Note 1 - Interim Financial Information

9 Months Ended

May 31, 2020

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1.

       INTERIM FINANCIAL INFORMATION

In the opinion of management, the accompanying unaudited consolidated financial statements contain all necessary adjustments, which are of a normal recurring nature, and present fairly the consolidated financial position of Northern Technologies International Corporation and its subsidiaries (the Company) as of

May 31, 2020

and

August 31, 2019,

the results of their operations for the

three

and

nine

months ended

May 31, 2020

and

2019,

the changes in equity for the

three

and

nine

months ended

May 31, 2020

and

2019,

and the Company’s cash flows for the

nine

months ended

May 31, 2020

and

2019,

in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP).

These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s annual report on Form

10

-K for the fiscal year ended

August 31, 2019.

These consolidated financial statements also should be read in conjunction with the “

Management’s Discussion and Analysis of Financial Condition and Results of Operations

” section appearing in this report.

On

June 3, 2019,

the Company’s Board of Directors declared a

two

-for-

one

stock split of the Company’s common stock effected in the form of a

100%

share dividend distributed on

June 28, 2019

to record holders as of

June 17, 2019.

All share and per share values in this report have been adjusted to retroactively reflect the effect of the

two

-for-

one

stock split.

Operating results for the

three

and

nine

months ended

May 31, 2020

are

not

necessarily indicative of the results that

may

be expected for the full fiscal year ending

August 31, 2020.

The Company evaluates events occurring after the date of the consolidated financial statements requiring recording or disclosure in the consolidated financial statements.

Impact of COVID-

19

Pandemic

In

March 2020,

the World Health Organization declared the novel coronavirus (COVID-

19

) outbreak a global pandemic. The COVID-

19

pandemic has negatively impacted the global economy, disrupted global supply chains, created significant volatility and disruption in financial markets and has resulted in an economic slowdown. As a result of the COVID-

19

pandemic and related government mandated restrictions on the Company’s business as well as the businesses of its joint ventures, customers and suppliers, disruption to the Company’s business and the manufacture and sale of its products and services has occurred and is expected to continue through the

fourth

quarter of fiscal

2020

and beyond. Additionally, the Company expects the COVID-

19

pandemic will likely continue to have a material adverse effect on its business, operating results and financial condition during the

fourth

quarter of fiscal

2020

and beyond; however, the precise financial impact and duration cannot be reasonably estimated at this time.

In response to the impact of the COVID-

19

pandemic, and given the uncertainty of its duration, the Company has taken a number of precautionary measures, including the withdrawal and suspension of its specific full-year fiscal

2020

guidance and the temporary suspension of its quarterly cash dividend.