Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jul. 31, 2018 | Sep. 12, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | COFFEE HOLDING CO INC | |
Entity Central Index Key | 1,007,019 | |
Document Type | 10-Q | |
Document Period End Date | Jul. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --10-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 5,620,767 | |
Entity Trading Symbol | JVA | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
CURRENT ASSETS: | ||
Cash | $ 5,080,021 | $ 2,325,650 |
Accounts receivable, net of allowances of $144,000 for 2018 and 2017 | 8,610,384 | 13,441,802 |
Inventories | 15,210,573 | 16,310,572 |
Prepaid green coffee | 171,350 | |
Prepaid expenses and other current assets | 707,332 | 593,825 |
Prepaid and refundable income taxes | 293,966 | 472,814 |
TOTAL CURRENT ASSETS | 29,902,276 | 33,316,013 |
Machinery and equipment, at cost, net of accumulated depreciation of $6,079,588 and $5,557,899 for 2018 and 2017, respectively | 2,667,203 | 2,439,338 |
Customer list and relationships, net of accumulated amortization of $95,125 and $72,250 for 2018 and 2017, respectively | 344,875 | 367,750 |
Trademarks | 820,000 | 820,000 |
Other intangible assets | 331,124 | 331,124 |
Non-compete | 150,000 | |
Goodwill | 2,794,265 | 1,794,265 |
Equity method investments | 90,284 | 94,643 |
Deferred income tax asset | 569,250 | 339,748 |
Deposits and other assets | 527,303 | 497,529 |
TOTAL ASSETS | 38,196,580 | 40,000,410 |
CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses | 2,732,107 | 4,430,626 |
Line of credit | 7,148,762 | 8,407,527 |
Due to broker | 528,038 | 210,862 |
Note payable | 150,000 | |
Income taxes payable | 7,235 | 1,346 |
TOTAL CURRENT LIABILITIES | 10,566,142 | 13,050,361 |
Deferred income tax liabilities | 862,932 | 629,680 |
Deferred rent payable | 241,702 | 240,379 |
Deferred compensation payable | 518,303 | 488,529 |
TOTAL LIABILITIES | 12,189,079 | 14,408,949 |
Coffee Holding Co., Inc. stockholders' equity: | ||
Preferred stock, par value $.001 per share; 10,000,000 shares authorized; no shares issued and outstanding | ||
Common stock, par value $.001 per share; 30,000,000 shares authorized, 6,494,680 shares issued; 5,620,767 and 5,805,935 shares outstanding as of July 31, 2018 and October 31, 2017, respectively | 6,494 | 6,494 |
Additional paid-in capital | 16,104,075 | 16,104,075 |
Retained earnings | 13,303,416 | 12,345,490 |
Less: Treasury stock, 873,913 and 688,745 common shares, at cost as of July 31, 2018 and October 31, 2017, respectively | (4,398,877) | (3,504,510) |
Total Coffee Holding Co., Inc. Stockholders' Equity | 25,015,108 | 24,951,549 |
Noncontrolling interest | 992,393 | 639,912 |
TOTAL EQUITY | 26,007,501 | 25,591,461 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 38,196,580 | $ 40,000,410 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowances for doubtful accounts | $ 144,000 | $ 144,000 |
Accumulated depreciation | 6,079,588 | 5,557,899 |
Customer list and relationships, accumulated amortization | $ 95,125 | $ 72,250 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 6,494,680 | 6,494,680 |
Common stock, shares outstanding | 5,620,767 | 5,805,935 |
Treasury Stock, Shares | 873,913 | 688,745 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Income Statement [Abstract] | ||||
NET SALES | $ 23,439,903 | $ 17,979,068 | $ 67,717,019 | $ 55,398,538 |
COST OF SALES (including $7.0 and $4.8 million of related party costs for the nine months ended July 31, 2018 and 2017, respectively. Including $2.6 and $2.6 million for the three months ended July 31, 2018 and 2017, respectively.) | 19,648,710 | 14,903,594 | 56,263,183 | 46,469,896 |
GROSS PROFIT | 3,791,193 | 3,075,474 | 11,453,836 | 8,928,642 |
OPERATING EXPENSES: | ||||
Selling and administrative | 3,352,268 | 2,716,393 | 8,905,830 | 7,517,062 |
Officers' salaries | 170,250 | 179,250 | 510,750 | 527,090 |
TOTAL | 3,522,518 | 2,895,643 | 9,416,580 | 8,044,152 |
INCOME FROM OPERATIONS | 268,675 | 179,831 | 2,037,256 | 884,490 |
OTHER INCOME (EXPENSE) | ||||
Interest income | 3,433 | 5,993 | 11,170 | 29,381 |
(Loss) gain from equity method investment | 199 | (322) | (4,359) | (71) |
Interest expense | (99,906) | (68,079) | (286,555) | (192,317) |
TOTAL | (96,274) | (62,408) | (279,744) | (163,007) |
INCOME BEFORE PROVISION FOR INCOME TAXES AND NON-CONTROLLING INTEREST IN SUBSIDIARY | 172,401 | 117,423 | 1,757,512 | 721,483 |
Provision for income taxes | 35,721 | 23,911 | 447,105 | 153,453 |
NET INCOME BEFORE NON-CONTROLLING INTEREST IN SUBSIDIARY | 136,680 | 93,512 | 1,310,407 | 568,030 |
Less: Net (income) attributable to the non-controlling interest | (120,990) | (60,712) | (352,481) | (157,711) |
NET INCOME ATTRIBUTABLE TO COFFEE HOLDING CO., INC. | $ 15,690 | $ 32,800 | $ 957,926 | $ 410,319 |
Basic and diluted earnings per share | $ 0 | $ 0.01 | $ 0.17 | $ 0.07 |
Weighted average common shares outstanding: Basic and diluted | 5,673,914 | 5,859,918 | 5,720,360 | 5,861,777 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Income (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Income Statement [Abstract] | ||||
Related party costs | $ 2,600,000 | $ 2,600,000 | $ 7,000,000 | $ 4,800,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | Apr. 24, 2018 | Feb. 23, 2017 | Jul. 31, 2018 | Jul. 31, 2017 |
OPERATING ACTIVITIES: | ||||
Net income | $ 1,310,407 | $ 568,030 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization | 544,564 | 573,447 | ||
Unrealized loss (gain) on commodities | 317,176 | (643,834) | ||
Loss on equity method investments | 4,359 | 70 | ||
Deferred rent | 1,323 | 6,872 | ||
Deferred income taxes | 3,750 | 178,460 | ||
Changes in operating assets and liabilities: | ||||
Accounts receivable | 4,917,860 | 3,684,724 | ||
Inventories | 2,240,892 | (270,523) | ||
Prepaid expenses and other current assets | (50,625) | (53,740) | ||
Prepaid green coffee | 171,350 | 155,323 | ||
Prepaid and refundable income taxes | 178,848 | (315,962) | ||
Accounts payable and accrued expenses | (1,698,518) | (1,434,462) | ||
Deposits and other assets | 59,640 | |||
Income taxes payable | 5,889 | (1,050) | ||
Net cash provided by operating activities | 7,947,275 | 2,506,995 | ||
INVESTING ACTIVITIES: | ||||
Purchases of business net of cash acquired | (2,893,275) | |||
Cash paid for business acquisition | (2,740,217) | |||
Purchases of machinery and equipment | (299,554) | (586,098) | ||
Net cash used in investing activities | (3,039,771) | (3,479,373) | ||
FINANCING ACTIVITIES: | ||||
Advances under bank line of credit | 3,800,300 | 4,512,950 | ||
Purchase of treasury stock | (894,368) | (15,829) | ||
Principal payments under bank line of credit | (5,059,065) | (4,065,000) | ||
Net cash (used in) provided by financing activities | (2,153,133) | 432,121 | ||
NET INCREASE DECREASE IN CASH | 2,754,371 | (540,257) | ||
CASH, BEGINNING OF PERIOD | 2,325,650 | 3,227,981 | ||
CASH, END OF PERIOD | 5,080,021 | 2,687,724 | ||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW DATA: | ||||
Interest paid | 285,603 | 189,933 | ||
Income taxes paid | $ 245,838 | $ 281,538 | ||
Steep & Brew, Inc [Member] | ||||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||
Accounts receivable | $ 86,442 | |||
Inventory | 1,140,893 | |||
Equipment | 450,000 | |||
Prepaid expenses | 62,882 | |||
Non-compete | 150,000 | |||
Goodwill | 1,000,000 | |||
Less: Note payable | 150,000 | |||
Net cash paid | $ 2,740,217 | |||
Comfort Foods, Inc [Member] | ||||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||
Accounts receivable | $ 584,918 | |||
Inventory | 1,116,906 | |||
Equipment | 229,597 | |||
Prepaid expenses | 32,681 | |||
Non-compete | 170,000 | |||
Customer lists | 1,359,502 | |||
Goodwill | 26,551 | |||
Less: Note payable | 626,880 | |||
Net cash paid | $ 2,893,275 |
Business Activities
Business Activities | 9 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Activities | NOTE 1 - BUSINESS ACTIVITIES: Coffee Holding Co., Inc. (the “Company”) conducts wholesale coffee operations, including manufacturing, roasting, packaging, marketing and distributing roasted and blended coffees for private labeled accounts and its own brands, and it sells green coffee. The Company also manufactures and sells coffee roasters. The Company’s core product, coffee, can be summarized and divided into three product categories (“product lines”) as follows: Wholesale Green Coffee: Private Label Coffee: Branded Coffee: The Company’s private label and branded coffee sales are primarily to customers that are located throughout the United States with limited sales in Canada and certain countries in Asia. Such customers include supermarkets, wholesalers, and individually-owned and multi-unit retailers. The Company’s unprocessed green coffee, which includes over 90 specialty coffee offerings, is sold primarily to specialty gourmet roasters and to coffee shop operators in the United States with limited sales in Australia, Canada and China. The Company’s wholesale green, private label, and branded coffee product categories generate revenues and cost of sales individually but incur selling, general and administrative expenses in the aggregate. There are no individual product managers and discrete financial information is not available for any of the product lines. The Company’s product portfolio is used in one business and it operates and competes in one business activity and economic environment. In addition, the three product lines share customers, manufacturing resources, sales channels, and marketing support. Thus, the Company considers the three product lines to be one single reporting segment. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jul. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | NOTE 2 - BASIS OF PRESENTATION: The following (a) condensed consolidated balance sheet as of October 31, 2017, which has been derived from audited financial statements, and (b) the unaudited interim condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. It is suggested that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s latest shareholders’ annual report on Form 10-K filed with the SEC on January 29, 2018 for the fiscal year ended October 31, 2017 (“Form 10-K”). In the opinion of management, all adjustments (which include normal and recurring nature adjustments) necessary to present a fair statement of the Company’s financial position as of July 31, 2018, and results of operations for the three and nine months ended July 31, 2018 and the cash flows for the nine months ended July 31, 2018 as applicable, have been made. The results of operations for the three and nine months ended July 31, 2018 are not necessarily indicative of the operating results for the full fiscal year or any future periods. The condensed consolidated financial statements include the accounts of the Company, the Company’s subsidiaries, Organic Products Trading Company, LLC (“OPTCO”) Sonofresco, LLC (“SONO”) Comfort Foods, Inc (“CFI”) and Generations Coffee Company, LLC (“GCC”), the entity formed as a result of the Company’s joint venture with Caruso’s Coffee, Inc. The Company owns a 60% equity interest in GCC. All significant inter-company transactions and balances have been eliminated in consolidation. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements Affecting the Company | 9 Months Ended |
Jul. 31, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Issued Accounting Pronouncements Affecting the Company | NOTE 3 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS AFFECTING THE COMPANY: The FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Public business entities should apply the amendments in ASU 2016-02 for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years (i.e., January 1, 2019, for a calendar year entity). Nonpublic business entities should apply the amendments for fiscal years beginning after December 15, 2019 (i.e., January 1, 2020, for a calendar year entity), and interim periods within fiscal years beginning after December 15, 2020. Early application is permitted for all public business entities and all nonpublic business entities upon issuance. The Company is currently evaluating the impact of adopting this guidance. In May 2014 the FASB issued ASU 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers - Deferral of the Effective Date Principal versus Agent Considerations Identifying Performance Obligations and Licensing Narrow-Scope Improvements and Practical Expedients, In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” which addresses narrow issues identified as a result of the complexity associated with applying generally accepted accounting principles for certain financial instruments with characteristics of liabilities and equity. Part I of this Update addresses the complexity of accounting for certain financial instruments with down round features. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. Part II of this Update addresses the difficulty of navigating Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests. The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. The amendments in Part II of this update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. These amendments in Part I of this update are effective for annual and interim periods beginning after December 15, 2018, early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part I of this Update should be applied in either of the following ways: (1) Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective. (2) Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10. The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect. The FASB has issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, which changes how deferred taxes are classified on organizations’ balance sheets. The ASU eliminates the current requirement for organizations to present deferred tax liabilities and assets as current and noncurrent in a classified balance sheet. Instead, organizations will be required to classify all deferred tax assets and liabilities as noncurrent. The amendments apply to all organizations that present a classified balance sheet. For public companies, the amendments are effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. For private companies, not - for - profit organizations, and employee benefit plans, the amendments are effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. The Company adopted ASU 2015-17 during the quarter ended January 31, 2018, which did not have a material impact on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory,” which applies to inventory that is measured using first-in, first-out (“FIFO”) or average cost. Under the updated guidance, an entity should measure inventory that is within scope at the lower of cost and net realizable value, which is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Subsequent measurement is unchanged for inventory that is measured using last-in, last-out (“LIFO”). This ASU is effective for annual and interim periods beginning after December 15, 2016, and should be applied prospectively with early adoption permitted at the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11, which did not have a material impact on its consolidated financial statements. |
Business Acquisition
Business Acquisition | 9 Months Ended |
Jul. 31, 2018 | |
Business Combinations [Abstract] | |
Business Acquisition | NOTE 4 – BUSINESS ACQUISITION: Pursuant to the terms of an Asset Purchase Agreement dated April 24, 2018 (the “Generations Agreement”), by and among Generations Coffee Company, LLC (“GCC”), the entity formed as a result of the Company’s joint venture with Caruso’s Coffee, Inc., Steep & Brew, Inc. (“the Seller”) a Wisconsin corporation and the stockholder of the Seller. GCC purchased substantially all the assets, including equipment, inventory, customer list and relationships (the “Assets”) of the Seller. This was accounted for as a business combination. GCC purchased the Assets for a purchase price consisting of $2,740,217 in cash and a Seller held promissory note for $150,000. The Seller held promissory note calls for two principal payments of $75,000 each. The first payment of principal only is due October 24, 2018 and the final payment is due April 24, 2019. As part of the transaction, all of the employees of the Seller will be leased to GCC for a transitional period ending July 31, 2018 (or earlier date as may be agreed in writing between GCC and the Seller). In addition, on April 24, 2018, GCC entered into a three month advisory agreement (the “Advisory Agreement”), with one of the Seller’s executives (the “Executive”), on an independent contractor basis, to ensure continuity of the business and to continue to operate the business located in Wisconsin. After completion of the first three month term, the Advisory Agreement will automatically expire, subject to renewal by mutual agreement of the parties. Pursuant to the terms of the Advisory Agreement, the Executive is entitled to cash compensation of $7,000 per month, as well as reimbursement by GCC of the Executive of up to $815 per month for health insurance benefits for the Executive paid by the seller. The Company has not yet completed its full analysis of the fair value of tangible assets acquired and liabilities assumed and the allocation of any excess acquisition cost over the fair value of the net tangible net assets acquired to any separately identifiable intangible assets. Pursuant to ASC No. 805-10-25, if the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, but during the allowed measurement period (which is not to exceed one year from the acquisition date), the Company retrospectively adjusts the provisional amounts recognized at the acquisition date by means of adjusting the amount recognized for goodwill. The following table summarizes the provisional amouts of assets purchased: Assets acquired: Accounts receivable $ 86,442 Inventory 1,140,893 Equipment 450,000 Prepaid expenses 62,882 Non-compete 150,000 Goodwill 1,000,000 Assets acquired: $ 2,890,217 Purchase of assets funded by: Cash paid $ 2,740,217 Note payable to seller 150,000 $ 2,890,217 Pro Forma Results of Operations (unaudited) The following pro forma results of operations for the nine months ended July 31, 2018 and 2017 and the three months ended July 31, 2017, have been prepared as though the business acquisition had occurred as of the beginning of the earliest period presented. This pro forma financial information is not indicative of the results of operations that the Company would have attained had the acquisition occurred at the beginning of the periods presented, nor is the pro forma financial information indicative of the results of operations that may occur in the future: Nine Months Ended July 31, Three Months Ended July 31, 2018 2017 2017 Pro forma sales $ 77,962,356 $ 64,418,901 $ 21,121,957 Pro forma net income (loss) $ 839,087 $ 423,340 $ 5,581 Pro forma basic and diluted earnings per share $ .15 $ .07 $ .00 The operations have been included in the Company’s consolidated statement of operations since the date of the acquisition on April 24, 2018. The total revenue included for the nine months is $2,984,984, and the net income included for the nine months is $157,443. |
Prepaid Green Coffee
Prepaid Green Coffee | 9 Months Ended |
Jul. 31, 2018 | |
Prepaid Green Coffee | |
Prepaid Green Coffee | NOTE 5 - PREPAID GREEN COFFEE: The balance represents advance payments made by OPTCO to several coffee growing cooperatives for the purchase of green coffee. Interest is charged to the cooperatives for these advances. Interest earned was $6,868 and $29,377 for the nine months ended July 31, 2018 and 2017, respectively. The prepaid coffee balance was $0 at July 31, 2018 and $171,350 at October 31, 2017. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Jul. 31, 2018 | |
Receivables [Abstract] | |
Accounts Receivable | NOTE 6 - ACCOUNTS RECEIVABLE: Trade accounts receivable are stated at the amount the Company expects to collect. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. Management considers the following factors when determining the collectability of specific customer accounts: customer credit-worthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms. Past due balances over 60 days and other higher risk amounts are reviewed individually for collectability. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, additional allowances would be required. Based on management’s assessment, the Company provides for estimated uncollectible amounts through a charge to earnings and a credit to a valuation allowance. Balances that remain outstanding after the Company has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. The reserve for sales discounts represents the estimated discount that customers will take upon payment. The reserve for other allowances represents the estimated amount of returns, slotting fees and volume based discounts estimated to be incurred by the Company from its customers. The allowances are summarized as follows: July 31, 2018 October 31, 2017 Allowance for doubtful accounts $ 65,000 $ 65,000 Reserve for other allowances 35,000 35,000 Reserve for sales discounts 44,000 44,000 Totals $ 144,000 $ 144,000 |
Inventories
Inventories | 9 Months Ended |
Jul. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | NOTE 7 - INVENTORIES: Inventories at July 31, 2018 and October 31, 2017 consisted of the following: July 31, 2018 October 31, 2017 Packed coffee $ 3,403,238 $ 2,242,714 Green coffee 9,747,978 12,317,394 Roasters and parts 251,129 286,515 Packaging supplies 1,808,228 1,463,949 Totals $ 15,210,573 $ 16,310,572 |
Commodities Held by Broker
Commodities Held by Broker | 9 Months Ended |
Jul. 31, 2018 | |
Commodities Held By Broker | |
Commodities Held by Broker | NOTE 8 - COMMODITIES HELD BY BROKER: The Company has used, and intends to continue to use in a limited capacity, short term coffee futures and options contracts primarily for the purpose of partially hedging and minimizing the effects of changing green coffee prices and to reduce our cost of sales. The commodities held at broker represent the market value of the Company’s trading account, which consists of options and future contracts for coffee held with a brokerage firm. The Company uses options and futures contracts, which are not designated or qualifying as hedging instruments, to partially hedge the effects of fluctuations in the price of green coffee beans. Options and futures contracts are recognized at fair value in the condensed consolidated financial statements with current recognition of gains and losses on such positions. The Company’s accounting for options and futures contracts may increase earnings volatility in any particular period. The Company has open position contracts held by the broker, which are summarized as follows: July 31, 2018 October 31, 2017 Option Contracts $ 56,768 $ 166,945 Future Contracts (584,805 ) (377,807 ) Total Commodities $ (528,038 ) $ (210,862 ) The Company classifies its options and future contracts as trading securities and accordingly, unrealized holding gains and losses are included in earnings and not reflected as a net amount as a separate component of stockholders’ equity. At July 31, 2018, the Company held 131 futures contracts (generally with terms of three to four months) for the purchase of 4,912,500 pounds of green coffee at a weighted average price of $1.159 per pound. The fair market value of coffee applicable to such contracts was $1.099 per pound at that date. At July 31, 2018, the Company did not have any options. At October 31, 2017, the Company held 145 futures contracts (generally with terms of three to four months) for the purchase of 5,437,500 pounds of green coffee at a weighted average price of $1.31 per pound. The fair market value of coffee applicable to such contracts was $1.25 per pound at that date. At October 31, 2017, the Company did not have any options. The Company recorded realized and unrealized gains and losses respectively, on these contracts as follows: Three Months Ended July 31, 2018 2017 Gross realized gains $ 369,233 $ 323,196 Gross realized losses (414,476 ) (1,129,690 ) Unrealized gain (loss) (1,170,086 ) 1,379,165 Total $ (1,215,329 ) $ 572,671 Nine Months Ended July 31, 2018 2017 Gross realized gains $ 635,029 $ 1,050,844 Gross realized losses (1,373,107 ) (1,630,591 ) Unrealized gain (loss) (317,177 ) 643,834 Total $ (1,055,255 ) $ 64,087 |
Line of Credit
Line of Credit | 9 Months Ended |
Jul. 31, 2018 | |
Debt Disclosure [Abstract] | |
Line of Credit | NOTE 9 - LINE OF CREDIT: On April 25, 2017 the Company and OPTCO (together with the Company, collectively referred to herein as the “Borrowers”) entered into an Amended and Restated Loan and Security Agreement (the “A&R Loan Agreement”) and Amended and Restated Loan Facility (the “A&R Loan Facility”) with Sterling National Bank (“Sterling”), which consolidated (i) the financing agreement between the Company and Sterling, dated February 17, 2009, as modified, (the “Company Financing Agreement”) and (ii) the financing agreement between Company, as guarantor, OPTCO and Sterling, dated March 10, 2015 (the “OPTCO Financing Agreement”), amongst other things. Pursuant to the A&R Loan Agreement, the terms of each of the Company Financing Agreement and the OPTCO Financing Agreement were amended and restated to, among other things: (i) provide for a new Maturity Date of February 28, 2018; (ii) consolidate the principal amounts of the Company Financing Agreement and the OPTCO Financing Agreement to provide for a maximum principal amount limit of $12,000,000 for the Borrowers, collectively, provided that On March 23, 2018, the Company reached an agreement for a new loan modification agreement and credit facility with Sterling. The terms of the new agreement among other things: (i) provides for a new maturity date of March 31, 2020; (ii) increases the maximum principal amount to $14,000,000; and (iii) decreases the interest rate per annum to LIBOR plus 2 percent. Each of the A&R Loan Facility and A&R Loan Agreement contains covenants, subject to certain exceptions, that place annual restrictions on the Borrowers’ operations, including covenants relating to debt restrictions, capital expenditures, indebtedness, minimum deposit restrictions, tangible net worth, net profit, leverage, employee loan restrictions, dividend and repurchase restrictions (common stock and preferred stock), and restrictions on intercompany transactions. The A&R Loan Facility also requires that we maintain a minimum working capital at all times, and the A&R Loan Agreement requires that the Borrowers, on a consolidated basis, maintain a minimum working capital at all times and achieve a minimum net profit amount as of fiscal year end during the term of the A&R Loan Agreement. Each of the A&R Loan Facility and the A&R Loan Agreement is secured by all tangible and intangible assets of the Company. Other than as amended and restated by the A&R Loan Agreement, the Company Financing Agreement and the OPTCO Financing Agreement remains in full force and effect. As of July 31, 2018 and October 31, 2017, the outstanding balance under the bank line of credit was $7,148,762 and $8,407,527, respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Jul. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 10 - INCOME TAXES: The Company accounts for income taxes pursuant to the asset and liability method which requires deferred income tax assets and liabilities to be computed for temporary differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The income tax provision or benefit is the tax incurred for the period plus or minus the change during the period in deferred tax assets and liabilities. As of July 31, 2018 and October 31, 2017, the Company did not have any unrecognized tax benefits or open tax positions. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. As of July 31, 2018 and October 31, 2017, the Company had no accrued interest or penalties related to income taxes. The Company currently has no federal or state tax examinations in progress. The Company files a U.S. federal income tax return and California, Colorado, Connecticut, Idaho, Kansas, Massachusetts, Michigan, New Jersey, New York, New York City, Oregon, Rhode Island, South Carolina, Virginia, and Texas state tax returns. The Company’s federal income tax return is no longer subject to examination by the federal taxing authority for the years before fiscal 2014. The Company’s California, Colorado and New Jersey income tax returns are no longer subject to examination by their respective taxing authorities for the years before fiscal 2011. The Company’s Oregon and New York income tax returns are no longer subject to examination by their respective taxing authorities for the years before fiscal 2012. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code that will affect the Company’s fiscal year ending October 31, 2018, including, but not limited to, reducing the U.S. federal corporate tax rate. The Tax Act reduces the federal corporate tax rate to 21% in the fiscal year ending October 31, 2018. Section 15 of the Internal Revenue Code stipulates that our fiscal year ending October 31, 2018, will have a blended corporate tax rate of approximately 23%, which is based on the applicable tax rates before and after the Tax Act and the number of days in the year. The reduction of the corporate tax rate to 21% has caused the Company to reduce its deferred tax assets and liabilities. The effect of this discrete event had an immaterial effect on the condensed consolidated financial statements for the nine and three months ended July 31, 2018. The changes included in the Tax Act are broad and complex. The final impacts of the Tax Act may differ from the above estimate, possibly materially, due to, among other things, changes in interpretations of the Tax Act, any legislative action to address questions that arise because of the Tax Act, any changes in accounting standards for income taxes or related interpretations in response to the Tax Act, or any updates or changes to estimates the company has utilized to calculate the transition impact. The Securities Exchange Commission has issued rules that would allow for a measurement period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts. We currently anticipate finalizing and recording any resulting adjustments within one year after enactment date of the Tax Act. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jul. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | NOTE 11 - EARNINGS PER SHARE: The Company presents “basic” and “diluted” earnings per common share pursuant to the provisions included in the authoritative guidance issued by FASB, “Earnings per Share,” and certain other financial accounting pronouncements. Basic earnings per common share were computed by dividing net income by the sum of the weighted-average number of common shares outstanding. Diluted earnings per common share is computed by dividing the net income by the weighted-average number of common shares outstanding plus the dilutive effect of common shares issuable upon exercise of potential sources of dilution. The weighted average common shares outstanding used in the computation of basic and diluted earnings per share were 5,720,360 and 5,673,914 for the nine and three months ended July 31, 2018, respectively and 5,861,777 and 5,859,918 for the nine and three months July 31, 2017, respectively. |
Economic Dependency
Economic Dependency | 9 Months Ended |
Jul. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Economic Dependency | NOTE 12 - ECONOMIC DEPENDENCY: Approximately 27% of the Company’s sales were derived from five customers during the nine months ended July 31, 2018. Approximately 25% of the Company’s sales were derived from four customers during the nine months ended July 31, 2017. Concentration of credit risk with respect to other trade receivables is limited due to the short payment terms generally extended by the Company, by ongoing credit evaluations of customers, and by maintaining an allowance for doubtful accounts that management believes will adequately provide for credit losses. For the nine months ended July 31, 2018, approximately 26% of the Company’s purchases were from six vendors. These vendors accounted for approximately $278,000 of the Company’s accounts payable at July 31, 2018. For the nine months ended July 31, 2017, approximately 39% of the Company’s purchases were from eight vendors. These vendors accounted for approximately $354,000 of the Company’s accounts payable at July 31, 2017. Management does not believe the loss of any one vendor would have a material adverse effect of the Company’s operations due to the availability of many alternate suppliers. Approximately 20% of the Company’s sales were derived from five customers during the three months ended July 31, 2018. Approximately 24% of the Company’s sales were derived from four customers during the three months ended July 31, 2017. For the three months ended July 31, 2018, approximately 22% of the Company’s purchases were from six vendors. For the three months ended July 31, 2017, approximately 27% of the Company’s purchases were from four vendors. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Jul. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 13 - RELATED PARTY TRANSACTIONS: The Company has engaged its 40% partner in GCC as an outside contractor (the “Partner”). Included in contract labor expense are expenses incurred from the Partner during the three and nine months ended July 31, 2018 of $112,458 and $343,683, respectively, for the processing of finished goods. An employee of one of the top six vendors is a director of the Company. Purchases from that vendor totaled approximately $6,989,000 and $2,555,000 for the nine and three months ended July 31, 2018, respectively and $4,788,000 and $2,587,000 for the nine and three months ended July 31, 2017, respectively. The corresponding accounts payable balance to this vendor was approximately $221,000 and $72,000 at July 31, 2018 and 2017, respectively. In January 2005, the Company established the “Coffee Holding Co., Inc. Non-Qualified Deferred Compensation Plan.” Currently, there is only one participant in the plan: Andrew Gordon, the Company’s Chief Executive Officer. Within the plan guidelines, this employee is deferring a portion of his current salary and bonus. The assets are held in a separate trust. The deferred compensation payable represents the liability due to an officer of the Company. The assets are included in the Deposits and other assets in the accompanying balance sheets. The deferred compensation asset and liability at July 31, 2018 and October 31, 2017 were $518,303 and $488,529, respectively. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Jul. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 14 - STOCKHOLDERS’ EQUITY: Treasury stock Share Repurchase Program. The 2017 Share Repurchase Program may be discontinued or suspended at any time. Pursuant to the terms of the 2017 Share Repurchase Program, the Company purchased 185,168 and 53,983 shares for $894,368 and $239,091 during the nine months ended July 31, 2018 and for the year ended October 31, 2017, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jul. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 15 - SUBSEQUENT EVENTS: The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required further adjustment or disclosure in the condensed consolidated financial statements. |
Business Acquisition (Tables)
Business Acquisition (Tables) | 9 Months Ended |
Jul. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of Assets Purchased | The following table summarizes the provisional amouts of assets purchased: Assets acquired: Accounts receivable $ 86,442 Inventory 1,140,893 Equipment 450,000 Prepaid expenses 62,882 Non-compete 150,000 Goodwill 1,000,000 Assets acquired: $ 2,890,217 Purchase of assets funded by: Cash paid $ 2,740,217 Note payable to seller 150,000 $ 2,890,217 |
Schedule of Pro Forma Results of Operations | Nine Months Ended July 31, Three Months Ended July 31, 2018 2017 2017 Pro forma sales $ 77,962,356 $ 64,418,901 $ 21,121,957 Pro forma net income (loss) $ 839,087 $ 423,340 $ 5,581 Pro forma basic and diluted earnings per share $ .15 $ .07 $ .00 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Jul. 31, 2018 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | The allowances are summarized as follows: July 31, 2018 October 31, 2017 Allowance for doubtful accounts $ 65,000 $ 65,000 Reserve for other allowances 35,000 35,000 Reserve for sales discounts 44,000 44,000 Totals $ 144,000 $ 144,000 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Jul. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories at July 31, 2018 and October 31, 2017 consisted of the following: July 31, 2018 October 31, 2017 Packed coffee $ 3,403,238 $ 2,242,714 Green coffee 9,747,978 12,317,394 Roasters and parts 251,129 286,515 Packaging supplies 1,808,228 1,463,949 Totals $ 15,210,573 $ 16,310,572 |
Commodities Held by Broker (Tab
Commodities Held by Broker (Tables) | 9 Months Ended |
Jul. 31, 2018 | |
Commodities Held By Broker | |
Schedule of Commodities Held by Broker | The Company has open position contracts held by the broker, which are summarized as follows: July 31, 2018 October 31, 2017 Option Contracts $ 56,768 $ 166,945 Future Contracts (584,805 ) (377,807 ) Total Commodities $ (528,038 ) $ (210,862 ) |
Schedule of Realized and Unrealized Gains and Losses On Contracts | The Company recorded realized and unrealized gains and losses respectively, on these contracts as follows: Three Months Ended July 31, 2018 2017 Gross realized gains $ 369,233 $ 323,196 Gross realized losses (414,476 ) (1,129,690 ) Unrealized gain (loss) (1,170,086 ) 1,379,165 Total $ (1,215,329 ) $ 572,671 Nine Months Ended July 31, 2018 2017 Gross realized gains $ 635,029 $ 1,050,844 Gross realized losses (1,373,107 ) (1,630,591 ) Unrealized gain (loss) (317,177 ) 643,834 Total $ (1,055,255 ) $ 64,087 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) | Jul. 31, 2018 |
Generations Coffee Company, LLC [Member] | |
Equity ownership interest percentage | 60.00% |
Business Acquisition (Details N
Business Acquisition (Details Narrative) - USD ($) | Apr. 24, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 |
Purchase price of assets acquired | $ 2,740,217 | |||
Revenue | $ 21,121,957 | 77,962,356 | 64,418,901 | |
Net income | $ 5,581 | 839,087 | $ 423,340 | |
Asset Purchase Agreement [Member] | ||||
Revenue | 2,984,984 | |||
Net income | 157,443 | |||
Asset Purchase Agreement [Member] | Caruso's Coffee, Inc., Steep & Brew, Inc. [Member] | ||||
Promissory note, principal amount | $ 150,000 | |||
Asset Purchase Agreement [Member] | Caruso's Coffee, Inc., Steep & Brew, Inc. [Member] | Principal Payment One [Member] | ||||
Debt principal payments | $ 75,000 | |||
Due date of principal payments | Oct. 24, 2018 | |||
Asset Purchase Agreement [Member] | Caruso's Coffee, Inc., Steep & Brew, Inc. [Member] | Principal Payment Two [Member] | ||||
Debt principal payments | $ 75,000 | |||
Due date of principal payments | Apr. 24, 2019 | |||
Asset Purchase Agreement [Member] | Generations Coffee Company, LLC [Member] | ||||
Purchase price of assets acquired | $ 2,740,217 | |||
Advisory Agreement [Member] | ||||
Agreement Term | 3 months | |||
Advisory Agreement [Member] | Executive [Member] | ||||
Cash compensation per month | 7,000 | |||
Advisory Agreement [Member] | Executive [Member] | Maximum [Member] | ||||
Reimbursement of health insurance benefits | $ 815 |
Business Acquisition - Summary
Business Acquisition - Summary of Assets Purchased (Details) - USD ($) | 9 Months Ended | |
Jul. 31, 2018 | Oct. 31, 2017 | |
Goodwill | $ 2,794,265 | $ 1,794,265 |
Caruso's Coffee, Inc., Steep & Brew, Inc. [Member] | ||
Accounts receivable | 86,442 | |
Inventory | 1,140,893 | |
Equipment | 450,000 | |
Prepaid expenses | 62,882 | |
Non-compete | 150,000 | |
Goodwill | 1,000,000 | |
Assets acquired | 2,890,217 | |
Cash paid | 2,740,217 | |
Note payable to seller | 150,000 | |
Purchase price of assets purchased | $ 2,890,217 |
Business Acquisition - Schedule
Business Acquisition - Schedule of Pro Forma Results of Operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |
Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Business Combinations [Abstract] | |||
Pro forma sales | $ 21,121,957 | $ 77,962,356 | $ 64,418,901 |
Pro forma net income (loss) | $ 5,581 | $ 839,087 | $ 423,340 |
Pro forma basic and diluted earnings per share | $ 0 | $ .15 | $ 0.07 |
Prepaid Green Coffee (Details N
Prepaid Green Coffee (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Oct. 31, 2017 | |
Prepaid Green Coffee | |||||
Interest income | $ 3,433 | $ 5,993 | $ 11,170 | $ 29,381 | |
Prepaid green coffee | $ 171,350 |
Accounts Receivable - Schedule
Accounts Receivable - Schedule of Accounts Receivable (Details) - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
Receivables [Abstract] | ||
Allowance for doubtful accounts | $ 65,000 | $ 65,000 |
Reserve for other allowances | 35,000 | 35,000 |
Reserve for sales discounts | 44,000 | 44,000 |
Totals | $ 144,000 | $ 144,000 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
Roasters and parts | $ 251,129 | $ 286,515 |
Packaging supplies | 1,808,228 | 1,463,949 |
Totals | 15,210,573 | 16,310,572 |
Packed Coffee [Member] | ||
Inventory - Coffee | 3,403,238 | 2,242,714 |
Green Coffee [Member] | ||
Inventory - Coffee | $ 9,747,978 | $ 12,317,394 |
Commodities Held by Broker (Det
Commodities Held by Broker (Details Narrative) | 9 Months Ended | 12 Months Ended |
Jul. 31, 2018Integerlb$ / shares | Oct. 31, 2017Integerlb$ / shares | |
Number of futures contracts | Integer | 131 | 145 |
Purchase of futures contracts | lb | 4,912,500 | 5,437,500 |
Futures contracts weighted average price per pound | $ / shares | $ 1.159 | $ 1.31 |
Fair market value of futures contract per pound | $ / shares | $ 1.099 | $ 1.25 |
Options [Member] | ||
Number of futures contracts | Integer | 0 | 0 |
Minimum [Member] | ||
Futures contracts term | 3 months | 3 months |
Maximum [Member] | ||
Futures contracts term | 4 months | 4 months |
Commodities Held by Broker - Sc
Commodities Held by Broker - Schedule of Commodities Held by Broker (Details) - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
Commodities Held By Broker | ||
Option Contracts | $ 56,768 | $ 166,945 |
Future Contracts | (584,805) | (377,807) |
Total Commodities | $ (528,038) | $ (210,862) |
Commodities Held by Broker - 35
Commodities Held by Broker - Schedule of Realized and Unrealized Gains and Losses On Contracts (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Commodities Held By Broker | ||||
Gross realized gains | $ 369,233 | $ 323,196 | $ 635,029 | $ 1,050,844 |
Gross realized losses | (414,476) | (1,129,690) | (1,373,107) | (1,630,591) |
Unrealized gain (loss) | (1,170,086) | 1,379,165 | (317,177) | 643,834 |
Total | $ (1,215,329) | $ 572,671 | $ (1,055,255) | $ 64,087 |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) | Mar. 23, 2018 | Apr. 25, 2017 | Jul. 31, 2018 | Oct. 31, 2017 |
Bank Line of Credit [Member] | ||||
Line of credit, maximum principal amount | $ 7,148,762 | $ 8,407,527 | ||
Amended and Restated Loan and Security Agreement [Member] | ||||
Line of credit, maximum principal amount | $ 12,000,000 | |||
Amended and Restated Loan and Security Agreement [Member] | Borrowers [Member] | ||||
Line of credit expire date | Feb. 28, 2018 | |||
Line of credit, maximum principal amount | $ 3,000,000 | |||
Line of credit interest rate | 85.00% | |||
Amended and Restated Loan and Security Agreement [Member] | Borrowers [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Line of credit interest rate | 2.40% | |||
Prepayment premium percentage | 1.00% | |||
Maximum obligation amount | $ 1,000,000 | |||
Amended and Restated Loan and Security Agreement [Member] | Borrowers [Member] | Accounts Receivable [Member] | ||||
Line of credit maximum borrowing capacity | 2,000,000 | |||
Amended and Restated Loan and Security Agreement [Member] | Borrowers [Member] | Accounts Receivable [Member] | OPTCO [Member] | ||||
Line of credit maximum borrowing capacity | $ 1,500,000 | |||
Organic Products Trading Company [Member] | ||||
Prepayment premium percentage | 0.50% | |||
New Loan Modification Agreement and Credit Facility [Member] | ||||
Line of credit expire date | Mar. 31, 2020 | |||
Line of credit, maximum principal amount | $ 14,000,000 | |||
New Loan Modification Agreement and Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Line of credit interest rate | 2.00% |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | Dec. 22, 2017 | Jul. 31, 2018 | Oct. 31, 2017 |
Unrecognized tax benefits | |||
Accrued interest or penalties | |||
Unites States [Member] | October 31, 2018 [Member] | |||
Income tax reconciliation description | The U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act makes broad and complex changes to the U.S. tax code that will affect the Company's fiscal year ending October 31, 2018, including, but not limited to, reducing the U.S. federal corporate tax rate. The Tax Act reduces the federal corporate tax rate to 21% in the fiscal year ending October 31, 2018. Section 15 of the Internal Revenue Code stipulates that our fiscal year ending October 31, 2018, will have a blended corporate tax rate of approximately 23%, which is based on the applicable tax rates before and after the Tax Act and the number of days in the year. The reduction of the corporate tax rate to 21% has caused the Company to reduce its deferred tax assets and liabilities. The effect of this discrete event had an immaterial effect on the condensed consolidated financial statements for the nine and three months ended July 31, 2018. | ||
Federal statutory income tax rate, percent | 21.00% | ||
Blended corporate tax rate | 23.00% |
Earnings Per Share (Details Nar
Earnings Per Share (Details Narrative) - shares | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Earnings Per Share [Abstract] | ||||
Weighted average common shares outstanding, basic and diluted | 5,673,914 | 5,859,918 | 5,720,360 | 5,861,777 |
Economic Dependency (Details Na
Economic Dependency (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Five Customers [Member] | Sales Revenue [Member] | ||||
Concentration risk percentage | 20.00% | 27.00% | ||
Four Customers [Member] | Sales Revenue [Member] | ||||
Concentration risk percentage | 24.00% | 25.00% | ||
Six Vendors [Member] | ||||
Concentration risk percentage | 22.00% | 26.00% | ||
Accounts payable | $ 278,000 | $ 278,000 | ||
Eight Vendors [Member] | ||||
Concentration risk percentage | 39.00% | |||
Accounts payable | $ 354,000 | $ 354,000 | ||
Four Vendors [Member] | ||||
Concentration risk percentage | 27.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Oct. 31, 2017 | |
Contract labor expense | $ 112,458 | $ 343,683 | |||
Purchases from related party vendor | 2,555,000 | $ 2,587,000 | 6,989,000 | $ 4,788,000 | |
Accounts payable from related party vendor | 221,000 | $ 72,000 | 221,000 | $ 72,000 | |
Deferred compensation liability | $ 518,303 | $ 518,303 | $ 488,529 | ||
Generations Coffee Company, LLC [Member] | |||||
Related party transaction percentage | 40.00% |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |||
Jul. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Sep. 10, 2017 | Sep. 29, 2015 | |
Number of treasury stock shares | 185,168 | 57,367 | |||
Number of treasury stock shares, value | $ 894,368 | $ 247,382 | |||
2015 Share Repurchase Program [Member] | |||||
Number of common stock repurchase value | $ 2,000,000 | ||||
2015 Share Repurchase Program [Member] | |||||
Number of treasury stock shares | 3,384 | 337,269 | |||
Number of treasury stock shares, value | $ 15,829 | $ 1,754,878 | |||
2017 Share Repurchase Program [Member] | |||||
Number of treasury stock shares | 185,168 | 53,983 | |||
Number of treasury stock shares, value | $ 894,368 | $ 239,091 | |||
Number of common stock repurchase value | $ 2,000,000 |