns. Sales and other tax amounts collected from customers for remittance to governmental authorities are excluded from revenue.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">Management must make estimates of potential future product returns related to current period product revenue. Management analyzes historical returns, current economic trends and changes in customer demand for the Company’s products when evaluating the adequacy of the reserve for sales returns. Management judgments and estimates must be made and used in connection with establishing the sales return reserves in any accounting period. Additional reserves <em style="font: inherit;"> may </em>be required if actual sales returns increase above the historical return rates. Conversely, the sales return reserve could be decreased if the actual return rates are less than the historical return rates, which were used to establish the reserve.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Sales allowances, marketing support programs, promotions and other volume-based incentives which are provided to retailers and distributors are accounted for on an accrual basis as a reduction to net revenues in the period in which the related sales are recognized in accordance with ASC topic <em style="font: inherit;">606,</em> “Revenue from Contracts with Customers” (“ASC <em style="font: inherit;">606”</em>).</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">At the time of sale, the Company reduces recognized gross revenue by allowances to cover, in addition to estimated sales returns as required by ASC <em style="font: inherit;">606,</em> (i) sales incentives offered to customers that meet the criteria for accrual and (ii) an estimated amount to recognize additional non-offered deductions it anticipates and can reasonably estimate will be taken by customers, which it does <em style="font: inherit;">not</em> expect to recover. Accruals for the estimated amount of future non-offered deductions are required to be made as contra-revenue items, because that percentage of shipped revenue fails to meet the collectability criteria within ASC <em style="font: inherit;">606.</em></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">If additional marketing support programs, promotions and other volume-based incentives are required to promote the Company’s products subsequent to the initial sale, then additional reserves <em style="font: inherit;"> may </em>be required and are accrued for when such support is offered.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">The Company offers limited warranties for its consumer electronics, comparable to those offered to consumers by the Company’s competitors in the United States. Such warranties typically consist of a <span style="-sec-ix-hidden:c101815606">one</span> year period for microwaves and a 90 day period for audio products, under which the Company pays for labor and parts, or offers a new or similar unit in exchange for a non-performing unit.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"><b><i>Licensing</i></b>:<b><i> </i></b>In addition to the distribution of products, the Company grants licenses for the right to access the Company’s intellectual property, specifically the Company’s trademarks, for a stated term for the manufacture and/or sale of consumer electronics and other products under agreements which require payment of either (i) a non-refundable minimum guaranteed royalty or, (ii) the greater of (a) the actual royalties due (based on a contractual calculation, normally comprised of actual product sales by the licensee multiplied by a stated royalty rate, or “Sales Royalties”) or (b) a minimum guaranteed royalty amount. In the case of the foregoing clause (i), such amounts are recognized as revenue on a straight-line basis over the term of the license agreement. In the case of the foregoing clause (ii), Sales Royalties in excess of guaranteed minimums are accounted for as variable fees and are <em style="font: inherit;">not</em> recognized as revenue until the Company has ascertained that the licensee’s sales of products have exceeded the guaranteed minimum. In effect, the Company recognizes the greater of Sales Royalties earned to date or the straight-line amount of minimum guaranteed royalties to date. In the case where a royalty is paid to the Company in advance, the royalty payment is initially recorded as a liability and recognized as revenue as the royalties are deemed to be earned according to the principles outlined above.</p> <p style="margin: 0pt; font-size: 10pt; font-family: &quot;Times New Roman&quot;;"> </p><p style="margin: 0pt; font-size: 10pt; font-family: &quot;Times New Roman&quot;;"></p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The consolidated financial statements include the accounts of Emerson Radio Corp. and its subsidiaries (“Emerson” or the “Company”). The Company designs, sources, imports and markets certain houseware and consumer electronic products, and licenses the Company’s trademarks for a variety of products.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the Company’s consolidated financial position as of <em style="font: inherit;"> June 30, 2023</em> and the results of operations for the <em style="font: inherit;">three</em> month periods ended <em style="font: inherit;"> June 30, 2023 </em>and <em style="font: inherit;"> June 30, 2022</em>. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements <em style="font: inherit;">not</em> misleading have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of the unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes; actual results could materially differ from those estimates. The unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly do <em style="font: inherit;">not</em> include all of the disclosures normally made in the Company’s annual consolidated financial statements. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended <em style="font: inherit;"> March 31, 2023</em> (“fiscal <em style="font: inherit;">2023”</em>), included in the Company’s Annual Report on Form <em style="font: inherit;">10</em>-K, as amended, for fiscal <em style="font: inherit;">2023.</em></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The results of operations for the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em> are <em style="font: inherit;">not</em> necessarily indicative of the results of operations that <em style="font: inherit;"> may </em>be expected for any other interim period or for the full year ending <em style="font: inherit;"> March </em><em style="font: inherit;">31,</em> <em style="font: inherit;">2024</em> (“fiscal <em style="font: inherit;">2024”</em>).</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Whenever necessary, reclassifications are made to conform the prior year’s consolidated financial statements to the current year’s presentation.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>Recently Issued Accounting Pronouncements</b></p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;">The following Accounting Standards Updates (“ASUs”) were issued by the Financial Accounting Standards Board (“FASB”) which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;"><i><b>Accounting Standards Update <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> </b>“<b>Income Taxes (Topic <em style="font: inherit;">740</em>) </b>–<b> Simplifying the Accounting for Income Taxes</b>”<b> (Issued <em style="font: inherit;"> December 2019)</em></b></i></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt; text-indent: 25pt;">In <em style="font: inherit;"> December 2019, </em>the FASB issued ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12,</em> “Income Taxes (Topic <em style="font: inherit;">740</em>) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> removes certain exceptions to the general principles in Topic <em style="font: inherit;">740</em> and also clarifies and amends existing guidance to improve consistent application. ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> is effective for fiscal years beginning after <em style="font: inherit;"> December 15, 2020. </em>This standard took effect in the <em style="font: inherit;">first</em> quarter (<em style="font: inherit;"> June 2021) </em>of the Company’s fiscal year ending <em style="font: inherit;"> March 31, 2022. </em>The adoption of ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> had <em style="font: inherit;">no</em> material impact on the Company’s consolidated financial statements and related disclosures.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; font-variant: normal; margin: 0pt; text-align: left; text-indent: 25pt;"><i><b>Accounting Standards Update <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> </b>“<b>Financial Instruments </b>–<b> Credit Losses</b>”<b> (Issued <em style="font: inherit;"> June 2016)</em></b></i></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">In <em style="font: inherit;"> June 2016, </em>the FASB issued ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> “Financial Instruments - Credit Losses” to introduce new guidance for the accounting for credit losses on instruments within its scope. ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> requires among other things, the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU <em style="font: inherit;">2016</em>-<em style="font: inherit;">13</em> is effective for fiscal years and interim periods beginning after <em style="font: inherit;"> December 15, 2022. </em>Early adoption is permitted. The Company does <em style="font: inherit;">not</em> expect these amendments to have a material impact on its financial statements.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"><b><i>Revenue recognition</i></b>: Sales to customers and related cost of sales are primarily recognized at the point in time when control of goods transfers to the customer. Control is considered to be transferred when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits of that good. Under the Direct Import Program, title passes in the country of origin when the goods are passed over the rail of the customer’s vessel. Under the Domestic Program, title passes primarily at the time of shipment. Estimates for future expected returns are based upon historical return rates and netted against revenues.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Revenue is recorded net of customer discounts, promotional allowances, volume rebates and similar charges. When the Company offers the right to return product, historical experience is utilized to establish a liability for the estimate of expected returns. Sales and other tax amounts collected from customers for remittance to governmental authorities are excluded from revenue.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">Management must make estimates of potential future product returns related to current period product revenue. Management analyzes historical returns, current economic trends and changes in customer demand for the Company’s products when evaluating the adequacy of the reserve for sales returns. Management judgments and estimates must be made and used in connection with establishing the sales return reserves in any accounting period. Additional reserves <em style="font: inherit;"> may </em>be required if actual sales returns increase above the historical return rates. Conversely, the sales return reserve could be decreased if the actual return rates are less than the historical return rates, which were used to establish the reserve.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Sales allowances, marketing support programs, promotions and other volume-based incentives which are provided to retailers and distributors are accounted for on an accrual basis as a reduction to net revenues in the period in which the related sales are recognized in accordance with ASC topic <em style="font: inherit;">606,</em> “Revenue from Contracts with Customers” (“ASC <em style="font: inherit;">606”</em>).</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">At the time of sale, the Company reduces recognized gross revenue by allowances to cover, in addition to estimated sales returns as required by ASC <em style="font: inherit;">606,</em> (i) sales incentives offered to customers that meet the criteria for accrual and (ii) an estimated amount to recognize additional non-offered deductions it anticipates and can reasonably estimate will be taken by customers, which it does <em style="font: inherit;">not</em> expect to recover. Accruals for the estimated amount of future non-offered deductions are required to be made as contra-revenue items, because that percentage of shipped revenue fails to meet the collectability criteria within ASC <em style="font: inherit;">606.</em></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">If additional marketing support programs, promotions and other volume-based incentives are required to promote the Company’s products subsequent to the initial sale, then additional reserves <em style="font: inherit;"> may </em>be required and are accrued for when such support is offered.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">The Company offers limited warranties for its consumer electronics, comparable to those offered to consumers by the Company’s competitors in the United States. Such warranties typically consist of a <span style="-sec-ix-hidden:c101815606">one</span> year period for microwaves and a 90 day period for audio products, under which the Company pays for labor and parts, or offers a new or similar unit in exchange for a non-performing unit.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;"><b><i>Licensing</i></b>:<b><i> </i></b>In addition to the distribution of products, the Company grants licenses for the right to access the Company’s intellectual property, specifically the Company’s trademarks, for a stated term for the manufacture and/or sale of consumer electronics and other products under agreements which require payment of either (i) a non-refundable minimum guaranteed royalty or, (ii) the greater of (a) the actual royalties due (based on a contractual calculation, normally comprised of actual product sales by the licensee multiplied by a stated royalty rate, or “Sales Royalties”) or (b) a minimum guaranteed royalty amount. In the case of the foregoing clause (i), such amounts are recognized as revenue on a straight-line basis over the term of the license agreement. In the case of the foregoing clause (ii), Sales Royalties in excess of guaranteed minimums are accounted for as variable fees and are <em style="font: inherit;">not</em> recognized as revenue until the Company has ascertained that the licensee’s sales of products have exceeded the guaranteed minimum. In effect, the Company recognizes the greater of Sales Royalties earned to date or the straight-line amount of minimum guaranteed royalties to date. In the case where a royalty is paid to the Company in advance, the royalty payment is initially recorded as a liability and recognized as revenue as the royalties are deemed to be earned according to the principles outlined above.</p> <p style="margin: 0pt; font-size: 10pt; font-family: &quot;Times New Roman&quot;;"> </p> P90D <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">2</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> EARNINGS PER SHARE</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts). Weighted average shares includes the impact of shares held in treasury.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="margin-right: 2.5%; margin-left: 2.5%; width: 95%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;"><em style="font: inherit;">Three Months Ended June 30,</em></em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 68%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Numerator:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Net loss</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(565</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(1,077</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Denominator:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Denominator for basic and diluted loss per share — weighted average shares</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);"> </td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">21,042,652</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);"> </td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">21,042,652</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Net loss per share:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Basic and diluted loss per share</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(0.03</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(0.05</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td></tr> </tbody></table> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="margin-right: 2.5%; margin-left: 2.5%; width: 95%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;"><em style="font: inherit;">Three Months Ended June 30,</em></em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 68%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Numerator:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Net loss</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(565</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(1,077</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Denominator:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Denominator for basic and diluted loss per share — weighted average shares</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);"> </td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">21,042,652</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);"> </td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">21,042,652</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Net loss per share:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Basic and diluted loss per share</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(0.03</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 13%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(0.05</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td></tr> </tbody></table> -565000 -1077000 21042652 21042652 -0.03 -0.05 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">3</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> SHAREHOLDERS</span></b><span style="background-color:#ffffff;">’</span><b><span style="background-color:#ffffff;"> EQUITY</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Outstanding capital stock at <em style="font: inherit;"> June 30, 2023</em> consisted of common stock and Series A preferred stock. The Series A preferred stock is non-voting, has <em style="font: inherit;">no</em> dividend preferences and has <em style="font: inherit;">not</em> been convertible since <em style="font: inherit;"> March </em><em style="font: inherit;">31,</em> <em style="font: inherit;">2002;</em> however, it retains a liquidation preference.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">At <em style="font: inherit;"> June 30, 2023</em>, the Company had no options, warrants or other potentially dilutive securities outstanding.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 0 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">4</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> INVENTORY</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">Inventories, which consist primarily of finished goods, are stated at the lower of cost or net realizable value. Cost is determined using the <em style="font: inherit;">first</em>-in, <em style="font: inherit;">first</em>-out method. As of <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023</em>, inventories consisted of the following (in thousands):</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="margin-right: 5%; margin-left: 5%; width: 90%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">June 30, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">March 31, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 66%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Finished goods</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 14%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">3,707</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 14%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">3,813</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td></tr> </tbody></table> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="margin-right: 5%; margin-left: 5%; width: 90%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">June 30, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">March 31, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 66%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Finished goods</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 14%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">3,707</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td><td style="width: 14%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">3,813</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;"> </td></tr> </tbody></table> 3707000 3813000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">5</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> INCOME TAXES</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">At <em style="font: inherit;"> June 30, 2023</em>, the Compan<span style="background-color:#ffffff;">y had $16.3 million of U.S. federal net operating loss (“NOL”) carry forwards. These losses do <em style="font: inherit;">not</em> expire but are limited to utilization of 80% of taxable income in any <em style="font: inherit;">one</em> year. At </span><em style="font: inherit;"> June 30, 2023</em><span style="background-color:#ffffff;">, the Company had approximately $19.5</span> million of U.S. state NOL carry forwards. The tax benefits related to these state NOL carry forwards and future deductible temporary differences are recorded to the extent management believes it is more likely than <em style="font: inherit;">not</em> that such benefits will be realized.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The income of foreign subsidiaries before taxes<span style="background-color:#ffffff;"> was $302,000 for the <em style="font: inherit;">three</em> month period ended </span><em style="font: inherit;"> June 30, 2023</em><span style="background-color:#ffffff;"> as compared to income of foreign subsidiaries before taxes of $83,000 for the <em style="font: inherit;">three</em> month period ended </span><em style="font: inherit;"> June 30, 2022</em><span style="background-color:#ffffff;">. </span></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"><span style="background-color:#ffffff;">The Company analyzed the future reasonability of recognizing its deferred tax assets at </span><em style="font: inherit;"> June 30, 2023</em><span style="background-color:#ffffff;">. As a result, the Company concluded that a 100% valuation allowance of $4,906,000 wo</span>uld be recorded against the assets.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:28pt;">Although the Company generated a net operating loss, it recorded income tax expense of <span style="background-color:#ffffff;">$8,650</span> during the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em>, primarily resulting from state income taxes. During the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2022</em>, the Company recorded income tax expense of <span style="background-color:#ffffff">$10,500,</span> primarily resulting from state income taxes. After the adoption of ASU <em style="font: inherit;">2019</em>-<em style="font: inherit;">12</em> “Income Taxes (Topic <em style="font: inherit;">740</em>) – Simplifying the Accounting for Income Taxes”<b> </b>during fiscal <em style="font: inherit;">2022,</em> these non-income based state taxes are now reported within selling, general and administrative expenses.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The Company is subject to examination and assessment by tax authorities in numerous jurisdictions. As of <em style="font: inherit;"> June 30, 2023</em>, the Company’s open tax years for examination for U.S. federal tax are <span style="-sec-ix-hidden:c101815641">2017</span>-<em style="font: inherit;">2023,</em> and for U.S. states’ tax are <span style="-sec-ix-hidden:c101815643">2015</span>-<em style="font: inherit;">2023.</em> Based on the outcome of tax examinations or due to the expiration of statutes of limitations, it is reasonably possible that the unrecognized tax benefits related to uncertain tax positions taken in previously filed returns <em style="font: inherit;"> may </em>be different from the liabilities that have been recorded for these unrecognized tax benefits. As a result, the Company <em style="font: inherit;"> may </em>be subject to additional tax expense.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: &quot;Times New Roman&quot;; font-size: 10pt; font-variant: normal; margin: 0pt; text-indent: 27pt;">As of <em style="font: inherit;"> June 30, 2023</em>, the Company is asserting under ASC <em style="font: inherit;">740</em>-<em style="font: inherit;">30</em> that all of the unremitted earnings of its foreign subsidiaries are indefinitely invested. The Company evaluates this assertion each period based on a number of factors, including the operating plans, budgets, and forecasts for both the Company and its foreign subsidiaries; the long-term and short-term financial requirements in the U.S. and in each foreign jurisdiction; and the tax consequences of any decision to repatriate earnings of foreign subsidiaries to the U.S.</p> <p style="font-family: &quot;Times New Roman&quot;; font-size: 10pt; font-variant: normal; margin: 0pt; text-indent: 27pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">As of <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023</em>, the Company had a federal tax liability of approximate<span style="background-color:#ffffff;">ly $1,603,000 </span>related to the repatriation of the Company’s undistributed earnings of its foreign subsidiaries as required by the Tax Cuts and Jobs Act of <em style="font: inherit;">2017</em> (the “Tax Act”). As of <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023, </em>the Company’s short term<span style="background-color:#ffffff;"> portion was approximately $401,000 and the long term portion was approximately $1,202,000.</span></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The liability is payable over 8 years. The <em style="font: inherit;">first</em> <em style="font: inherit;">five</em> installments are each equal to 8%, the <em style="font: inherit;">sixth</em> is equal to 15%, the <em style="font: inherit;">seventh</em> is equal to 20% and the final installment is equal to 25% of the liability. As of <em style="font: inherit;"> June 30, 2023</em>, the Company has paid<span style="background-color:#ffffff;"> five of</span> the <em style="font: inherit;">eight</em> installments. Each installment must be remitted on or before <em style="font: inherit;"> July 15</em><sup style="vertical-align:top;line-height:120%;">th</sup> of the year in which such installment is due. On <em style="font: inherit;"> July 12, 2023, </em>the Company paid its <em style="font: inherit;">sixth</em> installment of approximately $401,000.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 16.3 0.80 19.5 302000 83000 1 4906000 8650 10500 1603000 401000 1202000 P8Y 0.08 0.15 0.20 0.25 5 401000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>NOTE <em style="font: inherit;">6</em> </b>—<b><span style="background-color:#ffffff;"> RELATED PARTY TRANSACTIONS</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">From time to time, Emerson engages in business transactions with its controlling shareholder, Nimble Holdings Company Limited (“Nimble”), formerly known as The Grande Holdings Limited (“Grande”), and <em style="font: inherit;">one</em> or more of Nimble’s direct and indirect subsidiaries, or with entities related to the Company’s Chairman of the Board of Directors. Set forth below is a summary of such transactions.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><i>Controlling Shareholder</i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">S&amp;T International Distribution Limited (“S&amp;T”), which is a wholly owned subsidiary of Grande N.A.K.S. Ltd., which is a wholly owned subsidiary of Nimble, collectively have, based on a Schedule <em style="font: inherit;">13D/A</em> filed with the SEC on <em style="font: inherit;"> February 15, 2019, </em>the shared power to vote and direct the disposition of 15,243,283 shares, or approximately 72.4%, of the Company’s outstanding common stock as of <em style="font: inherit;"> June 30, 2023</em>. Accordingly, the Company is a “controlled company” as defined in Section <em style="font: inherit;">801</em>(a) of the NYSE American Company Guide.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><i>Related Party Transactions</i></b></p> <p style="font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin: 0pt; text-align: left"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><i><span style="text-decoration: underline; ">Charges of rental and utility fees on office space in Hong Kong</span></i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">During the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em>, the Company was billed approximately $40,000 for rental and utility fees from Vigers Appraisal and Consulting Ltd (“VACL”), which is a company related to the Company’s Chairman of the Board of Directors. As of <em style="font: inherit;"> June 30, 2023</em> the Company owed approximately $800 to VACL related to these charges.  </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 15243283 0.724 40000 800 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>NOTE <em style="font: inherit;">7</em> </b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> SHORT TERM DEPOSITS</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">As of <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023</em>, the Company held $22.9 million and $23.1 million, respectively, in term deposits. Such term deposits had maturity dates of <em style="font: inherit;">90</em> days or less and, as a result, were classified as cash equivalents.  </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 22900000 23100000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>NOTE <em class="GFJY4-DIN-com-rdg-thunderdome-client-resources-CssResource-html-element-highlighted" style="font: inherit;">8</em> </b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> CONCENTRATION RISK</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><i><span style="background-color:#ffffff;">Customer Concentration </span></i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"><span style="background-color:#ffffff;">For the <em style="font: inherit;">three</em> month period ended </span><em style="font: inherit;"> June 30, 2023</em><span style="background-color:#ffffff;">, the Company’s three largest customers accounted for approxim</span>ately 88% of the Company’s net revenues, of which Walmart accounted for approximately 43%, Amazon accounted for approximately 28% and Fred Meyer accounted for approximately 17%. <em style="font: inherit;">No</em> other customer accounted for greater than <em style="font: inherit;">10%</em> of the Company's net revenues during the period.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">For the <span style="-sec-ix-hidden:c101815687">three</span> month period ended <em style="font: inherit;"> June 30, 2022</em>, the Company’s <em style="font: inherit;">three</em> largest customers accounted for approximately 73% of the Company’s net revenues, of which Walmart accounted for approximately 42%, Fred Meyer accounted for approximately 19% and Amazon accounted for approximately 12%. <em style="font: inherit;">No</em> other customer accounted for greater than <em style="font: inherit;">10%</em> of the Company's net revenues during the period.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">A significant decline in net sales to any of the Company’s key customers would have a material adverse effect on the Company’s business, financial condition and results of operation.             </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><i><span style="background-color:#ffffff;">Product Concentration </span></i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">For the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em>, the Company’s gross product sales included microwave ovens, which generated approximately 36% of the Company’s gross product sales and audio products, which generated approximately 60% of the Company’s gross product sales. <em style="font: inherit;">No</em> other products accounted for greater than <em style="font: inherit;">10%</em> of the Company's gross product sales during the period.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">For the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2022</em>, the Company’s gross product sales included microwave ovens, which generated approximately 42% of the Company’s gross product sales and audio products, which generated approximately 57% of the Company’s gross product sales. <em style="font: inherit;">No</em> other products accounted for greater than <em style="font: inherit;">10%</em> of the Company's gross product sales during the period.    </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><i>Concentrations of Credit Risk </i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 48%, 25% and 20%, respectively, as of <em style="font: inherit;"> June 30, 2023</em>. <em style="font: inherit;">No</em> other customers accounted for greater than <em style="font: inherit;">10%</em> of the Company's total trade accounts receivable, net of specific reserves. As a percent of the Company’s total trade accounts receivable, net of specific reserves, the Company’s top three customers accounted for approximately 43%, 35% and 11%, respectively, as of <em style="font: inherit;"> March 31, 2023</em>. <em style="font: inherit;">No</em> other customers accounted for greater than <em style="font: inherit;">10%</em> of the Company's total trade accounts receivable, net of specific reserves. The Company periodically performs credit evaluations of its customers but generally does <em style="font: inherit;">not</em> require collateral, and the Company provides for any anticipated credit losses in the financial statements based upon management’s estimates and ongoing reviews of recorded allowances. Due to the high concentration of the Company’s net trade accounts receivables among just <em style="font: inherit;">two</em> customers, any significant failure by <em style="font: inherit;">one</em> of these customers to pay the Company the amounts owing against these receivables would result in a material adverse effect on the Company’s business, financial condition and results of operations.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The Company maintains its cash accounts with major U.S. and foreign financial institutions. The Company’s cash and restricted cash balances on deposit in the U.S. as of <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023</em> were insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per qualifying bank account in accordance with FDIC rules. The Company’s cash, cash equivalents and restricted cash balances in excess of these FDIC-insured limits were approximately $24.4 million and approximately $25.0 million at <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> March 31, 2023</em>, respectively.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><i><span style="background-color:#ffffff;">Supplier Concentration </span></i></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">During the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2023</em>, the Company procured 100% of its products for resale from its three largest factory suppliers, of which approximately 57% was supplied by its largest supplier and approximately 22% and 21%, respectively, by the other <em style="font: inherit;">two</em> suppliers. During the <em style="font: inherit;">three</em> month period ended <em style="font: inherit;"> June 30, 2022</em>, the Company procured 100% of its products for resale from its <span style="-sec-ix-hidden:c101815732">two</span> largest factory suppliers, of which approximately 76% was supplied by its largest supplier and approximately 24% by the other.    </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 3 0.88 0.43 0.28 0.17 0.73 0.42 0.19 0.12 0.36 0.60 0.42 0.57 3 0.48 0.25 0.20 3 0.43 0.35 0.11 250000 24400000 25000000.0 1 3 0.57 0.22 0.21 1 0.76 0.24 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">9</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> LEASES</span></b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:justify;margin:0pt;text-indent:25pt;">The Company leases office space in the U.S. and in Hong Kong as well as a copier in the U.S. These leases have remaining non-cancellable lease terms of <span style="-sec-ix-hidden:c101815737">twelve</span> to <span style="-sec-ix-hidden:c101815738">fourteen</span> months. The Company has elected <em style="font: inherit;">not</em> to separate lease and non-lease components for all leased assets. The Company did <em style="font: inherit;">not</em> identify any events or conditions during the quarter ended <em style="font: inherit;"> June 30, 2023</em> to indicate that a reassessment or re-measurement of the Company’s existing leases was required.</p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:justify;margin:0pt;text-indent:25pt;">As of <em style="font: inherit;"> June 30, 2023</em>, the Company’s current operating lease liabili<span style="background-color:#ffffff">ties </span>and finance lease liabili<span style="background-color:#ffffff;">ties were $142,000 and $1,000, respectively and its non-current operating lease liabili<span style="background-color:#ffffff">ties</span> and finance lease liabilities were $25,000 and <span style="-sec-ix-hidden:c101815744">nil,</span> respectively. The Company’s operating and finance lease right-of-use asset balances are presented in non-current assets. The net balance of the Company’s operating and finance lease right-of-use assets as of </span><em style="font: inherit;"> June 30, 2023</em><span style="background-color:#ffffff;"> was $166,000 and $1,000, r</span>espectively.</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:justify;margin:0pt;text-indent:25pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:justify;margin:0pt;text-indent:25pt;">In <em style="font: inherit;"> January 2023, </em>the Company relocated its headquarters to a temporary office space, while its new landlord awaited the proper permits to build out the agreed-upon space. The Company has subsequently moved into the agreed-upon space and the commencement date of the new lease is <em style="font: inherit;"> July 1, 2023.</em></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">The components of lease costs, which were included in operating expenses in the Company’s condensed consolidated statements of operations, were as follows:</p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;"><em style="font: inherit;">Three Months Ended June 30,</em></em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b>(in thousands)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Lease cost</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating lease cost</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance lease cost</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 18pt;">Amortization of right-of-use assets</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 18pt;">Interest on lease liabilities</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Variable lease costs</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Total lease cost</b></p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">The supplemental cash flow information related to leases are as follows:</p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Cash paid for amounts included in the measurement of lease liabilities:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating cash flows from operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating cash flows from finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Financing cash flows from finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Right-of-use assets obtained in exchange for lease obligations:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> </tbody></table> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"><b>Information relating to the lease term and discount rate are as follows:</b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Weighted average remaining lease term (in months)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">As of June 30, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">As of June 30, 2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">13.5</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">22.5</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">11.2</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">23.2</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Weighted average discount rate</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td></tr> </tbody></table> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"><b>As of <em style="font: inherit;"> June 30, 2023</em> the maturities of lease liabilities were as follows:</b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>(in thousands)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:right;margin:0pt;"><em style="font: inherit;">Operating Leases</em></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:right;margin:0pt;"><em style="font: inherit;">Finance Leases</em></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2024</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">112</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2025</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">62</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2026</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2027</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Thereafter</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Total lease payments</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">174</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Less: Imputed interest</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">(7</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Total</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">167</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> </tbody></table> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> 142000 1000 25000 166000 1000 <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;"><em style="font: inherit;">Three Months Ended June 30,</em></em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="6" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b>(in thousands)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Lease cost</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating lease cost</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance lease cost</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 18pt;">Amortization of right-of-use assets</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 18pt;">Interest on lease liabilities</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Variable lease costs</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Total lease cost</b></p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">The supplemental cash flow information related to leases are as follows:</p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Cash paid for amounts included in the measurement of lease liabilities:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating cash flows from operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">37</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">59</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating cash flows from finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Financing cash flows from finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Right-of-use assets obtained in exchange for lease obligations:</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> </tbody></table> 37000 59000 0 0 0 0 0 0 0 0 37000 59000 37000 59000 0 0 0 0 0 0 0 0 <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Weighted average remaining lease term (in months)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">As of June 30, 2023</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: center; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:center;margin:0pt;"><b><em style="font: inherit;">As of June 30, 2022</em></b></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">13.5</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">22.5</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">11.2</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">23.2</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>Weighted average discount rate</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"><b> </b></td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Operating leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Finance leases</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">7.50</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">%</td></tr> </tbody></table> P13M15D P22M15D P11M6D P23M6D 0.0750 0.0750 0.0750 0.0750 <table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman; text-indent: 0px;"><tbody><tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt; width: 70%;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;"><b>(in thousands)</b></p> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:right;margin:0pt;"><em style="font: inherit;">Operating Leases</em></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td><td style="font-family: Times New Roman; font-size: 10pt;"> </td><td colspan="2" style="text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;text-align:right;margin:0pt;"><em style="font: inherit;">Finance Leases</em></p> </td><td style="font-family: Times New Roman; font-size: 10pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2024</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">112</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2025</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">62</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2026</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">2027</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt;">Thereafter</p> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt;"> </td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0); text-align: right;">—</td><td style="width: 1%; font-family: &quot;Times New Roman&quot;; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Total lease payments</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">174</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Less: Imputed interest</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">(7</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);"> </td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">—</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;"> </td></tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"><td style="font-family: Times New Roman; font-size: 10pt;"> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt 0pt 0pt 9pt;">Total</p> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">167</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt;"> </td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">$</td><td style="width: 12%; text-align: right; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;">1</td><td style="width: 1%; font-family: Times New Roman; font-size: 10pt; margin-left: 0pt;"> </td></tr> </tbody></table> 112000 1000 62000 0 0 0 0 0 0 0 174000 1000 7000 -0 167000 1000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b><span style="background-color:#ffffff;">NOTE <em style="font: inherit;">10</em> </span></b><span style="background-color:#ffffff;">—</span><b><span style="background-color:#ffffff;"> GOVERNMENTAL ASSISTANCE PROGRAMS</span></b>  </p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family: Times New Roman; font-size: 10pt; font-variant: normal; margin: 0pt; text-indent: 25pt;">During the <em style="font: inherit;">three</em> month periods ended <em style="font: inherit;"> June 30, 2023</em> and <em style="font: inherit;"> June 30, 2022</em>, the Company’s Hong Kong subsidiary recorded <span style="-sec-ix-hidden:c101815750">nil</span> and $22,000, respectively, under the governmental program called the Employment Support Scheme (“ESS”). The proceeds were required to be used for payroll expenses and the Company was subject to government-appointed random reviews to verify the information submitted by the applicant. </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt 0pt 0pt 3pt;text-indent:25pt;"> </p> <p style="text-indent: 25pt; font-size: 10pt; font-family: &quot;Times New Roman&quot;; margin: 0pt;">The income realized from the amount granted under the ESS program is presented as Other Income under the description called “Income from governmental assistance programs” in the Consolidated Statements of Operations.</p> <p style="text-indent: 25pt; margin: 0pt; font-size: 10pt; font-family: &quot;Times New Roman&quot;;"> </p> 22000 <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"><b>NOTE <em style="font: inherit;">11</em> </b>—<b> LEGAL PROCEEDINGS</b></p> <p style="font-family:'Times New Roman';font-size:10pt;font-variant:normal;margin:0pt;"> </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;text-indent:25pt;">On <em style="font: inherit;"> April 19, 2022, </em>the US District Court for the District of Delaware (the "District Court") granted judgment in favor of the Company in its trademark infringement lawsuit against air conditioning and heating products provider Emerson Quiet Kool and wholesaler Home Easy (the “defendants”). Among other things, the court order issues an injunction and directs the US Patent and Trademark Office to cancel the defendants’ existing and proposed “Emerson Quiet Kool” trademarks and prohibits defendants from registering or applying to register the same mark or any other mark or name containing the word “Emerson” going forward. The judgment also awards $6.5 million to the Company. The defendants have to date conditionally made payments, including certain advances and a portion of their liability, which are reflected as advanced deposits in the Consolidated Balance Sheets, in connection with ongoing negotiations among the parties. The aggregate amount of the payments is $4.1 million, which has been reduced by approximately $784,000 for legal fees incurred in fiscal <em style="font: inherit;">2023</em> and approximately $154,000 for legal fees incurred in fiscal <em style="font: inherit;">2024,</em> in pursuit of the advanced deposits. On <em style="font: inherit;"> July 11, 2023, </em>the US Court of Appeals for the Third Circuit affirmed the District Court's default judgement against Emerson Quiet Kool. There is <em style="font: inherit;">no</em> guarantee that the Company will be able to collect the entire judgment or that a negotiated resolution regarding these matters will ever be agreed among the parties or, if agreed, how soon the parties will be able to do so.  </p> <p style="font-family:Times New Roman;font-size:10pt;font-variant:normal;margin:0pt;"> </p> 6500000 4100000 784000 154000 EXCEL 46 Financial_Report.xlsx IDEA: XBRL DOCUMENT begin 644 Financial_Report.xlsx M4$L#!!0 ( ^ #E<'04UB@0 +$ 0 9&]C4')O<',O87!P+GAM M;$V./0L",1!$_\IQO;=!P4)B0-!2L+(/>QLOD&1#LD)^OCG!CVX>;QA&WPIG M*N*I#BV&5(_C(I(/ !47BK9.7:=N')=HI6-Y #OGDK7A.YNJQ<&4GPZ4A!0W_J=0U[R;UEA_6\#MI7E!+ P04 M " /@ Y731.+Y.X K @ $0 &1O8U!R;W!S+V-O&ULS9+! 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