Note N - Segment Information

12 Months Ended

Jun. 30, 2023

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

N. Segment Information

Our business consists of two segments for financial reporting purposes. The two 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, and (ii) patent and trademark licensing, which primarily includes direct raw material sales and royalty income from our license and supply agreements associated with the sale and use of beta-alanine under our CarnoSyn® and SR CarnoSyn® trade names.

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 or loss 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. Transfers of raw materials between segments are recorded at cost. The accounting policies of our segments are the same as those described in the summary of significant accounting policies in Note A.

Our operating results by business segment for the years ended June 30 were as follows (in thousands):

	2023		2022
Net Sales
Private-label contract manufacturing	$	145,294	$	154,798
Patent and trademark licensing		8,721		16,168
	$	154,015	$	170,966

	2023			2022
Income from Operations
Private-label contract manufacturing	$	9,488		$	15,667
Patent and trademark licensing		3,021			6,780
Income from operations of reportable segments		12,509			22,447
Corporate expenses not allocated to segments		(7,796	)		(8,768	)
	$	4,713		$	13,679

	2023		2022
Assets
Private-label contract manufacturing	$	102,495	$	115,649
Patent and trademark licensing		31,657		30,354
	$	134,152	$	146,003

Our private-label contract manufacturing products are sold both in the U.S. and in markets outside the U.S., including Europe, Canada, Australia, New Zealand, Mexico and Asia. Our primary markets outside the U.S. are Europe and Asia. Our patent and trademark licensing activities are primarily based in the U.S.

Net sales by geographic region, based on the customers’ location, for the two years ended June 30 were as follows (in thousands):

	2023		2022
United States	$	109,277	$	115,255
Markets outside the United States		44,738		55,711
Total net sales	$	154,015	$	170,966

Products manufactured by NAIE accounted for 79% of consolidated net sales in markets outside the U.S. in fiscal 2023 and 84% in fiscal 2022. No products manufactured by NAIE were sold in the U.S. during the fiscal years ended June 30, 2023 and 2022.

Long-lived assets by geographic region, based on the location of the company or subsidiary at which they were located or made, for the two years ended June 30 were as follows (in thousands):

	2023		2022
United States	$	53,536	$	43,769
Europe		20,674		22,505
Total Long-Lived Assets	$	74,210	$	66,274

Total assets by geographic region, based on the location of the company or subsidiary at which they were located or made, for the two years ended June 30 were as follows (in thousands):

	2023		2022
United States	$	89,167	$	83,443
Europe		44,985		62,560
Total Assets	$	134,152	$	146,003

Capital expenditures by geographic region, based on the location of the company or subsidiary at which they were located or made, for the two years ended June 30 were as follows (in thousands):

	2023		2022
United States	$	13,210	$	25,383
Europe		314		1,105
Total Capital Expenditures	$	13,524	$	26,488