INVESTMENTS IN JOINT VENTURES

The consolidated financial statements of the Company’s foreign joint ventures are initially prepared using the accounting principles accepted in the respective joint ventures’ countries of domicile. Amounts related to foreign joint ventures reported in the below tables and the accompanying consolidated financial statements have subsequently been adjusted to conform with U.S. GAAP in all material respects. All material profits recorded that remain on the consolidated balance sheet on sales from the Company to its joint ventures and from joint ventures to other joint ventures have been eliminated for financial reporting purposes.

Financial information from the audited and unaudited financial statements of the Company’s joint venture in Germany, Excor Korrosionsschutz – Technologien und Produkte GmbH (EXCOR) and all the Company’s other joint ventures, are summarized as follows:

	As of May 31, 2018
	Total		EXCOR		All Other
Current assets	$	58,113,904	$	25,734,914	$	32,378,990
Total assets		62,004,849		27,838,358		34,166,491
Current liabilities		16,622,611		3,830,246		12,792,365
Noncurrent liabilities		110,926		-		110,926
Joint ventures’ equity		45,271,314		24,008,112		21,263,202
Northern Technologies International Corporation’s share of joint ventures’ equity		22,412,792		12,004,058		10,408,734
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings		20,383,580		11,973,153		8,410,427

	Three Months Ended May 31, 2018
	Total		EXCOR		All Other
Net sales	$	31,480,885	$	12,219,414	$	19,261,471
Gross profit		14,209,819		6,823,609		7,386,210
Net income		4,540,968		3,113,660		1,427,308
Northern Technologies International Corporation’s share of equity in income from joint ventures	$	2,246,066	$	1,558,243	$	687,823

	Nine Months Ended May 31, 2018
	Total		EXCOR		All Other
Net sales	$	90,200,146	$	35,450,664	$	54,749,482
Gross profit		40,529,217		19,315,099		21,214,118
Net income		11,753,467		8,272,237		3,481,230
Northern Technologies International Corporation’s share of equity in income from joint ventures	$	5,793,391	$	4,138,814	$	1,654,577
Northern Technologies International Corporation’s dividends received from joint ventures	$	2,941,807	$	1,780,392	$	1,161,415

	As of August 31, 2017
	Total		EXCOR		All Other
Current assets	$	51,518,210	$	22,142,514	$	29,375,696
Total assets		55,633,891		24,301,194		31,332,697
Current liabilities		15,118,074		4,469,567		10,648,507
Noncurrent liabilities		181,210		—		181,210
Joint ventures’ equity		40,334,607		19,831,627		20,502,980
Northern Technologies International Corporation’s share of joint ventures’ equity		20,035,074		9,915,816		10,119,258
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings		17,960,860		9,884,911		8,075,949
Northern Technologies International Corporation’s dividends received from joint ventures	$	6,377,054	$	5,379,062	$	997,992

	Three Months Ended May 31, 2017
	Total		EXCOR		All Other
Net sales	$	25,935,169	$	9,884,546	$	16,050,623
Gross profit		11,517,711		5,271,028		6,246,683
Net income		3,379,883		2,166,435		1,213,448
Northern Technologies International Corporation’s share of equity in income from joint ventures	$	1,686,016	$	1,083,494	$	602,522

	Nine Months Ended May 31, 2017
	Total		EXCOR		All Other
Net sales	$	73,098,215	$	28,169,978	$	44,928,237
Gross profit		32,376,247		15,032,724		17,343,523
Net income		8,562,834		6,184,181		2,378,653
Northern Technologies International Corporation’s share of equity in income from joint ventures		4,343,159		3,089,935		1,253,224
Northern Technologies International Corporation’s dividends received from joint ventures	$	5,179,786	$	4,240,400	$	939,386

The Company did

not

make any joint venture investments during the

three

and

nine

months ended

May 31, 2018

and

2017.