Espey Mfg. & Electronics (ESP) 10-Q 14 May 20 2020 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Mar. 31, 2020	May 14, 2020
Document And Entity Information [Abstract]
Entity Registrant Name	ESPEY MFG & ELECTRONICS CORP
Entity Central Index Key	0000033533
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2020
Entity Common Stock, Shares Outstanding		2,402,633
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity File Number	1-4383
Entity Incorportion, State or Country Code	NY
Entity Shell Company	false

Balance Sheets

Balance Sheets - USD ($)	Mar. 31, 2020	Jun. 30, 2019
ASSETS:
Cash and cash equivalents	$ 4,390,559	$ 1,462,761
Investment securities	5,723,214	5,684,240
Trade accounts receivable, net of allowance of $3,000	5,107,139	10,995,783
Income tax receivable	79,469
Inventories:
Raw materials	2,113,130	1,747,449
Work-in-process	796,825	408,130
Costs related to contracts in process	14,186,291	11,069,558
Total inventories	17,096,246	13,225,137
Prepaid expenses and other current assets	758,641	494,181
Total current assets	33,155,268	31,862,102
Property, plant and equipment, net	3,602,638	3,825,411
Total assets	36,757,906	35,687,513
LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable	1,536,083	2,160,433
Accrued expenses:
Salaries and wages	392,413	329,890
Vacation	785,806	786,870
ESOP payable	228,436
Other	191,606	109,755
Payroll and other taxes withheld	60,128	61,451
Contract liabilities	2,791,775	6,054
Income taxes payable		30,481
Total current liabilities	5,986,247	3,484,934
Deferred tax liabilities	254,801	277,075
Total liabilities	6,241,048	3,762,009
Commitments and contingencies (see Note 5)
Common stock, par value $.33-1/3 per share Authorized 10,000,000 shares; Issued 3,029,874 shares as of March 31, 2020 and June 30, 2019. Outstanding 2,402,633 and 2,401,213 as of March 31, 2020 and June 30, 2019, respectively (includes 3,541 and 14,166 Unearned ESOP shares, respectively)	1,009,958	1,009,958
Capital in excess of par value	18,924,725	18,731,975
Accumulated other comprehensive loss	(327)	(1,299)
Retained earnings	18,438,013	20,022,132
Total stockholders equity before ESOP	38,372,369	39,762,766
Less: Unearned ESOP shares	(204,706)	(204,706)
Cost of 627,241 and 628,661 shares of common stock in treasury as of March 31, 2020 and June 30, 2019, respectively	(7,650,805)	(7,632,556)
Total stockholders' equity	30,516,858	31,925,504
Total liabilities and stockholders' equity	$ 36,757,906	$ 35,687,513

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - USD ($)	Mar. 31, 2020	Jun. 30, 2019
Statement of Financial Position [Abstract]
Trade accounts receivable, allowance	$ 3,000	$ 3,000
Common stock, par value	$ 0.3333	$ 0.3333
Common stock, shares authorized	10,000,000	10,000,000
Common stock, shares issued	3,029,874	3,029,874
Common stock, shares outstanding	2,402,633	2,401,213
Unearned ESOP, shares	3,541	14,166
Treasury stock, shares	627,241	628,661

Statements of Comprehensive Inc

Statements of Comprehensive Income (Loss) (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019
Income Statement [Abstract]
Net sales	$ 6,191,300	$ 9,218,141	$ 19,401,793	$ 24,858,649
Cost of sales	5,280,367	7,067,702	15,874,364	20,199,041
Gross profit	910,933	2,150,439	3,527,429	4,659,608
Selling, general and administrative expenses	1,057,034	1,069,070	3,390,988	3,374,301
Operating (loss) income	(146,101)	1,081,369	136,441	1,285,307
Other income
Interest income	20,127	38,623	86,203	133,398
Other	3,391	6,631	23,568	41,288
Total other income	23,518	45,254	109,771	174,686
(Loss) income before (benefit) provision for income taxes	(122,583)	1,126,623	246,212	1,459,993
(Benefit) provision for income taxes	(18,818)	204,167	39,237	258,107
Net (loss) income	(103,765)	922,456	206,975	1,201,886
Other comprehensive income, net of tax:
Unrealized gain on investment securities	1,130	1,512	972	3,766
Total comprehensive (loss) income	$ (102,635)	$ 923,968	$ 207,947	$ 1,205,652
Net (loss) income per share:
Basic	$ (0.04)	$ 0.39	$ 0.09	$ 0.51
Diluted	$ (0.04)	$ 0.39	$ 0.09	$ 0.50
Weighted average number of shares outstanding:
Basic	2,394,727	2,378,332	2,391,247	2,369,527
Diluted	2,394,727	2,388,781	2,395,787	2,388,258
Dividends per share:	$ 0.25	$ 0.25	$ 0.75	$ 1.75

Statements of Changes in Stockh

Statements of Changes in Stockholders' Equity (Unaudited) - USD ($)	Common Stock [Member]	Capital in Excess of Par Value [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Unearned ESOP Shares [Member]	Total
Balance, beginning at Jun. 30, 2018	$ 1,009,958	$ 18,201,691	$ (6,349)	$ 22,416,400	$ (7,718,835)	$ (421,453)	$ 33,481,412
Balance, beginning, shares at Jun. 30, 2018	2,387,124				642,750
Net income (loss)				1,201,886			1,201,886
Other comprehensive income, net of tax			3,766				3,766
Total comprehensive (loss) income							1,205,652
Stock options exercised		179,039			$ 127,042		306,081
Stock options exercised, shares	15,399				(15,399)
Stock-based compensation		124,972					124,972
Dividends paid on common stock				(4,144,075)			(4,144,075)
Balance, ending at Mar. 31, 2019	$ 1,009,958	18,505,702	(2,583)	19,474,211	$ (7,591,793)	(421,453)	30,974,042
Balance, ending, common shares at Mar. 31, 2019	2,402,523				627,351
Balance, beginning at Dec. 31, 2018	$ 1,009,958	18,403,798	(4,095)	19,145,095	$ (7,642,943)	(421,453)	30,490,360
Balance, beginning, shares at Dec. 31, 2018	2,396,323				633,551
Net income (loss)				922,456			922,456
Other comprehensive income, net of tax			1,512				1,512
Total comprehensive (loss) income							923,968
Stock options exercised		54,808			$ 51,150		105,958
Stock options exercised, shares	6,200				(6,200)
Stock-based compensation		47,096					47,096
Dividends paid on common stock				(593,340)			(593,340)
Balance, ending at Mar. 31, 2019	$ 1,009,958	18,505,702	(2,583)	19,474,211	$ (7,591,793)	(421,453)	30,974,042
Balance, ending, common shares at Mar. 31, 2019	2,402,523				627,351
Balance, beginning at Jun. 30, 2019	$ 1,009,958	18,731,975	(1,299)	20,022,132	$ (7,632,556)	(204,706)	$ 31,925,504
Balance, beginning, shares at Jun. 30, 2019	2,401,213				628,661		2,401,213
Net income (loss)				206,975			$ 206,975
Other comprehensive income, net of tax			972				972
Total comprehensive (loss) income							207,947
Stock options exercised		51,300			$ 29,700		$ 81,000
Stock options exercised, shares	3,600				(3,600)		3,600
Stock-based compensation		141,450					$ 141,450
Dividends paid on common stock				(1,791,094)			(1,791,094)
Purchase of treasury stock					$ (47,949)		(47,949)
Purchase of treasury stock, shares	(2,180)				2,180
Balance, ending at Mar. 31, 2020	$ 1,009,958	18,924,725	(327)	18,438,013	$ (7,650,805)	(204,706)	$ 30,516,858
Balance, ending, common shares at Mar. 31, 2020	2,402,633				627,241		2,402,633
Balance, beginning at Dec. 31, 2019	$ 1,009,958	18,858,202	(1,457)	19,138,895	$ (7,664,005)	(204,706)	$ 31,136,887
Balance, beginning, shares at Dec. 31, 2019	2,401,033				628,841
Net income (loss)				(103,765)			(103,765)
Other comprehensive income, net of tax			1,130				1,130
Total comprehensive (loss) income							(102,635)
Stock options exercised		17,520			$ 13,200		30,720
Stock options exercised, shares	1,600				(1,600)
Stock-based compensation		49,003					49,003
Dividends paid on common stock				(597,117)			(597,117)
Balance, ending at Mar. 31, 2020	$ 1,009,958	$ 18,924,725	$ (327)	$ 18,438,013	$ (7,650,805)	$ (204,706)	$ 30,516,858
Balance, ending, common shares at Mar. 31, 2020	2,402,633				627,241		2,402,633

Statements of Changes in Stoc_2

Statements of Changes in Stockholders' Equity (Unaudited) (Parenthetical) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019
Statement of Stockholders' Equity [Abstract]
Other comprehensive income, tax portion	$ 217	$ 402	$ 259	$ 1,001
Dividends paid per share	$ 0.25	$ 0.25	$ 0.75	$ 1.75

Statements of Cash Flows (Unaud

Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash Flows from Operating Activities:
Net income	$ 206,975	$ 1,201,886
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Bad debt expense		69,010
Stock-based compensation	141,450	124,972
Depreciation	429,543	397,965
ESOP compensation expense	239,061	297,670
Loss on disposal of assets	3,757
Deferred income tax (benefit) expense	(22,533)	137,035
Changes in assets and liabilities:
Decrease (increase) in trade receivable, net	5,888,644	(3,642,605)
(Increase) decrease in income taxes receivable	(79,469)	35,956
Increase in inventories, net	(3,871,109)	(3,539,511)
(Increase) decrease in prepaid expenses and other current assets	(264,460)	924,361
(Decrease) increase in accounts payable	(624,350)	115,902
Increase (decrease) in accrued salaries and wages	62,523	(236,821)
(Decrease) increase in vacation accrual	(1,064)	75,501
Decrease in ESOP payable	(10,625)	(51,041)
Increase in other accrued expenses	81,851	39,234
(Decrease) increase in payroll and other taxes withheld	(1,323)	8,219
Increase (decrease) in contract liabilities	2,785,721	(81,989)
Decrease in income taxes payable	(30,481)
Net cash provided by (used in) operating activities	4,934,111	(4,124,256)
Cash Flows from Investing Activities:
Additions to property, plant and equipment	(210,527)	(538,550)
Purchase of investment securities	(7,981,580)	(3,891,435)
Proceeds from sale/maturity of investment securities	7,943,837	9,581,630
Net cash (used in) provided by investing activities	(248,270)	5,151,645
Cash Flows from Financing Activities:
Dividends on common stock	(1,791,094)	(4,144,075)
Purchase of treasury stock	(47,949)
Proceeds from exercise of stock options	81,000	306,081
Net cash used in financing activities	(1,758,043)	(3,837,994)
Increase (decrease) in cash and cash equivalents	2,927,798	(2,810,605)
Cash and cash equivalents, beginning of period	1,462,761	4,298,796
Cash and cash equivalents, end of period	4,390,559	1,488,191
Supplemental Schedule of Cash Flow Information:
Income taxes paid	$ 171,720	$ 80,000

Basis of Presentation

Basis of Presentation	9 Months Ended
	Mar. 31, 2020
Basis of Presentation [Abstract]
Basis of Presentation	Note 1. Basis of Presentation In the opinion of management the accompanying unaudited financial statements contain all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the results for such periods. The results for any interim period are not necessarily indicative of the results to be expected for the full fiscal year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted accounting principles have been condensed or omitted. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of assets and liabilities. On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue recognition, inventories, income taxes, and stock-based compensation. Specific to inventories, including work-in-process and contracts in process, management evaluates, quarterly, those estimates used in determining the cost to complete for each contract on Espey Mfg. & Electronics Corp. (the Company's) sales backlog. The change in estimates may affect the reported amount of inventories and gross profit in the current or a future period. Management bases its estimates on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. These financial statements should be read in conjunction with the Company's most recent audited financial statements included in its report on Form 10-K for the year ended June 30, 2019. Certain reclassifications may have been made to the prior year financial statements to conform to the current year presentation.

Investment Securities

Investment Securities	9 Months Ended
	Mar. 31, 2020
Investments, Debt and Equity Securities [Abstract]
Investment Securities	Note 2. Investment Securities ASC 820 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: § Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. § Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. § Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. The carrying amounts of financial instruments, including cash and cash equivalents, short term investment securities, accounts receivable, accounts payable and accrued expenses, approximated fair value as of March 31, 2020 and June 30, 2019 because of the immediate or short-term maturity of these financial instruments. Investment securities at March 31, 2020 and June 30, 2019 consist of certificates of deposit and municipal bonds which are classified as available-for-sale securities and have been determined to be level 1 assets. The cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale securities by major security type at March 31, 2020 and June 30, 2019 are as follows: Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value March 31, 2020 Certificates of deposit $ 5,156,847 $ — $ — $ 5,156,847 Municipal bonds 563,792 3,021 (446 ) 566,367 Total investment securities $ 5,720,639 $ 3,021 $ (446 ) $ 5,723,214 June 30, 2019 Certificates of deposit $ 5,046,627 $ — $ — $ 5,046,627 Municipal bonds 636,269 1,576 (232 ) 637,613 Total investment securities $ 5,682,896 $ 1,576 $ (232 ) $ 5,684,240 The portfolio is diversified and highly liquid and primarily consists of investment grade fixed income instruments. At March 31, 2020, the Company did not have any investments in individual securities that have been in a continuous loss position considered to be other than temporary. As of March 31, 2020 and June 30, 2019, the remaining contractual maturities of available-for-sale securities were as follows: Years to Maturity Less than One to One Year Five Years Total March 31, 2020 Available-for-sale $ 5,650,469 $ 72,745 $ 5,723,214 June 30, 2019 Available-for-sale $ 5,549,460 $ 134,780 $ 5,684,240

Net Income per Share

Net Income per Share	9 Months Ended
	Mar. 31, 2020
Net Income per Share [Abstract]
Net Income per Share	Note 3. Net Income per Share Basic net income per share excludes dilution and is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net income 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 income of the Company. The computation of weighted-average common shares outstanding, assuming dilution, excluded options to purchase 283,437 and 196,039 shares of our common stock for the three and nine months ended March 31, 2020 and 2019, respectively, as the effect of including them would be anti-dilutive. As unearned ESOP shares are released or committed-to-be-released the shares become outstanding for earnings-per-share computations.

Stock Based Compensation

Stock Based Compensation	9 Months Ended
	Mar. 31, 2020
Share-based Payment Arrangement [Abstract]
Stock Based Compensation	Note 4. Stock Based Compensation The Company follows ASC 718 in establishing standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services, as well as transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments. ASC 718 requires that the cost resulting from all share-based payment transactions be recognized in the financial statements based on the fair value of the share-based payment. ASC 718 establishes fair value as the measurement objective in accounting for share-based payment transactions with employees, except for equity instruments held by employee share ownership plans. Total stock-based compensation expense recognized in the statements of comprehensive income (loss) for the three-month periods ended March 31, 2020 and 2019 was $49,003 and $47,096, respectively, before income taxes. The related total deferred tax benefits were $2,727 and $2,547 for the same periods. Total stock-based compensation expense recognized in the statements of comprehensive income (loss) for the nine-month periods ended March 31, 2020 and 2019, was $141,450 and $124,972, respectively, before income taxes. The related total deferred tax benefits were $7,788 and $6,826 for the same periods. As of March 31, 2020, there was $195,512 of unrecognized compensation cost related to stock option awards that is expected to be recognized as expense over the next 1.75 years. The total deferred tax benefit related to these awards is expected to be $11,331. The Company has one employee stock option plan under which options or stock awards may be granted, the 2017 Stock Option and Restricted Stock Plan (the "2017 Plan"). The Board of Directors may grant options to acquire shares of common stock to employees and non-employee directors of the Company at the fair market value of the common stock on the date of grant. The maximum aggregate number of shares of Common Stock subject to options or awards to non-employee directors is 133,000 and the maximum aggregate number of shares of Common Stock subject to options or awards granted to non-employee directors during any single fiscal year is the lesser of 13,300 and 33 1/3% of the total number of shares subject to options or awards granted in such fiscal year. The maximum number of shares subject to options or awards granted to any individual employee may not exceed 15,000 in a fiscal year. Generally, options granted have a two-year vesting period based on two years of continuous service and have a ten-year contractual life. Option grants provide for accelerated vesting if there is a change in control. Shares issued upon the exercise of options are from those held in Treasury. Options covering 400,000 shares are authorized for issuance under the 2017 Plan, of which 164,329 have been granted as of March 31, 2020. While no further grants of options may be made under the Company’s 2007 Stock Option and Restricted Stock Plan, as of March 31, 2020, 136,600 options were outstanding under such plan of which all are vested and exercisable. ASC 718 requires the use of a valuation model to calculate the fair value of stock-based awards. The Company has elected to use the Black-Scholes option valuation model, which incorporates various assumptions including those for dividend yield, volatility, expected life and interest rates. The table below outlines the weighted average assumptions that the Company used to calculate the fair value of each option award for the nine months ended March 31, 2020 and 2019. March 31, 2020 March 31, 2019 Dividend yield 4.88% 3.68% Company’s expected volatility 27.81% 27.63% Risk-free interest rate 1.67% 2.70% Expected term 5.3 yrs 5.2 yrs Weighted average fair value per share of options granted during the period $ 3.03 $ 5.13 The Company declares regular dividends quarterly and declared and paid a regular cash dividends of $0.75 per share for the nine months ended March 31, 2020. The Company declared regular cash dividends of $0.75 per share and a special cash dividend of $1.00 per share for the nine months ended March 31, 2019. Expected stock price volatility is based on the historical volatility of the Company’s stock. The risk-free interest rate is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the expected life of the options. The expected option term (in years) represents the estimated period of time until exercise and is based on actual historical experience. The following table summarizes stock option activity during the nine months ended March 31, 2020: Employee Stock Options Plan Weighted Number of Weighted Average Shares Average Remaining Aggregate Subject Exercise Contractual Intrinsic To Options Price Term Value Balance at July 1, 2019 259,164 $ 25.16 6.37 Granted 54,025 20.50 9.69 Exercised (3,600 ) 22.50 — Forfeited or expired (26,152 ) 25.38 — Outstanding at March 31, 2020 283,437 $ 24.28 6.40 $ 0 Vested or expected to vest at March 31, 2020 266,689 $ 24.32 6.23 $ 0 Exercisable at March 31, 2020 177,820 $ 24.57 4.75 $ 0 The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the closing sale price of the Company’s common stock as reported on the NYSE American on March 31, 2020 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders if all option holders had exercised their options on March 31, 2020. This amount changes based on the fair market value of the Company’s common stock. The total intrinsic values of the options exercised during the nine months ended March 31, 2020 and 2019 were $263 and $64,420, respectively. The following table summarizes changes in non-vested stock options during the nine months ended March 31, 2020: Weighted Number Average of Shares Grant Date Subject Fair Value to Option (per Option) Non-vested at July 1, 2019 104,214 $ 4.077 Granted 54,025 $ 3.030 Vested (43,420 ) $ 2.794 Forfeited or expired (9,202 ) $ 4.194 Non-vested at March 31, 2020 105,617 $ 4.059

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 5. Commitments and Contingencies The Company from time to time, enters into standby letters of credit agreements with financial institutions primarily relating to the guarantee of future performance on certain contracts. Contingent liabilities on outstanding standby letters of credit agreements aggregated to zero at March 31, 2020 and June 30, 2019. The Company, as a U.S. Government contractor, is subject to audits, reviews, and investigations by the U.S. Government related to its negotiation and performance of government contracts and its accounting for such contracts. Failure to comply with applicable U.S. Government standards by a contractor may result in suspension from eligibility for award of any new government contract and a guilty plea or conviction may result in debarment from eligibility for awards. The government may, in certain cases, also terminate existing contracts, recover damages, and impose other sanctions and penalties. As a result of contract audits the Company will determine a range of possible outcomes and in accordance with ASC 450 “Contingencies” the Company will accrue amounts within a range that appears to be its best estimate of a possible outcome. Adjustments are made to accruals, if any, periodically based on current information. We are party to various litigation matters and claims arising from time to time in the ordinary course of business. While the results of such matters cannot be predicted with certainty, we believe that the final outcome of such matters will not have a material adverse effect on our business, financial condition, results of operations or cash flows.

Revenue

Revenue	9 Months Ended
	Mar. 31, 2020
Revenue from Contract with Customer [Abstract]
Revenue	Note 6. Revenue Effective July 1, 2018, we adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606 “Revenue from Contracts with Customers”, which requires entities to assess the products or services promised in contracts with customers at contract inception to determine the appropriate unit at which to record revenues. Revenue is recognized when control of the promised products or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those products or services. We adopted ASC 606 using the modified retrospective method, which means, using the allowed practical expedient, we applied the new standard to open contracts at June 30, 2018. We reviewed remaining obligations as of the effective date and determined no adjustment was required to the opening balance of retained earnings. Under the modified retrospective method, prior period revenue is not restated for comparative periods. As a result of the adoption, we reclassified customer advance payments from inventory to contract liabilities. Contract liabilities were $2,791,775 and $6,054 as of March 31, 2020 and June 30, 2019, respectively. The increase in contract liabilities is primarily due to cash collected from progress payments related to specific contracts. The Company used the practical expedient to expense incremental costs incurred to obtain a contract when the contract term is less than one year. Significant judgment is required in determining the satisfaction of performance obligations. Revenues from our performance obligations are satisfied over time using the output method which considers the appraisal of results achieved and milestones reached or units delivered based on contractual shipment terms, typically shipping point. Revenue is recognized when the customer takes control of the product or services. The output method best depicts the transfer of control to the customer as the output method represents work completed. Control is typically transferred to the customer at shipping point as the company has a present right to payment, the customer has legal title to the asset, the customer has the significant risks and rewards of ownership of the asset, and in most instances the customer has accepted the asset. Total revenue recognized for the three and nine months ended March 31, 2020 based on units delivered totaled $4,985,926 and $15,806,805, respectively, compared to $7,527,723 and $20,400,908 for the same periods in fiscal year 2019. Total revenue recognized for the three and nine months ended March 31, 2020 based on milestones achieved totaled $1,205,374 and $3,594,988, respectively, compared to $1,690,418 and $4,457,741 for the same periods in fiscal year 2019. The Company offers a standard one-year product warranty. Product warranties offered by the company are classified as assurance-type warranties, which means, the warranty only guarantees that the good or service functions as promised. Based on this, the provided warranty is not considered to be a distinct performance obligation. The impact of variable consideration has been considered but none identified which would be required to be allocated to the transaction price as of March 31, 2020. Our payment terms are generally 30-60 days. The Company’s backlog at March 31, 2020 totaling $59.8 million is expected, based on expected due dates, to be recognized in the following fiscal years: 24% in 2020; 46% in 2021; 21% in 2022, and 9% thereafter.

Recently Issued Accounting Stan

Recently Issued Accounting Standards	9 Months Ended
	Mar. 31, 2020
Recently Issued Accounting Standards [Abstract]
Recently Issued Accounting Standards	Note 7. Recently Issued Accounting Standards Recent Accounting Pronouncements Adopted In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”. Under current accounting guidance, the income tax effects for changes in income tax rates and certain other transactions are recognized in income from continuing operations resulting in income tax effects recognized in Accumulated Other Comprehensive Income that do not reflect the current tax rate of the entity (“stranded tax effects”). The new guidance allows the Company the option to reclassify these stranded tax effects to retained earnings that relate to the change in the federal tax rate resulting from the passage of the Tax Cuts and Jobs Act (the “Tax Act”). This update is effective for fiscal years beginning after December 15, 2018, including interim periods therein, and early adoption is permitted. The adoption did not have a material effect on the Company’s financial statements. Recent Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued guidance (ASU 2019-12) intended to simplify the accounting for income taxes. The amendments in this guidance are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 (the Company’s fiscal 2021), with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on the Company’s disclosures. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” This ASU is part of the FASB’s larger disclosure framework project intended to improve the effectiveness of financial statement footnote disclosure. ASU 2018-13 modifies required fair value disclosures related primarily to level 3 investments. This ASU is effective for annual periods beginning after December 15, 2019 and interim periods within those annual periods. The adoption of ASU 2018-13 is not expected to have a material effect on the Company’s financial position, results of operations, and cash flows.

Employee Stock Ownership Plan

Employee Stock Ownership Plan	9 Months Ended
	Mar. 31, 2020
Employee Stock Ownership Plan [Abstract]
Employee Stock Ownership Plan	Note 8. Employee Stock Ownership Plan The Company sponsors a leveraged employee stock ownership plan (the "ESOP") that covers all nonunion employees who work 1,000 or more hours per year and are employed on June 30. The Company makes annual contributions to the ESOP equal to the ESOP's debt service less dividends on unallocated shares received by the ESOP. All dividends on unallocated shares received by the ESOP are used to pay debt service. Dividends on allocated ESOP shares are recorded as a reduction of retained earnings. As the debt is repaid, shares are released and allocated to active employees, based on the proportion of debt service paid in the year. The Company accounts for its ESOP in accordance with FASB ASC 718-40. Accordingly, the shares purchased by the ESOP are reported as Unearned ESOP shares in the balance sheets and the statements of changes in stockholders’ equity. As shares are released or committed-to-be-released, the Company reports compensation expense equal to the current average market price of the shares, and the shares become outstanding for earnings-per-share (EPS) computations. ESOP compensation expense was $73,241 and $93,861 for the three-month periods ended March 31, 2020 and 2019, respectively. ESOP compensation expense was $239,061 and $297,670 for the nine-month periods ended March 31, 2020 and 2019, respectively. The ESOP shares as of March 31, 2020 and 2019 were as follows: March 31, 2020 March 31, 2019 Allocated shares 452,763 441,753 Committed-to-be-released shares 10,625 11,250 Unreleased shares 3,541 17,916 Total shares held by the ESOP 466,929 470,919 Fair value of unreleased shares $ 65,544 $ 443,421 The Company may at times be required to repurchase shares at the ESOP participants’ request at the fair market value. During the three and nine months ended March 31, 2020 the Company repurchased 0 and 2,180 shares previously held by the ESOP for $0 and $47,949, respectively. During the three and nine months ended March 31, 2019 the Company did not repurchase any shares held by the ESOP. The ESOP allows for eligible participants to take whole share distributions from the Plan on specific dates in accordance with the provision of the Plan. Share distributions from the ESOP during the nine months ended March 31, 2020 and 2019 totaled 2,180 and 17,279, respectively.

Investment Securities (Tables)

Investment Securities (Tables)	9 Months Ended
	Mar. 31, 2020
Investments, Debt and Equity Securities [Abstract]
Schedule of Available-for-Sale Securities	The cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale securities by major security type at March 31, 2020 and June 30, 2019 are as follows: Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value March 31, 2020 Certificates of deposit $ 5,156,847 $ — $ — $ 5,156,847 Municipal bonds 563,792 3,021 (446 ) 566,367 Total investment securities $ 5,720,639 $ 3,021 $ (446 ) $ 5,723,214 June 30, 2019 Certificates of deposit $ 5,046,627 $ — $ — $ 5,046,627 Municipal bonds 636,269 1,576 (232 ) 637,613 Total investment securities $ 5,682,896 $ 1,576 $ (232 ) $ 5,684,240
Schedule of Contractual Maturities	As of March 31, 2020 and June 30, 2019, the remaining contractual maturities of available-for-sale securities were as follows: Years to Maturity Less than One to One Year Five Years Total March 31, 2020 Available-for-sale $ 5,650,469 $ 72,745 $ 5,723,214 June 30, 2019 Available-for-sale $ 5,549,460 $ 134,780 $ 5,684,240

Stock Based Compensation (Table

Stock Based Compensation (Tables)	9 Months Ended
	Mar. 31, 2020
Share-based Payment Arrangement [Abstract]
Schedule of Fair Value Assumptions	The table below outlines the weighted average assumptions that the Company used to calculate the fair value of each option award for the nine months ended March 31, 2020 and 2019. March 31, 2020 March 31, 2019 Dividend yield 4.88% 3.68% Company’s expected volatility 27.81% 27.63% Risk-free interest rate 1.67% 2.70% Expected term 5.3 yrs 5.2 yrs Weighted average fair value per share of options granted during the period $ 3.03 $ 5.13
Schedule of Stock Option Activity	The following table summarizes stock option activity during the nine months ended March 31, 2020: Employee Stock Options Plan Weighted Number of Weighted Average Shares Average Remaining Aggregate Subject Exercise Contractual Intrinsic To Options Price Term Value Balance at July 1, 2019 259,164 $ 25.16 6.37 Granted 54,025 20.50 9.69 Exercised (3,600 ) 22.50 — Forfeited or expired (26,152 ) 25.38 — Outstanding at March 31, 2020 283,437 $ 24.28 6.40 $ 0 Vested or expected to vest at March 31, 2020 266,689 $ 24.32 6.23 $ 0 Exercisable at March 31, 2020 177,820 $ 24.57 4.75 $ 0
Schedule of Changes in Non-Vested Stock Options	The following table summarizes changes in non-vested stock options during the nine months ended March 31, 2020: Weighted Number Average of Shares Grant Date Subject Fair Value to Option (per Option) Non-vested at July 1, 2019 104,214 $ 4.077 Granted 54,025 $ 3.030 Vested (43,420 ) $ 2.794 Forfeited or expired (9,202 ) $ 4.194 Non-vested at March 31, 2020 105,617 $ 4.059

Employee Stock Ownership Plan (

Employee Stock Ownership Plan (Tables)	9 Months Ended
	Mar. 31, 2020
Employee Stock Ownership Plan [Abstract]
Schedule of ESOP shares	The ESOP shares as of March 31, 2020 and 2019 were as follows: March 31, 2020 March 31, 2019 Allocated shares 452,763 441,753 Committed-to-be-released shares 10,625 11,250 Unreleased shares 3,541 17,916 Total shares held by the ESOP 466,929 470,919 Fair value of unreleased shares $ 65,544 $ 443,421

Investment Securities (Schedule

Investment Securities (Schedule of Available-for-Sale Securities) (Details) - USD ($)	Mar. 31, 2020	Jun. 30, 2019
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 5,720,639	$ 5,682,896
Gross Unrealized Gains	3,021	1,576
Gross Unrealized Losses	(446)	(232)
Fair Value	5,723,214	5,684,240
Certificates of Deposit [Member]
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	5,156,847	5,046,627
Gross Unrealized Gains
Gross Unrealized Losses
Fair Value	5,156,847	5,046,627
Municipal Bonds [Member]
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	563,792	636,269
Gross Unrealized Gains	3,021	1,576
Gross Unrealized Losses	(446)	(232)
Fair Value	$ 566,367	$ 637,613

Investment Securities (Schedu_2

Investment Securities (Schedule of Contractual Maturities) (Details) - USD ($)	Mar. 31, 2020	Jun. 30, 2019
Contractual maturities of available-for-sale securities
Less than One Year	$ 5,650,469	$ 5,549,460
One to Five Years	72,745	134,780
Fair Value	$ 5,723,214	$ 5,684,240

Net Income per Share (Details)

Net Income per Share (Details) - shares	3 Months Ended		9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019
Net Income per Share [Abstract]
Anti-dilutive securities	283,437	196,039	283,437	196,039

Stock Based Compensation (Narra

Stock Based Compensation (Narrative) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019	Jun. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 49,003	$ 47,096	$ 141,450	$ 124,972
Deferred tax benefit related to stock based compensation	2,727	$ 2,547	7,788	$ 6,826
Unrecognized compensation costs	195,512		$ 195,512
Period in which compensation cost will be recognized			1 year 9 months
Deferred tax benefit related to unrecognized compensation costs	$ 11,331		$ 11,331
Granted			54,025
Outstanding	283,437		283,437		259,164
Cash divided paid	$ 0.25	$ 0.25	$ 0.75	$ 1.75
Special cash divided paid				$ 1
Total intrinsic values of the options exercised			$ 263	$ 64,420
2017 Plan [Member] | Non employee directors [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Authorized shares under plan	133,000		133,000
Percentage of total number of shares subject to options or awards, single fiscal year			33.33%
Number of shares subject to option or award, single fiscal year	13,300		13,300
2017 Plan [Member] | Individual Employee [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares subject to option or award, single fiscal year	15,000		15,000
Stock Option Plans [Member] | 2017 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			2 years
Expiration period			10 years
Authorized shares under plan	400,000		400,000
Granted			164,329
Stock Option Plans [Member] | 2007 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding	136,600		136,600

Stock Based Compensation (Sched

Stock Based Compensation (Schedule of weighted average assumptions for option awards) (Details) - $ / shares	9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Weighted Average Assumptions
Dividend yield	4.88%	3.68%
Company's expected volatility	27.81%	27.63%
Risk-free interest rate	1.67%	2.70%
Expected term	5 years 3 months 19 days	5 years 2 months 12 days
Weighted average fair value per share of options granted during the period	$ 3.03	$ 5.13

Stock Based Compensation (Sch_2

Stock Based Compensation (Schedule of Stock Option Activity) (Details) - USD ($)	9 Months Ended	12 Months Ended
	Mar. 31, 2020	Jun. 30, 2019
Number of Shares Subject To Options
Balance at July 1, 2019	259,164
Granted	54,025
Exercised	(3,600)
Forfeited or expired	(26,152)
Outstanding at March 31, 2020	283,437	259,164
Vested or expected to vest at March 31, 2020	266,689
Exercisable at March 31, 2020	177,820
Weighted Average Exercise Price
Balance at July 1, 2019	$ 25.16
Granted	20.50
Exercised	22.50
Forfeited or expired	25.38
Outstanding at March 31, 2020	24.28	$ 25.16
Vested or expected to vest at March 31, 2020	24.32
Exercisable at March 31, 2020	$ 24.57
Weighted Average Remaining Contractual Term
Outstanding	6 years 4 months 24 days	6 years 4 months 13 days
Granted	9 years 8 months 9 days
Vested or expected to vest at March 31, 2020	6 years 2 months 23 days
Exercisable at March 31, 2020	4 years 9 months
Aggregate Intrinsic Value
Outstanding at March 31, 2020	$ 0
Vested or expected to vest at March 31, 2020	0
Exercisable at March 31, 2020	$ 0

Stock Based Compensation (Sch_3

Stock Based Compensation (Schedule of Changes in Non-Vested Stock Options) (Details)	9 Months Ended
	Mar. 31, 2020$ / sharesshares
Number of Shares Subject to Option
Non-vested at July 1, 2019 | shares	104,214
Granted | shares	54,025
Vested | shares	(43,420)
Forfeited or expired | shares	(9,202)
Non-vested at March 31, 2020 | shares	105,617
Weighted Average Grant Date Fair Value (per Option)
Non-vested at July 1, 2019 | $ / shares	$ 4.077
Granted | $ / shares	3.030
Vested | $ / shares	2.794
Forfeited or expired | $ / shares	4.194
Non-vested at March 31, 2020 | $ / shares	$ 4.059

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($)	Mar. 31, 2020	Jun. 30, 2019
Standby Letters of Credit [Member]
Contingent liabilities	$ 0	$ 0

Revenue (Details)

Revenue (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019	Jun. 30, 2019
Item Effected [Line Items]
Revenue	$ 6,191,300	$ 9,218,141	$ 19,401,793	$ 24,858,649
ASC 606 [Member]
Item Effected [Line Items]
Contract liabilities	2,791,775		2,791,775		$ 6,054
ASC 606 [Member] | Backlog [Member]
Item Effected [Line Items]
Intangible assets	59,800,000		$ 59,800,000
Percentage of estimated shipments			24% in 2020; 46% in 2021; 21% in 2022, and 9% thereafter.
ASC 606 [Member] | Units Delivered [Member]
Item Effected [Line Items]
Revenue	4,985,926	7,527,723	$ 15,806,805	20,400,908
ASC 606 [Member] | Milestones Achieved [Member]
Item Effected [Line Items]
Revenue	$ 1,205,374	$ 1,690,418	$ 3,594,988	$ 4,457,741

Employee Stock Ownership Plan_2

Employee Stock Ownership Plan (Narrative) (Details)	3 Months Ended		9 Months Ended
	Mar. 31, 2020USD ($)shares	Mar. 31, 2019USD ($)	Mar. 31, 2020USD ($)hshares	Mar. 31, 2019USD ($)shares
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
ESOP compensation expense	$ 73,241	$ 93,861	$ 239,061	$ 297,670
Value of shares repurchased			$ 47,949
Employee Stock Ownership Plan [Member]
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Number of hours worked per year to quality for the plan | h			1,000
Shares distributed | shares			2,180	17,279
Shares repurchased | shares	0		2,180
Value of shares repurchased	$ 0		$ 47,949

Employee Stock Ownership Plan_3

Employee Stock Ownership Plan (Schedule of ESOP shares) (Details) - USD ($)	Mar. 31, 2020	Mar. 31, 2019
Employee Stock Ownership Plan [Abstract]
Allocated shares	452,763	441,753
Committed-to-be-released shares	10,625	11,250
Unreleased shares	3,541	17,916
Total shares held by the ESOP	466,929	470,919
Fair value of unreleased shares	$ 65,544	$ 443,421