Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2022 | Oct. 28, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Document Transition Report | false | |
Entity File Number | 000-23329 | |
Entity Registrant Name | Charles & Colvard, Ltd. | |
Entity Central Index Key | 0001015155 | |
Entity Incorporation, State or Country Code | NC | |
Entity Tax Identification Number | 56-1928817 | |
Entity Address, Address Line One | 170 Southport Drive | |
Entity Address, City or Town | Morrisville | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 27560 | |
City Area Code | 919 | |
Local Phone Number | 468-0399 | |
Title of 12(b) Security | Common Stock, no par value per share | |
Trading Symbol | CTHR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 30,344,955 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 11,568,995 | $ 15,668,361 |
Restricted cash | 5,054,778 | 5,510,979 |
Accounts receivable, net | 1,558,401 | 2,220,816 |
Inventory, net | 12,092,385 | 11,024,276 |
Note receivable | 0 | 250,000 |
Prepaid expenses and other assets | 1,375,093 | 1,190,012 |
Total current assets | 31,649,652 | 35,864,444 |
Long-term assets: | ||
Inventory, net | 24,476,083 | 22,488,524 |
Property and equipment, net | 2,196,099 | 1,901,176 |
Intangible assets, net | 265,710 | 265,730 |
Operating lease right-of-use assets | 2,638,400 | 2,787,419 |
Deferred income taxes, net | 6,154,860 | 5,851,904 |
Note receivable | 250,000 | 0 |
Other assets | 50,212 | 49,658 |
Total long-term assets | 36,031,364 | 33,344,411 |
TOTAL ASSETS | 67,681,016 | 69,208,855 |
Current liabilities: | ||
Accounts payable | 4,718,048 | 4,401,229 |
Operating lease liabilities, current portion | 862,401 | 856,571 |
Accrued expenses and other liabilities | 1,135,536 | 1,546,483 |
Total current liabilities | 6,715,985 | 6,804,283 |
Long-term liabilities: | ||
Noncurrent operating lease liabilities | 2,653,039 | 2,846,805 |
Total long-term liabilities | 2,653,039 | 2,846,805 |
Total liabilities | 9,369,024 | 9,651,088 |
Commitments and contingencies (Note 9) | ||
Shareholders' equity: | ||
Common stock, no par value; 50,000,000 shares authorized; 30,733,358 shares issued and 30,344,955 shares outstanding at September 30, 2022 and 30,778,046 shares issued and 30,747,759 shares outstanding at June 30, 2022 | 57,242,211 | 57,242,211 |
Additional paid-in capital | 26,052,723 | 25,956,491 |
Treasury stock, at cost, 388,403 shares and 30,287 shares at September 30, 2022 and June 30, 2022, respectively | (489,979) | (38,164) |
Accumulated deficit | (24,492,963) | (23,602,771) |
Total shareholders' equity | 58,311,992 | 59,557,767 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 67,681,016 | $ 69,208,855 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2022 | Jun. 30, 2022 |
Shareholders' equity | ||
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 30,733,358 | 30,778,046 |
Common stock, shares outstanding (in shares) | 30,344,955 | 30,747,759 |
Treasury stock (in shares) | 388,403 | 30,287 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||
Net sales | $ 7,374,083 | $ 10,280,311 |
Costs and expenses: | ||
Cost of goods sold | 4,086,010 | 5,016,550 |
Sales and marketing | 3,107,946 | 2,730,153 |
General and administrative | 1,413,476 | 1,584,275 |
Total costs and expenses | 8,607,432 | 9,330,978 |
(Loss) Income from operations | (1,233,349) | 949,333 |
Other income (expense): | ||
Interest income | 40,201 | 355 |
Loss on foreign currency exchange | 0 | (34) |
Total other income (expense), net | 40,201 | 321 |
(Loss) Income before income taxes | (1,193,148) | 949,654 |
Income tax benefit (expense) | 302,956 | (122,629) |
Net (loss) income | $ (890,192) | $ 827,025 |
Net (loss) income per common share: | ||
Basic (in dollars per share) | $ (0.03) | $ 0.03 |
Diluted (in dollars per share) | $ (0.03) | $ 0.03 |
Weighted average number of shares used in computing net (loss) income per common share: | ||
Basic (in shares) | 30,433,195 | 29,971,178 |
Diluted (in shares) | 30,433,195 | 31,097,540 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total |
Balance at Jun. 30, 2021 | $ 56,057,109 | $ 25,608,593 | $ 0 | $ (25,976,686) | $ 55,689,016 |
Balance (in shares) at Jun. 30, 2021 | 29,913,095 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 0 | 279,407 | 0 | 0 | $ 279,407 |
Repurchases of common stock (in shares) | 0 | ||||
Issuance of restricted stock | $ 0 | 0 | 0 | 0 | $ 0 |
Issuance of restricted stock (in shares) | 242,725 | ||||
Stock option exercises | $ 397,112 | (139,742) | 0 | 0 | 257,370 |
Stock option exercises (in shares) | 183,637 | ||||
Net (loss) income | $ 0 | 0 | 0 | 827,025 | 827,025 |
Balance at Sep. 30, 2021 | 56,454,221 | 25,748,258 | 0 | (25,149,661) | $ 57,052,818 |
Balance (in shares) at Sep. 30, 2021 | 30,339,457 | ||||
Balance at Jun. 30, 2022 | 57,242,211 | 25,956,491 | (38,164) | (23,602,771) | $ 59,557,767 |
Balance (in shares) at Jun. 30, 2022 | 30,747,759 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 0 | 96,232 | 0 | 0 | $ 96,232 |
Cancellation of restricted stock | $ 0 | 0 | 0 | 0 | 0 |
Cancellation of restricted stock (in shares) | (44,688) | ||||
Repurchases of common stock | $ 0 | 0 | $ (451,815) | 0 | $ (451,815) |
Repurchases of common stock (in shares) | (358,116) | (358,116) | |||
Net (loss) income | 0 | 0 | $ 0 | (890,192) | $ (890,192) |
Balance at Sep. 30, 2022 | $ 57,242,211 | $ 26,052,723 | $ (489,979) | $ (24,492,963) | $ 58,311,992 |
Balance (in shares) at Sep. 30, 2022 | 30,344,955 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net (loss) income | $ (890,192) | $ 827,025 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||
Depreciation and amortization | 137,711 | 124,212 |
Stock-based compensation | 96,232 | 279,407 |
Provision for uncollectible accounts | 0 | 32,000 |
(Recovery of) Provision for sales returns | (36,000) | 27,000 |
Inventory write-downs | 119,000 | 232,000 |
Provision for accounts receivable discounts | 3,250 | 16,419 |
Deferred income taxes | (302,956) | 122,158 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 695,165 | (1,085,046) |
Inventory | (3,174,668) | (2,673,706) |
Prepaid expenses and other assets, net | (36,616) | (302,985) |
Accounts payable | 316,819 | 978,534 |
Accrued income taxes | 0 | 471 |
Accrued expenses and other liabilities | (598,883) | (717,057) |
Net cash used in operating activities | (3,671,138) | (2,139,568) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (430,400) | (398,121) |
Payments for intangible assets | (2,214) | 0 |
Net cash used in investing activities | (432,614) | (398,121) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Stock option exercises | 0 | 257,370 |
Repurchases of common stock | (451,815) | 0 |
Net cash (used in) provided by financing activities | (451,815) | 257,370 |
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | (4,555,567) | (2,280,319) |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | 21,179,340 | 21,446,951 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | 16,623,773 | 19,166,632 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the period for income taxes | $ 5,900 | $ 0 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 3 Months Ended |
Sep. 30, 2022 | |
DESCRIPTION OF BUSINESS [Abstract] | |
DESCRIPTION OF BUSINESS | 1. DESCRIPTION OF BUSINESS Charles & Colvard, Ltd. (the “Company”), a North Carolina corporation, was founded in 1995. The Company manufactures, markets, and distributes Charles & Colvard Created Moissanite ® Forever One™ Caydia ® The Company sells loose moissanite jewels, loose lab grown diamonds, and finished jewelry featuring both moissanite and lab grown diamonds at wholesale prices to distributors, manufacturers, retailers, and designers, including some of the largest distributors and jewelry manufacturers in the world. The Company’s finished jewelry and loose moissanite jewels and lab grown diamonds that are mounted into fine jewelry by other manufacturers are sold at retail outlets and via the Internet. The Company sells at retail prices to end-consumers through its wholly owned operating subsidiary, charlesandcolvard.com, LLC, third-party online marketplaces, drop-ship, and other pure-play, exclusively e-commerce outlets. The Company also sells at discount retail prices to end-consumers through moissaniteoutlet.com, LLC, a wholly owned operating subsidiary of charlesandcolvard.com, LLC, and third-party online marketplaces. |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the three months ended September 30, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2023. The condensed consolidated financial statements as of September 30, 2022 and for the three months ended September 30, 2022 and 2021 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of June 30, 2022 is derived from the audited financial statements as of that date. The accompanying statements should be read in conjunction with the audited financial statements and related notes contained in Item 8 of the Company’s Annual Report on Form 10-K (the “2022 Annual Report”) for the fiscal year ended June 30, 2022 filed with the SEC on September 2, 2022. The accompanying condensed consolidated financial statements as of and for the three months ended September 30, 2022 and 2021, and as of the fiscal year ended June 30, 2022, include the accounts of the Company and its wholly owned subsidiaries charlesandcolvard.com, LLC, including its wholly-owned subsidiary, moissaniteoulet.com, LLC, which was formed and incorporated as of February 24, 2022; Charles & Colvard Direct, LLC; and Charles & Colvard (HK) Ltd., the Company’s Hong Kong subsidiary, which was entered into dormancy as of September 30, 2020 following its re-activation in December 2017. Charles & Colvard (HK) Ltd. previously became dormant in the second quarter of 2009 and has had no operating activity since 2008. Charles & Colvard Direct, LLC, had no operating activity during the three-month periods September 30, 2022 or 2021. All intercompany accounts have been eliminated. Significant Accounting Policies – Use of Estimates Cash and Cash Equivalents – Restricted Cash – Pursuant to the terms and conditions of the Company’s broker-dealer agreement with Oppenheimer & Co., Inc. (“Oppenheimer”), with whom the Company has engaged to transact common stock share repurchases in connection with its stock repurchase program, the Company is required to maintain a funded liquid margin account held by Oppenheimer for the benefit of the Company. The purpose of this account is to fund the Company’s common stock purchases and any underlying transaction costs and fees. Depending upon the level and timing of stock repurchase activity, the funded margin account cash balance will fluctuate from time to time. At September 30, 2022 and June 30, 2022, cash in the amount of approximately $30 and approximately $461,000, respectively, was held by Oppenheimer. Such cash amount held by Oppenheimer was classified as restricted cash for financial reporting purposes on the Company’s condensed consolidated balance sheets. For additional information regarding the Company’s stock repurchase program, see Note 11, “Shareholders’ Equity and Stock-Based Compensation.” The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: September 30, 2022 June 30, 2022 Cash and cash equivalents $ 11,568,995 $ 15,668,361 Restricted cash 5,054,778 5,510,979 Total cash, cash equivalents, and restricted cash $ 16,623,773 $ 21,179,340 Recently Adopted/Issued Accounting Pronouncements – Financial Accounting Standards Board (“ ”) Accounting Standards Update (“ ”) Reference Rate Reform (Topic 848) |
SEGMENT INFORMATION AND GEOGRAP
SEGMENT INFORMATION AND GEOGRAPHIC DATA | 3 Months Ended |
Sep. 30, 2022 | |
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract] | |
SEGMENT INFORMATION AND GEOGRAPHIC DATA | 3. SEGMENT INFORMATION AND GEOGRAPHIC DATA The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making operating decisions and assessing performance as the source of the Company’s operating and reportable segments. The Company manages its business through two operating and reportable segments based on its distribution channels to sell its product lines, loose jewels and finished jewelry: its “Online Channels” segment, which consists of e-commerce outlets including charlesandcolvard.com, moissaniteoutlet.com, third-party online marketplaces, drop-ship retail, and other pure-play, exclusively e-commerce outlets; and its “Traditional” segment, which consists of wholesale and retail customers. The accounting policies of the Online Channels segment and Traditional segment are the same as those described in Note 2, “Basis of Presentation and Significant Accounting Policies” of this Quarterly Report on Form 10-Q and in the Notes to the Consolidated Financial Statements in the 2022 Annual Report. The Company evaluates the financial performance of its segments based on net sales; product line gross profit, or the excess of product line sales over product line cost of goods sold; and operating income. The Company’s product line cost of goods sold is defined as product cost of goods sold, excluding non-capitalized expenses from the Company’s manufacturing and production control departments, comprising personnel costs, depreciation, leases, utilities, and corporate overhead allocations; freight out; inventory write-downs; and other inventory adjustments, comprising costs of quality issues, and damaged goods. The Company allocates certain general and administrative expenses between its Online Channels segment and its Traditional segment based on net sales and number of employees to arrive at segment operating income. Unallocated expenses remain in its Traditional segment. Summary financial information by reportable segment is as follows: Three Months Ended September 30, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 4,403,589 $ 1,136,817 $ 5,540,406 Loose jewels 448,897 1,384,780 1,833,677 Total $ 4,852,486 $ 2,521,597 $ 7,374,083 Product line cost of goods sold Finished jewelry $ 1,970,111 $ 636,588 $ 2,606,699 Loose jewels 162,699 662,924 825,623 Total $ 2,132,810 $ 1,299,512 $ 3,432,322 Product line gross profit Finished jewelry $ 2,433,478 $ 500,229 $ 2,933,707 Loose jewels 286,198 721,856 1,008,054 Total $ 2,719,676 $ 1,222,085 $ 3,941,761 Operating loss $ (609,545 ) $ (623,804 ) $ (1,233,349 ) Depreciation and amortization $ 63,387 $ 74,324 $ 137,711 Capital expenditures $ 136,988 $ 293,412 $ 430,400 Three Months Ended September 30, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 4,486,958 $ 1,199,329 $ 5,686,287 Loose jewels 882,847 3,711,177 4,594,024 Total $ 5,369,805 $ 4,910,506 $ 10,280,311 Product line cost of goods sold Finished jewelry $ 1,711,224 $ 623,258 $ 2,334,482 Loose jewels 314,105 1,745,341 2,059,446 Total $ 2,025,329 $ 2,368,599 $ 4,393,928 Product line gross profit Finished jewelry $ 2,775,734 $ 576,071 $ 3,351,805 Loose jewels 568,742 1,965,836 2,534,578 Total $ 3,344,476 $ 2,541,907 $ 5,886,383 Operating income $ 321,671 $ 627,662 $ 949,333 Depreciation and amortization $ 67,702 $ 56,510 $ 124,212 Capital expenditures $ 59,260 $ 338,861 $ 398,121 The Company does not allocate any assets to the reportable segments, and, therefore, no asset information is reported to the chief operating decision maker or disclosed in the financial information for each segment. A reconciliation of the Company’s product line cost of goods sold to cost of goods sold as reported in the condensed consolidated financial statements is as follows: Three Months Ended September 30, 2022 2021 Product line cost of goods sold $ 3,432,322 $ 4,393,928 Non-capitalized manufacturing and production control expenses 377,053 342,401 Freight out 275,737 217,506 Inventory write-downs 119,000 232,000 Other inventory adjustments (118,102 ) (169,285 ) Cost of goods sold $ 4,086,010 $ 5,016,550 The Company recognizes sales by geographic area based on the country in which the customer is based. Sales to international end consumers made through the Company’s transactional websites, charlesandcolvard.com and moissaniteoutlet.com, are included in international sales for financial reporting purposes. A portion of the Company’s Traditional segment sales made to international wholesale distributors represents products sold internationally that may be re-imported to U.S. retailers. The following presents net sales data by geographic area: Three Months Ended September 30, 2022 2021 Net sales: United States $ 7,095,373 $ 9,824,730 International 278,710 455,581 Total $ 7,374,083 $ 10,280,311 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
FAIR VALUE MEASUREMENTS | 4. FAIR VALUE MEASUREMENTS Under U.S. GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are obtained from independent sources and can be validated by a third party, whereas unobservable inputs reflect assumptions regarding what a third party would use in pricing an asset or liability. The fair value hierarchy consists of three levels based on the reliability of inputs, as follows: Level 1. Level 2. Level 3. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made by management of the Company. The financial instruments identified as subject to fair value measurements on a recurring basis are cash and cash equivalents, notes receivable, trade accounts receivable, and trade accounts payable. All financial instruments are reflected in the condensed consolidated balance sheets at carrying value, which approximates fair value due to the nature of these financial instruments. Assets that are measured at fair value on a non-recurring basis include property and equipment, leasehold improvements, and intangible assets comprising patents, license rights, and trademarks. These items are recognized at fair value when they are considered to be impaired. For the three months ended September 30, 2022 and 2021, no impairment was recorded. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Sep. 30, 2022 | |
INVENTORIES [Abstract] | |
INVENTORIES | 5. INVENTORIES The Company’s total inventories, net of reserves, consisted of the following as of the dates presented: September 30, 2022 June 30, 2022 Finished jewelry: Raw materials $ 1,380,713 $ 1,697,361 Work-in-process 1,622,170 1,260,728 Finished goods 14,421,069 12,100,910 Finished goods on consignment 2,440,245 2,135,856 Total finished jewelry $ 19,864,197 $ 17,194,855 Loose jewels: Raw materials $ 1,987,296 $ 1,985,355 Work-in-process 9,070,743 8,485,713 Finished goods 5,297,794 5,454,266 Finished goods on consignment 265,338 303,491 Total loose jewels 16,621,171 16,228,825 Total supplies inventory 83,100 89,120 Total inventory $ 36,568,468 $ 33,512,800 As of the dates presented, the Company’s total inventories, net of reserves, are classified as follows: September 30, 2022 June 30, 2022 Short-term portion $ 12,092,385 $ 11,024,276 Long-term portion 24,476,083 22,488,524 Total $ 36,568,468 $ 33,512,800 The Company’s work-in-process inventories include raw SiC crystals on which processing costs, such as labor and sawing, have been incurred; and components, such as metal castings and finished goods set with moissanite jewels, that have been issued to jobs in the manufacture of finished jewelry. The Company’s moissanite jewel manufacturing process involves the production of intermediary shapes, called “preforms,” that vary depending upon the expected size and shape of the finished jewel. To maximize manufacturing efficiencies, preforms may be made in advance of current finished inventory needs but remain in work-in-process inventories. As of September 30, 2022 and June 30, 2022, work-in-process inventories issued to active production jobs approximated $2.87 million and $2.76 million, respectively. The Company’s moissanite and lab grown diamond jewels do not degrade in quality over time and inventory generally consists of the shapes and sizes most commonly used in the jewelry industry. In addition, approximately one-half The Company manufactures finished jewelry featuring moissanite and lab grown diamonds. Relative to loose moissanite jewels and lab grown diamonds, finished jewelry is more fashion-oriented and subject to styling trends that could render certain designs obsolete over time. The majority of the Company’s finished jewelry featuring moissanite and lab grown diamonds is held in inventory for resale and largely consists of such core designs as stud earrings, solitaire and three-stone rings, pendants, and bracelets that tend not to be subject to significant obsolescence risk due to their classic styling. In addition, the Company generally holds smaller quantities of designer-inspired and trend moissanite fashion jewelry that is available for resale through retail companies and through its Online Channels segment. The Company also carries a limited amount of inventory as part of its sample line that the Company uses in the selling process to its customers. The Company’s continuing operating subsidiaries carry no net inventories, and inventory is transferred without intercompany markup from the parent entity as product line cost of goods sold when sold to the end consumer. The Company’s inventories are stated at the lower of cost or net realizable value on an average cost basis. Each accounting period the Company evaluates the valuation and classification of inventories including the need for potential adjustments to inventory-related reserves, which include significant estimates by management, including the effect of market factors and sales trends. . |
NOTE RECEIVABLE
NOTE RECEIVABLE | 3 Months Ended |
Sep. 30, 2022 | |
NOTE RECEIVABLE [Abstract] | |
NOTE RECEIVABLE | 6. NOTE RECEIVABLE On March 5, 2021, the Company entered into a $250,000 Interest is accrued at a simple rate of 0.14% per annum and will continue to accrue until the Convertible Promissory Note is converted in accordance with the conversion privileges contained within the Convertible Promissory Note or is repaid. Subject to the borrower’s completion of a specified equity financing transaction (an “Equity Financing”) on or prior to the Maturity Date, the unpaid principal amount, including accrued and unpaid interest, automatically converts into equity units of the most senior class of equity securities issued to investors in the Equity Financing at the lesser of 80% of the per unit price of the units purchased by investors or the price equal to $33,500,000 divided by the aggregate number of outstanding units of the borrower immediately prior to the closing of the financing. Unless converted as provided in the Convertible Promissory Note, the principal amount, including accrued and unpaid interest, will, on the Maturity Date, at the Company’s option either ( i ii |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 3 Months Ended |
Sep. 30, 2022 | |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | |
ACCRUED EXPENSES AND OTHER LIABILITIES | 7. ACCRUED EXPENSES AND OTHER LIABILITIES Accrued expenses and other liabilities, current, consist of the following as of the dates presented: September 30, 2022 June 30, 2022 Deferred revenue $ 504,919 $ 452,866 Accrued compensation and related benefits 325,121 614,443 Accrued sales taxes 142,216 295,743 Accrued cooperative advertising 139,694 137,467 Accrued franchise taxes 23,585 45,963 Other accrued expenses 1 1 Total accrued expenses and other liabilities $ 1,135,536 $ 1,546,483 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Sep. 30, 2022 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | 8. INCOME TAXES For the three months ended September 30, 2022, the Company’s statutory tax rate was 22.98% and consisted of the federal income tax rate of 21.00% and a blended state income tax rate of 1.98%, net of the federal benefit. For the three months ended September 30, 2021, the Company’s statutory tax rate was 22.24% and consisted of the federal income tax rate of 21.00% and a blended state income tax rate of 1.24%, net of the federal benefit. For the three months ended September 30, 2022, the Company’s effective tax rate was 25.39%. The Company’s effective income tax rate reflects the effect of federal and state income taxes on earnings and the impact of differences in book and tax accounting arising primarily from the permanent tax benefits associated with stock-based compensation transactions during the accounting period then ended. The Company recognized a net income tax benefit of approximately $303,000 for the quarter ended September 30, 2022, compared with a net income tax expense of approximately $123,000 for the quarter ended September 30, 2021. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact its view with regard to future realization of deferred tax assets. As of September 30 , 2022 September 30 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9. COMMITMENTS AND CONTINGENCIES Lease Arrangements On December 9, 2013, the Company entered into a Lease Agreement, as amended on December 23, 2013, April 15, 2014, and January 29, 2021 (the “Lease Agreement”), for its corporate headquarters, which occupies approximately 36,350 square feet of office, storage and light manufacturing space and is classified as an operating lease for financial reporting purposes. The expiration date of the base term of the Lease Agreement in effect as of September 30, 2022 is October 31, 2026 and the terms of the Lease Agreement contain no early termination provisions. Provided there is no outstanding uncured event of default under the Lease Agreement, the Company has an option to extend the lease term for a period of five years. The Company’s option to extend the term of the Lease Agreement must be exercised in writing on or before 270 days prior to expiration of the then-current term. If the option is exercised, the monthly minimum rent for each of the extended terms will be adjusted to the then prevailing fair market rate. The Company took possession of the leased property on May 23, 2014, once certain improvements to the leased space were completed and did not have access to the property before this date. Upon execution of the third amendment to the Lease Agreement (the “Lease Amendment”) on January 29, 2021, the Lease Amendment included a rent abatement in the amount of approximately $214,000, which is reflected in the rent payments used in the calculation of the right-of-use (“ROU”) asset and lease liability once remeasured upon the execution of the Lease Amendment to extend the lease term. The Lease Amendment also included an allowance for leasehold improvements offered by the landlord in an amount not to exceed approximately $545,000. As of the quarter ended September 30, 2022, the Company has been reimbursed approximately $506,000 by the landlord for qualified leasehold improvements in accordance with the terms of the Lease Amendment. This reimbursement by the landlord reduced the remaining ROU asset by the same amount and is being recognized prospectively over the remaining term of the lease. The Company has no other material operating leases and is not party to leases that would qualify for classification as a finance lease, variable lease, or short-term lease. As of September 30, 2022, the Company’s balance sheet classifications of its leases are as follows: Operating Leases: Noncurrent operating lease ROU assets $ 2,638,400 Current operating lease liabilities $ 862,401 Noncurrent operating lease liabilities 2,653,039 Total operating lease liabilities $ 3,515,440 The Company’s total operating lease cost for the three months ended September 30, 2022 and 2021 was approximately $175,000 and $202,000, respectively. As of September 30, 2022, the Company’s estimated incremental borrowing rate used and assumed discount rate with respect to operating leases was 2.81% and the remaining operating lease term was 4.08 years. As of September 30, 2022, the Company’s remaining future payments under operating leases for each fiscal year ending June 30 are as follows: 2023 $ 656,221 2024 893,660 2025 918,236 2026 943,487 2027 317,327 Total lease payments 3,728,931 Less: imputed interest 213,491 Present value of lease payments 3,515,440 Less: current lease obligations 862,401 Total long-term lease obligations $ 2,653,039 The Company makes cash payments for amounts included in the measurement of its lease liabilities. During the three months ended September 30, 2022 and 2021, cash paid for operating leases was approximately $231,414 and $162,000 respectively. Purchase Commitments On December 12, 2014, the Company entered into an exclusive supply agreement (the “Supply Agreement”) with Wolfspeed, Inc. (“Wolfspeed”), formerly known as Cree, Inc. Under the Supply Agreement, subject to certain terms and conditions, the Company agreed to exclusively purchase from Wolfspeed, and Wolfspeed agreed to exclusively supply, 100% of the Company’s required SiC materials in quarterly installments that must equal or exceed a set minimum order quantity. The initial term of the Supply Agreement was scheduled to expire on June 24, 2018, unless extended by the parties. Effective June 22, 2018, the Supply Agreement was amended to extend the expiration date to June 25, 2023. The Supply Agreement was also amended to (i) provide the Company with one option, subject to certain conditions, to unilaterally extend the term of the Supply Agreement for an additional two-year period following expiration of the initial term; (ii) establish a process by which Wolfspeed may begin producing alternate SiC material based on the Company’s specifications that will give the Company the flexibility to use the materials in a broader variety of its products; and (iii) permit the Company to purchase certain amounts of SiC materials from third parties under limited conditions. Effective June 30, 2020, the Supply Agreement was further amended to extend the expiration date to June 29, 2025, which may be extended again by mutual agreement of the parties. The Supply Agreement was also amended to, among other things, (i) spread the Company’s total purchase commitment under the Supply Agreement in the amount of approximately $52.95 million over the term of the Supply Agreement, as amended; (ii) establish a process by which Wolfspeed has agreed to accept purchase orders in excess of the agreed-upon minimum purchase commitment, subject to certain conditions; and (iii) permit the Company to purchase revised amounts of SiC materials from third parties under limited conditions. The Company’s total purchase commitment under the Supply Agreement, as amended, until June 2025 is approximately $52.95 million, of which approximately $24.75 million remains to be purchased as of September 30, 2022. Over the life of the Supply Agreement, as amended, the Company’s future minimum annual purchase commitments of SiC crystals range from approximately $4.00 million to $10.00 million each year. During the three months ended September 30, 2022 and 2021, the Company purchased approximately $1.80 million and $1.50 million, respectively, of SiC crystals from Wolfspeed pursuant to the terms of the Supply Agreement, as amended. COVID-19 Update The COVID-19 pandemic continues to present business challenges and the Company expects these to continue throughout the fiscal year ending June 30, 2023 (“Fiscal 2023”). The Company’s management has reintroduced employees to the workplace, including in some cases permitting a hybrid blend of remote and onsite work for certain sectors of the workforce, as vaccine and related booster shot rates have increased and COVID-19 infection levels have decreased. The Company continues working with its customers and suppliers to minimize disruptions, including at times accelerating payments to key suppliers that are due by their terms in future periods. The Company expects to continue accelerating payments to its suppliers in some cases into Fiscal 2023. T |
DEBT
DEBT | 3 Months Ended |
Sep. 30, 2022 | |
DEBT [Abstract] | |
DEBT | 10. DEBT Line of Credit Effective July 7, 2021, the Company obtained from JPMorgan Chase a $5.00 million cash collateralized line of credit facility (the “JPMorgan Chase Credit Facility”). The JPMorgan Chase Credit Facility may be used for general corporate and working capital purposes, including permitted acquisitions and certain additional indebtedness for borrowed money, installment obligations, and obligations under capital and operating leases. The JPMorgan Chase Credit Facility is secured by a cash deposit in the amount of $5.05 million held by JPMorgan Chase as collateral for the line of credit facility and was scheduled to mature on July 31, 2022. Effective July 28, 2022, the JPMorgan Chase Credit Facility was amended to, among other things, extend the maturity date to July 31, 2023, and append the Company’s obligations under the JPMorgan Chase Credit Facility to be guaranteed by the Company’s wholly owned subsidiaries, Charles & Colvard Direct, LLC, charlesandcolvard.com, LLC, and moissaniteoutlet.com, LLC . Each advance under the JPMorgan Chase Credit Facility, as amended, accrues interest at a rate equal to the sum of JPMorgan Chase’s monthly secured overnight financing rate (“SOFR rate”) to which JPMorgan Chase is subject with respect to the adjusted SOFR rate as established by the U.S. Federal Reserve Board, plus a margin of 1.25% per annum and an unsecured to secured interest rate adjustment of 0.10% per annum. Prior to its amendment, each advance under the JPMorgan Chase Credit Facility would have accrued interest at a rate equal to JPMorgan Chase’s monthly LIBOR rate multiplied by a statutory reserve rate for eurocurrency funding to which JPMorgan Chase is subject with respect to the adjusted LIBOR rate as established by the U.S. Federal Reserve Board, plus a margin of 1.25% per annum. Interest is calculated monthly on an actual/360-day basis and payable monthly in arrears. Principal outstanding during an event of default, at JPMorgan Chase’s option, accrues interest at a rate of 3% per annum in excess of the above rate. Any advance may be prepaid in whole or in part without penalty at any time . As of September 30, 2022, the Company had not borrowed against the JPMorgan Chase Credit Facility and had no outstanding debt as of the period then ended . |
SHAREHOLDERS' EQUITY AND STOCK-
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | 3 Months Ended |
Sep. 30, 2022 | |
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract] | |
SHAREHOLDERS' EQUITY | 11. SHAREHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION Repurchases of Common Stock Pursuant to authority granted by the Company’s Board of Directors on April 29, 2022, the Company can repurchase up to approximately $5.00 million in shares outstanding of the Company’s common stock over the three-year period ending April 29, 2025. Pursuant to the terms of the repurchase authorization, the common stock share repurchases are generally at the discretion of the Company’s management. As the Company repurchases its common shares, which have no par value, the Company reports such shares held as treasury stock in the accompanying condensed consolidated balance sheets with the purchase price recorded within treasury stock. During the three-month period ended September 30, 2022, the Company repurchased 358,116 shares of the Company’s common stock for an aggregate price of $451,815 pursuant to the repurchase authorization. The Company repurchased no shares of its common stock during the three-month period ended September 30, 2021. Dividends The Company has paid no cash dividends during the current fiscal year through September 30, 2022. |
STOCK-BASED COMPENSATION | Stock-Based Compensation The following table summarizes the components of the Company’s stock-based compensation included in net income for the periods presented: Three Months Ended September 30, 2022 2021 Employee stock options $ 72,498 $ 69,565 Restricted stock awards 23,734 209,842 Totals $ 96,232 $ 279,407 No stock-based compensation was capitalized as a cost of inventory during the three months ended September 30, 2022 or 2021. Stock Options – Shares Weighted Average Exercise Price Outstanding, June 30, 2022 1,658,803 $ 1.32 Granted 55,000 $ 1.30 Forfeited (3,001 ) $ 1.96 Expired (999 ) $ 0.88 Outstanding, September 30, 2022 1,709,803 $ 1.32 The weighted average grant date fair value of stock options granted during the three months ended September 30, 2022 and 2021 was approximately $0.70 and $1.32, respectively. The total fair value of stock options that vested during the three months ended September 30, 2022 and 2021 was approximately $53,000 and $38,000, respectively. The following table summarizes information about stock options outstanding at September 30, 2022: Options Outstanding Options Exercisable Options Vested or Expected to Vest Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price 1,709,803 6.75 $ 1.32 1,315,087 6.07 $ 1.11 1,645,429 6.65 $ 1.30 As of September 30, 2022, the unrecognized stock-based compensation expense related to unvested stock options was approximately $267,000, which is expected to be recognized over a weighted average period of approximately 26 months. The aggregate intrinsic value of stock options outstanding, exercisable, and vested or expected to vest at September 30, 2022 and 2021 was approximately $157,000 and $1.53 million, respectively. These amounts are before applicable income taxes and represents the closing market price of the Company’s common stock at September 30, 2022 less the grant price, multiplied by the number of stock options that had a grant price that is less than the closing market price. These values represent the amount that would have been received by the optionees had these stock options been exercised on that date. There were no stock options exercised during the three-month-period ended September 30, 2022. During the three months ended September 30, 2021, the aggregate intrinsic value of stock options exercised was approximately $255,000, respectively, and the total tax benefit associated with the stock options that were exercised was approximately $77,000. Restricted Stock – Shares Weighted Average Grant Date Fair Value Unvested, June 30, 2022 178,750 $ 2.75 Cancelled (44,688 ) $ 2.75 Vested (134,062 ) $ 2.75 Unvested, September 30, 2022 - $ - During the three-month period ended September 30, 2022, there were no restricted stock shares awarded to plan participants. Therefore, as of September 30, 2022, the Company had no unrecognized stock-based compensation expense related to unvested restricted shares that would be otherwise subject to achievement of performance goals. |
NET (LOSS) INCOME PER COMMON SH
NET (LOSS) INCOME PER COMMON SHARE | 3 Months Ended |
Sep. 30, 2022 | |
NET (LOSS) INCOME PER COMMON SHARE [Abstract] | |
NET (LOSS) INCOME PER COMMON SHARE | 12. NET (LOSS) INCOME PER COMMON SHARE Basic net (loss) income per common share is computed by dividing net (loss) income by the weighted average number of common shares outstanding during the periods. Diluted net income per common share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the periods. Common equivalent shares consist of stock options and unvested restricted shares that are computed using the treasury stock method. Anti-dilutive stock awards consist of stock options that would have been anti-dilutive in the application of the treasury stock method. The following table reconciles the differences between the basic and diluted net (loss) income per share presentations: Three Months Ended September 30, 2022 2021 Numerator: Net (loss) income $ (890,192 ) $ 827,025 Denominator: Weighted average common shares outstanding: Basic 30,433,195 29,971,178 Effect of dilutive securities - 1,126,362 Diluted 30,433,195 31,097,540 Net (loss) income per common share: Basic $ (0.03 ) $ 0.03 Diluted $ (0.03 ) $ 0.03 For the three months ended September 30, 2022, stock options to purchase approximately 1.71 million shares were excluded from the computation of diluted net loss per common share because the effect of inclusion of such amounts would be anti-dilutive to net loss per common share. For the three months ended September 30, 2021, stock options to purchase approximately 934,000 shares were excluded from the computation of diluted net income per common share. These shares are excluded from the computation of diluted net income per common share because the exercise price of the stock options for the period presented herein was greater than the average market price of the common shares or the effect of inclusion of such amounts would be anti-dilutive to net income per common share. Approximately 179,000 shares of unvested restricted stock are excluded from the computation of diluted net income per common share as of September 30, 2021, because the shares are performance-based and the underlying conditions had not been met as of the periods presented herein. There were no shares of unvested restricted stock outstanding as of September 30, 2022. |
MAJOR CUSTOMERS AND CONCENTRATI
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK | 3 Months Ended |
Sep. 30, 2022 | |
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK [Abstract] | |
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK | 13. MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash on deposit and cash equivalents held with banks and trade accounts receivable. The Company places cash deposits with federally insured financial institutions and maintains its cash at banks and financial institutions it considers to be of high credit quality. However, the Company’s cash deposits may at times exceed the Federal Deposit Insurance Corporation’s insurable limits. Accordingly, balances in excess of federally insured limitations may not be insured. The Company has not experienced losses on these accounts, and management believes that the Company is not exposed to significant risks on such accounts. Trade receivables potentially subject the Company to credit risk. Payment terms on trade receivables for the Company’s Traditional segment customers are generally between 30 and 90 days, though it may offer extended terms with specific customers and on significant orders from time to time. The Company extends credit to its customers based upon a number of factors, including an evaluation of the customer’s financial condition and credit history that is verified through trade association reference services, the customer’s payment history with the Company, the customer’s reputation in the trade, and/or an evaluation of the Company’s opportunity to introduce its moissanite jewels or finished jewelry featuring moissanite and lab grown diamonds to new or expanded markets. Collateral is not generally required from customers. The need for an allowance for doubtful accounts is determined based upon factors surrounding the credit risk of specific customers, historical trends, and other information. For additional information regarding the Company’s measurement and disclosure of credit losses on financial assets, including trade accounts receivable, see Note 4, “Fair Value Measurements.” At times, a portion of the Company’s accounts receivable will be due from customers that have individual balances of 10% or more of the Company’s total gross accounts receivable. The following is a summary of customers that represent 10% or more of total gross accounts receivable as of the dates presented: September 30, 2022 June 30, 2022 Customer A 11 % 29 % Customer B 31 % 20 % Customer C 16 % 13 % A significant portion of sales is derived from certain customer relationships. The following is a summary of customers that represent 10% or more of total net sales for the periods presented: Three Months Ended September 30, 2022 2021 Customer A * % 19 % Customer B 17 % 14 % * Customer A did not have net sales that represented 10% or more of total net sales for the three months ended September 30, 2022. |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the three months ended September 30, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2023. The condensed consolidated financial statements as of September 30, 2022 and for the three months ended September 30, 2022 and 2021 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of June 30, 2022 is derived from the audited financial statements as of that date. The accompanying statements should be read in conjunction with the audited financial statements and related notes contained in Item 8 of the Company’s Annual Report on Form 10-K (the “2022 Annual Report”) for the fiscal year ended June 30, 2022 filed with the SEC on September 2, 2022. |
Principles of Consolidation | The accompanying condensed consolidated financial statements as of and for the three months ended September 30, 2022 and 2021, and as of the fiscal year ended June 30, 2022, include the accounts of the Company and its wholly owned subsidiaries charlesandcolvard.com, LLC, including its wholly-owned subsidiary, moissaniteoulet.com, LLC, which was formed and incorporated as of February 24, 2022; Charles & Colvard Direct, LLC; and Charles & Colvard (HK) Ltd., the Company’s Hong Kong subsidiary, which was entered into dormancy as of September 30, 2020 following its re-activation in December 2017. Charles & Colvard (HK) Ltd. previously became dormant in the second quarter of 2009 and has had no operating activity since 2008. Charles & Colvard Direct, LLC, had no operating activity during the three-month periods September 30, 2022 or 2021. All intercompany accounts have been eliminated. |
Use of Estimates | Use of Estimates |
Cash and Cash Equivalents | Cash and Cash Equivalents – |
Restricted Cash | Restricted Cash – Pursuant to the terms and conditions of the Company’s broker-dealer agreement with Oppenheimer & Co., Inc. (“Oppenheimer”), with whom the Company has engaged to transact common stock share repurchases in connection with its stock repurchase program, the Company is required to maintain a funded liquid margin account held by Oppenheimer for the benefit of the Company. The purpose of this account is to fund the Company’s common stock purchases and any underlying transaction costs and fees. Depending upon the level and timing of stock repurchase activity, the funded margin account cash balance will fluctuate from time to time. At September 30, 2022 and June 30, 2022, cash in the amount of approximately $30 and approximately $461,000, respectively, was held by Oppenheimer. Such cash amount held by Oppenheimer was classified as restricted cash for financial reporting purposes on the Company’s condensed consolidated balance sheets. For additional information regarding the Company’s stock repurchase program, see Note 11, “Shareholders’ Equity and Stock-Based Compensation.” The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: September 30, 2022 June 30, 2022 Cash and cash equivalents $ 11,568,995 $ 15,668,361 Restricted cash 5,054,778 5,510,979 Total cash, cash equivalents, and restricted cash $ 16,623,773 $ 21,179,340 |
Recently Adopted/Issued Accounting Pronouncements | Recently Adopted/Issued Accounting Pronouncements – Financial Accounting Standards Board (“ ”) Accounting Standards Update (“ ”) Reference Rate Reform (Topic 848) |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Cash, Cash Equivalents and Restricted Cash | The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: September 30, 2022 June 30, 2022 Cash and cash equivalents $ 11,568,995 $ 15,668,361 Restricted cash 5,054,778 5,510,979 Total cash, cash equivalents, and restricted cash $ 16,623,773 $ 21,179,340 |
SEGMENT INFORMATION AND GEOGR_2
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract] | |
Summary Financial Information by Reportable Segment | Summary financial information by reportable segment is as follows: Three Months Ended September 30, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 4,403,589 $ 1,136,817 $ 5,540,406 Loose jewels 448,897 1,384,780 1,833,677 Total $ 4,852,486 $ 2,521,597 $ 7,374,083 Product line cost of goods sold Finished jewelry $ 1,970,111 $ 636,588 $ 2,606,699 Loose jewels 162,699 662,924 825,623 Total $ 2,132,810 $ 1,299,512 $ 3,432,322 Product line gross profit Finished jewelry $ 2,433,478 $ 500,229 $ 2,933,707 Loose jewels 286,198 721,856 1,008,054 Total $ 2,719,676 $ 1,222,085 $ 3,941,761 Operating loss $ (609,545 ) $ (623,804 ) $ (1,233,349 ) Depreciation and amortization $ 63,387 $ 74,324 $ 137,711 Capital expenditures $ 136,988 $ 293,412 $ 430,400 Three Months Ended September 30, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 4,486,958 $ 1,199,329 $ 5,686,287 Loose jewels 882,847 3,711,177 4,594,024 Total $ 5,369,805 $ 4,910,506 $ 10,280,311 Product line cost of goods sold Finished jewelry $ 1,711,224 $ 623,258 $ 2,334,482 Loose jewels 314,105 1,745,341 2,059,446 Total $ 2,025,329 $ 2,368,599 $ 4,393,928 Product line gross profit Finished jewelry $ 2,775,734 $ 576,071 $ 3,351,805 Loose jewels 568,742 1,965,836 2,534,578 Total $ 3,344,476 $ 2,541,907 $ 5,886,383 Operating income $ 321,671 $ 627,662 $ 949,333 Depreciation and amortization $ 67,702 $ 56,510 $ 124,212 Capital expenditures $ 59,260 $ 338,861 $ 398,121 |
Reconciliation of Product Line Cost of Goods Sold | A reconciliation of the Company’s product line cost of goods sold to cost of goods sold as reported in the condensed consolidated financial statements is as follows: Three Months Ended September 30, 2022 2021 Product line cost of goods sold $ 3,432,322 $ 4,393,928 Non-capitalized manufacturing and production control expenses 377,053 342,401 Freight out 275,737 217,506 Inventory write-downs 119,000 232,000 Other inventory adjustments (118,102 ) (169,285 ) Cost of goods sold $ 4,086,010 $ 5,016,550 |
Net Sales by Geographic Area | The following presents net sales data by geographic area: Three Months Ended September 30, 2022 2021 Net sales: United States $ 7,095,373 $ 9,824,730 International 278,710 455,581 Total $ 7,374,083 $ 10,280,311 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
INVENTORIES [Abstract] | |
Inventories | The Company’s total inventories, net of reserves, consisted of the following as of the dates presented: September 30, 2022 June 30, 2022 Finished jewelry: Raw materials $ 1,380,713 $ 1,697,361 Work-in-process 1,622,170 1,260,728 Finished goods 14,421,069 12,100,910 Finished goods on consignment 2,440,245 2,135,856 Total finished jewelry $ 19,864,197 $ 17,194,855 Loose jewels: Raw materials $ 1,987,296 $ 1,985,355 Work-in-process 9,070,743 8,485,713 Finished goods 5,297,794 5,454,266 Finished goods on consignment 265,338 303,491 Total loose jewels 16,621,171 16,228,825 Total supplies inventory 83,100 89,120 Total inventory $ 36,568,468 $ 33,512,800 As of the dates presented, the Company’s total inventories, net of reserves, are classified as follows: September 30, 2022 June 30, 2022 Short-term portion $ 12,092,385 $ 11,024,276 Long-term portion 24,476,083 22,488,524 Total $ 36,568,468 $ 33,512,800 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | |
Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities, current, consist of the following as of the dates presented: September 30, 2022 June 30, 2022 Deferred revenue $ 504,919 $ 452,866 Accrued compensation and related benefits 325,121 614,443 Accrued sales taxes 142,216 295,743 Accrued cooperative advertising 139,694 137,467 Accrued franchise taxes 23,585 45,963 Other accrued expenses 1 1 Total accrued expenses and other liabilities $ 1,135,536 $ 1,546,483 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Balance Sheet Classifications of Leases | As of September 30, 2022, the Company’s balance sheet classifications of its leases are as follows: Operating Leases: Noncurrent operating lease ROU assets $ 2,638,400 Current operating lease liabilities $ 862,401 Noncurrent operating lease liabilities 2,653,039 Total operating lease liabilities $ 3,515,440 |
Remaining Future Payments Under Operating Leases | As of September 30, 2022, the Company’s remaining future payments under operating leases for each fiscal year ending June 30 are as follows: 2023 $ 656,221 2024 893,660 2025 918,236 2026 943,487 2027 317,327 Total lease payments 3,728,931 Less: imputed interest 213,491 Present value of lease payments 3,515,440 Less: current lease obligations 862,401 Total long-term lease obligations $ 2,653,039 |
SHAREHOLDERS' EQUITY AND STOC_2
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract] | |
Stock-Based Compensation | The following table summarizes the components of the Company’s stock-based compensation included in net income for the periods presented: Three Months Ended September 30, 2022 2021 Employee stock options $ 72,498 $ 69,565 Restricted stock awards 23,734 209,842 Totals $ 96,232 $ 279,407 |
Stock Option Activity | Stock Options – Shares Weighted Average Exercise Price Outstanding, June 30, 2022 1,658,803 $ 1.32 Granted 55,000 $ 1.30 Forfeited (3,001 ) $ 1.96 Expired (999 ) $ 0.88 Outstanding, September 30, 2022 1,709,803 $ 1.32 |
Stock Options Outstanding | The following table summarizes information about stock options outstanding at September 30, 2022: Options Outstanding Options Exercisable Options Vested or Expected to Vest Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 9/30/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price 1,709,803 6.75 $ 1.32 1,315,087 6.07 $ 1.11 1,645,429 6.65 $ 1.30 |
Restricted Stock Activity | Restricted Stock – Shares Weighted Average Grant Date Fair Value Unvested, June 30, 2022 178,750 $ 2.75 Cancelled (44,688 ) $ 2.75 Vested (134,062 ) $ 2.75 Unvested, September 30, 2022 - $ - |
NET (LOSS) INCOME PER COMMON _2
NET (LOSS) INCOME PER COMMON SHARE (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
NET (LOSS) INCOME PER COMMON SHARE [Abstract] | |
Basic and Diluted Net (Loss) Income per Share | The following table reconciles the differences between the basic and diluted net (loss) income per share presentations: Three Months Ended September 30, 2022 2021 Numerator: Net (loss) income $ (890,192 ) $ 827,025 Denominator: Weighted average common shares outstanding: Basic 30,433,195 29,971,178 Effect of dilutive securities - 1,126,362 Diluted 30,433,195 31,097,540 Net (loss) income per common share: Basic $ (0.03 ) $ 0.03 Diluted $ (0.03 ) $ 0.03 |
MAJOR CUSTOMERS AND CONCENTRA_2
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK [Abstract] | |
Major Customers | The following is a summary of customers that represent 10% or more of total gross accounts receivable as of the dates presented: September 30, 2022 June 30, 2022 Customer A 11 % 29 % Customer B 31 % 20 % Customer C 16 % 13 % A significant portion of sales is derived from certain customer relationships. The following is a summary of customers that represent 10% or more of total net sales for the periods presented: Three Months Ended September 30, 2022 2021 Customer A * % 19 % Customer B 17 % 14 % * Customer A did not have net sales that represented 10% or more of total net sales for the three months ended September 30, 2022. |
BASIS OF PRESENTATION AND SIG_4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES, Restricted Cash (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 |
Restricted Cash [Abstract] | ||||
Funded liquid margin account | $ 30 | $ 461,000 | ||
Cash, Cash Equivalents and Restricted Cash [Abstract] | ||||
Cash and cash equivalents | 11,568,995 | 15,668,361 | ||
Restricted cash | 5,054,778 | 5,510,979 | ||
Total cash, cash equivalents, and restricted cash | 16,623,773 | $ 21,179,340 | $ 19,166,632 | $ 21,446,951 |
JPMorgan Chase Credit Facility [Member] | ||||
Restricted Cash [Abstract] | ||||
Borrowing capacity | 5,000,000 | |||
Cash deposit | $ 5,050,000 |
BASIS OF PRESENTATION AND SIG_5
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES, Recently Adopted/Issued Accounting Pronouncements (Details) - JPMorgan Chase Credit Facility [Member] | 3 Months Ended |
Sep. 30, 2022 USD ($) | |
Recently Adopted/Issued Accounting Pronouncements [Abstract] | |
Borrowings against line of credit | $ 0 |
LIBOR [Member] | |
Recently Adopted/Issued Accounting Pronouncements [Abstract] | |
Term of variable rate | 1 month |
SEGMENT INFORMATION AND GEOGR_3
SEGMENT INFORMATION AND GEOGRAPHIC DATA, Summary Financial Information by Reportable Segment (Details) | 3 Months Ended | |
Sep. 30, 2022 USD ($) Segment | Sep. 30, 2021 USD ($) | |
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract] | ||
Number of operating segments | Segment | 2 | |
Number of reportable segments | Segment | 2 | |
Summary Information by Reportable Segment [Abstract] | ||
Net sales | $ 7,374,083 | $ 10,280,311 |
Product line cost of goods sold | 4,086,010 | 5,016,550 |
Operating income (loss) | (1,233,349) | 949,333 |
Depreciation and amortization | 137,711 | 124,212 |
Capital expenditures | 430,400 | 398,121 |
Product Line [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Product line cost of goods sold | 3,432,322 | 4,393,928 |
Product line gross profit | 3,941,761 | 5,886,383 |
Finished Jewelry [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 5,540,406 | 5,686,287 |
Product line cost of goods sold | 2,606,699 | 2,334,482 |
Product line gross profit | 2,933,707 | 3,351,805 |
Loose Jewels [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 1,833,677 | 4,594,024 |
Product line cost of goods sold | 825,623 | 2,059,446 |
Product line gross profit | 1,008,054 | 2,534,578 |
Operating and Reportable Segments [Member] | Online Channels [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 4,852,486 | 5,369,805 |
Product line cost of goods sold | 2,132,810 | 2,025,329 |
Product line gross profit | 2,719,676 | 3,344,476 |
Operating income (loss) | (609,545) | 321,671 |
Depreciation and amortization | 63,387 | 67,702 |
Capital expenditures | 136,988 | 59,260 |
Operating and Reportable Segments [Member] | Online Channels [Member] | Finished Jewelry [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 4,403,589 | 4,486,958 |
Product line cost of goods sold | 1,970,111 | 1,711,224 |
Product line gross profit | 2,433,478 | 2,775,734 |
Operating and Reportable Segments [Member] | Online Channels [Member] | Loose Jewels [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 448,897 | 882,847 |
Product line cost of goods sold | 162,699 | 314,105 |
Product line gross profit | 286,198 | 568,742 |
Operating and Reportable Segments [Member] | Traditional [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 2,521,597 | 4,910,506 |
Product line cost of goods sold | 1,299,512 | 2,368,599 |
Product line gross profit | 1,222,085 | 2,541,907 |
Operating income (loss) | (623,804) | 627,662 |
Depreciation and amortization | 74,324 | 56,510 |
Capital expenditures | 293,412 | 338,861 |
Operating and Reportable Segments [Member] | Traditional [Member] | Finished Jewelry [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 1,136,817 | 1,199,329 |
Product line cost of goods sold | 636,588 | 623,258 |
Product line gross profit | 500,229 | 576,071 |
Operating and Reportable Segments [Member] | Traditional [Member] | Loose Jewels [Member] | ||
Summary Information by Reportable Segment [Abstract] | ||
Net sales | 1,384,780 | 3,711,177 |
Product line cost of goods sold | 662,924 | 1,745,341 |
Product line gross profit | $ 721,856 | $ 1,965,836 |
SEGMENT INFORMATION AND GEOGR_4
SEGMENT INFORMATION AND GEOGRAPHIC DATA, Reconciliation of Cost of Goods Sold (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Reconciliation of Cost of Goods Sold [Abstract] | ||
Cost of goods sold | $ 4,086,010 | $ 5,016,550 |
Inventory write-downs | 119,000 | 232,000 |
Product Line [Member] | ||
Reconciliation of Cost of Goods Sold [Abstract] | ||
Cost of goods sold | 3,432,322 | 4,393,928 |
Segment Reconciling Item [Member] | ||
Reconciliation of Cost of Goods Sold [Abstract] | ||
Non-capitalized manufacturing and production control expenses | 377,053 | 342,401 |
Freight out | 275,737 | 217,506 |
Inventory write-downs | 119,000 | 232,000 |
Other inventory adjustments | $ (118,102) | $ (169,285) |
SEGMENT INFORMATION AND GEOGR_5
SEGMENT INFORMATION AND GEOGRAPHIC DATA, Net Sales by Geographic Area (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Net Sales by Geographic Area [Abstract] | ||
Net sales | $ 7,374,083 | $ 10,280,311 |
Reportable Geographical Component [Member] | United States [Member] | ||
Net Sales by Geographic Area [Abstract] | ||
Net sales | 7,095,373 | 9,824,730 |
Reportable Geographical Component [Member] | International [Member] | ||
Net Sales by Geographic Area [Abstract] | ||
Net sales | $ 278,710 | $ 455,581 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
FAIR VALUE MEASUREMENTS [Abstract] | ||
Asset impairment | $ 0 | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Jun. 30, 2022 | |
Inventories [Abstract] | ||
Total supplies inventory | $ 83,100 | $ 89,120 |
Total inventory | 36,568,468 | 33,512,800 |
Short-term portion | 12,092,385 | 11,024,276 |
Long-term portion | 24,476,083 | 22,488,524 |
Work-in-process inventories issued to active production jobs | $ 2,870,000 | 2,760,000 |
Percentage of jewel inventory not mounted in finished jewelry settings | 50% | |
Finished Jewelry [Member] | ||
Inventories [Abstract] | ||
Raw materials | $ 1,380,713 | 1,697,361 |
Work-in-process | 1,622,170 | 1,260,728 |
Finished goods | 14,421,069 | 12,100,910 |
Finished goods on consignment | 2,440,245 | 2,135,856 |
Total | 19,864,197 | 17,194,855 |
Loose Jewels [Member] | ||
Inventories [Abstract] | ||
Raw materials | 1,987,296 | 1,985,355 |
Work-in-process | 9,070,743 | 8,485,713 |
Finished goods | 5,297,794 | 5,454,266 |
Finished goods on consignment | 265,338 | 303,491 |
Total | $ 16,621,171 | $ 16,228,825 |
NOTE RECEIVABLE (Details)
NOTE RECEIVABLE (Details) - Convertible Promissory Note [Member] - USD ($) | Sep. 30, 2022 | Mar. 05, 2021 |
Note Receivable [Abstract] | ||
Note receivable | $ 250,000 | |
Interest rate | 0.14% | |
Interest rate during event of default | 5% | |
Percentage of per unit price of units purchased by investors | 80% | |
Value used to compute equity securities received upon conversion | $ 33,500,000 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | ||
Deferred revenue | $ 504,919 | $ 452,866 |
Accrued compensation and related benefits | 325,121 | 614,443 |
Accrued sales tax | 142,216 | 295,743 |
Accrued cooperative advertising | 139,694 | 137,467 |
Accrued franchise taxes | 23,585 | 45,963 |
Other accrued expenses | 1 | 1 |
Total accrued expenses and other liabilities | $ 1,135,536 | $ 1,546,483 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | |
INCOME TAXES [Abstract] | |||
Combined federal and state statutory tax rate | 22.98% | 22.24% | |
Federal income tax rate | 21% | 21% | |
State income tax rate | 1.98% | 1.24% | |
Effective tax rate | 25.39% | ||
Income tax (benefit) expense | $ (302,956) | $ 122,629 | |
Deferred tax assets | $ 6,154,860 | $ 5,851,904 |
COMMITMENTS AND CONTINGENCIES,
COMMITMENTS AND CONTINGENCIES, Lease Arrangements (Details) | 3 Months Ended | |||
Jan. 29, 2021 USD ($) | Sep. 30, 2022 USD ($) ft² | Sep. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | |
COMMITMENTS AND CONTINGENCIES [Abstract] | ||||
Area leased under operating lease | ft² | 36,350 | |||
Period of extension on option | 5 years | |||
Minimum notice period for extension of lease term | 270 days | |||
Rent abatement | $ 214,000 | |||
Allowance for leasehold improvements | $ 545,000 | |||
Reimbursement for leasehold improvements | $ 506,000 | |||
Balance Sheet Classifications of Leases [Abstract] | ||||
Noncurrent operating lease ROU assets | 2,638,400 | $ 2,787,419 | ||
Operating Lease Liabilities [Abstract] | ||||
Current operating lease liabilities | 862,401 | 856,571 | ||
Noncurrent operating lease liabilities | 2,653,039 | 2,846,805 | ||
Total operating lease liabilities | 3,515,440 | |||
Operating lease cost | $ 175,000 | $ 202,000 | ||
Assumed discount rate | 2.81% | |||
Remaining operating lease term | 4 years 29 days | |||
Future Lease Payments Under Operating Leases [Abstract] | ||||
2023 | $ 656,221 | |||
2024 | 893,660 | |||
2025 | 918,236 | |||
2026 | 943,487 | |||
2027 | 317,327 | |||
Total lease payments | 3,728,931 | |||
Less: imputed interest | 213,491 | |||
Total operating lease liabilities | 3,515,440 | |||
Less: current lease obligations | 862,401 | 856,571 | ||
Total long-term lease obligations | 2,653,039 | $ 2,846,805 | ||
Cash paid for operating leases | $ 231,414 | $ 162,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES, Purchase Commitments (Details) - SiC Materials [Member] $ in Thousands | 3 Months Ended | |
Sep. 30, 2022 USD ($) Option | Sep. 30, 2021 USD ($) | |
Purchase Commitments [Abstract] | ||
Percentage of materials committed to be purchased | 100% | |
Number of options to extend term of exclusive supply agreement | Option | 1 | |
Extension period of exclusive supply agreement | 2 years | |
Total purchase commitment | $ 52,950 | |
Remaining purchase commitment | 24,750 | |
Purchases | 1,800 | $ 1,500 |
Minimum [Member] | ||
Purchase Commitments [Abstract] | ||
Future minimum annual purchase commitments | 4,000 | |
Maximum [Member] | ||
Purchase Commitments [Abstract] | ||
Future minimum annual purchase commitments | $ 10,000 |
DEBT (Details)
DEBT (Details) - USD ($) | 3 Months Ended | |
Jul. 28, 2022 | Sep. 30, 2022 | |
Line of Credit [Abstract] | ||
Long-term debt | $ 0 | |
JPMorgan Chase Credit Facility [Member] | ||
Line of Credit [Abstract] | ||
Borrowing capacity | 5,000,000 | |
Cash deposit | $ 5,050,000 | |
Interest rate premium in excess of rate otherwise applicable charged during an event of default | 3% | |
Credit facility outstanding | $ 0 | |
JPMorgan Chase Credit Facility [Member] | SOFR Rate [Member] | ||
Line of Credit [Abstract] | ||
Basis spread on variable rate | 1.25% | |
Interest rate adjustment | 0.10% | |
JPMorgan Chase Credit Facility [Member] | LIBOR [Member] | ||
Line of Credit [Abstract] | ||
Basis spread on variable rate | 1.25% |
SHAREHOLDERS' EQUITY AND STOC_3
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Repurchases of Common Stock (Details) - USD ($) | 3 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Apr. 29, 2022 | |
Repurchases of Common Stock [Abstract] | ||||
Period over which common stock can be repurchased | 3 years | |||
Common stock, par value (in dollars per share) | $ 0 | $ 0 | ||
Repurchases of common stock (in shares) | 358,116 | 0 | ||
Repurchases of common stock | $ 451,815 | |||
Maximum [Member] | ||||
Repurchases of Common Stock [Abstract] | ||||
Authorized amount of common stock that can be repurchased | $ 5,000,000 |
SHAREHOLDERS' EQUITY AND STOC_4
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Dividends (Details) | 3 Months Ended |
Sep. 30, 2022 USD ($) | |
Dividends [Abstract] | |
Cash dividends | $ 0 |
SHAREHOLDERS' EQUITY AND STOC_5
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Stock-Based Compensation [Abstract] | ||
Employee stock options | $ 72,498 | $ 69,565 |
Restricted stock awards | 23,734 | 209,842 |
Totals | 96,232 | 279,407 |
Stock-based compensation capitalized as a cost of inventory | $ 0 | $ 0 |
SHAREHOLDERS' EQUITY AND STOC_6
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock Option Activity (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Stock Option Activity [Roll Forward] | ||
Outstanding, beginning balance (in shares) | 1,658,803 | |
Granted (in shares) | 55,000 | |
Forfeited (in shares) | (3,001) | |
Expired (in shares) | (999) | |
Outstanding, ending balance (in shares) | 1,709,803 | |
Weighted Average Exercise Price [Roll Forward] | ||
Outstanding, beginning balance (in dollars per share) | $ 1.32 | |
Granted (in dollars per share) | 1.3 | |
Forfeited (in dollars per share) | 1.96 | |
Expired (in dollars per share) | 0.88 | |
Outstanding, ending balance (in dollars per share) | 1.32 | |
Fair Value of Stock Options [Abstract] | ||
Fair value of stock options (in dollars per share) | $ 0.7 | $ 1.32 |
Fair value of stock options vested | $ 53 | $ 38 |
SHAREHOLDERS' EQUITY AND STOC_7
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock Options Outstanding (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | |
Stock Options Outstanding and Exercisable [Abstract] | |||
Options outstanding, balance as of end of period (in shares) | 1,709,803 | 1,658,803 | |
Options outstanding, weighted average remaining contractual life | 6 years 9 months | ||
Options outstanding, weighted average exercise price (in dollars per share) | $ 1.32 | $ 1.32 | |
Options exercisable, balance as of end of period (in shares) | 1,315,087 | ||
Options exercisable, weighted average remaining contractual life | 6 years 25 days | ||
Options exercisable, weighted average exercise price (in dollars per share) | $ 1.11 | ||
Options Vested or Expected to Vest [Abstract] | |||
Options vested or expected to vest, balance as of end of period (in shares) | 1,645,429 | ||
Options vested or expected to vest, weighted average remaining contractual life | 6 years 7 months 24 days | ||
Options vested or expected to vest, weighted average exercise price (in dollars per share) | $ 1.3 | ||
Unrecognized Stock-Based Compensation Expense [Abstract] | |||
Unrecognized stock-based compensation expense | $ 267 | ||
Unrecognized stock-based compensation expense, period for recognition | 26 months | ||
Options outstanding, aggregate intrinsic value | $ 157 | $ 1,530 | |
Options exercisable, aggregate intrinsic value | 157 | 1,530 | |
Options vested or expected to vest, aggregate intrinsic value | $ 157 | 1,530 | |
Exercised (in shares) | 0 | ||
Options exercised, aggregate intrinsic value | 255 | ||
Tax benefit associated with stock options exercised | $ 77 |
SHAREHOLDERS' EQUITY AND STOC_8
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Restricted Stock Activity (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | |
Unrecognized Stock-Based Compensation Expense [Abstract] | |
Shares awarded (in shares) | 0 |
Restricted Stock [Member] | |
Restricted Stock Activity [Roll Forward] | |
Unvested, beginning balance (in shares) | 178,750 |
Canceled (in shares) | (44,688) |
Vested (in shares) | (134,062) |
Unvested, ending balance (in shares) | 0 |
Weighted Average Grant Date Fair Value [Roll Forward] | |
Unvested, beginning balance (in dollars per share) | $ / shares | $ 2.75 |
Canceled (in dollars per share) | $ / shares | 2.75 |
Vested (in dollars per share) | $ / shares | 2.75 |
Unvested, ending balance (in dollars per share) | $ / shares | $ 0 |
Unrecognized Stock-Based Compensation Expense [Abstract] | |
Unrecognized stock-based compensation expense | $ | $ 0 |
NET (LOSS) INCOME PER COMMON _3
NET (LOSS) INCOME PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator [Abstract] | ||
Net (loss) income | $ (890,192) | $ 827,025 |
Denominator [Abstract] | ||
Weighted average common shares outstanding, Basic (in shares) | 30,433,195 | 29,971,178 |
Effect of dilutive securities (in shares) | 0 | 1,126,362 |
Weighted average common shares outstanding, Diluted (in shares) | 30,433,195 | 31,097,540 |
Net (Loss) Income Per Common Share [Abstract] | ||
Basic (in dollars per share) | $ (0.03) | $ 0.03 |
Diluted (in dollars per share) | $ (0.03) | $ 0.03 |
Stock Options [Member] | ||
Net Income per Common Share [Abstract] | ||
Shares excluded from the computation of diluted net income per common share (in shares) | 1,710,000 | 934,000 |
Restricted Stock [Member] | ||
Net Income per Common Share [Abstract] | ||
Shares excluded from the computation of diluted net income per common share (in shares) | 179,000 | |
Unvested restricted stock outstanding (in shares) | 0 |
MAJOR CUSTOMERS AND CONCENTRA_3
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK (Details) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | ||
Minimum [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Payment terms on trade receivables | 30 days | |||
Maximum [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Payment terms on trade receivables | 90 days | |||
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer A [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Concentration risk, percentage | 11% | 29% | ||
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer B [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Concentration risk, percentage | 31% | 20% | ||
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer C [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Concentration risk, percentage | 16% | 13% | ||
Total Net Sales [Member] | Customer Concentration Risk [Member] | Customer A [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Concentration risk, percentage | [1] | 19% | ||
Total Net Sales [Member] | Customer Concentration Risk [Member] | Customer B [Member] | ||||
Major Customers and Concentration of Credit Risk [Abstract] | ||||
Concentration risk, percentage | 17% | 14% | ||
[1]Customer A did not have net sales that represented 10% or more of total net sales for the three months ended September 30, 2022. |