Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Apr. 30, 2024 | Jun. 04, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 0-27022 | |
Entity Registrant Name | OPTICAL CABLE CORPORATION | |
Entity Incorporation, State or Country Code | VA | |
Entity Tax Identification Number | 54-1237042 | |
Entity Address, Address Line One | 5290 Concourse Drive | |
Entity Address, City or Town | Roanoke | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 24019 | |
City Area Code | 540 | |
Local Phone Number | 265‑0690 | |
Title of 12(b) Security | Common Stock, no par value | |
Trading Symbol | OCC | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 7,892,475 | |
Entity Central Index Key | 0001000230 | |
Current Fiscal Year End Date | --10-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Apr. 30, 2024 | Oct. 31, 2023 |
Current assets: | ||
Cash | $ 1,089,912 | $ 1,468,709 |
Trade accounts receivable, net of allowance for credit losses of $54,261 at April 30, 2024 and $71,189 at October 31, 2023 | 8,297,895 | 8,727,810 |
Income taxes refundable - current | 81,844 | 81,844 |
Other receivables | 13,228 | 397,758 |
Inventories | 21,486,376 | 23,766,326 |
Prepaid expenses and other assets | 483,909 | 595,469 |
Total current assets | 31,453,164 | 35,037,916 |
Property and equipment, net | 7,079,322 | 7,139,616 |
Intangible assets, net | 539,168 | 566,197 |
Other assets, net | 813,250 | 1,135,172 |
Total assets | 39,884,904 | 43,878,901 |
Current liabilities: | ||
Current installments of long-term debt | 55,445 | 52,624 |
Accounts payable and accrued expenses | 5,396,473 | 5,843,044 |
Accrued compensation and payroll taxes | 1,647,773 | 1,849,780 |
Income taxes payable | 34,777 | 22,754 |
Total current liabilities | 7,134,468 | 7,768,202 |
Note payable, revolver - noncurrent | 8,046,853 | 8,324,397 |
Long-term debt, excluding current installments | 2,599,030 | 2,622,620 |
Other noncurrent liabilities | 266,198 | 441,838 |
Total liabilities | 18,046,549 | 19,157,057 |
Shareholders’ equity: | ||
Preferred stock, no par value, authorized 1,000,000 shares; none issued and outstanding | 0 | 0 |
Common stock, no par value, authorized 50,000,000 shares; issued and outstanding 7,852,515 shares at April 30, 2024 and 7,893,681 shares at October 31, 2023 | 15,277,264 | 15,134,133 |
Retained earnings | 6,561,091 | 9,587,711 |
Total shareholders’ equity | 21,838,355 | 24,721,844 |
Commitments and Contingencies | ||
Total liabilities and shareholders’ equity | $ 39,884,904 | $ 43,878,901 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ / shares in Thousands | Apr. 30, 2024 | Oct. 31, 2023 |
Accounts Receivable, Allowance for Credit Loss, Current | $ 54,261 | $ 71,189 |
Preferred Stock, No Par Value (in dollars per share) | $ 0 | $ 0 |
Preferred Stock, Shares Authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred Stock, Shares Issued (in shares) | 0 | 0 |
Preferred Stock, Shares Outstanding (in shares) | 0 | 0 |
Common Stock, No Par Value (in dollars per share) | $ 0 | $ 0 |
Common Stock, Shares Authorized (in shares) | 50,000,000 | 50,000,000 |
Common Stock, Shares, Issued (in shares) | 7,852,515 | 7,893,681 |
Common Stock, Shares, Outstanding (in shares) | 7,852,515 | 7,893,681 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | |
Net sales | $ 16,112,098 | $ 19,619,536 | $ 30,966,863 | $ 37,903,211 |
Cost of goods sold | 12,073,462 | 12,836,830 | 23,214,705 | 24,599,296 |
Gross profit | 4,038,636 | 6,782,706 | 7,752,158 | 13,303,915 |
Selling, general and administrative expenses | 5,319,580 | 5,662,339 | 10,412,685 | 11,117,805 |
Royalty expense, net | 6,677 | 6,572 | 13,263 | 13,158 |
Amortization of intangible assets | 13,516 | 13,689 | 27,032 | 26,910 |
Income (loss) from operations | (1,301,137) | 1,100,106 | (2,700,822) | 2,146,042 |
Other income (expense), net: | ||||
Interest expense, net | (280,618) | (286,065) | (579,228) | (556,688) |
Gain on insurance proceeds, net | 0 | 1,696,290 | 218,902 | 1,696,290 |
Other, net | (12,364) | (12,311) | 48,834 | 54,824 |
Other income (expense), net | (292,982) | 1,397,914 | (311,492) | 1,194,426 |
Income (loss) before income taxes | (1,594,119) | 2,498,020 | (3,012,314) | 3,340,468 |
Income tax expense | 7,227 | 74,933 | 14,306 | 107,397 |
Net income (loss) | $ (1,601,346) | $ 2,423,087 | $ (3,026,620) | $ 3,233,071 |
Net income (loss) per share: Basic and diluted (in dollars per share) | $ (0.21) | $ 0.31 | $ (0.39) | $ 0.41 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Retained Earnings [Member] | Total |
Balances (in shares) at Oct. 31, 2022 | 7,893,194 | ||
Balances at Oct. 31, 2022 | $ 14,638,505 | $ 7,521,213 | $ 22,159,718 |
Share-based compensation, net (in shares) | (24,626) | ||
Share-based compensation, net | $ 34,322 | 34,322 | |
Net loss | $ 0 | 809,984 | 809,984 |
Balances (in shares) at Jan. 31, 2023 | 7,868,568 | ||
Balances at Jan. 31, 2023 | $ 14,672,827 | 8,331,197 | 23,004,024 |
Balances (in shares) at Oct. 31, 2022 | 7,893,194 | ||
Balances at Oct. 31, 2022 | $ 14,638,505 | 7,521,213 | 22,159,718 |
Net loss | 3,233,071 | ||
Balances (in shares) at Apr. 30, 2023 | 7,865,121 | ||
Balances at Apr. 30, 2023 | $ 14,812,334 | 10,754,284 | 25,566,618 |
Balances (in shares) at Jan. 31, 2023 | 7,868,568 | ||
Balances at Jan. 31, 2023 | $ 14,672,827 | 8,331,197 | 23,004,024 |
Share-based compensation, net (in shares) | (3,447) | ||
Share-based compensation, net | $ 139,507 | 139,507 | |
Net loss | $ 0 | 2,423,087 | 2,423,087 |
Balances (in shares) at Apr. 30, 2023 | 7,865,121 | ||
Balances at Apr. 30, 2023 | $ 14,812,334 | 10,754,284 | 25,566,618 |
Balances (in shares) at Oct. 31, 2023 | 7,893,681 | ||
Balances at Oct. 31, 2023 | $ 15,134,133 | 9,587,711 | 24,721,844 |
Share-based compensation, net (in shares) | (40,324) | ||
Share-based compensation, net | $ 51,490 | 51,490 | |
Net loss | $ 0 | (1,425,274) | (1,425,274) |
Balances (in shares) at Jan. 31, 2024 | 7,853,357 | ||
Balances at Jan. 31, 2024 | $ 15,185,623 | 8,162,437 | 23,348,060 |
Balances (in shares) at Oct. 31, 2023 | 7,893,681 | ||
Balances at Oct. 31, 2023 | $ 15,134,133 | 9,587,711 | 24,721,844 |
Net loss | (3,026,620) | ||
Balances (in shares) at Apr. 30, 2024 | 7,852,515 | ||
Balances at Apr. 30, 2024 | $ 15,277,264 | 6,561,091 | 21,838,355 |
Balances (in shares) at Jan. 31, 2024 | 7,853,357 | ||
Balances at Jan. 31, 2024 | $ 15,185,623 | 8,162,437 | 23,348,060 |
Share-based compensation, net (in shares) | (842) | ||
Share-based compensation, net | $ 91,641 | 91,641 | |
Net loss | $ 0 | (1,601,346) | (1,601,346) |
Balances (in shares) at Apr. 30, 2024 | 7,852,515 | ||
Balances at Apr. 30, 2024 | $ 15,277,264 | $ 6,561,091 | $ 21,838,355 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (3,026,620) | $ 3,233,071 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 431,414 | 496,661 |
Bad debt expense (recovery) | (16,928) | 14,959 |
Share-based compensation expense | 250,792 | 289,680 |
Gain on insurance proceeds, net | (218,902) | (1,696,290) |
Loss on disposal of property and equipment | 796 | 10,307 |
(Increase) decrease in: | ||
Trade accounts receivable | 446,843 | (357,932) |
Other receivables | 384,530 | (35,867) |
Inventories | 2,279,950 | (3,661,198) |
Prepaid expenses and other assets | 111,560 | 80,602 |
Other assets | 201,924 | (103,560) |
Increase (decrease) in: | ||
Accounts payable and accrued expenses | (436,535) | (102,154) |
Accrued compensation and payroll taxes | (202,007) | 218,168 |
Income taxes payable | 12,023 | 55,329 |
Other noncurrent liabilities | (106,235) | 65,078 |
Net cash provided by (used in) operating activities | 112,605 | (1,493,146) |
Cash flows from investing activities: | ||
Purchase of and deposits for the purchase of property and equipment | (235,823) | (230,252) |
Insurance proceeds, net | 218,902 | 1,696,290 |
Investment in intangible assets | 0 | (1,997) |
Net cash provided by (used in) investing activities | (16,921) | 1,464,041 |
Cash flows from financing activities: | ||
Payroll taxes withheld and remitted on share-based payments | (107,661) | (115,851) |
Principal payments on long-term debt | (20,770) | (167,596) |
Payments for financing costs | (50,000) | (50,000) |
Principal payments on finance lease | (18,507) | (17,652) |
Net cash provided by (used in) financing activities | (474,481) | 1,656,048 |
Net increase (decrease) in cash | (378,797) | 1,626,943 |
Cash at beginning of period | 1,468,709 | 215,936 |
Cash at end of period | 1,089,912 | 1,842,879 |
North Mill Capital LLC [Member] | Revolving Credit Facility [Member] | ||
Cash flows from financing activities: | ||
Proceeds from note payable, revolver | 31,812,257 | 41,292,679 |
Payments on note payable, revolver | $ (32,089,800) | $ (39,285,532) |
Note 1 - General
Note 1 - General | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | (1) General The accompanying unaudited condensed consolidated financial statements of Optical Cable Corporation and its subsidiaries (collectively, the “Company” or “OCC ® |
Note 2 - Stock Incentive Plans
Note 2 - Stock Incentive Plans and Other Share-based Compensation | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Share-Based Payment Arrangement [Text Block] | (2) Stock Incentive Plan and Other Share Based Compensation As of April 30, 2024, there were approximately 397,000 remaining shares available for grant under the Optical Cable Corporation Stock Incentive Plan (“2017 Plan”). Share-based compensation expense for employees, a consultant and non-employee Directors recognized in the condensed consolidated statements of operations for the three months and six months ended April 30, 2024 was $91,641 and $250,792, respectively. Share-based compensation expense for employees, a consultant and non-employee Directors recognized in the condensed consolidated statements of operations for the three months and six months ended April 30, 2023 was $154,639 and $289,680, respectively. Share-based compensation expense is entirely related to expense recognized in connection with the vesting of restricted stock awards or other stock awards. Stock Compensation The Company has granted, and anticipates granting from time to time, restricted stock awards subject to approval by the Compensation Committee of the Board of Directors. Since fiscal year 2004, the Company has exclusively used restricted stock awards for all share-based compensation of employees and consultants, and restricted stock awards or stock awards to non-employee members of the Board of Directors. Restricted stock award activity during the six months ended April 30, 2024 consisted of restricted shares forfeited totaling 842 shares and restricted shares withheld for taxes in connection with the vesting of restricted shares totaling 40,324 shares. OCC restricted stock grants provide the participant with the option to surrender shares to pay for withholding tax obligations resulting from any vesting restricted shares, or to pay cash to the Company or taxing authorities in the amount of the withholding taxes owed on the value of any vesting restricted shares in order to avoid surrendering shares. As of April 30, 2024, the estimated amount of compensation cost related to unvested equity-based compensation awards in the form of service-based and operational performance-based shares that the Company will recognize over a 1 year weighted-average period is approximately $262,000. On May 17, 2024, subsequent to the Company’s fiscal quarter end, the Company granted restricted stock awards totaling 39,960 shares to non-employee Directors under the 2017 Plan. The shares are subject to a one-year vesting period and are part of the non-employee Directors’ annual compensation for service on the Board of Directors. |
Note 3 - Allowance for Credit L
Note 3 - Allowance for Credit Losses for Trade Accounts Receivable | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Allowance for Doubtful Accounts for Trade Accounts Receivable Disclosure [Text Block] | (3) Allowance for Credit Losses for Trade Accounts Receivable A summary of changes in the allowance for credit losses for trade accounts receivable for the six months ended April 30, 2024 and 2023 follows: Six Months Ended April 30, 2024 2023 Balance at beginning of period $ 71,189 $ 69,643 Bad debt expense (recovery) (16,928 ) 14,959 Balance at end of period $ 54,261 $ 84,602 |
Note 4 - Inventories
Note 4 - Inventories | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | (4) Inventories Inventories as of April 30, 2024 and October 31, 2023 consist of the following: April 30, October 31, 2024 2023 Finished goods $ 5,646,852 $ 5,937,682 Work in process 4,103,938 4,372,913 Raw materials 11,345,172 13,130,478 Production supplies 390,414 325,253 Total $ 21,486,376 $ 23,766,326 |
Note 5 - Product Warranties
Note 5 - Product Warranties | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Product Warranty Disclosure [Text Block] | (5) Product Warranties As of April 30, 2024 and October 31, 2023, the Company’s accrual for estimated product warranty claims totaled $75,000 and $80,000, respectively, and is included in accounts payable and accrued expenses. Warranty claims expense for the three months and six months ended April 30, 2024 totaled $39,078 and $44,266, respectively. Warranty claims expense for the three months and six months ended April 30, 2023 totaled $13,078 and $29,652, respectively. The following table summarizes the changes in the Company’s accrual for product warranties during the six months ended April 30, 2024 and 2023: Six Months Ended April 30, 2024 2024 2023 Balance at beginning of period $ 80,000 $ 75,000 Liabilities accrued for warranties issued during the period 65,766 59,149 Warranty claims and costs paid during the period (49,266 ) (39,652 ) Changes in liability for pre-existing warranties during the period (21,500 ) (29,497 ) Balance at end of period $ 75,000 $ 65,000 |
Note 6 - Long-term Debt and Not
Note 6 - Long-term Debt and Notes Payable | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Long-Term Debt [Text Block] | (6) Long-term Debt and Notes Payable The Company has credit facilities consisting of a real estate term loan, as amended and restated (the “Virginia Real Estate Loan”), and a Revolving Credit Master Promissory Note and related Loan and Security Agreement (collectively, the “Revolver”). The Virginia Real Estate Loan is with Northeast Bank and is payable in monthly installments of principal and interest. Principal is calculated using the unpaid balance of the loan and a two hundred forty (240) month amortization schedule. Interest is computed on the aggregate principal balance outstanding at a rate equal to the Prime Rate, adjusted monthly on the fifth day of each calendar month in accordance with changes to the Prime Rate, provided, however, that the interest rate is never less than 8.5% per annum on the basis of a 360-day year times the actual number of days elapsed. The Prime Rate The Loan remains generally secured by a first lien deed of trust on the land and buildings at the Company’s headquarters and manufacturing facilities located in Roanoke, Virginia. All other terms of the Virginia Real Estate Loan remain unaltered and remain in full force and effect. The Company had an outstanding balance on its Virginia Real Estate Loan of $2.7 million, as of April 30, 2024 and October 31, 2023. The Revolver with North Mill Capital LLC (now doing business as SLR Business Credit, “SLR”) provides the Company with one or more advances in an amount up to: (a) 85% of the aggregate outstanding amount of eligible accounts (the “eligible accounts loan value”); plus (b) the lowest of (i) an amount up to 35% of the aggregate value of eligible inventory, (ii) $5,000,000, and (iii) an amount not to exceed 100% of the then outstanding eligible accounts loan value; minus (c) $1,150,000. The maximum aggregate principal amount subject to the Revolver is $18,000,000. Interest accrues on the daily balance at the per annum rate of 1.5% above the Prime Rate one The Revolver is secured by all of the following assets: properties, rights and interests in property of the Company whether now owned or existing, or hereafter acquired or arising, and wherever located; all accounts, equipment, commercial tort claims, general intangibles, chattel paper, inventory, negotiable collateral, investment property, financial assets, letter-of-credit rights, supporting obligations, deposit accounts, money or assets of the Company, which hereafter come into the possession, custody, or control of SLR; all proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the foregoing; any and all tangible or intangible property resulting from the sale, lease, license or other disposition of any of the foregoing, or any portion thereof or interest therein, and all proceeds thereof; and any other assets of the Company which may be subject to a lien in favor of SLR as security for the obligations under the Loan Agreement. As of April 30, 2024, the Company had $8.0 million of outstanding borrowings on its Revolver and $2.0 million in available credit. As of October 31, 2023, the Company had $8.3 million of outstanding borrowings on its Revolver and $2.6 million in available credit. |
Note 7 - Leases
Note 7 - Leases | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Lessee, Operating and Finance Leases Disclosure [Text Block] | (7) Leases The Company has an operating lease agreement for approximately 34,000 square feet of office, manufacturing and warehouse space in Plano, Texas (near Dallas). The lease term expires on November 30, 2024. The Company has an operating lease agreement for approximately 36,000 square feet of warehouse space in Roanoke, Virginia. During the first quarter of fiscal year 2023, the lease term was extended for an additional three The Company also leases certain office equipment under operating leases with initial 60 month terms. The lease terms expire in February and April of 2025. OCC leases printers that are used in the Roanoke, Virginia manufacturing facility. The lease term expires on August 22, 2026. The right-of-use asset is being amortized on a straight line basis over seven years. When the lease term ends, the remaining net book value of the right-of-use asset will be classified as property and equipment. The Company’s lease contracts may include options to extend or terminate the leases. The Company exercises judgment to determine the term of those leases when such options are present and include such options in the calculation of the lease term when it is reasonably certain that it will exercise those options. The Company includes contract lease components in its determination of lease payments, while non-lease components of the contracts, such as taxes, insurance, and common area maintenance, are expensed as incurred. At commencement, right-of-use assets and lease liabilities are measured at the present value of future lease payments over the lease term. The Company uses its incremental borrowing rate based on information available at the time of lease commencement to measure the present value of future payments. Operating lease expense is recognized on a straight-line basis over the lease term. Short term leases with an initial term of 12 months or less are expensed as incurred. The Company’s short term leases have month-to-month terms. Operating lease right-of-use assets of $407,796 and $596,578 were included in other assets accounts payable and accrued expenses other noncurrent liabilities accounts payable and accrued expenses other noncurrent liabilities The weighted average remaining lease term was 16.5 months and the weighted average discount rate was 7.6% as of April 30, 2024. For the three months ended April 30, 2024 and 2023, cash paid for operating lease liabilities totaled $111,770 and $109,151, respectively. For the three months ended April 30, 2024 and 2023, there were no Finance lease right-of-use assets of $126,593 and $141,342 were included in other assets accounts payable and accrued expenses other noncurrent liabilities accounts payable and accrued expenses other noncurrent liabilities The remaining lease term for the finance lease is 28 months and the discount rate is 4.75% as of April 30, 2024. For the three months ended April 30, 2024, cash paid for the finance lease liability totaled $1,409 for interest and $9,309 for principal. For the six months ended April 30, 2024, cash paid for the finance lease liability totaled $2,927 for interest and $18,507 for principal. For the three months ended April 30, 2023, cash paid for the finance lease liability totaled $1,840 for interest and $8,878 for principal. For the six months ended April 30, 2023, cash paid for the finance lease liability totaled $3,784 for interest and $17,652 for principal. The Company’s future payments due under leases reconciled to the lease liabilities are as follows: Fiscal Year Operating leases Finance lease 2024 (1) $ 225,340 $ 21,434 2025 177,997 42,868 2026 63,644 55,714 Total undiscounted lease payments 466,981 120,016 Present value discount (27,462 ) (7,613 ) Total lease liability $ 439,519 $ 112,403 (1) Remaining six months of fiscal year 2024. |
Note 8 - Fair Value Measurement
Note 8 - Fair Value Measurements | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | (8) Fair Value Measurements The carrying amounts reported in the condensed consolidated balance sheets as of April 30, 2024 and October 31, 2023 for cash, trade accounts receivable, income taxes refundable – current, other receivables, current installments of long-term debt, accounts payable and accrued expenses, accrued compensation and payroll taxes, and income taxes payable approximate fair value because of the short maturity of these instruments. The carrying value of the Company’s note payable, revolver – noncurrent, and long-term debt, excluding current installments, approximates fair value because the interest rates vary with the market. Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. |
Note 9 - Net Income (Loss) Per
Note 9 - Net Income (Loss) Per Share | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | Net Income (Loss) Per Share Basic net income (loss) per share excludes dilution and is computed by dividing net income (loss) available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the net income (loss) of the Company. The following is a reconciliation of the numerators and denominators of the net income (loss) per share computations for the periods presented: Three months ended Six months ended April 30, April 30, 2024 2023 2024 2023 Net income (loss) (numerator) $ (1,601,346 ) $ 2,423,087 $ (3,026,620 ) $ 3,233,071 Shares (denominator) 7,710,801 7,867,755 7,731,605 7,880,685 Basic and diluted net income (loss) per share $ (0.21 ) $ 0.31 $ (0.39 ) $ 0.41 Weighted average unvested shares for the three months and six months ended April 30, 2024 totaling 141,723, while issued and outstanding, were not included in the computation of basic and diluted net loss per share for the three months and six months ended April 30, 2024 (because to include such shares would have been anti-dilutive, or in other words, to do so would have reduced the net loss per share for those periods). |
Note 10 - Segment Information a
Note 10 - Segment Information and Business and Credit Concentrations | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Concentration Risk Disclosure [Text Block] | (10) Segment Information and Business and Credit Concentrations The Company provides credit, in the normal course of business, to various commercial enterprises, governmental entities and not‑for‑profit organizations. Concentration of credit risk with respect to trade receivables is normally limited due to the Company’s large number of customers. The Company also manages exposure to credit risk through credit approvals, credit limits and monitoring procedures. Management believes that credit risks as of April 30, 2024 have been adequately provided for in the condensed consolidated financial statements. The Company includes all entities under common ownership for the purpose of calculating business concentrations. For the three months and six months ended April 30, 2024, 16.3% and 15.9%, respectively, of consolidated net sales were attributable to one The Company has a single |
Note 11 - Revenue Recognition
Note 11 - Revenue Recognition | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Revenue from Contract with Customer [Text Block] | (11) Revenue Recognition Revenues consist of product sales that are recognized at a specific point in time under the core principle of recognizing revenue when control transfers to the customer. The Company considers customer purchase orders, governed by master sales agreements or the Company’s standard terms and conditions, to be the contract with the customer. For each contract, the promise to transfer the control of the products, each of which is individually distinct, is considered to be the identified performance obligation. The Company evaluates each customer’s credit risk when determining whether to accept a contract. In determining transaction prices, the Company evaluates whether fixed order prices are subject to adjustment to determine the net consideration to which the Company expects to be entitled. Contracts do not include financing components, as payment terms are generally due 30 to 90 days after shipment. Taxes assessed by governmental authorities and collected from the customer including, but not limited to, sales and use taxes and value-added taxes, are not included in the transaction price and are not included in net sales. The Company recognizes revenue at the point in time when products are shipped or delivered from its manufacturing facility to its customer, in accordance with the agreed-upon shipping terms. Since the Company typically invoices the customer at the same time that performance obligations are satisfied, no contract assets are recognized. The Company’s contract liability represents advance consideration received from customers prior to transfer of the product. This liability was $180,431 as of April 30, 2024 and $110,336 as of October 31, 2023. Sales to certain customers are made pursuant to agreements that provide price adjustments and limited return rights with respect to the Company’s products. The Company maintains a reserve for estimated future price adjustment claims, rebates and returns as a refund liability. The Company’s refund liability was $133,201 as of April 30, 2024 and $252,264 as of October 31, 2023. The Company offers standard product warranty coverage which provides assurance that its products will conform to contractually agreed-upon specifications for a limited period from the date of shipment. Separately-priced warranty coverage is not offered. The warranty claim is generally limited to a credit equal to the purchase price or a promise to repair or replace the product for a specified period of time at no additional charge. The Company accounts for shipping and handling activities related to contracts with customers as a cost to fulfill its promise to transfer control of the related product. Shipping and handling costs are included in selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Operations. The Company incurs sales commissions to acquire customer contracts that are directly attributable to the contracts. The commissions are expensed as selling expenses during the period that the related products are transferred to customers. Disaggregation of Revenue The following table presents net sales attributable to the United States and all other countries in total for the three months and six months ended April 30, 2024 and 2023: Three months ended Six months ended April 30, April 30, 2024 2023 2024 2023 United States $ 13,024,311 $ 15,829,216 $ 24,993,866 $ 30,407,301 Outside the United States 3,087,787 3,790,320 5,972,997 7,495,910 Total net sales $ 16,112,098 $ 19,619,536 $ 30,966,863 $ 37,903,211 |
Note 12 - Contingencies
Note 12 - Contingencies | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | (12) Contingencies From time to time, the Company is involved in various claims, legal actions and regulatory reviews arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position, results of operations or liquidity. |
Note 13 - New Accounting Standa
Note 13 - New Accounting Standards Not Yet Adopted | 3 Months Ended |
Apr. 30, 2024 | |
Notes to Financial Statements | |
Accounting Standards Update and Change in Accounting Principle [Text Block] | (13) New Accounting Standards Not Yet Adopted In November 2023, the FASB issued Accounting Standards Update 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures In December 2023, the FASB issued Accounting Standards Update 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures There are no other new accounting standards issued, but not yet adopted by the Company, which are expected to materially impact the Company’s financial position, operating results or financial statement disclosures. |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 6 Months Ended |
Apr. 30, 2024 | Apr. 30, 2024 | |
Insider Trading Arr Line Items | ||
Material Terms of Trading Arrangement [Text Block] | At the end of December 2022, an office building and its contents at the Company’s Asheville facilities sustained water damage resulting from a burst pipe in the sprinkler system, likely due to extreme low temperatures in the area during the days leading up to the event. This office building is separate from the Company’s manufacturing building which houses its manufacturing operations and certain offices at the same location. There was no During the first half of fiscal year 2024, the Company recognized a gain on insurance proceeds, net for damage to property and equipment totaling $219,000 which is reflected as income under other income (expense), net on the Company’s condensed consolidated statement of operations. To the extent the Company incurs expenses in future periods to restore, repair or replace damaged assets, it may recognize offsetting losses in those future periods. At this time, the Company does not expect any future restoration and repair costs to exceed any insurance proceeds. | |
Rule 10b5-1 Arrangement Adopted [Flag] | false | |
Rule 10b5-1 Arrangement Terminated [Flag] | false | |
Non-Rule 10b5-1 Arrangement Adopted [Flag] | false | |
Non-Rule 10b5-1 Arrangement Terminated [Flag] | false |
Note 3 - Allowance for Credit_2
Note 3 - Allowance for Credit Losses for Trade Accounts Receivable (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Summary of Changes in the Allowance for Doubtful Accounts for Trade Accounts Receivable [Table Text Block] | Six Months Ended April 30, 2024 2023 Balance at beginning of period $ 71,189 $ 69,643 Bad debt expense (recovery) (16,928 ) 14,959 Balance at end of period $ 54,261 $ 84,602 |
Note 4 - Inventories (Tables)
Note 4 - Inventories (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | April 30, October 31, 2024 2023 Finished goods $ 5,646,852 $ 5,937,682 Work in process 4,103,938 4,372,913 Raw materials 11,345,172 13,130,478 Production supplies 390,414 325,253 Total $ 21,486,376 $ 23,766,326 |
Note 5 - Product Warranties (Ta
Note 5 - Product Warranties (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Schedule of Product Warranty Liability [Table Text Block] | Six Months Ended April 30, 2024 2024 2023 Balance at beginning of period $ 80,000 $ 75,000 Liabilities accrued for warranties issued during the period 65,766 59,149 Warranty claims and costs paid during the period (49,266 ) (39,652 ) Changes in liability for pre-existing warranties during the period (21,500 ) (29,497 ) Balance at end of period $ 75,000 $ 65,000 |
Note 7 - Leases (Tables)
Note 7 - Leases (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Lessee, Lease Liability, Maturity [Table Text Block] | Fiscal Year Operating leases Finance lease 2024 (1) $ 225,340 $ 21,434 2025 177,997 42,868 2026 63,644 55,714 Total undiscounted lease payments 466,981 120,016 Present value discount (27,462 ) (7,613 ) Total lease liability $ 439,519 $ 112,403 (1) Remaining six months of fiscal year 2024. |
Note 9 - Net Income (Loss) Pe_2
Note 9 - Net Income (Loss) Per Share (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three months ended Six months ended April 30, April 30, 2024 2023 2024 2023 Net income (loss) (numerator) $ (1,601,346 ) $ 2,423,087 $ (3,026,620 ) $ 3,233,071 Shares (denominator) 7,710,801 7,867,755 7,731,605 7,880,685 Basic and diluted net income (loss) per share $ (0.21 ) $ 0.31 $ (0.39 ) $ 0.41 |
Note 11 - Revenue Recognition (
Note 11 - Revenue Recognition (Tables) | 3 Months Ended |
Apr. 30, 2024 | |
Notes Tables | |
Revenue from External Customers by Geographic Areas [Table Text Block] | Three months ended Six months ended April 30, April 30, 2024 2023 2024 2023 United States $ 13,024,311 $ 15,829,216 $ 24,993,866 $ 30,407,301 Outside the United States 3,087,787 3,790,320 5,972,997 7,495,910 Total net sales $ 16,112,098 $ 19,619,536 $ 30,966,863 $ 37,903,211 |
Note 2 - Stock Incentive Plan_2
Note 2 - Stock Incentive Plans and Other Share-based Compensation (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||
May 17, 2024 | Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | |
Restricted Stock [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 842 | ||||
Share-Based Payment Arrangement, Shares Withheld for Tax Withholding Obligation | 40,324 | ||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 1 year | ||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $ 262,000 | $ 262,000 | |||
Plan 2017 [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant | 397,000 | 397,000 | |||
Plan 2017 [Member] | Restricted Stock [Member] | Subsequent Event [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | 39,960 | ||||
Plan 2017 [Member] | Employees, Consultant and Non-employee Directors [Member] | |||||
Share-Based Payment Arrangement, Expense | $ 91,641 | $ 154,639 | $ 250,792 | $ 289,680 |
Note 3 - Allowance for Credit_3
Note 3 - Allowance for Credit Losses for Trade Accounts Receivable - Summary of Changes in the Allowance for Doubtful Accounts for Trade Accounts Receivable (Details) - USD ($) | 6 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Balance at beginning of period | $ 71,189 | $ 69,643 |
Bad debt expense (recovery) | (16,928) | 14,959 |
Balance at end of period | $ 54,261 | $ 84,602 |
Note 4 - Inventories - Componen
Note 4 - Inventories - Components of Inventories (Details) - USD ($) | Apr. 30, 2024 | Oct. 31, 2023 |
Finished goods | $ 5,646,852 | $ 5,937,682 |
Work in process | 4,103,938 | 4,372,913 |
Raw materials | 11,345,172 | 13,130,478 |
Production supplies | 390,414 | 325,253 |
Total | $ 21,486,376 | $ 23,766,326 |
Note 5 - Product Warranties (De
Note 5 - Product Warranties (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | Oct. 31, 2023 | Oct. 31, 2022 | |
Standard and Extended Product Warranty Accrual | $ 75,000 | $ 65,000 | $ 75,000 | $ 65,000 | $ 80,000 | $ 75,000 |
Product Warranty Expense | 39,078 | $ 13,078 | 44,266 | $ 29,652 | ||
Accounts Payable and Accrued Liabilities [Member] | ||||||
Standard and Extended Product Warranty Accrual | $ 75,000 | $ 75,000 | $ 80,000 |
Note 5 - Product Warranties - C
Note 5 - Product Warranties - Changes in Accrual for Product Warranties (Details) - USD ($) | 6 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Balance at beginning of period | $ 80,000 | $ 75,000 |
Liabilities accrued for warranties issued during the period | 65,766 | 59,149 |
Warranty claims and costs paid during the period | (49,266) | (39,652) |
Changes in liability for pre-existing warranties during the period | (21,500) | (29,497) |
Balance at end of period | $ 75,000 | $ 65,000 |
Note 6 - Long-term Debt and N_2
Note 6 - Long-term Debt and Notes Payable (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jul. 24, 2020 | Apr. 30, 2024 | Apr. 30, 2024 | Oct. 31, 2023 | |
Loans Payable, Noncurrent | $ 2,599,030 | $ 2,599,030 | $ 2,622,620 | |
Revolving Credit Facility [Member] | North Mill Capital LLC [Member] | ||||
Debt Instrument, Interest Rate, Effective Percentage | 4.75% | 10% | 10% | 10% |
Debt Instrument, Variable Interest Rate, Type [Extensible Enumeration] | us-gaap:PrimeRateMember | us-gaap:PrimeRateMember | us-gaap:PrimeRateMember | |
Line of Credit Facility, Percent of Eligible Accounts | 85% | 85% | ||
Line of Credit Facility, Percent of Eligible Inventory | 35% | 35% | ||
Line of Credit Facility, Additional Capacity for Advances | $ 5,000,000 | $ 5,000,000 | ||
Line of Credit Facility, Maximum Percentage of Outstanding Eligible Accounts Loan Value | 100% | 100% | ||
Line of Credit Facility, Restricted Capacity for Advances | $ 1,150,000 | $ 1,150,000 | ||
Line of Credit Facility, Maximum Borrowing Capacity | 18,000,000 | $ 18,000,000 | ||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | |||
Debt Instrument, Term Extensions | 1 year | |||
Long-Term Line of Credit | 8,000,000 | $ 8,000,000 | $ 8,300,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | $ 2,000,000 | $ 2,000,000 | $ 2,600,000 | |
Maximum [Member] | Revolving Credit Facility [Member] | North Mill Capital LLC [Member] | ||||
Debt Instrument, Interest Rate, Effective Percentage | 6% | |||
Virginia Real Estate Loan [Member] | ||||
Debt Instrument, Amortization Period | 240 months | |||
Debt Instrument, Interest Rate, Effective Percentage | 8.50% | 8.50% | 8.50% | |
Debt Instrument, Variable Interest Rate, Type [Extensible Enumeration] | us-gaap:PrimeRateMember | us-gaap:PrimeRateMember | ||
Loans Payable, Noncurrent | $ 2,700,000 | $ 2,700,000 | $ 2,700,000 | |
Virginia Real Estate Loan [Member] | Minimum [Member] | ||||
Debt Instrument, Interest Rate, Effective Percentage | 8.50% | 8.50% |
Note 7 - Leases (Details Textua
Note 7 - Leases (Details Textual) | 3 Months Ended | 6 Months Ended | ||||
Apr. 30, 2024 USD ($) ft² | Apr. 30, 2023 USD ($) | Jan. 31, 2023 USD ($) | Apr. 30, 2024 USD ($) ft² | Apr. 30, 2023 USD ($) | Oct. 31, 2023 USD ($) | |
Operating Lease, Right-of-Use Asset | $ 407,796 | $ 407,796 | $ 596,578 | |||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other assets, net | Other assets, net | Other assets, net | |||
Operating Lease, Liability, Current | $ 318,225 | $ 318,225 | $ 414,159 | |||
Operating Lease, Liability, Noncurrent | $ 121,294 | $ 121,294 | $ 227,925 | |||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accounts payable and accrued expenses | Accounts payable and accrued expenses | Accounts payable and accrued expenses | |||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other noncurrent liabilities | Other noncurrent liabilities | Other noncurrent liabilities | |||
Operating Lease, Expense | $ 109,144 | $ 109,144 | $ 212,477 | $ 218,288 | ||
Operating Lease, Weighted Average Remaining Lease Term | 16 months 15 days | 16 months 15 days | ||||
Operating Lease, Weighted Average Discount Rate, Percent | 7.60% | 7.60% | ||||
Operating Lease, Payments | $ 111,770 | 109,151 | ||||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 0 | 0 | ||||
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | $ 126,593 | $ 126,593 | $ 141,342 | |||
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other assets, net | Other assets, net | Other assets, net | |||
Finance Lease, Liability, Current | $ 38,357 | $ 38,357 | $ 37,459 | |||
Finance Lease, Liability, Noncurrent | $ 74,046 | $ 74,046 | $ 93,451 | |||
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accounts payable and accrued expenses | Accounts payable and accrued expenses | Accounts payable and accrued expenses | |||
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other noncurrent liabilities | Other noncurrent liabilities | Other noncurrent liabilities | |||
Finance Lease, Interest Expense | $ 1,409 | 1,840 | $ 2,927 | $ 3,784 | ||
Finance Lease, Right-of-Use Asset, Amortization | $ 7,374 | 7,374 | $ 14,749 | 14,749 | ||
Lessee, Finance Lease, Remaining Lease Term | 28 months | 28 months | ||||
Lessee, Finance Lease, Discount Rate | 4.75% | 4.75% | ||||
Finance Lease, Principal Payments | $ 9,309 | $ 8,878 | $ 18,507 | $ 17,652 | ||
Operating Lease for Office, Manufacturing and Warehouse Space in Plano, Texas [Member] | ||||||
Area of Real Estate Property | ft² | 34,000 | 34,000 | ||||
Operating Lease for Warehouse Space in Roanoke, Virginia [Member] | ||||||
Area of Real Estate Property | ft² | 36,000 | 36,000 | ||||
Lessee, Operating Lease, Term of Contract | 3 years | 3 years | ||||
Operating Lease For Office Equipment [Member] | ||||||
Lessee, Operating Lease, Term of Contract | 60 months | 60 months |
Note 7 - Leases - Future Paymen
Note 7 - Leases - Future Payments Due (Details) | Apr. 30, 2024 USD ($) | |
2024, Operating Lease | $ 225,340 | [1] |
2024, Financing Lease | 21,434 | [1] |
2025, Operating Lease | 177,997 | |
2025, Financing Lease | 42,868 | |
2026, Operating Lease | 63,644 | |
2026, Financing Lease | 55,714 | |
Total undiscounted lease payments, Operating Lease | 466,981 | |
Total undiscounted lease payments, Financing Lease | 120,016 | |
Present value discount, Operating Lease | (27,462) | |
Present value discount, Financing Lease | (7,613) | |
Total lease liability, Operating Lease | 439,519 | |
Total lease liability, Financing Lease | $ 112,403 | |
[1]Remaining six months of fiscal year 2024. |
Note 9 - Net Income (Loss) Pe_3
Note 9 - Net Income (Loss) Per Share (Details Textual) - shares | 3 Months Ended | 6 Months Ended |
Apr. 30, 2024 | Apr. 30, 2024 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 141,723 | 141,723 |
Note 9 - Net Income (Loss) Pe_4
Note 9 - Net Income (Loss) Per Share - Components of Reconciliation of Numerators and Denominators Net Loss Per Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Apr. 30, 2024 | Jan. 31, 2024 | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | |
Net loss | $ (1,601,346) | $ (1,425,274) | $ 2,423,087 | $ 809,984 | $ (3,026,620) | $ 3,233,071 |
Shares (denominator) (in shares) | 7,710,801 | 7,867,755 | 7,731,605 | 7,880,685 | ||
Net income (loss) per share: Basic and diluted (in dollars per share) | $ (0.21) | $ 0.31 | $ (0.39) | $ 0.41 |
Note 10 - Segment Information_2
Note 10 - Segment Information and Business and Credit Concentrations (Details Textual) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | |
Number of Reportable Segments | 1 | |||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | ||||
Concentration Risk, Number of Customers | 1 | 1 | 1 | 1 |
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | One Customer [Member] | ||||
Concentration Risk, Percentage | 16.30% | 17.70% | 15.90% | 16.30% |
Note 11 - Revenue Recognition_2
Note 11 - Revenue Recognition (Details Textual) - USD ($) | Apr. 30, 2024 | Oct. 31, 2023 |
Contract with Customer, Liability | $ 180,431 | $ 110,336 |
Contract with Customer, Refund Liability | $ 133,201 | $ 252,264 |
Note 11 - Revenue Recognition -
Note 11 - Revenue Recognition - Schedule of Revenue from External Customers by Geographical Areas (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2024 | Apr. 30, 2023 | |
Net sales | $ 16,112,098 | $ 19,619,536 | $ 30,966,863 | $ 37,903,211 |
UNITED STATES | ||||
Net sales | 13,024,311 | 15,829,216 | 24,993,866 | 30,407,301 |
Non-US [Member] | ||||
Net sales | $ 3,087,787 | $ 3,790,320 | $ 5,972,997 | $ 7,495,910 |