Note 4 - Segment Reporting Information

3 Months Ended

Sep. 30, 2024

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE 4 - SEGMENT REPORTING INFORMATION

The accounting guidance on Segment Reporting establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in financial statements. Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker (the Company’s Chief Executive Officer or “CODM”) in making decisions on how to allocate resources and assess performance. The Company’s two operating segments are Lighting and Display Solutions, with one executive team under the organizational structure reporting directly to the CODM with responsibilities for managing each segment. Corporate and Eliminations, which captures the Company’s corporate administrative activities, is also reported in the segment information.

The Lighting Segment includes non-residential outdoor and indoor lighting fixtures utilizing LED light sources that have been fabricated and assembled for the Company’s markets, primarily the refueling and convenience store markets, parking lot and garage markets, quick-service restaurant market, retail and grocery store markets, the automotive market, the warehouse market, and the sports court and field market. The Company also services lighting product customers through the commercial and industrial project, stock and flow, and renovation channels. In addition to the manufacture and sale of lighting fixtures, the Company offers a variety of lighting controls to complement its lighting fixtures which include sensors, photocontrols, dimmers, motion detection and Bluetooth systems. The Lighting Segment also includes the design, engineering and manufacturing of electronic circuit boards, assemblies and sub-assemblies which are sold directly to customers.

The Display Solutions Segment manufactures, sells and installs exterior and interior visual image and display elements, including printed graphics, structural graphics, digital signage, menu board systems, millwork display fixtures, refrigerated displays, food equipment, countertops, and other custom display elements. These products are used in visual image programs in several markets including the refueling and convenience store markets, parking lot and garage markets, quick-service and casual restaurant market, retail and grocery store, and other retail markets. The Company accesses its customers primarily through a direct sale model utilizing its own sales force. Sales through distribution represents a small portion of Display Solutions sales. The Display Solutions Segment also provides a variety of project management services to complement our display elements, such as installation management, site surveys, permitting, and content management which are offered to our customers to support our digital signage.

The Company’s corporate administration activities are reported in the Corporate and Eliminations line item. These activities primarily include intercompany profit in inventory eliminations, expense related to certain corporate officers and support staff, the Company’s internal audit staff, expense related to the Company’s Board of Directors, equity compensation expense for various equity awards granted to corporate administration employees, certain consulting expenses, investor relations activities, and a portion of the Company’s legal, auditing, and professional fee expenses. Corporate identifiable assets primarily consist of cash, invested cash (if any), refundable income taxes (if any), and deferred income taxes. 

There were no customers or customer programs representing a concentration of 10% or more of the Company’s consolidated net sales in the three months ended September 30, 2024, or 2023. There was no concentration of accounts receivable at September 30, 2024, or 2023.

Summarized financial information for the Company’s operating segments is provided for the indicated periods and as of September 30, 2024, and September 30, 2023:

(In thousands)	Three Months Ended
	September 30
	2024			2023
Net Sales:
Lighting Segment	$	58,437		$	67,641
Display Solutions Segment		79,658			55,800
	$	138,095		$	123,441
Operating Income (Loss):
Lighting Segment	$	5,759		$	8,753
Display Solutions Segment		7,708			7,219
Corporate and Eliminations		(4,336	)		(4,944	)
	$	9,131		$	11,028
Capital Expenditures:
Lighting Segment	$	712		$	862
Display Solutions Segment		47			519
Corporate and Eliminations		-			12
	$	759		$	1,393
Depreciation and Amortization:
Lighting Segment	$	1,212		$	1,309
Display Solutions Segment		1,635			976
Corporate and Eliminations		93			86
	$	2,940		$	2,371

	September 30, 2024		June 30, 2024
Identifiable Assets:
Lighting Segment	$	125,965	$	130,695
Display Solutions Segment		214,534		208,248
Corporate and Eliminations		9,003		9,857
	$	349,502	$	348,800

The segment net sales reported above represent sales to external customers. Segment operating income, which is used in management’s evaluation of segment performance, represents net sales less all operating expenses. Identifiable assets are those assets used by each segment in its operations.

The Company records a 10% mark-up on intersegment revenues. Any intersegment profit in inventory is eliminated in consolidation. Intersegment revenues were eliminated in consolidation as follows:

Inter-segment sales
	Three Months Ended
(In thousands)	September 30
	2024		2023
Lighting Segment inter-segment net sales	$	5,984	$	6,864
Display Solutions Segment inter-segment net sales	$	171	$	455