Note H - Segment Information

9 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

H. Segment Information

Our business consists of three segments for financial reporting purposes. The three segments are identified as (i) private label contract manufacturing, which primarily relates to the provision of private label contract manufacturing services to companies that market and distribute nutritional supplements and other health care products,  (ii) patent and trademark licensing, which primarily includes royalty income from our license and supply agreements associated with the sale and use of beta-alanine under our CarnosSyn® trade name and the sale of beta-alanine raw material, and (iii) branded products, which relates to the marketing and distribution of our branded nutritional supplements and consists primarily of the products sold under our Pathway to Healing® product line.

We evaluate performance based on a number of factors. The primary performance measures for each segment are net sales and income or loss from operations before corporate allocations. Operating income for each segment does not include corporate general and administrative expenses, interest expense and other miscellaneous income and expense items. Corporate general and administrative expenses include, but are not limited to: human resources, corporate legal, finance, information technology, and other corporate level related expenses, which are not allocated to any segment. The accounting policies of our segments are the same as those described in Note A above and in the consolidated financial statements included in our 2013 Annual Report.

Our operating results by business segment were as follows (in thousands):

	Three Months Ended March 31,				Nine Months Ended March 31,
	2014		2013		2014		2013
Net Sales
Private label contract manufacturing	$	17,692	$	14,505	$	48,056	$	41,773
Patent and trademark licensing		1,141		1,009		3,812		3,207
Branded products		294		321		889		1,001
	$	19,127	$	15,835	$	52,757	$	45,981

	Three Months Ended March 31,						Nine Months Ended March 31,
	2014			2013			2014			2013
Income from Operations
Private label contract manufacturing	$	1,717		$	1,353		$	3,434		$	3,924
Patent and trademark licensing		570			337			1,500			654
Branded products		46			11			61			85
Income from operations of reportable segments		2,333			1,701			4,995			4,663
Corporate expenses not allocated to segments		(1,165	)		(1,132	)		(3,473	)		(3,338	)
	$	1,168		$	569		$	1,522		$	1,325

	March 31, 2014		June 30, 2013
Total Assets
Private label contract manufacturing	$	48,180	$	45,032
Patent and trademark licensing		1,141		1,388
Branded products		208		220
	$	49,529	$	46,640

Our private label contract manufacturing products are sold both in the U.S. and in markets outside the U.S., including Europe, Canada, Mexico, Australia and Asia. Our primary market outside the U.S. is Europe. Our patent and trademark licensing activities are primarily based in the U.S. and our branded products are only sold in the U.S.

Net sales by geographic region, based on the customers’ location, were as follows (in thousands):

	Three Months Ended March 31,				Nine Months Ended March 31,
	2014		2013		2014		2013
United States	$	8,992	$	9,485	$	26,695	$	27,288
Markets outside the United States		10,135		6,350		26,062		18,693
Total net sales	$	19,127	$	15,835	$	52,757	$	45,981

Products manufactured by NAIE accounted for approximately 61% of net sales in markets outside the U.S. for the three months ended March 31, 2014, and 73% for the three months ended March 31, 2013. NAIE accounted for 55% of net sales in markets outside the U.S. for the nine months ended March 31, 2014, and 72% for the nine months ended March 31, 2013. No products manufactured by NAIE were sold in the U.S. during the nine months ended March 31, 2014 and 2013.

Assets and capital expenditures by geographic region, based on the location of the company or subsidiary at which they were located or made, were as follows (in thousands):

	Long-Lived Assets				Total Assets				Capital Expenditures
									Nine Months Ended
	March 31,2014		June 30, 2013		March 31,2014		June 30, 2013		March 31,2014		March 31, 2013
United States	$	6,588	$	6,728	$	34,376	$	32,450	$	1869	$	635
Europe		2,287		2,477		15,153		14,190		329		719
	$	8,875	$	9,205	$	49,529	$	46,640	$	2,198	$	1,354