Espey Mfg. & Electronics (ESP) 10-Q 13 Feb 23 2023 Q2 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	6 Months Ended
	Dec. 31, 2022	Feb. 09, 2023
Document Information Line Items
Entity Registrant Name	ESPEY MFG & ELECTRONICS CORP
Trading Symbol	ESP
Document Type	10-Q
Current Fiscal Year End Date	--06-30
Entity Common Stock, Shares Outstanding		2,702,633
Amendment Flag	false
Entity Central Index Key	0000033533
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Dec. 31, 2022
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	1-4383
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	14-1387171
Entity Address, Address Line One	233 Ballston Avenue
Entity Address, City or Town	Saratoga Springs
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	12866
Local Phone Number	245-4400
City Area Code	518
Entity Interactive Data Current	Yes
Title of 12(b) Security	Common stock, $.33-1/3 par value

Balance Sheets (Unaudited)

Balance Sheets (Unaudited) - USD ($)	Dec. 31, 2022	Jun. 30, 2022
ASSETS
Cash and cash equivalents	$ 6,328,442	$ 8,104,060
Investment securities	10,067,377	3,708,779
Trade accounts receivable, net of allowance of $3,000	4,609,444	5,733,174
Raw materials	2,132,004	2,037,483
Work-in-process	126,571	315,547
Costs related to contracts in process	16,511,931	16,207,419
Total inventories	18,770,506	18,560,449
Prepaid expenses and other current assets	2,161,460	992,774
Total current assets	41,937,229	37,099,236
Property, plant and equipment, net	2,659,521	2,797,993
Total assets	44,596,750	39,897,229
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	2,905,391	2,079,177
Accrued expenses:
Salaries and wages	400,302	627,187
Vacation	686,965	666,380
ESOP payable	155,477
Other	534,609	752,554
Payroll and other taxes withheld	57,415	55,292
Contract liabilities	5,286,073	3,384,474
Income taxes payable	282,564	54,722
Total current liabilities	10,308,796	7,619,786
Deferred tax liabilities	169,940	177,829
Total liabilities	10,478,736	7,797,615
Commitments and contingencies (See Note 5)
Common stock, par value $.33-1/3 per share Authorized 10,000,000 shares; Issued 3,129,874 shares as of December 31, 2022 and June 30, 2022. Outstanding 2,702,633 shares as of December 31, 2022 and June 30, 2022 (includes 245,049 and 256,293 Unearned ESOP shares, respectively)	1,043,291	1,043,291
Capital in excess of par value	23,207,870	23,104,693
Accumulated other comprehensive loss	(1,017)	(1,932)
Retained earnings	20,594,165	18,679,857
Total stockholders equity before ESOP	44,844,309	42,825,909
Less: Unearned ESOP shares	(4,687,604)	(4,687,604)
Cost of 427,241 shares of common stock in treasury as of December 31, 2022 and June 30, 2022	(6,038,691)	(6,038,691)
Total stockholders’ equity	34,118,014	32,099,614
Total liabilities and stockholders' equity	$ 44,596,750	$ 39,897,229

Balance Sheets (Unaudited) (Par

Balance Sheets (Unaudited) (Parentheticals) - USD ($)	Dec. 31, 2022	Jun. 30, 2022
Statement of Financial Position [Abstract]
Trade accounts receivable, allowance (in Dollars)	$ 3,000	$ 3,000
Common stock, shares authorized	10,000,000	10,000,000
Common stock, shares issued	3,129,874	3,129,874
Common stock, shares outstanding	2,702,633	2,702,633
Unearned ESOP shares	245,049	256,293
Common stock, par value (in Dollars per share)	$ 0.33	$ 0.33
Treasury stock, shares	427,241	427,241

Statements of Comprehensive Inc

Statements of Comprehensive Income (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2022	Dec. 31, 2021
Income Statement [Abstract]
Net sales	$ 8,804,109	$ 7,458,050	$ 17,439,904	$ 15,003,482
Cost of sales	6,543,387	6,251,233	13,367,040	12,443,567
Gross profit	2,260,722	1,206,817	4,072,864	2,559,915
Selling, general and administrative expenses	874,931	1,186,168	1,713,961	2,180,990
Operating income	1,385,791	20,649	2,358,903	378,925
Other income
Interest income	64,625	1,716	73,432	3,312
Other	8,917	10,105	12,684	28,076
Total other income	73,542	11,821	86,116	31,388
Income before provision for income taxes	1,459,333	32,470	2,445,019	410,313
Provision for income taxes	313,291	11,269	530,711	83,051
Net income	1,146,042	21,201	1,914,308	327,262
Other comprehensive income, net of tax:
Unrealized gain on investment securities	2,678		915
Total comprehensive income	$ 1,148,720	$ 21,201	$ 1,915,223	$ 327,262
Net income per share:
Basic (in Dollars per share)	$ 0.47	$ 0.01	$ 0.78	$ 0.14
Diluted (in Dollars per share)	$ 0.47	$ 0.01	$ 0.78	$ 0.14
Weighted average number of shares outstanding:
Basic (in Shares)	2,452,064	2,429,051	2,449,233	2,426,159
Diluted (in Shares)	2,452,064	2,429,199	2,449,791	2,426,233

Statements of Changes in Stockh

Statements of Changes in Stockholders' Equity (Unaudited) - USD ($)	Common Stock	Capital in Excess of Par Value	Accumulated Other Comprehensive (Loss) Gain	Retained Earnings	Treasury Stock	Unearned ESOP Shares	Total
Balance at Jun. 30, 2021	$ 1,043,291	$ 23,026,096	$ (2,361)	$ 17,414,730	$ (6,038,691)	$ (5,110,770)	$ 30,332,295
Balance (in Shares) at Jun. 30, 2021	2,702,633				427,241
Net income				327,262			327,262
Total comprehensive income							327,262
Stock-based compensation		94,567					94,567
Balance at Dec. 31, 2021	$ 1,043,291	23,120,663	(2,361)	17,741,992	$ (6,038,691)	(5,110,770)	30,754,124
Balance (in Shares) at Dec. 31, 2021	2,702,633				427,241
Balance at Sep. 30, 2021	$ 1,043,291	23,078,872	(2,361)	17,720,791	$ (6,038,691)	(5,110,770)	30,691,132
Balance (in Shares) at Sep. 30, 2021	2,702,633				427,241
Net income				21,201			21,201
Total comprehensive income							21,201
Stock-based compensation		41,791					41,791
Balance at Dec. 31, 2021	$ 1,043,291	23,120,663	(2,361)	17,741,992	$ (6,038,691)	(5,110,770)	30,754,124
Balance (in Shares) at Dec. 31, 2021	2,702,633				427,241
Balance at Jun. 30, 2022	$ 1,043,291	23,104,693	(1,932)	18,679,857	$ (6,038,691)	(4,687,604)	32,099,614
Balance (in Shares) at Jun. 30, 2022	2,702,633				427,241
Net income				1,914,308			1,914,308
Other comprehensive income, net of tax			915				915
Total comprehensive income							1,915,223
Stock-based compensation		103,177					103,177
Balance at Dec. 31, 2022	$ 1,043,291	23,207,870	(1,017)	20,594,165	$ (6,038,691)	(4,687,604)	34,118,014
Balance (in Shares) at Dec. 31, 2022	2,702,633				427,241
Balance at Sep. 30, 2022	$ 1,043,291	23,165,952	(3,695)	19,448,123	$ (6,038,691)	(4,687,604)	32,927,376
Balance (in Shares) at Sep. 30, 2022	2,702,633				427,241
Net income				1,146,042			1,146,042
Other comprehensive income, net of tax			2,678				2,678
Total comprehensive income							1,148,720
Stock-based compensation		41,918					41,918
Balance at Dec. 31, 2022	$ 1,043,291	$ 23,207,870	$ (1,017)	$ 20,594,165	$ (6,038,691)	$ (4,687,604)	$ 34,118,014
Balance (in Shares) at Dec. 31, 2022	2,702,633				427,241

Statements of Changes in Stoc_2

Statements of Changes in Stockholders' Equity (Unaudited) (Parentheticals) - USD ($)	3 Months Ended	6 Months Ended
	Dec. 31, 2022	Dec. 31, 2022
Statement of Stockholders' Equity [Abstract]
Other comprehensive income, net of tax	$ 562	$ 192

Statements of Cash Flows (Unaud

Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Cash Flows from Operating Activities:
Net income	$ 1,914,308	$ 327,262
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation	103,177	94,567
Depreciation	242,357	253,846
ESOP compensation expense	155,477	168,318
Deferred income tax benefit	(7,889)	(33,908)
Gain on disposal of assets	(2,500)
Changes in assets and liabilities:
Decrease in trade accounts receivable	1,123,730	465,382
Increase in income taxes receivable		(3,041)
Increase in inventories	(210,057)	(537,319)
Increase in prepaid expenses and other current assets	(1,168,686)	(108,560)
Increase (decrease) in accounts payable	826,214	(132,999)
(Decrease) increase in accrued salaries and wages	(226,885)	173,422
Increase (decrease) in vacation accrual	20,585	(16,319)
Decrease in other accrued expenses	(217,945)	(68,977)
Increase (decrease) in payroll and other taxes withheld	2,123	(130,957)
Increase (decrease) in contract liabilities	1,901,599	(172,859)
Increase in income taxes payable	227,842
Net cash provided by operating activities	4,683,450	277,858
Cash Flows from Investing Activities:
Additions to property, plant and equipment	(103,885)	(97,288)
Proceeds from sale of fixed assets	2,500
Purchase of investment securities	(8,515,017)	(2,061,000)
Proceeds from sale/maturity of investment securities	2,157,334	2,096,000
Net cash used in investing activities	(6,459,068)	(62,288)
(Decrease) increase in cash and cash equivalents	(1,775,618)	215,570
Cash and cash equivalents, beginning of period	8,104,060	6,802,712
Cash and cash equivalents, end of period	6,328,442	7,018,282
Supplemental Schedule of Cash Flow Information:
Income taxes paid	$ 311,000	$ 120,000

Basis of Presentation

Basis of Presentation	6 Months Ended
	Dec. 31, 2022
Accounting Policies [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.’s (the “Company”) 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, 2022. Certain reclassifications may have been made to the prior year financial statements to conform to the current year presentation.

Investment Securities

Investment Securities	6 Months Ended
	Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]
Investment Securities	Note 2. Investment Securities Accounting Standards Codification (“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 investments, accounts receivable, accounts payable and accrued expenses, approximated fair value as of December 31, 2022 and June 30, 2022 because of the immediate or short-term maturity of these financial instruments. Investment securities at December 31, 2022 consists of certificates of deposit, municipal bonds and U.S. treasury bills and at June 30, 2022 consisted of certificates of deposit and municipal bonds. The Company classifies investment securities as available-for-sale which have been determined to be level 1 assets. The cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale debt securities by major security type at December 31, 2022 and June 30, 2022 are as follows: Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value December 31, 2022 Certificates of deposit $ 9,700,000 $ — $ — $ 9,700,000 Municipal bonds $ 72,225 $ — $ (3,755 ) $ 68,470 U.S. Treasury Bills $ 296,439 $ 2,468 $ — $ 298,907 Total investment securities $ 10,068,664 $ 2,468 $ (3,755 ) $ 10,067,377 June 30, 2022 Certificates of deposit $ 3,639,000 $ — $ — $ 3,639,000 Municipal bonds $ 72,225 $ — $ (2,446 ) $ 69,779 Total investment securities $ 3,711,225 $ — $ (2,446 ) $ 3,708,779 The portfolio is diversified and highly liquid and primarily consists of investment grade fixed income instruments. At December 31, 2022, 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 December 31, 2022 and June 30, 2022, the remaining contractual maturities of available-for-sale debt securities were as follows Years to Maturity Less than One to One Year Five Years Total December 31, 2022 Available-for-sale $ 9,998,908 $ 68,469 $ 10,067,377 June 30, 2022 Available-for-sale $ 3,639,000 $ 69,779 $ 3,708,779

Net Income per Share

Net Income per Share	6 Months Ended
	Dec. 31, 2022
Earnings 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 diluted net income per share, excluded options to purchase 300,923 shares of our common stock for the three and six months ended , 2022 and 316,912 shares for the three and six months ended , 2021, as the effect of including them would be anti-dilutive. As unearned shares owned by the Company’s sponsored leveraged employee stock ownership plan (the “ESOP”) are released or committed-to-be-released, the shares become outstanding for earnings-per-share computations.

Stock Based Compensation

Stock Based Compensation	6 Months Ended
	Dec. 31, 2022
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 for the three-month periods ended December 31, 2022 and 2021 was $41,918 and $41,791, respectively, before income taxes. The amount of this stock-based compensation expense related to non-qualified stock options (“NQSOs”) for the three-month periods ended December 31, 2022 and 2021, was $3,877 and $8,757, respectively. The deferred tax benefit related to the NQSOs as of December 31, 2022 and 2021 was approximately $814 and $1,839, respectively. Total stock-based compensation expense recognized in the statements of comprehensive income for the six-month periods ended December 31, 2022 and 2021, was $103,177 and $94,567, respectively, before income taxes. The amount of this stock-based compensation expense related to NQSOs for the six-month periods ended December 31, 2022 and 2021, was $13,481 and $16,123, respectively. The deferred tax benefit related to the NQSOs as of December 31, 2022 and 2021 was approximately $2,831 and $3,386, respectively. The remaining stock option expense in each year related to incentive stock options (“ISOs”) which are not deductible by the corporation when exercised, assuming a qualifying disposition and as such no deferred tax benefit was established related to these amounts. As of December 31, 2022, there was approximately $262,081 of unrecognized compensation cost related to stock option awards that is expected to be recognized as expense over the next 1.75 years, of which $218,533 relates to ISOs and $43,548 relates to NQSOs. The total deferred tax benefit related to these awards is expected to be $9,145. 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 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 six months ended December 31, 2022 and 2021. December 31, 2022 December 31, 2021 Company’s expected volatility 27.10% 25.56% Risk-free interest rate 2.66% 0.93% Expected term 5.4 yrs 5.4 yrs Weighted average fair value per share of options granted during the period $4.11 $3.72 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 six months ended December 31, 2022: Employee Stock Options Plan Weighted Number of Weighted Average Shares Average Remaining Aggregate Subject Exercise Contractual Intrinsic to Option Price Term Value Balance at July 1, 2022 246,273 $ 20.89 6.73 Granted 71,200 $ 13.61 9.59 Exercised — — — Forfeited or expired (16,550 ) $ 19.83 — Outstanding at December 31, 2022 300,923 $ 19.23 6.95 $ 42,169 Vested or expected to vest at December 31, 2022 276,789 $ 19.67 6.76 $ 34,514 Exercisable at December 31, 2022 171,023 $ 23.09 5.30 $ 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 December 31, 2022 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 December 31, 2022. This amount changes based on the fair market value of the Company’s common stock. The intrinsic value of options exercised during the six months ended December 31, 2022 and 2021 was $0, resulting from no option exercise activity during those periods. 10 Index The following table summarizes changes in non-vested stock options during the six months ended December 31, 2022: Weighted Number Average of Shares Grant Date Subject Fair Value to Option (per Option) Non-vested at July 1, 2022 104,175 $ 2.92 Granted 71,200 $ 4.11 Vested (36,375 ) $ 1.59 Forfeited or expired (9,100 ) $ 3.01 Non-vested at December 31, 2022 129,900 $ 3.94

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Dec. 31, 2022
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 December 31, 2022 and June 30, 2022. 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. There are no such pending matters which we believe will have a material adverse effect on our business, financial condition, results of operations or cash flows.

Revenue

Revenue	6 Months Ended
	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Revenue	Note 6. Revenue The Company follows ASC 606 “Revenue from Contracts with Customers” to determine the recognition of revenue. This standard 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. 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, or as, 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 the 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 six months ended December 31, 2022 based on units delivered was $6,757,440 and $13,717,229, respectively, compared to $6,100,228 and $12,592,464 for the same period in fiscal year 2022. Total revenue recognized for the three and six months ended December 31, 2022 based on milestones achieved was $2,046,669 and $3,722,675, respectively, compared to $1,357,822 and $2,411,018 for the same period in fiscal year 2022. 11 Index 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 December 31, 2022. Our payment terms are generally 30-60 days. Contract liabilities were $5,286,073 and $3,384,474 as of December 31, 2022 and June 30, 2022, respectively. The increase in contract liabilities is primarily due to the advance collection of cash on specific contracts, offset in part, by revenue recognized. Revenue recognized, that was in contract liabilities in the beginning of the fiscal year, was $1,826,797 for the six months ended December 31, 2022. The Company used the practical expedient to expense incremental costs incurred to obtain a contract when the contract term is less than one year. The Company’s backlog at December 31, 2022 totaling approximately $78.3 million is projected, based on expected due dates, to be recognized in the following fiscal years: 24% in 2023; 49% in 2024; 13% in 2025, and 14% thereafter.

Recently Issued Accounting Stan

Recently Issued Accounting Standards	6 Months Ended
	Dec. 31, 2022
Accounting Standards Update and Change in Accounting Principle [Abstract]
Recently Issued Accounting Standards	Note 7. Recently Issued Accounting Standards Recent Accounting Pronouncements Adopted In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 amends ASC 740 to simplify the accounting for income taxes by removing certain exceptions for investments, intraperiod allocations and interim calculations, and adding guidance to reduce complexity in the accounting standard under the FASB’s simplification initiative. ASU 2019-12 is effective for public entities for fiscal years beginning after December 15, 2020. Upon adoption, the amendments in ASU 2019-12 should be applied on a prospective basis to all periods presented. The Company adopted the new guidance under ASU 2019-12 in the first quarter of fiscal year 2022 and removed the exception for intraperiod allocations from its interim period tax provision calculation, accordingly. The removal of the exception for intraperiod allocations did not have a material impact on the Company. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which requires a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected, with further clarifications made more recently. For trade receivables, loans and other financial instruments, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. Credit losses relating to available-for-sale debt securities are required to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities.

Employee Stock Ownership Plan

Employee Stock Ownership Plan	6 Months Ended
	Dec. 31, 2022
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 $76,549 and $83,812 for the three-month periods ended December 31, 2022 and 2021, respectively. ESOP compensation expense was $155,477 and $168,318 for the six-month periods ended December 31, 2022 and 2021, respectively. 12 Index The ESOP shares as of December 31, 2022 and 2021 were as follows: December 31, 2022 December 31, 2021 Allocated shares 465,248 478,935 Committed-to-be-released shares 11,244 11,568 Unreleased shares 245,049 267,861 Total shares held by the ESOP 721,541 758,364 Fair value of unreleased shares $ 3,479,696 $ 3,806,305 The Company may at times be required to repurchase shares at the ESOP participants’ request at the shares’ fair market value. During the three and six months ended December 31, 2022 and 2021, the Company did not repurchase shares previously 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 provisions of the Plan. Share distributions from the ESOP during the six months ended December 31, 2022 and 2021 totaled 30,843 and 8,285 shares, respectively.

Subsequent Events

Subsequent Events	6 Months Ended
	Dec. 31, 2022
Subsequent Events [Abstract]
Subsequent Events	Note 9. Subsequent Events The Company has evaluated subsequent events through the filing of this Form 10-Q, and has determined that there have been no events that have occurred that would require adjustments to our disclosures in the financial statements except for the following: The Company was awarded $7.4 million in funding in support of facility and capital equipment upgrades for testing and qualification for the United States Navy. The funding is part of the Navy’s investment to improve and sustain the Surface Combatant Industrial Base. The work will be conducted on Espey’s property in Saratoga Springs, NY, with completion slated for 2024. The Company expects to be paid within 30 days after the submission of invoices, but will not be paid for expenses incurred in excess of the specified milestone payment limits. The Company expects to have a cash outlay to satisfy income tax obligations arising from the value of the award.

Investment Securities (Tables)

Investment Securities (Tables)	6 Months Ended
	Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]
Schedule of Available-for-Sale Securities	Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value December 31, 2022 Certificates of deposit $ 9,700,000 $ — $ — $ 9,700,000 Municipal bonds $ 72,225 $ — $ (3,755 ) $ 68,470 U.S. Treasury Bills $ 296,439 $ 2,468 $ — $ 298,907 Total investment securities $ 10,068,664 $ 2,468 $ (3,755 ) $ 10,067,377 June 30, 2022 Certificates of deposit $ 3,639,000 $ — $ — $ 3,639,000 Municipal bonds $ 72,225 $ — $ (2,446 ) $ 69,779 Total investment securities $ 3,711,225 $ — $ (2,446 ) $ 3,708,779
Schedule of Contractual Maturities	Years to Maturity Less than One to One Year Five Years Total December 31, 2022 Available-for-sale $ 9,998,908 $ 68,469 $ 10,067,377 June 30, 2022 Available-for-sale $ 3,639,000 $ 69,779 $ 3,708,779

Stock Based Compensation (Table

Stock Based Compensation (Tables)	6 Months Ended
	Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of Fair Value Assumptions	December 31, 2022 December 31, 2021 Company’s expected volatility 27.10% 25.56% Risk-free interest rate 2.66% 0.93% Expected term 5.4 yrs 5.4 yrs Weighted average fair value per share of options granted during the period $4.11 $3.72
Schedule of Stock Option Activity	Employee Stock Options Plan Weighted Number of Weighted Average Shares Average Remaining Aggregate Subject Exercise Contractual Intrinsic to Option Price Term Value Balance at July 1, 2022 246,273 $ 20.89 6.73 Granted 71,200 $ 13.61 9.59 Exercised — — — Forfeited or expired (16,550 ) $ 19.83 — Outstanding at December 31, 2022 300,923 $ 19.23 6.95 $ 42,169 Vested or expected to vest at December 31, 2022 276,789 $ 19.67 6.76 $ 34,514 Exercisable at December 31, 2022 171,023 $ 23.09 5.30 $ 0
Schedule of Changes in Non-Vested Stock Options	Weighted Number Average of Shares Grant Date Subject Fair Value to Option (per Option) Non-vested at July 1, 2022 104,175 $ 2.92 Granted 71,200 $ 4.11 Vested (36,375 ) $ 1.59 Forfeited or expired (9,100 ) $ 3.01 Non-vested at December 31, 2022 129,900 $ 3.94

Employee Stock Ownership Plan (

Employee Stock Ownership Plan (Tables)	6 Months Ended
	Dec. 31, 2022
Employee Stock Ownership Plan Abstract
Schedule of ESOP shares	December 31, 2022 December 31, 2021 Allocated shares 465,248 478,935 Committed-to-be-released shares 11,244 11,568 Unreleased shares 245,049 267,861 Total shares held by the ESOP 721,541 758,364 Fair value of unreleased shares $ 3,479,696 $ 3,806,305

Investment Securities (Details)

Investment Securities (Details) - Schedule of Available-for-Sale Securities - USD ($)	Dec. 31, 2022	Jun. 30, 2022
Debt Securities, Available-for-Sale [Line Items]
Amortized cost	$ 10,068,664	$ 3,711,225
Gross Unrealized Gains	2,468
Gross Unrealized Losses	(3,755)	(2,446)
Fair Value	10,067,377	3,708,779
Certificates of Deposit [Member]
Debt Securities, Available-for-Sale [Line Items]
Amortized cost	9,700,000	3,639,000
Gross Unrealized Gains
Gross Unrealized Losses
Fair Value	9,700,000	3,639,000
Municipal Bonds [Member]
Debt Securities, Available-for-Sale [Line Items]
Amortized cost	72,225	72,225
Gross Unrealized Gains
Gross Unrealized Losses	(3,755)	(2,446)
Fair Value	68,470	$ 69,779
U.S. Treasury Bills [Member]
Debt Securities, Available-for-Sale [Line Items]
Amortized cost	296,439
Gross Unrealized Gains	2,468
Gross Unrealized Losses
Fair Value	$ 298,907

Investment Securities (Detail_2

Investment Securities (Details) - Schedule of Contractual Maturities - USD ($)	Dec. 31, 2022	Jun. 30, 2022
Schedule Of Contractual Maturities Abstract
Less than One Year	$ 9,998,908	$ 3,639,000
One to Five Years	68,469	69,779
Fair Value	$ 10,067,377	$ 3,708,779

Net Income per Share (Details)

Net Income per Share (Details) - shares	3 Months Ended		6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2022	Dec. 31, 2021
Earnings Per Share [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	300,923	316,912	300,923	316,912

Stock Based Compensation (Detai

Stock Based Compensation (Details) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2022	Dec. 31, 2021	Jun. 30, 2022
Stock Based Compensation (Details) [Line Items]
Stock based compensation expense	$ 41,918	$ 41,791	$ 103,177	$ 94,567
Deferred tax benefit related to stock based compensation	814	1,839	2,831	3,386
Unrecognized compensation costs	262,081		$ 262,081
Period in which compensation cost will be recognized			1 year 9 months
Deferred tax benefit related to unrecognized compensation costs	$ 9,145		$ 9,145
Vesting period			2 years
Granted (in Shares)			71,200
Outstanding (in Shares)	300,923		300,923		246,273
Shares cancelled (in Shares)			16,550
Shares remain available for grant (in Shares)	149,827		149,827
Aggregate intrinsic value of options exercised			$ 0	0
Non employee directors [Member] | Maximum [Member] | 2017 Plan [Member]
Stock Based Compensation (Details) [Line Items]
Authorized shares under plan (in Shares)	133,000		133,000
Number of shares subject to option or award, single fiscal year (in Shares)	13,300		13,300
Percentage of total number of shares subject to options or awards, single fiscal year			33%
Individual Employee [Member] | Maximum [Member] | 2017 Plan [Member]
Stock Based Compensation (Details) [Line Items]
Number of shares subject to option or award, single fiscal year (in Shares)	15,000		15,000
Non-qualified stock options [Member]
Stock Based Compensation (Details) [Line Items]
Stock based compensation expense	$ 3,877	$ 8,757	$ 13,481	$ 16,123
Unrecognized compensation costs	43,548		43,548
Incentive Stock Options [Member]
Stock Based Compensation (Details) [Line Items]
Unrecognized compensation costs	$ 218,533		$ 218,533
Incentive Stock Options [Member] | TwoThousandSeventenPlanMember
Stock Based Compensation (Details) [Line Items]
Outstanding (in Shares)	250,173		250,173
Shares cancelled (in Shares)			128,931
Share-Based Payment Arrangement, Option [Member] | 2017 Plan [Member]
Stock Based Compensation (Details) [Line Items]
Authorized shares under plan (in Shares)	400,000		400,000
Granted (in Shares)			379,104
Restricted Stock Plan [Member] | 2007 Plan [Member]
Stock Based Compensation (Details) [Line Items]
Outstanding (in Shares)	50,750		50,750

Stock Based Compensation (Det_2

Stock Based Compensation (Details) - Schedule of Fair Value Assumptions - $ / shares	6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Schedule Of Fair Value Assumptions Abstract
Company’s expected volatility	27.10%	25.56%
Risk-free interest rate	2.66%	0.93%
Expected term	5 years 4 months 24 days	5 years 4 months 24 days
Weighted average fair value per share of options granted during the period (in Dollars per share)	$ 4.11	$ 3.72

Stock Based Compensation (Det_3

Stock Based Compensation (Details) - Schedule of Stock Option Activity	6 Months Ended
	Dec. 31, 2022 USD ($) $ / shares shares
Schedule Of Stock Option Activity Abstract
Balance at July 1, 2022 | shares	246,273
Balance at July 1, 2022 | $ / shares	$ 20.89
Balance at July 1, 2022	6 years 8 months 23 days
Granted | shares	71,200
Granted | $ / shares	$ 13.61
Granted	9 years 7 months 2 days
Exercised | shares
Exercised | $ / shares
Forfeited or expired | shares	(16,550)
Forfeited or expired | $ / shares	$ 19.83
Outstanding at December 31, 2022 | shares	300,923
Outstanding at December 31, 2022 | $ / shares	$ 19.23
Outstanding at December 31, 2022	6 years 11 months 12 days
Outstanding at December 31, 2022 | $	$ 42,169
Vested or expected to vest at December 31, 2022 | shares	276,789
Vested or expected to vest at December 31, 2022 | $ / shares	$ 19.67
Vested or expected to vest at December 31, 2022	6 years 9 months 3 days
Vested or expected to vest at December 31, 2022 | $	$ 34,514
Exercisable at December 31, 2022 | shares	171,023
Exercisable at December 31, 2022 | $ / shares	$ 23.09
Exercisable at December 31, 2022	5 years 3 months 18 days
Exercisable at December 31, 2022 | $	$ 0

Stock Based Compensation (Det_4

Stock Based Compensation (Details) - Schedule of Changes in Non-Vested Stock Options	6 Months Ended
	Dec. 31, 2022 $ / shares shares
Schedule Of Changes In Non Vested Stock Options Abstract
Non-vested at July 1, 2022 | shares	104,175
Non-vested at July 1, 2022 | $ / shares	$ 2.92
Granted | shares	71,200
Granted | $ / shares	$ 4.11
Vested | shares	(36,375)
Vested | $ / shares	$ 1.59
Forfeited or expired | shares	(9,100)
Forfeited or expired | $ / shares	$ 3.01
Non-vested at December 31, 2022 | shares	129,900
Non-vested at December 31, 2022 | $ / shares	$ 3.94

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($)	Dec. 31, 2022	Jun. 30, 2022
Standby Letters of Credit [Member]
Commitments and Contingencies (Details) [Line Items]
Contingent liabilities	$ 0	$ 0

Revenue (Details)

Revenue (Details) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2022	Dec. 31, 2021	Jun. 30, 2022
Revenue (Details) [Line Items]
Revenue	$ 8,804,109	$ 7,458,050	$ 17,439,904	$ 15,003,482
Revenue recognized			1,826,797
ASC 606 [Member]
Revenue (Details) [Line Items]
Contract with Customer, Liability	5,286,073		5,286,073		$ 3,384,474
Units Delivered [Member] | ASC 606 [Member]
Revenue (Details) [Line Items]
Revenue	6,757,440	6,100,228	13,717,229	12,592,464
Milestones Achieved [Member] | ASC 606 [Member]
Revenue (Details) [Line Items]
Revenue	2,046,669	$ 1,357,822	3,722,675	$ 2,411,018
Order or Production Backlog [Member] | ASC 606 [Member]
Revenue (Details) [Line Items]
Intangible assets	$ 78,300,000		$ 78,300,000
Percentage of estimated shipments			24% in 2023; 49% in 2024; 13% in 2025, and 14% thereafter.

Employee Stock Ownership Plan_2

Employee Stock Ownership Plan (Details) - Employee Stock Ownership Plan [Member]	3 Months Ended		6 Months Ended
	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2022 USD ($) shares	Dec. 31, 2021 USD ($) shares
Employee Stock Ownership Plan (Details) [Line Items]
Number of hours worked per year to quality for the plan			1,000
ESOP compensation expense | $	$ 76,549	$ 83,812	$ 155,477	$ 168,318
Shares distributed (in Shares) | shares			30,843	8,285

Employee Stock Ownership Plan_3

Employee Stock Ownership Plan (Details) - Schedule of ESOP shares - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Schedule Of Esop Shares Abstract
Allocated shares	465,248	478,935
Committed-to-be-released shares	11,244	11,568
Unreleased shares	245,049	267,861
Total shares held by the ESOP	721,541	758,364
Fair value of unreleased shares (in Dollars)	$ 3,479,696	$ 3,806,305

Subsequent Events (Details)

Subsequent Events (Details) $ in Millions	Dec. 31, 2022 USD ($)
Subsequent Events [Abstract]
Funding in support of facility and capital equipment	$ 7.4