Note H - Segment Information

9 Months Ended

Mar. 31, 2024

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

H. 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 of these segments based on a number of factors. The primary performance measures for each segment are net sales and income or loss from operations before the allocation of certain corporate level expenses. 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 above and in the consolidated financial statements included in our 2023 Annual Report.

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

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2024		2023		2024		2023
Net Sales
Private label contract manufacturing	$	22,479	$	30,354	$	77,718	$	112,969
Patent and trademark licensing		2,657		2,345		6,589		5,152
Total Net Sales	$	25,136	$	32,699	$	84,307	$	118,121

	Three Months Ended						Nine Months Ended
	March 31,						March 31,
	2024			2023			2024			2023
(Loss) Income from Operations
Private label contract manufacturing	$	(1,007	)	$	(1,243	)	$	(2,367	)	$	6,264
Patent and trademark licensing		1,201			790		$	2,592			1,485
Income (Loss) from operations of reportable segments		194			(453	)	$	225			7,749
Corporate expenses not allocated to segments		(2,146	)		(2,035	)	$	(6,234	)		(6,210	)
Total (Loss) Income from Operations	$	(1,952	)	$	(2,488	)	$	(6,009	)	$	1,539

	March 31,		June 30,
	2024		2023
Total Assets
Private-label contract manufacturing	$	119,245	$	102,495
Patent and trademark licensing		33,966		31,657
	$	153,211	$	134,152

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, were as follows (in thousands):

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2024		2023		2024		2023
United States	$	15,457	$	24,254	$	56,990	$	82,995
Markets outside of the United States		9,679		8,445		27,317		35,126
Total	$	25,136	$	32,699	$	84,307	$	118,121

Products manufactured by our Swiss subsidiary ("NAIE") accounted for 68% of net sales in markets outside the U.S. for the three months ended March 31, 2024, and 76% for the nine months ended March 31, 2024. Products manufactured by our Swiss subsidiary ("NAIE") accounted for 81% of net sales in markets outside the U.S. for the three months ended March 31, 2023, and 76% for the nine months ended March 31, 2023.

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

	March 31, 2024		June 30, 2023
United States	$	78,238	$	53,536
Europe		18,178		20,674
Total Long-Lived Assets	$	96,416	$	74,210

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

	March 31, 2024		June 30, 2023
United States	$	109,465	$	89,167
Europe		43,746		44,985
Total Assets	$	153,211	$	134,152

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):

	Nine Months Ended
	March 31,
	2024		2023
United States	$	1,801	$	12,983
Europe		182		256
Total Capital Expenditures	$	1,983	$	13,239