Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Sep. 14, 2022 | Dec. 31, 2021 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jun. 30, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 0-19266 | ||
Entity Registrant Name | ALLIED HEALTHCARE PRODUCTS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 25-1370721 | ||
Entity Address, Address Line One | 1720 Sublette Avenue | ||
Entity Address, City or Town | St. Louis | ||
Entity Address, State or Province | MO | ||
Entity Address, Postal Zip Code | 63110 | ||
City Area Code | 314 | ||
Local Phone Number | 771-2400 | ||
Title of 12(b) Security | Common Stock, $.01 | ||
Trading Symbol | AHPI | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
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 Public Float | $ 22,303,014 | ||
Entity Common Stock, Shares Outstanding | 4,013,537 | ||
Entity Central Index Key | 0000874710 | ||
Current Fiscal Year End Date | --06-30 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | RubinBrown LLP | ||
Auditor Firm ID | 41 | ||
Auditor Location | St. Louis, Missouri |
STATEMENT OF OPERATIONS
STATEMENT OF OPERATIONS - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
STATEMENT OF OPERATIONS | |||
Net sales | $ 27,046,587 | $ 36,279,476 | $ 31,894,262 |
Cost of sales | 24,519,174 | 29,169,980 | 26,323,646 |
Gross profit | 2,527,413 | 7,109,496 | 5,570,616 |
Selling, general and administrative expenses | 7,107,388 | 7,636,318 | 8,632,795 |
Loss from operations | (4,579,975) | (526,822) | (3,062,179) |
Other (income) expenses: | |||
Interest expense | 191,450 | 115,975 | 64,682 |
Interest income | (176) | (233) | (654) |
Payroll Protection Program loan forgiveness | 0 | (2,402,236) | 0 |
Other, net | (9,493) | 18,252 | |
Other (income) expenses | 181,781 | (2,286,494) | 82,280 |
Income (loss) before provision for (benefit from) income taxes | (4,761,756) | 1,759,672 | (3,144,459) |
Provision for (benefit from) income taxes | 599,672 | 72,484 | (130,359) |
Net income (loss) | $ (5,361,428) | $ 1,687,188 | $ (3,014,100) |
Basic income (loss) per share: | $ (1.34) | $ 0.42 | $ (0.75) |
Diluted income (loss) per share: | $ (1.34) | $ 0.42 | $ (0.75) |
Weighted average shares outstanding - Basic | 4,013,537 | 4,013,537 | 4,013,537 |
Weighted average shares outstanding - Diluted | 4,013,537 | 4,026,446 | 4,013,537 |
BALANCE SHEET
BALANCE SHEET - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 3,317,047 | $ 726,223 |
Restricted cash | 1,500,000 | 0 |
Accounts receivable, net of allowances of $170,000 | 2,369,956 | 2,929,751 |
Inventories, net | 8,471,527 | 9,450,731 |
Income tax receivable | 0 | 9,800 |
Other current assets | 423,000 | 268,136 |
Total current assets | 16,081,530 | 13,384,641 |
Property, plant and equipment, net | 3,351,155 | 3,727,384 |
Restricted cash | 229,600 | 0 |
Operating lease assets | 8,301 | 13,078 |
Deferred income taxes | 0 | 577,088 |
Total assets | 19,670,586 | 17,702,191 |
Current liabilities: | ||
Revolving credit facility | 2,466,360 | 2,077,440 |
Current portion of financial liability | 131,519 | 0 |
Current portion of operating lease liability | 5,370 | 4,777 |
Accounts payable | 1,210,828 | 1,898,747 |
Customer deposits | 912,632 | 575,930 |
Other accrued liabilities | 1,255,490 | 2,557,135 |
Total current liabilities | 5,982,199 | 7,114,029 |
Long-term operating lease liability | 2,931 | 8,301 |
Long-term portion of financial liability | 7,971,376 | 0 |
Long-term environmental liability | 480,000 | 0 |
Commitments and contingencies (Notes 6 and 11) | ||
Stockholders' equity: | ||
Preferred stock | 0 | 0 |
Common stock; $0.01 par value; 30,000,000 shares authorized; 5,213,902 shares issued at June 30, 2022 and June 30, 2021; 4,013,537 shares outstanding at June 30, 2022 and June 30, 2021 | 52,139 | 52,139 |
Additional paid-in capital | 48,523,385 | 48,507,738 |
Accumulated deficit | (22,360,656) | (16,999,228) |
Less: treasury stock, at cost; 1,200,365 shares at June 30, 2022 and 2021 | (20,980,788) | (20,980,788) |
Total stockholders' equity | 5,234,080 | 10,579,861 |
Total liabilities and stockholders' equity | 19,670,586 | 17,702,191 |
Series A preferred stock | ||
Stockholders' equity: | ||
Preferred stock | $ 0 | $ 0 |
BALANCE SHEET (Parenthetical)
BALANCE SHEET (Parenthetical) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Allowances for accounts receivable (in dollars) | $ 170,000 | $ 170,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,500,000 | 1,500,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 5,213,902 | 5,213,902 |
Common stock, shares outstanding | 4,013,537 | 4,013,537 |
Treasury stock, at cost | 1,200,365 | 1,200,365 |
Series A preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 200,000 | 200,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
STATEMENT OF CHANGES IN STOCKHO
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY - USD ($) | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Treasury Stock | Total |
Balance at Beginning of period at Jun. 30, 2019 | $ 52,139 | $ 48,491,317 | $ (15,672,316) | $ (20,980,788) | $ 11,890,352 |
Stock based compensation | 0 | 2,415 | 0 | 0 | 2,415 |
Net income (loss) | 0 | 0 | (3,014,100) | 0 | (3,014,100) |
Balance at End of period at Jun. 30, 2020 | 52,139 | 48,493,732 | (18,686,416) | (20,980,788) | 8,878,667 |
Stock based compensation | 0 | 14,006 | 0 | 0 | 14,006 |
Net income (loss) | 0 | 0 | 1,687,188 | 0 | 1,687,188 |
Balance at End of period at Jun. 30, 2021 | 52,139 | 48,507,738 | (16,999,228) | (20,980,788) | 10,579,861 |
Stock based compensation | 0 | 15,647 | 0 | 0 | 15,647 |
Net income (loss) | 0 | 0 | (5,361,428) | 0 | (5,361,428) |
Balance at End of period at Jun. 30, 2022 | $ 52,139 | $ 48,523,385 | $ (22,360,656) | $ (20,980,788) | $ 5,234,080 |
STATEMENT OF CASH FLOWS
STATEMENT OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (5,361,428) | $ 1,687,188 | $ (3,014,100) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 451,265 | 579,472 | 619,801 |
Stock based compensation | 15,647 | 14,006 | 2,415 |
Provision for doubtful accounts and sales returns and allowances | 4,472 | 19,001 | 21,750 |
PPP loan forgiveness | 0 | (2,402,236) | 0 |
Deferred tax provision | 577,088 | 63,679 | (138,876) |
Changes in operating assets and liabilities: | |||
Accounts receivable | 555,323 | 155,067 | 39,720 |
Inventories | 979,204 | (522,043) | (1,595,593) |
Income tax receivable | 9,800 | 2,378 | 0 |
Customer deposits | 336,702 | (2,256,440) | 2,269,465 |
Other current assets | (154,864) | (38,331) | 15,103 |
Accounts payable | (687,919) | (1,041,259) | 1,330,172 |
Other accrued liabilities | (821,646) | (44,619) | 1,097,724 |
Net cash provided by (used in) operating activities | (4,096,356) | (3,784,137) | 647,581 |
Cash flows from investing activities: | |||
Capital expenditures | (75,036) | (167,163) | (617,811) |
Net cash used in investing activities | (75,036) | (167,163) | (617,811) |
Cash flows from financing activities: | |||
Borrowings under revolving credit agreement | 28,536,287 | 36,717,068 | 32,856,428 |
Payments under revolving credit agreement | (28,147,367) | (34,639,628) | (32,856,428) |
Proceeds from sale-leaseback transaction | 8,102,896 | 0 | 0 |
Proceeds from Payroll Protection Program loan | 0 | 0 | 2,374,859 |
Net cash provided by financing activities | 8,491,816 | 2,077,440 | 2,374,859 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 4,320,424 | (1,873,860) | 2,404,629 |
Cash, cash equivalents and restricted cash at beginning of year | 726,223 | 2,600,083 | 195,454 |
Cash, cash equivalents and restricted cash at end of year | 5,046,647 | 726,223 | 2,600,083 |
Supplemental disclosures of cash flow information: | |||
Income taxes | 9,363 | 6,428 | 8,517 |
Interest | 191,450 | 115,975 | 64,682 |
Non-cash investing and financing activities | |||
Lease liability and right of use asset arising from operating leases | 0 | 0 | 17,326 |
Capital expenditures included in accounts payable at year end | $ 0 | $ 0 | $ 140,602 |
Organization
Organization | 12 Months Ended |
Jun. 30, 2022 | |
Organization | |
Organization | 1. Organization Allied Healthcare Products, Inc. (the “Company” or “Allied”) is a manufacturer of respiratory products used in the health care industry in a wide range of hospital and alternate site settings, including post-acute care facilities, home health care and trauma care. The Company’s product lines include respiratory care products, medical gas equipment and emergency medical products. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting and Reporting Policies | 2. Summary of Significant Accounting Policies The significant accounting policies followed by the Company are described below. Use of estimates The policies utilized by the Company in the preparation of the financial statements conform to accounting principles generally accepted in the United States of America, and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from those estimates. Revenue recognition The Company’s revenues are derived primarily from the sales of respiratory products, medical gas equipment and emergency medical products. The products are generally sold directly to distributors, customers affiliated with buying groups, individual customers and construction contractors, throughout the world. The Company recognizes revenue from product sales upon satisfaction of its performance obligation which occurs on the transfer of control of the product, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract. Payment terms between Allied and its customers vary by the type of customer, country of sale, and the products offered. The term between invoicing and the payment due date is not significant. Management exercises judgment in estimating variable consideration. Provisions for early payment discounts, rebates and returns and other adjustments are provided for in the period the related sales are recorded. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. The Company provides rebates to wholesalers. Rebate amounts are based upon purchases using contractual amount for each product sold. Factors used in the rebate calculations include the identification of which products have been sold subject to a rebate and the customer or price terms that apply. Using known contractual allowances, the Company estimates the amount of the rebate that will be paid, and records the liability as a reduction of gross sales when it records the sale of the product. Settlement of the rebate generally occurs in the month following the sale. The Company regularly analyzes the historical rebate trends and adjusts reserves for changes in trends and terms of rebate programs. Historically, adjustments to prior years’ rebate accruals have not been material to net income. Other allowances charged against gross sales include cash discounts and returns, which are not significant. Cash discounts are known within 15 to 30 days of sale, and therefore can be reliably estimated. Returns can be reliably estimated because the Company’s historical returns are low, and because sales return terms and other sales terms have remained relatively unchanged for several periods. Product warranties are also not significant. The Company does not allocate transaction price as the Company has only one performance obligation and its contracts do not span multiple periods. All taxes imposed on and concurrent with revenue producing transactions and collected by the Company are excluded from the measurement of transaction price. Marketing and Advertising Costs Promotional and advertising costs are expensed as incurred and are included in selling, general and administrative expenses in the Statement of Operations. Advertising expenses for the years ended June 30, 2022, 2021 and 2020 were $400, $0, and $3,550, respectively. Cash and cash equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents. The Company maintains funds in bank accounts that, at times, may exceed the limit insured by the Federal Deposit Insurance Corporation. The risk of loss attributable to these uninsured balances is mitigated by depositing funds only in high credit quality financial institutions. The Company has not experienced any losses in such accounts. The Company includes restricted cash along with the cash balance for presentation in the statements of cash flows. The reconciliation between the balance sheet and the statement of cash flows at June 30 is as follows: 2022 2021 Cash and cash equivalents $ 3,317,047 $ 726,223 Restricted Cash 1,729,600 — Total cash, cash equivalents and restricted cash $ 5,046,647 $ 726,223 Restricted Cash Restricted cash includes cash in escrow that is restricted to capital improvements of the building and payment of rent. Foreign currency transactions Allied has international sales which are denominated in U.S. dollars, the functional currency for these transactions. Accounts receivable and concentrations of credit risk Accounts receivable are recorded at the invoiced amount. The Company performs ongoing credit evaluations of its customers and generally does not require collateral. The Company maintains reserves for potential credit losses based on past experience and an analysis of current amounts due, and historically such losses have been within management’s expectations. The Company maintains an allowance for doubtful accounts to reflect the collectibility of accounts receivable based on past collection history and specific risks identified among uncollected accounts. Accounts receivable are charged to the allowance for doubtful accounts when the Company determines that the receivable will not be collected and/or when the account has been referred to a third party collection agency. The Company’s customers can be grouped into three main categories: medical equipment distributors, construction contractors and health care institutions. At June 30, 2022, the Company believes that it has no significant concentration of credit risk. Inventories Inventories are stated at the lower of cost, determined using the last-in, first-out (“LIFO”) method, or market. If the first-in, first-out method (which approximates replacement cost) had been used in determining cost, inventories would have been $2,951,941 and $2,149,560 higher at June 30, 2022 and 2021, respectively. Changes in the LIFO reserve are included in cost of sales. Cost of sales was reduced by $37,470, $0, and $0 in fiscal 2022, 2021, and 2020 respectively, as a result of LIFO liquidations. Costs in inventory include raw materials, direct labor and manufacturing overhead. Inventory is recorded net of a reserve for obsolete and excess inventory which is determined primarily based on an analysis of inventory items with no usage in the preceding year and for inventory items for which there is greater than two years’ usage on hand. The reserve for obsolete and excess inventory was $2,413,104 and $2,174,149 at June 30, 2022 and 2021, respectively. Property, plant and equipment Property, plant and equipment are recorded at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, which range from 3 to 35 years. Expenditures for repairs, maintenance and renewals are charged to income as incurred. Expenditures, which improve an asset or extend its estimated useful life, are capitalized. When properties are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in income. Impairment of long-lived assets The Company evaluates impairment of long-lived assets under the provisions of ASC Topic 360: “Property, Plant and Equipment.” ASC 360 provides a single accounting model for long-lived assets to be disposed of and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Under ASC 360, if the sum of the expected future cash flows (undiscounted and without interest charges) of the long-lived assets is less than the carrying amount of such assets, an impairment loss will be recognized. No impairment losses of long-lived assets or identifiable intangibles were recorded by the Company for fiscal years ended June 30, 2022, 2021, and 2020. Collective Bargaining Agreement At June 30, 2022, the Company had approximately 146 full-time employees. Approximately 82 employees in the Company’s principal manufacturing facility located in St. Louis, Missouri, are covered by a collective bargaining agreement that will expire on July 31, 2024. Self-insurance The Company maintains a self-insurance program for a portion of its health care costs. Self-insurance costs are accrued based upon the aggregate of the liability for reported claims and the estimated liability for claims incurred but not reported. As of June 30, 2022 and 2021, the Company had $125,000 and $120,000, respectively, of accrued liabilities related to health care claims. In order to establish the self-insurance reserves, the Company utilized actuarial estimates of expected claims based on analyses of historical data. Fair value of financial instruments The Company’s financial instruments include cash, accounts receivable, the revolving line of credit and accounts payable. The carrying amounts for cash, accounts receivable, the revolving line of credit and accounts payable approximate their fair value due to the short maturity of these instruments. Income taxes The Company accounts for income taxes under ASC Topic 740: “Income Taxes.” Under ASC 740, the deferred tax provision is determined using the liability method, whereby deferred tax assets and liabilities are recognized based upon temporary differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates that are expected to apply to taxable income when such assets and liabilities are anticipated to be settled or realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as tax expense or benefit in the period that includes the enactment date of the change. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. In assessing the need for a valuation allowance the Company first considers the reversals of existing temporary deferred tax liabilities and available tax planning strategies. To the extent these items are not sufficient to cause the realization of deferred tax assets, the Company considers the availability of future taxable income to the extent such income is considered likely to occur based on the Company’s earnings history, current income trends and projections. Considering its history of operating losses, the Company does not rely on the existence of future taxable income as it currently cannot conclude future taxable income is likely to occur. The Company does rely on reversals of existing temporary deferred tax liabilities and tax planning strategies to the extent available to support the value of its existing deferred tax assets. In 2022, the Company concluded that its previously relied upon tax planning strategies were no longer available to support the value of any deferred tax assets. Accordingly, in 2022 a full valuation allowance was recorded. To the extent the Company’s deferred tax assets exceed the amount supportable through reversals of existing deferred tax liabilities, a valuation allowance will be recorded against the excess deferred tax assets. The Company recognizes tax liabilities when, despite the Company’s belief that its tax return positions are supportable, the Company believes that certain positions may not be fully sustained upon review by tax authorities. Benefits from tax positions are measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon settlement. To the extent the Company deems it necessary to record a liability for its tax positions, the current portion of the liability is included in income taxes payable and the noncurrent portion is included in other liabilities on the balance sheet. If upon the final tax outcome of these matters the ultimate liability is different than the amounts recorded, such differences are reflected in income tax expense in the period in which such determination is made. The Company files a federal and multiple state income tax returns. With few exceptions, the Company’s federal and state income tax returns are open for fiscal years ending after June 30, 2019. The Company classifies interest expenses on taxes payable as interest expense. Penalties are classified as a component of other expenses. Research and development costs Research and development costs are expensed as incurred and are included in selling, general and administrative expenses. Research and development expenses for the years ended June 30, 2022, 2021 and 2020 were $260,439, $571,535, and $595,236, respectively. Earnings per share Basic earnings per share are based on the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share are based on the sum of the weighted average number of shares of common stock and common stock equivalents outstanding during the year. The weighted average number of basic shares outstanding for the years ended June 30, 2022, 2021 and 2020 was 4,013,537 shares. The weighted average number of diluted shares outstanding for the years ended June 30, 2022, 2021 and 2020 was 4,013,537, 4,026,446 and 4,013,537 shares, respectively. The dilutive effect of the Company’s employee and director stock option plans are determined by use of the treasury stock method. There are no potential common shares excluded from the calculation of net loss per share, as their effect would be anti-dilutive for the years ended June 30, 2022 and 2020. For the year ended June 30, 2021, there was 20,250 potential common shares excluded from the calculation of net income per share, as their effect would be anti-dilutive. The following information is necessary to calculate earnings per share for the periods presented: Year ended June 30, 2022 2021 2020 Net income (loss), as reported $ (5,361,428) $ 1,687,188 $ (3,014,100) Weighted average common shares outstanding 4,013,537 4,013,537 4,013,537 Effect of dilutive stock options — 12,909 — Weighted average diluted common shares outstanding 4,013,537 4,026,446 4,013,537 Net income (loss) per common share Basic $ (1.34) $ 0.42 $ (0.75) Diluted $ (1.34) $ 0.42 $ (0.75) Employee stock options excluded from computation of diluted income per share amounts because their effect would be anti-dilutive — 20,250 — Employee stock-based compensation The company follows the provisions of ASC Topic 718: “Compensation – Stock Compensation”, which sets accounting requirements for “share-based” compensation to employees, including employee stock purchase plans, and requires companies to recognize in the statement of operations the grant-date fair value of the stock options and other equity-based compensation. The fair value of options granted is estimated on the date of grant using the Black-Scholes option-pricing model. The following table summarizes the weighted average assumptions utilized in the Black-Scholes option pricing model for options granted during the fiscal years ended June 30, 2022, 2021 and 2020. 2022 2021 2020 Weighted-average fair value $ 4.29 $ 6.44 $ 0.61 Weighted-average volatility 114 % 109 % 53 % Weighted-average expected life (in years) 6.0 6.0 6.0 Weighted-average risk-free interest rate 1.34 % 0.52 % 1.77 % Dividend yield 0 % 0 % 0 % Expected volatility is based on the historical volatility of the Company’s common stock to estimate future volatility. The risk-free rates are taken from rates as published by the Federal Reserve and represent the yields on actively traded treasury securities for terms equal or approximately equal to the expected terms of the options. The expected term is calculated using the SEC Staff Accounting Bulletin 107 (ASC 718-10-S99) simplified method. Forfeitures are recognized as they occur. The dividend yield is zero based on the fact that the Company has no intention of paying dividends in the near term. Share-based compensation expense included in the Statement of Operations for the fiscal years ended June 30, 2022, 2021 and 2020 was approximately $15,647, $14,006 and $2,415, respectively. Unrecognized shared-based compensation cost related to unvested stock options as of June 30, 2022 amounts to approximately $6,000. The cost is expected to be recognized through fiscal 2025. The Company recognized an income tax benefit for share-based compensation arrangements of approximately $6,000, $6,000 and $1,000 respectively for the years ended June 30, 2022, 2021 and 2020, all of which were fully offset by an increase in the deferred tax asset valuation allowance. No stock options were exercised during fiscal years 2022, 2021 and 2020. Recently Issued Accounting Pronouncements The Company adopted ASU 2016-13: Financial Instruments - Credit Losses as of the beginning of the fiscal year 2022. This update introduces the current expected credit loss (CECL) model, which requires an entity to measure credit losses for certain financial instruments and financial assets, including trade receivables. Under this update, on initial recognition and at each reporting period, an entity is required to recognize an allowance that reflects the entity’s current estimate of credit losses expected to be incurred over the life of the financial instrument. The adoption of this standard did not have a material impact on the Company’s financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 was effective for the Company beginning in the first quarter of 2022. The adoption of this standard did not have a material impact on the Company’s financial statements and related disclosures. Environmental Remediation The Company is subject to federal and state requirements for protection of the environment, including the remediation of contaminated sites. The Company’s policy is to accrue and charge to current expense identified exposures related to environmental remediation sites when it is probable that a liability has been incurred and the amount can be reasonably estimated. The amount of the liability is based on the best estimate or the low end of a range of reasonably possible exposure for investigation, cleanup, and monitoring costs to be incurred. Estimated remediation costs are not discounted to present value. On January 30, 2020, the Company filed a Citizen Participation Plan with the New York Department of Environmental Conservation under its Brownfield Cleanup Program. The plan was filed with respect to the Company’s property in Stuyvesant Falls, New York. The plan recognizes that the soil and groundwater at the Stuyvesant Falls facility is impacted by chemical compounds exceeding regulatory standards. On October 13, 2020, the Company executed a Brownfield Cleanup Program Agreement with the Department of Environmental Conservation with respect to the property. Under the agreement, the Company has voluntarily agreed to conduct, at its expense, certain remedial investigations and remedial actions with respect to suspected soil and groundwater contamination at the site with oversight by the department. The Company’s best estimate of the expected cost to remediate the site is $1.3 million. The Company recorded $1.1 million as an expense in the fiscal year ended June 30, 2020 and is reflected in other accrued liabilities and selling, general and administrative expenses in the Company’s financial statements. During fiscal 2022, the Company recorded an additional $171,000 charge to income and reclassified $0.5 million to long-term liability to reflect the rescheduling of the remediation. As of June 30, 2022, the Company has paid approximately $634,000 in remediation expenses which have been charged to the reserve. Risk and Uncertainties, Going Concern, Liquidity and Management’s Plan The Company believes that the Covid-19 pandemic resulted in increased sales of ventilator products in fiscal 2021, however, this peak in demand ended in fiscal 2021 and the impacts of the COVID-19 continue to develop. In fiscal 2022 demand dropped from the peak, and the Company believes that COVID-19 is no longer contributing positively to product demand. |
Going Concern
Going Concern | 12 Months Ended |
Jun. 30, 2022 | |
Going Concern | |
Going Concern | 3. Going Concern The Company follows the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 205-40, Going Concern. Historically, the Company has experienced, and continues to experience, losses from operations and net losses. Additionally, the Company expects to incur significant environmental costs that are planned to be expended over the next year (Note 11) and faces several challenges which are currently negatively impacting the Company’s operations. Since the onset of the pandemic the Company has found it difficult to hire and retain hourly workers. This has led to the requirement for additional overtime for existing employees, inefficiency, and contributed to delays in shipments. The Company has experienced increasing cost for both raw materials and components. In fiscal year 2021, the Company estimates that inflationary price increases raised product cost by approximately $500,000. In fiscal year 2022, the Company estimates that inflationary price increases raised product cost by an additional $1.3 million dollars. The Company has, where possible, increased prices on certain products to maintain margins at acceptable levels offsetting these cost increases. Supply chain, staffing, and management issues have led to higher levels of delayed shipments to customers, lower sales, and an increase in past-due backlog. In the past year, the Company has been unable to produce or obtain product to fulfill its order backlog. Lower sales have resulted in a decrease in earnings and liquidity. The Company is seeking to fill open positions, expedite needed components, improve the performance of management, and find new sources of components where necessary. The Company has engaged a consulting firm to assess and improve its operational capabilities. These actions are intended to mitigate the substantial doubt raised by the Company’s historical operating results, and current shipping difficulties. The ability of the Company to continue as a going concern is dependent upon its ability to fulfill its current order backlog and return future order backlogs to historic levels while maintain an adequate gross profit. There is no certainty that the needed improvements can be made. As a result, management of the Company has concluded that this uncertainty creates substantial doubt on the Company’s ability to continue as a going concern within one year after the issuance date. The accompanying financial statements do not include any adjustments that might be necessary should the Company be unable to continue as going concern. |
Financing
Financing | 12 Months Ended |
Jun. 30, 2022 | |
Financing | |
Financing | 4. Financing North Mill Loan The Company is party to a Loan and Security Agreement with North Mill Capital, LLC (“North Mill”), as successor in interest to Summit Financial Resources, L.P., dated effective February 27, 2017, as amended April 16, 2018, April 24, 2019, December 18, 2020, October 7, 2021 and June 13, 2022 (as amended, the “Credit Agreement”). Pursuant to the Credit Agreement, the Company obtained a secured revolving credit facility (the “Credit Facility”). The Company’s obligations under the Credit Facility are secured by all of the Company’s personal property, both tangible and intangible, pursuant to the terms and subject to the conditions set forth in the Credit Agreement. Availability of funds under the Credit Agreement is based on the Company’s accounts receivable and inventory but will not exceed $4,000,000. At June 30, 2022 borrowing under the agreement was $2,466,360, maximum available borrowing based on eligible collateral was $3,345,123, resulting in availability of $878,763. Availability of funds under the Credit Agreement is based on the Company’s eligible accounts receivable and eligible inventory but will not exceed $4,000,000. In determining eligible Accounts Receivable Advances several classifications are considered ineligible and are subtracted from the Company’s total Accounts Receivable before calculating eligible Accounts Receivable. Ineligible receivables include receivables from governmental entities, receivables to be paid by credit card, uninsured international receivables, receivables over 90 days old, and receivables from customers with a significant concentration of receivables over 90 days old. The Company may be advanced up to 85% of eligible Accounts Receivable under the loan agreement. Accounts Receivable is dependent on sales revenue. Decreased sales revenue has resulted in decreased Accounts Receivable available for loan collateral. At June 30, 2022 the Company had Accounts Receivable of $1,672,581 included as eligible collateral in determining total available borrowing advances under the loan agreement. In determining eligible inventory several categories of inventory are subtracted from total inventory. Work in Process Inventory, Packaging and Supplies, and Inventory Reserves are subtracted from total inventory to calculate eligible inventory. The Company may be advanced up to 25% of eligible inventory. Advances from inventory are limited by the lesser of the calculated eligible inventory, two million dollars ($2,000,000), or the amount advanced from eligible Accounts Receivable. At June 30, 2022 the Company had $1,672,581 from Inventory included as eligible collateral in determining total available borrowing under the loan agreement. At June 30, 2022 Inventory Advances were limited by the eligible Accounts Receivable Advance of $1,672,581. The Credit Facility will be available, subject to its terms, on a revolving basis until it expires on September 30, 2024, at which time all amounts outstanding under the Credit Facility will be due and payable. Advances will bear interest at a rate equal to 2.00% in excess of the prime rate as reported in the Wall Street Journal. Interest is computed based on the actual number of days elapsed over a year of 360 days. In addition to interest, the Credit facility requires that the Company pay the lender a monthly administration fee in an amount equal to forty-seven hundredths percent (0.47%) of the average outstanding daily principal amount of loan advances for each calendar month, or portion thereof. Regardless of the amount borrowed under the Credit Facility, the Company will pay a minimum amount of .25% (25 basis points) per month on the maximum availability ($10,000 per month). Under the Credit Agreement, advances are generally subject to customary borrowing conditions and to North Mill’s sole discretion to fund the advances. The Credit Agreement also contains covenants with which the Company must comply during the term of the Credit Facility. Among other things, such covenants require the Company to maintain insurance on the collateral, operate in the ordinary course and not engage in a change of control, dissolve or wind up the Company. The Credit Agreement also contains certain events of default including, without limitation: the failure to make payments when due; the material breach of representations or warranties contained in the Credit Agreement or other loan documents; cross-default with other indebtedness of the Company; the entry of judgments or fines that may have a material adverse effect on the Company; failure to comply with the observance or performance of covenants contained in the Credit Agreement or other loan documents; insolvency of the Company, appointment of a receiver, commencement of bankruptcy or other insolvency proceedings; dissolution of the Company; the attachment of any state or federal tax lien; attachment or levy upon or seizure of the Company’s property; or any change in the Company’s condition that may have a material adverse effect. After an event of default, and upon the continuation thereof, the principal amount of all loans made under the Credit Facility would bear interest at a rate per annum equal to 20.00% above the otherwise applicable interest rate (provided, that the interest rate may not exceed the highest rate permissible under law), and would have the option to accelerate maturity and payment of the Company’s obligations under the Credit Facility. The Company was in compliance with all of the covenants associated with the Credit Facility at June 30, 2022. PPP Loan On April 13, 2020, the Company entered into a Payroll Protection Program (PPP) loan agreement (the “SBA Loan”) with Jefferson Bank and Trust Company under the recently enacted Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the U.S. Small Business Administration (the “SBA”). The Company received total proceeds of $2.375 million from the SBA Loan. In accordance with the requirements of the CARES Act, the Company used proceeds from the SBA Loan for payroll costs and other permitted uses. The SBA Loan was scheduled to mature on April 13, 2022 and had a 1.00% interest rate and is subject to the terms and conditions applicable to loans administered by the U.S. Small Business Administration under the CARES Act. The loan, including all principal and accrued interest, was forgiven on June 11, 2021. The company elected to account for the PPP Loan using FASB ASC 470, Debt. The related forgiveness income is included in other income for the year ended June 30, 2021. According to the rules of the SBA, the Company is required to retain PPP Loan documentation for six years after the date the loan is forgiven or repaid in full, and permit authorized representatives of the SBA, including representatives of its Office of Inspector General, to access such files upon request. Should the SBA conduct such a review and reject all or some of the Company’s judgments pertaining to satisfying PPP Loan eligibility or forgiveness conditions, the Company may be required to adjust previously reported amounts and disclosures in the financial statements. At June 30, 2022, the Company had $10.6 million indebtedness, including lease obligations, financial liabilty and short-term debt. The prime rate as reported in the Wall Street Journal was 4.75% on June 30, 2022. |
Sale-Leaseback Financing Transa
Sale-Leaseback Financing Transaction | 12 Months Ended |
Jun. 30, 2022 | |
Sale-Leaseback Financing Transaction | |
Sale-Leaseback Financing Transaction | 5. Sale -Leaseback Financing Transaction On June 16, 2022 the Company sold the Company’s headquarters and manufacturing facilities located at 1720 Sublette Avenue in St. Louis, Missouri. Simultaneously, the Company entered into a lease agreement with the buyer of the property (the sale of the property and simultaneous leaseback is referred to as the “Sale-Leaseback”). The Sale-Leaseback is repayable over a 15-year and ten day term The Company accounted for the Sale-Leaseback as a financing transaction with the purchaser of the property in accordance with ASC 842 as the lease agreement was determined to be a finance lease. The Company concluded the lease agreement met the qualifications to be classified as a finance lease due to the significance of the present value of the lease payments, using a discount rate of 6.75% to reflect the Company’s incremental borrowing rate, compared to the fair value of the leased property as of the lease commencement date. The presence of a finance lease indicates that control of the St. Louis property has not transferred to the buyer/lessor and, as such, the transaction was deemed a failed sale-leaseback and must be accounted for as a financing arrangement. As a result of this determination, the Company is viewed as having received the sales proceeds from the buyer/lessor in the form of a hypothetical loan collateralized by its leased facilities. The hypothetical loan is payable as principal and interest in the form of “lease payments” to the buyer/lessor. As such, the Company will not derecognize the property from its books for accounting purposes until the lease ends. As of June 30, 2022, the carrying value of the financing liability was $8,102,895, net of $212,667 in debt issuance costs, of which $131,519 was classified as current on the Consolidated Balance Sheet with $7,971,376 classified as long-term. The monthly lease payments are split between a reduction of principal and interest expense using the effective interest rate method. Interest expense associated with the financing arrangement was $15,585 for the year ended June 30, 2022. No gain or loss was recognized related to the Sale-Leaseback under U.S. GAAP for the fiscal year ended June 30, 2022. Pursuant to the agreement for the sale of the St. Louis headquarters property, $1,500,000 of the purchase price (the “Improvement Escrow”) is subject to an escrow agreement to pay for the repair and/or replacement of certain agreed upon work, including the roof, HVAC system and certain lighting in the offices. Any funds remaining in the Improvement Escrow will be paid to the Company when the improvements are substantially completed. Pursuant to the lease, an amount equal to four months of initial rental payments ($229,600) is being held in escrow to guaranty the payment by the Company of rent for the first two years of this lease. Any funds remaining in the rent escrow will be paid to the Company on July 1, 2024. As of June 30, 2022, the carrying value of restricted cash from this transaction was $1,729,600. The Company will depreciate the building down to zero over the remaining economic life of the property so that at the end of the financing liability term, the remaining carrying amount of the financing liability will equal the carrying amount of the land of $873,200. Remaining future cash payments related to the financing liability, assuming the exercise of two renewal options of five years each, for the fiscal years ending June 30 are as follows: 2023 $ 688,800 2024 702,576 2025 716,628 2026 730,960 2027 745,579 Thereafter 19,359,359 Total Minimum Liability Payments 22,943,902 Imputed Interest (14,841,007) Total $ 8,102,895 |
Lease Commitments
Lease Commitments | 12 Months Ended |
Jun. 30, 2022 | |
Lease Commitments | |
Lease Commitments | 6. Lease Commitments The Company leases vehicles and equipment, generally for terms of three The Company follows the requirements of ASC Topic 842, Leases (“ASC 842” or “Topic 842”). The Company has elected to not apply the recognition requirements in Topic 842 to short-term leases (i.e., leases of 12 months or less). Instead, as permitted by Topic 842, the Company recognizes the lease payments under its short-term leases in profit or loss on a straight-line basis over the lease term. The Company elected this accounting policy for all classes of underlying assets. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Right-of-use assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company generally uses the rate implicit in the lease to discount lease payments to present value. As of June 30, 2022, the Company had vehicles and equipment financed under operating leases with lease terms expiring through 2024. Rent expense consists of monthly rental payments under the terms of the Company’s lease agreements recognized on a straight-line basis. The following table sets forth the Company’s future minimum lease payments under operating lease liabilities recorded on the Company’s balance sheet as of June 30, 2022. Maturity of Operating Lease Fiscal years ending Liabilities 2023 6,065 2024 3,032 Total lease payments 9,097 Less: amounts representing interest 796 Present value of lease liabilities 8,301 Less: current portion 5,370 Long-term portion $ 2,931 The Company’s operating lease cost amounted to $71,234 in 2022 and $59,432 in 2021. Expenses are classified within selling, general and administrative expenses in the Company’s statement of operations for the year ended June 30, 2022 and 2021. The table below presents lease-related terms and discount rates as of June 30, 2022. June 30, 2022 June 30, 2021 June 30, 2020 Weighted average remaining lease terms Operating leases 1.5 years 2.5 years 3.5 years Weighted average discount rate Operating leases 12 % 12 % 12 % |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes | |
Income Taxes | 7. Income Taxes The provision for (benefit from) income taxes consists of the following: 2022 2021 2020 Current: Federal $ 89,733 $ — $ 84,420 State 38,578 8,805 23,093 Less net operating loss carryforward applied (105,727) — (98,996) Total current 22,584 8,805 8,517 Deferred: Federal (943,677) (644,606) (182,517) State (214,462) (78,641) 4,405 Valuation allowance 1,735,227 786,926 39,236 Total deferred 577,088 63,679 (138,876) Provision (benefit) $ 599,672 $ 72,484 $ (130,359) A reconciliation of income taxes, with the amounts computed at the statutory federal rate is as follows: 2022 2021 2020 Computed tax at federal statutory rate $ (1,004,711) $ 367,682 $ (662,125) State income taxes, net of federal tax (benefit) provision (146,553) (13,771) (17,475) Non deductible expenses 854 1,570 506,798 Federal research credit — (28,428) (31,076) Non taxable income from PPP Loan forgiveness — (504,470) — State NOLs 1,522 11,602 30,397 Stock Options - Expired 13,543 5,243 3,763 Change in tax law allowing deductibilty of PPP Loan related expenses — (553,653) — Other, net (210) (217) 123 Valuation allowance 1,735,227 786,926 39,236 Total $ 599,672 $ 72,484 $ (130,359) The deferred tax assets and deferred tax liabilities recorded on the balance sheet as of June 30, 2022 and 2021 are as follows: 2022 2021 Deferred tax assets Bad debts $ 25,500 $ 25,500 Intangible assets 150 745 Accrued liabilities 343,269 458,337 Stock options 13,329 23,403 Depreciation 1,196,223 — Net operating loss and credit carryforwards 4,377,126 4,505,628 Total Assets 5,955,597 5,013,613 Deferred tax liabilities Prepaid expenses 6,177 10,341 Inventory 473,929 529,045 Depreciation — 209,997 Other 178,272 125,147 Total Liabilities 658,378 874,530 Valuation allowance (5,297,219) (3,561,995) Total deferred taxes $ 0 $ 577,088 At June 30, 2022, there were $12.8 million dollars of federal net operating loss carryforwards which will expire in 2031 through 2038 and $3.8 million subject to indefinite carryforward. In addition, the Company has state tax net operating losses of approximately $8.3 million that expire in varying years from 2022 through 2042 and $0.8 million subject to indefinite carryforward. The Company files a federal and multiple state income tax returns. With few exceptions the Company’s federal and state income tax returns are open for fiscal years ending after June 30, 2019. The Company has not taken any uncertain tax positions on its federal or state income tax filings for open tax years. |
Employee Retirement Benefits
Employee Retirement Benefits | 12 Months Ended |
Jun. 30, 2022 | |
Employee Retirement Benefits | |
Employee Retirement Benefits | 8. Employee Retirement Benefits The Company offers a retirement savings plan under Section 401(k) of the Internal Revenue Code to certain eligible salaried employees. Each employee may elect to enter a written salary deferral agreement under which a portion of such employee’s pre-tax earnings may be contributed to the plan. During the fiscal years ended June 30, 2022, 2021 and 2020, the Company made contributions of $182,026, $186,366, and $185,000, respectively, to the retirement savings plan. The Company contributes 2% of eligible salaried employee’s annual income to the plan. In addition, the Company provides a 25% match on the first 8% of employee deferrals for eligible employees. The risk of participating in multi-employer pension plan is different from single-employer plans. Assets contributed to a multi-employer plan by one employer may be used to provide benefits to employees of other participating employers. If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. The Company’s participation in a multi-employer pension plan for the year ended June 30, 2022, is outlined in the table below. The “EIN/PN” column provides the Employee Identification Number (EIN) and the three-digit plan number (PN). The audit of the pension plan for the year ended June 30, 2021 is not yet completed. The most recent Pension Protection Act (PPA) zone status for 2020 and 2019 is for the plan year-ends as indicated below. The zone status is based on information that the Company obtained from the annual funding notice for District No. 9 International Association of Machinists and Aerospace Workers Pension Trust. Among other factors, plans in the red zone are less than 65 percent funded, plans in the yellow zone are between 65 and 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (FIP) or a rehabilitation plan (RP) is either pending or has been implemented. In addition to regular plan contributions, the Company may be subject to a surcharge if the plan is in the red zone. The “Surcharge Imposed” column indicates whether a surcharge has been imposed on contributions to the plan. The last column lists the expiration date(s) of the collective-bargaining agreement (CBA) to which the plan is subject. PPA Zone Status Contributions by the Company FIP/RP Status Pending/ Surcharge Expiration Pension Trust Fund EIN/PN 2020 2019 Implemented 2022 2021 2020 Imposed Date of CBA District No. 9 51‑0138317/001 Yellow Yellow Implemented International Association of Machinists and Aerospace Workers Pension Plan 12/31/2020 12/31/2019 Yes $ 321,011 $ 315,342 $ 245,824 No 7/31/2024 The Company was not listed in the Form 5500 for the above plan as of the plan year ends as providing more than 5 percent of total contributions. Under federal pension law, a plan generally is in “endangered” status if its funded percentage is less than 80% (other factors may apply). If a pension plan enters endangered status, the trustees of the plan are required to adopt a funding improvement plan. Funding improvement plans establish benchmarks for pension plans to improve their funding status over a specified period of time. The plan was first certified as being in endangered status in the 2019 Plan Year because the Plan was projected to have a funding deficiency in the 2023 Plan Year. The Plan continues to be in endangered status in the 2020 Plan Year because funding improvement plan contribution rate increases are required to eliminate the Plan’s projected deficiency. In an effort to improve the Plan’s funding situation, the Board of Trustees adopted a funding improvement plan that includes increases in the contribution by employers and/or decreases in the benefit accrual rate for members. As a result, Allied Healthcare Products, Inc. and District 9 of the International Association of Machinist were required to collectively bargain the required Contribution Rate Increase and the impact on the Future Benefit Accrual. On June 30, 2021 the two parties reached agreement on the Funding Improvement Plan. Under the plan, future benefit accruals are eliminated for members and the monthly employer contribution rate will increase by 80%. Additional contributions under the plan began on December 1, 2021. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Jun. 30, 2022 | |
Stock Based Compensation | |
Stock Based Compensation | 9. Stock Based Compensation The Company has established a 2005 Directors Non-Qualified Stock Option Plan and a 2013 Incentive Plan for Non-Employee Directors (collectively the “Directors Plans”). The Directors Plans provide for the granting of options to the Company’s directors who are not employees of the Company to purchase shares of common stock at prices equal to the fair market value of the stock on the date of grant. Options to purchase up to 75,000 shares of common stock may be granted under the Directors Plans. Options shall become exercisable with respect to one Upon stock-settled compensation exercises and awards, the Company issues new shares of common stock. A summary of stock option transactions in fiscal 2020, 2021 and 2022, respectively, pursuant to the Employee Plans and the Directors Plans is as follows: Weighted Average Weighted Remaining Aggregate Average Contractual Intrinsic Shares Exercise Price Term (years) Value June 30, 2019 45,000 $ 5.52 Options Granted 7,500 $ 1.20 Options Exercised — $ 0.00 Options Forfeited or Expired (9,750) $ 6.00 June 30, 2020 42,750 $ 4.65 4.1 $ 304,768 Options Granted 3,000 $ 7.86 Options Exercised — $ 0.00 Options Forfeited or Expired (2,250) $ 8.68 June 30, 2021 43,500 $ 4.66 3.8 $ 41,915 Options Granted 3,000 $ 5.09 Options Exercised — $ 0.00 Options Forfeited or Expired (17,250) $ 7.01 June 30, 2022 29,250 $ 3.32 5.6 $ 3,200 Exercisable at June 30, 2022 22,500 $ 3.44 4.7 $ 1,663 The following table provides additional information for options outstanding and exercisable at June 30, 2022: Options Outstanding Weighted Average Weighted Average Range of Exercise Prices Number Remaining Life Exercise Price $1.17 - 1.99 7,500 7.5 years $ 1.20 $2.00 - 3.99 11,250 4.4 years $ 2.42 $4.00 - 7.86 10,500 5.4 years $ 5.80 $1.17 - 7.86 29,250 5.6 years $ 3.32 Options Exercisable Weighted Average Range of Exercise Prices Number Exercise Price $1.17 - 1.99 3,750 $ 1.19 $2.00 - 3.99 11,250 $ 2.42 $4.00 -7.86 7,500 $ 6.08 $1.17 - 7.86 22,500 $ 3.44 See Note 2 for discussion of accounting for stock awards and related fair value disclosures. |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 12 Months Ended |
Jun. 30, 2022 | |
Supplemental Balance Sheet Information | |
Supplemental Balance Sheet Information | 10. Supplemental Balance Sheet Information June 30, 2022 2021 Inventories Work in progress $ 604,253 $ 829,962 Component parts 8,905,109 8,994,457 Finished goods 1,375,269 1,800,461 Reserve for obsolete and excess inventory (2,413,104) (2,174,149) $ 8,471,527 $ 9,450,731 Estimated Useful Life (years) Property, plant and equipment Machinery and equipment 3‑10 $ 19,073,964 $ 18,998,928 Buildings 28‑35 13,055,628 13,055,628 Land and land improvements 5‑7 919,566 919,566 Total property, plant and equipment at cost 33,049,158 32,974,122 Less accumulated depreciation and amortization (29,698,003) (29,246,738) $ 3,351,155 $ 3,727,384 Depreciation and amortization expense was approximately $0.5 million, $0.6 million, and $0.6 million for the fiscal years ended June 30, 2022, 2021 and 2020, respectively. Other accrued liabilities Accrued compensation expense $ 804,080 $ 1,323,901 Environmental remediation 176,062 976,720 Other 275,348 256,514 $ 1,255,490 $ 2,557,135 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | 11. Commitments and Contingencies Legal Claims The Company is subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities. The Company intends to continue to conduct business in such a manner as to avert any FDA action seeking to interrupt or suspend manufacturing or require any recall or modification of products. The Company has recognized the costs and associated liabilities only for those investigations, claims and legal proceedings for which, in its view, it is probable that liabilities have been incurred and the related amounts are estimable. Based upon information currently available, management believes that existing accrued liabilities are sufficient. Stuyvesant Falls Remediation On January 30, 2020, the Company filed a Citizen Participation Plan with the New York Department of Environmental Conservation under its Brownfield Cleanup Program. The plan was filed with respect to the Company’s property in Stuyvesant Falls, New York. The plan recognizes that the soil and groundwater at the Stuyvesant Falls facility is impacted by chemical compounds exceeding regulatory standards. On October 13, 2020, the Company executed a Brownfield Cleanup Program Agreement with the Department of Environmental Conservation with respect to the property. Under the agreement, the Company has voluntarily agreed to conduct, at its expense, certain remedial investigations and remedial actions with respect to suspected soil and groundwater contamination at the site with oversight by the department. The Company’s best estimate of the expected cost to remediate the site is $1.3 million. The Company recorded $1.1 million as an expense in the fiscal year ended June 30, 2020 and is reflected in other accrued liabilities and selling, general and administrative expenses in the Company’s financial statements. During the fiscal year ended June 30, 2022, the Company recorded an additional $171,000. As of June 30, 2022, the Company has paid approximately $634,000 in remediation expenses which have been charged to the initial reserve. Vendor Demand Letter On June 22, 2022, the Company received a demand letter from one of its vendors, International Control Services, Inc. (“ICS”) for $586,000 as payment on outstanding ICS invoices. The invoices in question cover components which the Company rejected as defective, certain charges for prior years and purchases the Company cancelled which ICS claims were non-cancellable. The Company’s standard purchase orders provide that the Company may reject defective parts and that all purchases are cancellable by the Company for its convenience. The Company disputes all of ICS’s claims, including that any portion of the subject purchases were non-cancellable. No litigation has been commenced as of this filing, but the Company will defend any such lawsuit. The Company notes that the range of loss is between $0 and $586,000. The Company has not recorded a provision for this matter because, at this early stage, there is insufficient information to determine the likelihood of loss or to estimate any possible loss. Liability for future environmental expenditures 2022 2021 Beginning Balance $ 976,720 $ 1,037,000 Charges to income 170,552 — Remedial and investigatory spending 491,210 60,280 Ending Balance $ 656,062 $ 976,720 Reflected in the Balance sheet as: Current, included in Other Liabilities $ 176,062 $ 976,720 Long-term environmental 480,000 — Total $ 656,062 $ 976,720 Employment Contract On April 20, 2021, the Company entered into an employment contract with its chief executive officer, Joseph F. Ondrus, Jr., which provides for an initial term of three years with annual renewals. The contract includes termination without cause and change of control provisions, under which the chief executive officer is entitled to continued payments of annual salary and benefits if the Company terminates his employment without cause or he voluntarily terminates his employment with “good reason.” “Good Reason” generally includes changes in the scope of his duties or location of employment but also includes (i) the Company’s written election not to renew the Employment Agreement and (ii) certain voluntary resignations by the chief executive officer following a “Change of Control” as defined in the Agreement. |
Segment Information
Segment Information | 12 Months Ended |
Jun. 30, 2022 | |
Segment Information | |
Segment Information | 12. Segment Information The Company operates in one segment consisting of the manufacturing, marketing and distribution of a variety of respiratory products used in the health care industry to hospitals, hospital equipment dealers, hospital construction contractors, home health care dealers and emergency medical product dealers. The Company’s product lines include respiratory care products, medical gas equipment and emergency medical products. The Company does not have any one single customer that represents more than 10 percent of total sales. Disaggregation information of sales by region, and by product, are as follows: Sales by Region 2022 2021 2020 Domestic United States $ 20,672,291 $ 24,162,321 $ 23,138,276 Europe 366,175 4,069,672 1,422,660 Canada 636,681 1,310,440 829,901 Latin America 2,262,172 2,819,165 3,122,929 Middle East 498,695 1,189,139 693,716 Far East 2,610,573 2,727,508 2,686,206 Other International — 1,231 574 $ 27,046,587 $ 36,279,476 $ 31,894,262 Sales by Product 2022 2021 2020 Respiratory care products $ 8,177,500 $ 8,082,974 $ 8,555,954 Medical gas equipment 13,449,542 15,943,246 15,282,732 Emergency medical products 5,419,545 12,253,256 8,055,576 $ 27,046,587 $ 36,279,476 $ 31,894,262 |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Jun. 30, 2022 | |
Quarterly Financial Data (unaudited) | |
Quarterly Financial Data (unaudited) | 13. Quarterly Financial Data (unaudited) Summarized quarterly financial data for fiscal 2022 and 2021 appears below (all amounts in thousands except per share amounts): June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Three months ended, 2022 2022 2021 2021 2021 2021 2020 2020 Net sales $ 6,015 $ 6,867 $ 6,807 $ 7,358 $ 7,018 $ 7,967 $ 11,104 $ 10,190 Gross profit 443 440 707 937 1,188 1,435 2,612 1,874 Income (loss) from operations (1,266) (1,232) (1,130) (952) (745) (381) 734 (135) Net income (loss) (1,935) (1,280) (1,162) (984) 1,553 (413) 700 (153) Basic earnings (loss) per share (0.48) (0.32) (0.29) (0.25) 0.39 (0.10) 0.17 (0.04) Diluted earnings (loss) per share (0.48) (0.32) (0.29) (0.25) 0.39 (0.10) 0.17 (0.04) Earnings per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly amounts will not necessarily equal the total for the year. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Use of estimates | Use of estimates The policies utilized by the Company in the preparation of the financial statements conform to accounting principles generally accepted in the United States of America, and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from those estimates. |
Revenue recognition | Revenue recognition The Company’s revenues are derived primarily from the sales of respiratory products, medical gas equipment and emergency medical products. The products are generally sold directly to distributors, customers affiliated with buying groups, individual customers and construction contractors, throughout the world. The Company recognizes revenue from product sales upon satisfaction of its performance obligation which occurs on the transfer of control of the product, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract. Payment terms between Allied and its customers vary by the type of customer, country of sale, and the products offered. The term between invoicing and the payment due date is not significant. Management exercises judgment in estimating variable consideration. Provisions for early payment discounts, rebates and returns and other adjustments are provided for in the period the related sales are recorded. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. The Company provides rebates to wholesalers. Rebate amounts are based upon purchases using contractual amount for each product sold. Factors used in the rebate calculations include the identification of which products have been sold subject to a rebate and the customer or price terms that apply. Using known contractual allowances, the Company estimates the amount of the rebate that will be paid, and records the liability as a reduction of gross sales when it records the sale of the product. Settlement of the rebate generally occurs in the month following the sale. The Company regularly analyzes the historical rebate trends and adjusts reserves for changes in trends and terms of rebate programs. Historically, adjustments to prior years’ rebate accruals have not been material to net income. Other allowances charged against gross sales include cash discounts and returns, which are not significant. Cash discounts are known within 15 to 30 days of sale, and therefore can be reliably estimated. Returns can be reliably estimated because the Company’s historical returns are low, and because sales return terms and other sales terms have remained relatively unchanged for several periods. Product warranties are also not significant. The Company does not allocate transaction price as the Company has only one performance obligation and its contracts do not span multiple periods. All taxes imposed on and concurrent with revenue producing transactions and collected by the Company are excluded from the measurement of transaction price. |
Marketing and Advertising Costs | Marketing and Advertising Costs Promotional and advertising costs are expensed as incurred and are included in selling, general and administrative expenses in the Statement of Operations. Advertising expenses for the years ended June 30, 2022, 2021 and 2020 were $400, $0, and $3,550, respectively. |
Cash and cash equivalents | Cash and cash equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents. The Company maintains funds in bank accounts that, at times, may exceed the limit insured by the Federal Deposit Insurance Corporation. The risk of loss attributable to these uninsured balances is mitigated by depositing funds only in high credit quality financial institutions. The Company has not experienced any losses in such accounts. The Company includes restricted cash along with the cash balance for presentation in the statements of cash flows. The reconciliation between the balance sheet and the statement of cash flows at June 30 is as follows: 2022 2021 Cash and cash equivalents $ 3,317,047 $ 726,223 Restricted Cash 1,729,600 — Total cash, cash equivalents and restricted cash $ 5,046,647 $ 726,223 |
Restricted Cash | Restricted Cash Restricted cash includes cash in escrow that is restricted to capital improvements of the building and payment of rent. |
Foreign currency transactions | Foreign currency transactions Allied has international sales which are denominated in U.S. dollars, the functional currency for these transactions. |
Accounts receivable and concentrations of credit risk | Accounts receivable and concentrations of credit risk Accounts receivable are recorded at the invoiced amount. The Company performs ongoing credit evaluations of its customers and generally does not require collateral. The Company maintains reserves for potential credit losses based on past experience and an analysis of current amounts due, and historically such losses have been within management’s expectations. The Company maintains an allowance for doubtful accounts to reflect the collectibility of accounts receivable based on past collection history and specific risks identified among uncollected accounts. Accounts receivable are charged to the allowance for doubtful accounts when the Company determines that the receivable will not be collected and/or when the account has been referred to a third party collection agency. The Company’s customers can be grouped into three main categories: medical equipment distributors, construction contractors and health care institutions. At June 30, 2022, the Company believes that it has no significant concentration of credit risk. |
Inventories | Inventories Inventories are stated at the lower of cost, determined using the last-in, first-out (“LIFO”) method, or market. If the first-in, first-out method (which approximates replacement cost) had been used in determining cost, inventories would have been $2,951,941 and $2,149,560 higher at June 30, 2022 and 2021, respectively. Changes in the LIFO reserve are included in cost of sales. Cost of sales was reduced by $37,470, $0, and $0 in fiscal 2022, 2021, and 2020 respectively, as a result of LIFO liquidations. Costs in inventory include raw materials, direct labor and manufacturing overhead. Inventory is recorded net of a reserve for obsolete and excess inventory which is determined primarily based on an analysis of inventory items with no usage in the preceding year and for inventory items for which there is greater than two years’ usage on hand. The reserve for obsolete and excess inventory was $2,413,104 and $2,174,149 at June 30, 2022 and 2021, respectively. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are recorded at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, which range from 3 to 35 years. Expenditures for repairs, maintenance and renewals are charged to income as incurred. Expenditures, which improve an asset or extend its estimated useful life, are capitalized. When properties are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in income. |
Impairment of long-lived assets | Impairment of long-lived assets The Company evaluates impairment of long-lived assets under the provisions of ASC Topic 360: “Property, Plant and Equipment.” ASC 360 provides a single accounting model for long-lived assets to be disposed of and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Under ASC 360, if the sum of the expected future cash flows (undiscounted and without interest charges) of the long-lived assets is less than the carrying amount of such assets, an impairment loss will be recognized. No impairment losses of long-lived assets or identifiable intangibles were recorded by the Company for fiscal years ended June 30, 2022, 2021, and 2020. |
Collective Bargaining Agreement | Collective Bargaining Agreement At June 30, 2022, the Company had approximately 146 full-time employees. Approximately 82 employees in the Company’s principal manufacturing facility located in St. Louis, Missouri, are covered by a collective bargaining agreement that will expire on July 31, 2024. |
Self-insurance | Self-insurance The Company maintains a self-insurance program for a portion of its health care costs. Self-insurance costs are accrued based upon the aggregate of the liability for reported claims and the estimated liability for claims incurred but not reported. As of June 30, 2022 and 2021, the Company had $125,000 and $120,000, respectively, of accrued liabilities related to health care claims. In order to establish the self-insurance reserves, the Company utilized actuarial estimates of expected claims based on analyses of historical data. |
Fair value of financial instruments | Fair value of financial instruments The Company’s financial instruments include cash, accounts receivable, the revolving line of credit and accounts payable. The carrying amounts for cash, accounts receivable, the revolving line of credit and accounts payable approximate their fair value due to the short maturity of these instruments. |
Income taxes | Income taxes The Company accounts for income taxes under ASC Topic 740: “Income Taxes.” Under ASC 740, the deferred tax provision is determined using the liability method, whereby deferred tax assets and liabilities are recognized based upon temporary differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates that are expected to apply to taxable income when such assets and liabilities are anticipated to be settled or realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as tax expense or benefit in the period that includes the enactment date of the change. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. In assessing the need for a valuation allowance the Company first considers the reversals of existing temporary deferred tax liabilities and available tax planning strategies. To the extent these items are not sufficient to cause the realization of deferred tax assets, the Company considers the availability of future taxable income to the extent such income is considered likely to occur based on the Company’s earnings history, current income trends and projections. Considering its history of operating losses, the Company does not rely on the existence of future taxable income as it currently cannot conclude future taxable income is likely to occur. The Company does rely on reversals of existing temporary deferred tax liabilities and tax planning strategies to the extent available to support the value of its existing deferred tax assets. In 2022, the Company concluded that its previously relied upon tax planning strategies were no longer available to support the value of any deferred tax assets. Accordingly, in 2022 a full valuation allowance was recorded. To the extent the Company’s deferred tax assets exceed the amount supportable through reversals of existing deferred tax liabilities, a valuation allowance will be recorded against the excess deferred tax assets. The Company recognizes tax liabilities when, despite the Company’s belief that its tax return positions are supportable, the Company believes that certain positions may not be fully sustained upon review by tax authorities. Benefits from tax positions are measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon settlement. To the extent the Company deems it necessary to record a liability for its tax positions, the current portion of the liability is included in income taxes payable and the noncurrent portion is included in other liabilities on the balance sheet. If upon the final tax outcome of these matters the ultimate liability is different than the amounts recorded, such differences are reflected in income tax expense in the period in which such determination is made. The Company files a federal and multiple state income tax returns. With few exceptions, the Company’s federal and state income tax returns are open for fiscal years ending after June 30, 2019. The Company classifies interest expenses on taxes payable as interest expense. Penalties are classified as a component of other expenses. |
Research and development costs | Research and development costs Research and development costs are expensed as incurred and are included in selling, general and administrative expenses. Research and development expenses for the years ended June 30, 2022, 2021 and 2020 were $260,439, $571,535, and $595,236, respectively. |
Earnings per share | Earnings per share Basic earnings per share are based on the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share are based on the sum of the weighted average number of shares of common stock and common stock equivalents outstanding during the year. The weighted average number of basic shares outstanding for the years ended June 30, 2022, 2021 and 2020 was 4,013,537 shares. The weighted average number of diluted shares outstanding for the years ended June 30, 2022, 2021 and 2020 was 4,013,537, 4,026,446 and 4,013,537 shares, respectively. The dilutive effect of the Company’s employee and director stock option plans are determined by use of the treasury stock method. There are no potential common shares excluded from the calculation of net loss per share, as their effect would be anti-dilutive for the years ended June 30, 2022 and 2020. For the year ended June 30, 2021, there was 20,250 potential common shares excluded from the calculation of net income per share, as their effect would be anti-dilutive. The following information is necessary to calculate earnings per share for the periods presented: Year ended June 30, 2022 2021 2020 Net income (loss), as reported $ (5,361,428) $ 1,687,188 $ (3,014,100) Weighted average common shares outstanding 4,013,537 4,013,537 4,013,537 Effect of dilutive stock options — 12,909 — Weighted average diluted common shares outstanding 4,013,537 4,026,446 4,013,537 Net income (loss) per common share Basic $ (1.34) $ 0.42 $ (0.75) Diluted $ (1.34) $ 0.42 $ (0.75) Employee stock options excluded from computation of diluted income per share amounts because their effect would be anti-dilutive — 20,250 — |
Employee stock-based compensation | Employee stock-based compensation The company follows the provisions of ASC Topic 718: “Compensation – Stock Compensation”, which sets accounting requirements for “share-based” compensation to employees, including employee stock purchase plans, and requires companies to recognize in the statement of operations the grant-date fair value of the stock options and other equity-based compensation. The fair value of options granted is estimated on the date of grant using the Black-Scholes option-pricing model. The following table summarizes the weighted average assumptions utilized in the Black-Scholes option pricing model for options granted during the fiscal years ended June 30, 2022, 2021 and 2020. 2022 2021 2020 Weighted-average fair value $ 4.29 $ 6.44 $ 0.61 Weighted-average volatility 114 % 109 % 53 % Weighted-average expected life (in years) 6.0 6.0 6.0 Weighted-average risk-free interest rate 1.34 % 0.52 % 1.77 % Dividend yield 0 % 0 % 0 % Expected volatility is based on the historical volatility of the Company’s common stock to estimate future volatility. The risk-free rates are taken from rates as published by the Federal Reserve and represent the yields on actively traded treasury securities for terms equal or approximately equal to the expected terms of the options. The expected term is calculated using the SEC Staff Accounting Bulletin 107 (ASC 718-10-S99) simplified method. Forfeitures are recognized as they occur. The dividend yield is zero based on the fact that the Company has no intention of paying dividends in the near term. Share-based compensation expense included in the Statement of Operations for the fiscal years ended June 30, 2022, 2021 and 2020 was approximately $15,647, $14,006 and $2,415, respectively. Unrecognized shared-based compensation cost related to unvested stock options as of June 30, 2022 amounts to approximately $6,000. The cost is expected to be recognized through fiscal 2025. The Company recognized an income tax benefit for share-based compensation arrangements of approximately $6,000, $6,000 and $1,000 respectively for the years ended June 30, 2022, 2021 and 2020, all of which were fully offset by an increase in the deferred tax asset valuation allowance. No stock options were exercised during fiscal years 2022, 2021 and 2020. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements The Company adopted ASU 2016-13: Financial Instruments - Credit Losses as of the beginning of the fiscal year 2022. This update introduces the current expected credit loss (CECL) model, which requires an entity to measure credit losses for certain financial instruments and financial assets, including trade receivables. Under this update, on initial recognition and at each reporting period, an entity is required to recognize an allowance that reflects the entity’s current estimate of credit losses expected to be incurred over the life of the financial instrument. The adoption of this standard did not have a material impact on the Company’s financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 was effective for the Company beginning in the first quarter of 2022. The adoption of this standard did not have a material impact on the Company’s financial statements and related disclosures. |
Environmental Remediation | Environmental Remediation The Company is subject to federal and state requirements for protection of the environment, including the remediation of contaminated sites. The Company’s policy is to accrue and charge to current expense identified exposures related to environmental remediation sites when it is probable that a liability has been incurred and the amount can be reasonably estimated. The amount of the liability is based on the best estimate or the low end of a range of reasonably possible exposure for investigation, cleanup, and monitoring costs to be incurred. Estimated remediation costs are not discounted to present value. On January 30, 2020, the Company filed a Citizen Participation Plan with the New York Department of Environmental Conservation under its Brownfield Cleanup Program. The plan was filed with respect to the Company’s property in Stuyvesant Falls, New York. The plan recognizes that the soil and groundwater at the Stuyvesant Falls facility is impacted by chemical compounds exceeding regulatory standards. On October 13, 2020, the Company executed a Brownfield Cleanup Program Agreement with the Department of Environmental Conservation with respect to the property. Under the agreement, the Company has voluntarily agreed to conduct, at its expense, certain remedial investigations and remedial actions with respect to suspected soil and groundwater contamination at the site with oversight by the department. The Company’s best estimate of the expected cost to remediate the site is $1.3 million. The Company recorded $1.1 million as an expense in the fiscal year ended June 30, 2020 and is reflected in other accrued liabilities and selling, general and administrative expenses in the Company’s financial statements. During fiscal 2022, the Company recorded an additional $171,000 charge to income and reclassified $0.5 million to long-term liability to reflect the rescheduling of the remediation. As of June 30, 2022, the Company has paid approximately $634,000 in remediation expenses which have been charged to the reserve. |
Risk and Uncertainties, Going Concern, Liquidity and Management's Plan | Risk and Uncertainties, Going Concern, Liquidity and Management’s Plan The Company believes that the Covid-19 pandemic resulted in increased sales of ventilator products in fiscal 2021, however, this peak in demand ended in fiscal 2021 and the impacts of the COVID-19 continue to develop. In fiscal 2022 demand dropped from the peak, and the Company believes that COVID-19 is no longer contributing positively to product demand. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of reconciliation between the balance sheet and the statement of cash flows | 2022 2021 Cash and cash equivalents $ 3,317,047 $ 726,223 Restricted Cash 1,729,600 — Total cash, cash equivalents and restricted cash $ 5,046,647 $ 726,223 |
Schedule of information is necessary to calculate earnings per share | The following information is necessary to calculate earnings per share for the periods presented: Year ended June 30, 2022 2021 2020 Net income (loss), as reported $ (5,361,428) $ 1,687,188 $ (3,014,100) Weighted average common shares outstanding 4,013,537 4,013,537 4,013,537 Effect of dilutive stock options — 12,909 — Weighted average diluted common shares outstanding 4,013,537 4,026,446 4,013,537 Net income (loss) per common share Basic $ (1.34) $ 0.42 $ (0.75) Diluted $ (1.34) $ 0.42 $ (0.75) Employee stock options excluded from computation of diluted income per share amounts because their effect would be anti-dilutive — 20,250 — |
Schedule of the weighted average assumptions utilized in the Black-Scholes option pricing model for options granted | 2022 2021 2020 Weighted-average fair value $ 4.29 $ 6.44 $ 0.61 Weighted-average volatility 114 % 109 % 53 % Weighted-average expected life (in years) 6.0 6.0 6.0 Weighted-average risk-free interest rate 1.34 % 0.52 % 1.77 % Dividend yield 0 % 0 % 0 % |
Sale-Leaseback Financing Tran_2
Sale-Leaseback Financing Transaction (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Sale-Leaseback Financing Transaction | |
Schedule of remaining future cash payments related to the financing liability | 2023 $ 688,800 2024 702,576 2025 716,628 2026 730,960 2027 745,579 Thereafter 19,359,359 Total Minimum Liability Payments 22,943,902 Imputed Interest (14,841,007) Total $ 8,102,895 |
Lease Commitments (Tables)
Lease Commitments (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Lease Commitments | |
Schedule of Company's future minimum lease payments under operating lease liabilities | The following table sets forth the Company’s future minimum lease payments under operating lease liabilities recorded on the Company’s balance sheet as of June 30, 2022. Maturity of Operating Lease Fiscal years ending Liabilities 2023 6,065 2024 3,032 Total lease payments 9,097 Less: amounts representing interest 796 Present value of lease liabilities 8,301 Less: current portion 5,370 Long-term portion $ 2,931 |
Schedule of lease-related terms and discount rates | The table below presents lease-related terms and discount rates as of June 30, 2022. June 30, 2022 June 30, 2021 June 30, 2020 Weighted average remaining lease terms Operating leases 1.5 years 2.5 years 3.5 years Weighted average discount rate Operating leases 12 % 12 % 12 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes | |
Schedule of provision for (benefit from) income taxes | The provision for (benefit from) income taxes consists of the following: 2022 2021 2020 Current: Federal $ 89,733 $ — $ 84,420 State 38,578 8,805 23,093 Less net operating loss carryforward applied (105,727) — (98,996) Total current 22,584 8,805 8,517 Deferred: Federal (943,677) (644,606) (182,517) State (214,462) (78,641) 4,405 Valuation allowance 1,735,227 786,926 39,236 Total deferred 577,088 63,679 (138,876) Provision (benefit) $ 599,672 $ 72,484 $ (130,359) |
Schedule of reconciliation of income taxes, with the amounts computed at the statutory federal rate | A reconciliation of income taxes, with the amounts computed at the statutory federal rate is as follows: 2022 2021 2020 Computed tax at federal statutory rate $ (1,004,711) $ 367,682 $ (662,125) State income taxes, net of federal tax (benefit) provision (146,553) (13,771) (17,475) Non deductible expenses 854 1,570 506,798 Federal research credit — (28,428) (31,076) Non taxable income from PPP Loan forgiveness — (504,470) — State NOLs 1,522 11,602 30,397 Stock Options - Expired 13,543 5,243 3,763 Change in tax law allowing deductibilty of PPP Loan related expenses — (553,653) — Other, net (210) (217) 123 Valuation allowance 1,735,227 786,926 39,236 Total $ 599,672 $ 72,484 $ (130,359) |
Schedule of deferred tax assets and liabilities recorded on the balance sheet | The deferred tax assets and deferred tax liabilities recorded on the balance sheet as of June 30, 2022 and 2021 are as follows: 2022 2021 Deferred tax assets Bad debts $ 25,500 $ 25,500 Intangible assets 150 745 Accrued liabilities 343,269 458,337 Stock options 13,329 23,403 Depreciation 1,196,223 — Net operating loss and credit carryforwards 4,377,126 4,505,628 Total Assets 5,955,597 5,013,613 Deferred tax liabilities Prepaid expenses 6,177 10,341 Inventory 473,929 529,045 Depreciation — 209,997 Other 178,272 125,147 Total Liabilities 658,378 874,530 Valuation allowance (5,297,219) (3,561,995) Total deferred taxes $ 0 $ 577,088 |
Employee Retirement Benefits (T
Employee Retirement Benefits (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Employee Retirement Benefits | |
Schedule of multi-employer pension plan | PPA Zone Status Contributions by the Company FIP/RP Status Pending/ Surcharge Expiration Pension Trust Fund EIN/PN 2020 2019 Implemented 2022 2021 2020 Imposed Date of CBA District No. 9 51‑0138317/001 Yellow Yellow Implemented International Association of Machinists and Aerospace Workers Pension Plan 12/31/2020 12/31/2019 Yes $ 321,011 $ 315,342 $ 245,824 No 7/31/2024 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Stock Based Compensation | |
Schedule of stock option plan activity under employee plans and the directors plans | A summary of stock option transactions in fiscal 2020, 2021 and 2022, respectively, pursuant to the Employee Plans and the Directors Plans is as follows: Weighted Average Weighted Remaining Aggregate Average Contractual Intrinsic Shares Exercise Price Term (years) Value June 30, 2019 45,000 $ 5.52 Options Granted 7,500 $ 1.20 Options Exercised — $ 0.00 Options Forfeited or Expired (9,750) $ 6.00 June 30, 2020 42,750 $ 4.65 4.1 $ 304,768 Options Granted 3,000 $ 7.86 Options Exercised — $ 0.00 Options Forfeited or Expired (2,250) $ 8.68 June 30, 2021 43,500 $ 4.66 3.8 $ 41,915 Options Granted 3,000 $ 5.09 Options Exercised — $ 0.00 Options Forfeited or Expired (17,250) $ 7.01 June 30, 2022 29,250 $ 3.32 5.6 $ 3,200 Exercisable at June 30, 2022 22,500 $ 3.44 4.7 $ 1,663 |
Schedule of additional information for options outstanding and exercisable | The following table provides additional information for options outstanding and exercisable at June 30, 2022: Options Outstanding Weighted Average Weighted Average Range of Exercise Prices Number Remaining Life Exercise Price $1.17 - 1.99 7,500 7.5 years $ 1.20 $2.00 - 3.99 11,250 4.4 years $ 2.42 $4.00 - 7.86 10,500 5.4 years $ 5.80 $1.17 - 7.86 29,250 5.6 years $ 3.32 Options Exercisable Weighted Average Range of Exercise Prices Number Exercise Price $1.17 - 1.99 3,750 $ 1.19 $2.00 - 3.99 11,250 $ 2.42 $4.00 -7.86 7,500 $ 6.08 $1.17 - 7.86 22,500 $ 3.44 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Supplemental Balance Sheet Information | |
Schedule of supplemental balance sheet information | June 30, 2022 2021 Inventories Work in progress $ 604,253 $ 829,962 Component parts 8,905,109 8,994,457 Finished goods 1,375,269 1,800,461 Reserve for obsolete and excess inventory (2,413,104) (2,174,149) $ 8,471,527 $ 9,450,731 Estimated Useful Life (years) Property, plant and equipment Machinery and equipment 3‑10 $ 19,073,964 $ 18,998,928 Buildings 28‑35 13,055,628 13,055,628 Land and land improvements 5‑7 919,566 919,566 Total property, plant and equipment at cost 33,049,158 32,974,122 Less accumulated depreciation and amortization (29,698,003) (29,246,738) $ 3,351,155 $ 3,727,384 Depreciation and amortization expense was approximately $0.5 million, $0.6 million, and $0.6 million for the fiscal years ended June 30, 2022, 2021 and 2020, respectively. Other accrued liabilities Accrued compensation expense $ 804,080 $ 1,323,901 Environmental remediation 176,062 976,720 Other 275,348 256,514 $ 1,255,490 $ 2,557,135 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies | |
Schedule of liability for future environmental expenditures | 2022 2021 Beginning Balance $ 976,720 $ 1,037,000 Charges to income 170,552 — Remedial and investigatory spending 491,210 60,280 Ending Balance $ 656,062 $ 976,720 Reflected in the Balance sheet as: Current, included in Other Liabilities $ 176,062 $ 976,720 Long-term environmental 480,000 — Total $ 656,062 $ 976,720 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Segment Information | |
Schedule of disaggregation information of sales by region and by product | Sales by Region 2022 2021 2020 Domestic United States $ 20,672,291 $ 24,162,321 $ 23,138,276 Europe 366,175 4,069,672 1,422,660 Canada 636,681 1,310,440 829,901 Latin America 2,262,172 2,819,165 3,122,929 Middle East 498,695 1,189,139 693,716 Far East 2,610,573 2,727,508 2,686,206 Other International — 1,231 574 $ 27,046,587 $ 36,279,476 $ 31,894,262 Sales by Product 2022 2021 2020 Respiratory care products $ 8,177,500 $ 8,082,974 $ 8,555,954 Medical gas equipment 13,449,542 15,943,246 15,282,732 Emergency medical products 5,419,545 12,253,256 8,055,576 $ 27,046,587 $ 36,279,476 $ 31,894,262 |
Quarterly Financial Data (una_2
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Quarterly Financial Data (unaudited) | |
Schedule of quarterly financial data | Summarized quarterly financial data for fiscal 2022 and 2021 appears below (all amounts in thousands except per share amounts): June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Three months ended, 2022 2022 2021 2021 2021 2021 2020 2020 Net sales $ 6,015 $ 6,867 $ 6,807 $ 7,358 $ 7,018 $ 7,967 $ 11,104 $ 10,190 Gross profit 443 440 707 937 1,188 1,435 2,612 1,874 Income (loss) from operations (1,266) (1,232) (1,130) (952) (745) (381) 734 (135) Net income (loss) (1,935) (1,280) (1,162) (984) 1,553 (413) 700 (153) Basic earnings (loss) per share (0.48) (0.32) (0.29) (0.25) 0.39 (0.10) 0.17 (0.04) Diluted earnings (loss) per share (0.48) (0.32) (0.29) (0.25) 0.39 (0.10) 0.17 (0.04) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Reconciliation between the balance sheet and the statement of cash flows (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 |
Summary of Significant Accounting Policies | ||||
Cash and cash equivalents | $ 3,317,047 | $ 726,223 | ||
Restricted cash | 1,729,600 | |||
Total cash, cash equivalents and restricted cash | $ 5,046,647 | $ 726,223 | $ 2,600,083 | $ 195,454 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of information is necessary to calculate earnings per share (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Summary of Significant Accounting Policies | |||||||||||
Net loss, as reported | $ (1,935,000) | $ (1,280,000) | $ (1,162,000) | $ (984,000) | $ 1,553,000 | $ (413,000) | $ 700,000 | $ (153,000) | $ (5,361,428) | $ 1,687,188 | $ (3,014,100) |
Weighted average shares outstanding - Basic | 4,013,537 | 4,013,537 | 4,013,537 | ||||||||
Effect of dilutive stock options | 0 | 12,909 | 0 | ||||||||
Weighted average shares outstanding - Diluted | 4,013,537 | 4,026,446 | 4,013,537 | ||||||||
Net loss per common share | |||||||||||
Basic earnings (loss) per share | $ (0.48) | $ (0.32) | $ (0.29) | $ (0.25) | $ 0.39 | $ (0.10) | $ 0.17 | $ (0.04) | $ (1.34) | $ 0.42 | $ (0.75) |
Diluted earnings (loss) per share | $ (0.48) | $ (0.32) | $ (0.29) | $ (0.25) | $ 0.39 | $ (0.10) | $ 0.17 | $ (0.04) | $ (1.34) | $ 0.42 | $ (0.75) |
Employee stock options excluded from computation of diluted income per share amounts because their effect would be anti-dilutive | 0 | 20,250 | 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of the weighted average assumptions utilized in the Black-Scholes option pricing model for options granted (Details) - $ / shares | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Summary of Significant Accounting Policies | |||
Weighted-average fair value | $ 4.29 | $ 6.44 | $ 0.61 |
Weighted-average volatility | 114% | 109% | 53% |
Weighted-average expected life (in years) | 6 years | 6 years | 6 years |
Weighted-average risk-free interest rate | 1.34% | 0.52% | 1.77% |
Dividend yield | 0% | 0% | 0% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Jun. 30, 2022 USD ($) shares | Jun. 30, 2021 USD ($) shares | Jun. 30, 2020 USD ($) shares | |
Advertising expenses | $ 400 | $ 0 | $ 3,550 |
FIFO inventory amount | 2,951,941 | 2,149,560 | |
Decreases in cost of sales | 37,470 | 0 | 0 |
Reserve for obsolete and excess inventory | $ 2,413,104 | 2,174,149 | |
Number of employees | 146 | ||
Expiry date of collective bargaining agreement | Jul. 31, 2024 | ||
Accrued liabilities related to health care claims | $ 125,000 | 120,000 | |
Research and development | 260,439 | 571,535 | 595,236 |
Stock based compensation | 15,647 | 14,006 | 2,415 |
Unrecognized shared-based compensation cost related to unvested stock options | 6,000 | ||
Income tax benefit for share-based compensation arrangements | $ 6,000 | $ 6,000 | $ 1,000 |
Stock options exercised | shares | 0 | 0 | 0 |
Expected cost of environmental remediation, best estimate | $ 1,300,000 | ||
Total Payments For Environmental Liabilities | 634,000 | ||
Payment of environmental liabilities | 634,000 | ||
Environmental expense | $ 1,100,000 | ||
Charges to income | 171,000 | ||
Reclassification to long-term liability | $ 500,000 | ||
Minimum | |||
Estimated useful life of property, plant and equipment | 3 years | ||
Cash discount term | 15 days | ||
Maximum | |||
Estimated useful life of property, plant and equipment | 35 years | ||
Cash discount term | 30 days | ||
Collective Bargaining Agreement [Member] | |||
Number of employees | 82 |
Going Concern (Details)
Going Concern (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Going Concern | ||
Increase of inflationary product cost | $ 1,300 | $ 500 |
Financing (Details)
Financing (Details) | 12 Months Ended | ||||
Apr. 13, 2020 USD ($) | Feb. 27, 2017 USD ($) | Jun. 30, 2022 USD ($) D | Jun. 30, 2021 USD ($) | Jun. 30, 2020 USD ($) | |
Debt Instrument [Line Items] | |||||
Credit Facility, expiration date | Sep. 30, 2024 | ||||
Credit Facility, frequency of payment and payment terms | pay a minimum amount of .25% (25 basis points) per month on the maximum availability ($10,000 per month) | ||||
Total indebtedness | $ 10,600,000 | ||||
Credit Facility, interest rate per annum | 20% | ||||
Loan proceeds | $ 0 | $ 0 | $ 2,374,859 | ||
Summit Financial Resources, L.P | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Credit Facility, maximum borrowing capacity | $ 4,000,000 | 3,345,123 | |||
Credit Facility, remaining borrowing capacity | 878,763 | ||||
Credit Facility, basis spread on variable rate | 2% | ||||
Credit Facility, commitment fee percentage | 0.47% | ||||
Borrowings as of balance sheet date | $ 2,466,360 | ||||
Number of days old receivables that are considered as ineligible receivables | D | 90 | ||||
Number of days old receivables from customers with a significant concentration of receivables that are considered as ineligible receivables | D | 90 | ||||
Maximum borrowing capacity as a percentage of eligible Accounts Receivable | 85% | ||||
Maximum borrowing capacity as a percentage of eligible Inventories | 25% | ||||
Amount of calculated eligible inventory | $ 2,000,000 | ||||
Summit Financial Resources, L.P | Revolving Credit Facility | Accounts receivable pledged as collateral | |||||
Debt Instrument [Line Items] | |||||
Collateral amount | 1,672,581 | ||||
Summit Financial Resources, L.P | Revolving Credit Facility | Inventories pledged as collateral | |||||
Debt Instrument [Line Items] | |||||
Collateral amount | $ 1,672,581 | ||||
Summit Financial Resources, L.P | Revolving Credit Facility | Prime Rate | |||||
Debt Instrument [Line Items] | |||||
Prime rate | 4.75% | ||||
Payroll Protection Program loan | |||||
Debt Instrument [Line Items] | |||||
Prime rate | 1% | ||||
Loan proceeds | $ 2,375,000 |
Sale-Leaseback Financing Tran_3
Sale-Leaseback Financing Transaction (Details) | 12 Months Ended | |
Jun. 16, 2022 USD ($) item | Jun. 30, 2022 USD ($) item | |
Sale Leaseback Transaction [Line Items] | ||
Term of contract | 15 years 10 days | |
Number of renewal options | item | 5 | 2 |
Term of each renewal option | 5 years | 5 years |
Initial basic rent per month | $ 57,400 | |
Annual increase percentage in basic rent | 2% | |
Discount rate percentage | 6.75% | |
Carrying value of the financing liability | $ 8,102,895 | |
Debt issuance costs | 212,667 | |
Financing liability, net - current | 131,519 | |
Financing liability, net - noncurrent | 7,971,376 | |
Interest expense | 15,585 | |
Gain (loss) recognized for sale-leaseback transaction | 0 | |
Improvement Escrow amount | $ 1,500,000 | |
Number of months of initial rental payments held in escrow | 4 months | |
Rent escrow amount | $ (229,600) | |
Rent escrow period | 2 years | |
Carrying value of restricted cash | $ 1,729,600 | |
Buildings | ||
Sale Leaseback Transaction [Line Items] | ||
Net book value | 0 | |
Land | ||
Sale Leaseback Transaction [Line Items] | ||
Carrying amount | $ 873,200 |
Sale-Leaseback Financing Tran_4
Sale-Leaseback Financing Transaction - Remaining future cash payments related to the financing liability (Details) | Jun. 30, 2022 USD ($) |
Remaining future cash payments related to the financing liability | |
2023 | $ 688,800 |
2024 | 702,576 |
2025 | 716,628 |
2026 | 730,960 |
2027 | 745,579 |
Thereafter | 19,359,359 |
Total Minimum Liability Payments | 22,943,902 |
Imputed Interest | (14,841,007) |
Total | $ 8,102,895 |
Lease Commitments - Future mini
Lease Commitments - Future minimum lease payments under operating lease liabilities (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Lease Commitments | ||
2023 | $ 6,065 | |
2024 | 3,032 | |
Total lease payments | 9,097 | |
Less: amounts representing interest | 796 | |
Present value of lease liabilities | 8,301 | |
Less: current portion | 5,370 | $ 4,777 |
Long-term portion | $ 2,931 | $ 8,301 |
Lease Commitments - Additional
Lease Commitments - Additional Information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease cost | $ 71,234 | $ 59,432 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Vehicles and equipment lease term | 3 years | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Vehicles and equipment lease term | 5 years |
Lease Commitments - Lease-relat
Lease Commitments - Lease-related terms and discount rates (Details) | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 |
Weighted average remaining lease terms | |||
Operating leases | 1 year 6 months | 2 years 6 months | 3 years 6 months |
Operating leases | 12% | 12% | 12% |
Income Taxes - Summary of provi
Income Taxes - Summary of provision for (benefit from) income taxes (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Current: | |||
Federal | $ 89,733 | $ 0 | $ 84,420 |
State | 38,578 | 8,805 | 23,093 |
Less net operating loss carryforward applied | (105,727) | 0 | (98,996) |
Total current | 22,584 | 8,805 | 8,517 |
Deferred: | |||
Federal | (943,677) | (644,606) | (182,517) |
State | (214,462) | (78,641) | 4,405 |
Valuation Allowance | 1,735,227 | 786,926 | 39,236 |
Total deferred | 577,088 | 63,679 | (138,876) |
Provision (benefit) | $ 599,672 | $ 72,484 | $ (130,359) |
Income Taxes - Summary of recon
Income Taxes - Summary of reconciliation of income taxes, with the amounts computed at the statutory federal rate (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Taxes | |||
Computed tax at federal statutory rate | $ (1,004,711) | $ 367,682 | $ (662,125) |
State income taxes, net of federal tax (benefit) provision | (146,553) | (13,771) | (17,475) |
Non deductible expenses | 854 | 1,570 | 506,798 |
Federal research credit | 0 | (28,428) | (31,076) |
Non taxable income from PPP Loan forgiveness | 0 | 504,470 | 0 |
State NOLs | 1,522 | 11,602 | 30,397 |
Stock Options - Expired | 13,543 | 5,243 | 3,763 |
Change in tax law allowing deductibility of PPP Loan related expenses | 0 | (553,653) | 0 |
Other, net | (210) | (217) | 123 |
Valuation Allowance | 1,735,227 | 786,926 | 39,236 |
Provision (benefit) | $ 599,672 | $ 72,484 | $ (130,359) |
Income Taxes - Summary of defer
Income Taxes - Summary of deferred tax assets and liabilities recorded on the balance sheet (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Deferred tax assets | ||
Bad debts | $ 25,500 | $ 25,500 |
Intangible assets | 150 | 745 |
Accrued liabilities | 343,269 | 458,337 |
Stock options | 13,329 | 23,403 |
Depreciation | 1,196,223 | |
Net operating loss and credit carryforwards | 4,377,126 | 4,505,628 |
Total Assets | 5,955,597 | 5,013,613 |
Deferred tax liabilities | ||
Prepaid expenses | 6,177 | 10,341 |
Inventory | 473,929 | 529,045 |
Depreciation | 209,997 | |
Other | 178,272 | 125,147 |
Total Liabilities | 658,378 | 874,530 |
Valuation allowance | 5,297,219 | 3,561,995 |
Total deferred taxes | $ 0 | $ 577,088 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2022 USD ($) | |
Schedule Of Income Tax Disclosure [Line Items] | |
Federal net operating loss carryforwards | $ 12.8 |
State tax net operating losses | 8.3 |
Maximum | |
Schedule Of Income Tax Disclosure [Line Items] | |
Federal net operating loss carryforwards | 3.8 |
State tax net operating losses | $ 0.8 |
Domestic Tax Authority | Minimum | |
Schedule Of Income Tax Disclosure [Line Items] | |
Operating loss carryforwards expiration date | 2031 |
Domestic Tax Authority | Maximum | |
Schedule Of Income Tax Disclosure [Line Items] | |
Operating loss carryforwards expiration date | 2038 |
State and Local Jurisdiction | Minimum | |
Schedule Of Income Tax Disclosure [Line Items] | |
Operating loss carryforwards expiration date | 2022 |
State and Local Jurisdiction | Maximum | |
Schedule Of Income Tax Disclosure [Line Items] | |
Operating loss carryforwards expiration date | 2042 |
Employee Retirement Benefits -
Employee Retirement Benefits - Summary of multi-employer pension plan (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Employee Retirement Benefits | |||
Contributions by the Company | $ 321,011 | $ 315,342 | $ 245,824 |
Expiration Date of CBA | Jul. 31, 2024 | ||
Surcharge Imposed | No |
Employee Retirement Benefits _2
Employee Retirement Benefits - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Multiemployer Plan [Line Items] | |||
Contributions to the retirement savings plan | $ 182,026 | $ 186,366 | $ 185,000 |
Percentage of eligible salaried employees annual income | 2% | ||
Percentage of annual income to plan | 25% | ||
Percentage of employee deferrals | 8% | ||
Percentage Of Increase In Monthly Employer Contribution Rate | 80% | ||
Percentage of plans funded in red zone | 65% | ||
Percentage of plans funded in green zone | 80% | ||
Minimum | |||
Multiemployer Plan [Line Items] | |||
Percentage of plans funded in yellow zone | 65% | ||
Maximum | |||
Multiemployer Plan [Line Items] | |||
Percentage of plans funded in yellow zone | 80% |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of stock option plan activity under employee plans and the directors plans (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Stock Based Compensation | |||
Beginning Balance, Shares | 43,500 | 42,750 | 45,000 |
Options Granted, Shares | 3,000 | 3,000 | 7,500 |
Options Exercised, Shares | 0 | 0 | 0 |
Options Forfeited or Expired, Shares | (17,250) | (2,250) | (9,750) |
Ending Balance, Shares | 29,250 | 43,500 | 42,750 |
Exercisable, Shares | 22,500 | ||
Beginning Balance, Weighted Average Exercise Price | $ 4.66 | $ 4.65 | $ 5.52 |
Options Granted, Weighted Average Exercise Price | 5.09 | 7.86 | 1.20 |
Options Exercised, Weighted Average Exercise Price | 0 | 0 | 0 |
Options Forfeited or Expired, Weighted Average Exercise Price | 7.01 | 8.68 | 6 |
Ending Balance, Weighted Average Exercise Price | 3.32 | $ 4.66 | $ 4.65 |
Exercisable, Weighted Average Exercise Price | $ 3.44 | ||
Options, Weighted Average Remaining Contractual Terms (years) | 5 years 7 months 6 days | 3 years 9 months 18 days | 4 years 1 month 6 days |
Exercisable, Weighted Average Remaining Contractual Terms (years) | 4 years 8 months 12 days | ||
Options, Aggregate Intrinsic Value | $ 3,200 | $ 41,915 | $ 304,768 |
Exercisable, Aggregate Intrinsic Value | $ 1,663 |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of additional information for options outstanding and exercisable (Details) | 12 Months Ended |
Jun. 30, 2022 $ / shares shares | |
$1.17 - 1.99 Exercise Prices | |
Schedule Of Share Based Compensation Stock Options Activity [Line Items] | |
Options Outstanding, Number | shares | 7,500 |
Options Outstanding, Weighted Average Remaining Life | 7 years 6 months |
Option Outstanding, Weighted Average Exercise Price | $ / shares | $ 1.20 |
Options Exercisable, Number | shares | 3,750 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 1.19 |
$2.00 - 3.99 Exercise Prices | |
Schedule Of Share Based Compensation Stock Options Activity [Line Items] | |
Options Outstanding, Number | shares | 11,250 |
Options Outstanding, Weighted Average Remaining Life | 4 years 4 months 24 days |
Option Outstanding, Weighted Average Exercise Price | $ / shares | $ 2.42 |
Options Exercisable, Number | shares | 11,250 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 2.42 |
$4.00 - 7.86 Exercise Prices | |
Schedule Of Share Based Compensation Stock Options Activity [Line Items] | |
Options Outstanding, Number | shares | 10,500 |
Options Outstanding, Weighted Average Remaining Life | 5 years 4 months 24 days |
Option Outstanding, Weighted Average Exercise Price | $ / shares | $ 5.80 |
Options Exercisable, Number | shares | 7,500 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 6.08 |
$1.17 - 7.86 Exercise Prices | |
Schedule Of Share Based Compensation Stock Options Activity [Line Items] | |
Options Outstanding, Number | shares | 29,250 |
Options Outstanding, Weighted Average Remaining Life | 5 years 7 months 6 days |
Option Outstanding, Weighted Average Exercise Price | $ / shares | $ 3.32 |
Options Exercisable, Number | shares | 22,500 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 3.44 |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) - Director Plan | 12 Months Ended |
Jun. 30, 2022 shares | |
Schedule Of Share Based Compensation Stock Options Activity [Line Items] | |
Options to purchase of common stock (Shares) | 75,000 |
Percentage of shares converted on each anniversary | 25% |
Right to exercise options, expiration period from the date of grant (years) | 10 years |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information - Summary of inventories and property plant and equipment (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Inventories | ||
Work in progress | $ 604,253 | $ 829,962 |
Component parts | 8,905,109 | 8,994,457 |
Finished goods | 1,375,269 | 1,800,461 |
Reserve for obsolete and excess inventory | (2,413,104) | (2,174,149) |
Inventories | 8,471,527 | 9,450,731 |
Property, plant and equipment | ||
Total property, plant and equipment at cost | 33,049,158 | 32,974,122 |
Less accumulated depreciation and amortization | (29,698,003) | (29,246,738) |
Property, Plant and Equipment, Net, Total | 3,351,155 | 3,727,384 |
Other accrued liabilities | ||
Accrued compensation expense | 804,080 | 1,323,901 |
Environmental remediation | 176,062 | 976,720 |
Other | 275,348 | 256,514 |
Accrued Liabilities, Current, Total | $ 1,255,490 | 2,557,135 |
Minimum | ||
Property, plant and equipment | ||
Estimated Useful Life | 3 years | |
Maximum | ||
Property, plant and equipment | ||
Estimated Useful Life | 35 years | |
Machinery and equipment | ||
Property, plant and equipment | ||
Total property, plant and equipment at cost | $ 19,073,964 | 18,998,928 |
Machinery and equipment | Minimum | ||
Property, plant and equipment | ||
Estimated Useful Life | 3 years | |
Machinery and equipment | Maximum | ||
Property, plant and equipment | ||
Estimated Useful Life | 10 years | |
Buildings | ||
Property, plant and equipment | ||
Total property, plant and equipment at cost | $ 13,055,628 | 13,055,628 |
Buildings | Minimum | ||
Property, plant and equipment | ||
Estimated Useful Life | 28 years | |
Buildings | Maximum | ||
Property, plant and equipment | ||
Estimated Useful Life | 35 years | |
Land and land improvements | ||
Property, plant and equipment | ||
Total property, plant and equipment at cost | $ 919,566 | $ 919,566 |
Land and land improvements | Minimum | ||
Property, plant and equipment | ||
Estimated Useful Life | 5 years | |
Land and land improvements | Maximum | ||
Property, plant and equipment | ||
Estimated Useful Life | 7 years |
Supplemental Balance Sheet In_4
Supplemental Balance Sheet Information - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Supplemental Balance Sheet Information | |||
Depreciation and amortization | $ 0.5 | $ 0.6 | $ 0.6 |
Commitments and Contingencies -
Commitments and Contingencies - Liability for future environmental expenditures (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Commitments and Contingencies | ||
Beginning Balance | $ 976,720 | $ 1,037,000 |
Charges to income | 170,552 | |
Remedial and investigatory spending | 491,210 | 60,280 |
Ending Balance | 656,062 | 976,720 |
Current, included in Other Liabilities | 176,062 | 976,720 |
Long-term environmental | 480,000 | 0 |
Total | $ 656,062 | $ 976,720 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | |||
Apr. 20, 2021 | Jun. 30, 2022 | Jun. 30, 2020 | Jun. 22, 2022 | |
Loss Contingencies [Line Items] | ||||
Expected cost of environmental remediation, best estimate | $ 1,300,000 | |||
Environmental expense | $ 1,100,000 | |||
Charges to income | 171,000 | |||
Payment of environmental liabilities | 634,000 | |||
Employment contract renewal term | 3 years | |||
Outstanding ICS invoices demanded by vendor | $ 586,000 | |||
Minimum | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency, Estimate of possible loss | 0 | |||
Maximum | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency, Estimate of possible loss | $ 586,000 |
Segment Information - Disaggreg
Segment Information - Disaggregation information of sales by region (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 6,015,000 | $ 6,867,000 | $ 6,807,000 | $ 7,358,000 | $ 7,018,000 | $ 7,967,000 | $ 11,104,000 | $ 10,190,000 | $ 27,046,587 | $ 36,279,476 | $ 31,894,262 |
Europe | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 366,175 | 4,069,672 | 1,422,660 | ||||||||
Canada | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 636,681 | 1,310,440 | 829,901 | ||||||||
Latin America | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 2,262,172 | 2,819,165 | 3,122,929 | ||||||||
Middle East | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 498,695 | 1,189,139 | 693,716 | ||||||||
Far East | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 2,610,573 | 2,727,508 | 2,686,206 | ||||||||
Other International | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 1,231 | 574 | |||||||||
Domestic United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 20,672,291 | $ 24,162,321 | $ 23,138,276 |
Segment Information - Disaggr_2
Segment Information - Disaggregation information of sales by product (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 6,015,000 | $ 6,867,000 | $ 6,807,000 | $ 7,358,000 | $ 7,018,000 | $ 7,967,000 | $ 11,104,000 | $ 10,190,000 | $ 27,046,587 | $ 36,279,476 | $ 31,894,262 |
Respiratory care products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 8,177,500 | 8,082,974 | 8,555,954 | ||||||||
Medical gas equipment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 13,449,542 | 15,943,246 | 15,282,732 | ||||||||
Emergency medical products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 5,419,545 | $ 12,253,256 | $ 8,055,576 |
Quarterly Financial Data (una_3
Quarterly Financial Data (unaudited) - Summary of quarterly financial data (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Quarterly Financial Data (unaudited) | |||||||||||
Net sales | $ 6,015,000 | $ 6,867,000 | $ 6,807,000 | $ 7,358,000 | $ 7,018,000 | $ 7,967,000 | $ 11,104,000 | $ 10,190,000 | $ 27,046,587 | $ 36,279,476 | $ 31,894,262 |
Gross profit | 443,000 | 440,000 | 707,000 | 937,000 | 1,188,000 | 1,435,000 | 2,612,000 | 1,874,000 | 2,527,413 | 7,109,496 | 5,570,616 |
Income (loss) from operations | (1,266,000) | (1,232,000) | (1,130,000) | (952,000) | (745,000) | (381,000) | 734,000 | (135,000) | (4,579,975) | (526,822) | (3,062,179) |
Net income (loss) | $ (1,935,000) | $ (1,280,000) | $ (1,162,000) | $ (984,000) | $ 1,553,000 | $ (413,000) | $ 700,000 | $ (153,000) | $ (5,361,428) | $ 1,687,188 | $ (3,014,100) |
Basic earnings (loss) per share | $ (0.48) | $ (0.32) | $ (0.29) | $ (0.25) | $ 0.39 | $ (0.10) | $ 0.17 | $ (0.04) | $ (1.34) | $ 0.42 | $ (0.75) |
Diluted earnings (loss) per share | $ (0.48) | $ (0.32) | $ (0.29) | $ (0.25) | $ 0.39 | $ (0.10) | $ 0.17 | $ (0.04) | $ (1.34) | $ 0.42 | $ (0.75) |