Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Nov. 30, 2021 | Jan. 06, 2022 | |
Document Information [Line Items] | ||
Entity Central Index Key | 0000875582 | |
Entity Registrant Name | Northern Technologies International Corporation | |
Amendment Flag | false | |
Current Fiscal Year End Date | --08-31 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Nov. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-11038 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 41-0857886 | |
Entity Address, Address Line One | 4201 Woodland Road P.O. Box 69 | |
Entity Address, City or Town | Circle Pines | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55014 | |
City Area Code | 763 | |
Local Phone Number | 225-6600 | |
Title of 12(b) Security | Common stock, par value $0.02 per share | |
Trading Symbol | NTIC | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 9,203,446 |
Consolidated Balance Sheets (Cu
Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 8,047,565 | $ 7,680,641 |
Available for sale securities | 4,634 | 4,634 |
Receivables: | ||
Trade, excluding joint ventures, less allowance for doubtful accounts of $382,000 as of November 30, 2021 and August 31, 2021 | 13,107,126 | 11,128,805 |
Trade, joint ventures | 791,246 | 624,808 |
Fees for services provided to joint ventures | 1,200,869 | 1,505,127 |
Income taxes | 500,061 | 386,574 |
Inventories | 11,439,738 | 11,114,207 |
Prepaid expenses | 2,173,851 | 1,302,293 |
Total current assets | 37,265,090 | 33,747,089 |
PROPERTY AND EQUIPMENT, NET | 12,194,674 | 11,821,458 |
OTHER ASSETS: | ||
Investments in joint ventures | 21,357,911 | 27,623,768 |
Deferred income taxes | 0 | 92,554 |
Intangible assets, net | 6,279,000 | 0 |
Goodwill | 4,782,376 | 0 |
Operating lease right of use asset | 655,819 | 376,438 |
Total other assets | 33,784,981 | 28,802,332 |
Total assets | 83,244,745 | 74,370,879 |
CURRENT LIABILITIES: | ||
Accounts payable | 5,466,381 | 4,290,972 |
Line of credit | 2,500,000 | |
Income taxes payable | 96,596 | 178,923 |
Accrued liabilities: | ||
Payroll and related benefits | 1,604,109 | 2,879,468 |
Other | 1,407,724 | 894,497 |
Current portion of operating lease | 314,918 | 272,336 |
Total current liabilities | 11,389,728 | 8,516,196 |
LONG-TERM LIABILITIES: | ||
Deferred income tax, net | 1,883,272 | 0 |
Operating lease, less current portion | 340,901 | 104,102 |
Total long-term liabilities | 2,224,173 | 104,102 |
EQUITY: | ||
Preferred stock, no par value; authorized 10,000 shares; none issued and outstanding | 0 | 0 |
Common stock, $0.02 par value per share; authorized 15,000,000 shares as of November 30, 2021 and August 31, 2021; issued and outstanding 9,203,446 and 9,184,811, respectively | 184,069 | 183,696 |
Additional paid-in capital | 19,146,510 | 18,736,268 |
Retained earnings | 50,823,730 | 46,973,092 |
Accumulated other comprehensive loss | (3,862,085) | (3,525,030) |
Stockholders’ equity | 66,292,224 | 62,368,026 |
Non-controlling interests | 3,338,620 | 3,382,555 |
Total equity | 69,630,844 | 65,750,581 |
Total liabilities and equity | 83,244,745 | 74,370,879 |
Patents and Trademarks [Member] | ||
OTHER ASSETS: | ||
Intangible assets, net | $ 709,875 | $ 709,572 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
NET SALES: | ||
Net sales, excluding joint ventures | $ 17,352,974 | $ 12,198,808 |
Net sales, to joint ventures | 840,439 | 580,304 |
Total net sales | 18,193,413 | 12,779,112 |
Cost of goods sold | 12,490,483 | 8,313,321 |
Gross profit | 5,702,930 | 4,465,791 |
JOINT VENTURE OPERATIONS: | ||
Equity in income from joint ventures | 1,374,749 | 1,825,712 |
Fees for services provided to joint ventures | 1,258,858 | 1,336,561 |
Total joint venture operations | 2,633,607 | 3,162,273 |
OPERATING EXPENSES: | ||
Selling expenses | 3,237,758 | 2,741,768 |
General and administrative expenses | 2,596,347 | 2,093,982 |
Research and development expenses | 1,235,821 | 1,075,737 |
Total operating expenses | 7,069,926 | 5,911,487 |
OPERATING INCOME | 1,266,611 | 1,716,577 |
REMEASUREMENT GAIN ON ACQUISITION OF EQUITY METHOD INVESTEE | 3,951,550 | 0 |
INTEREST INCOME | 10,943 | 69,538 |
INTEREST EXPENSE | (2,891) | (2,368) |
INCOME BEFORE INCOME TAX EXPENSE | 5,226,213 | 1,783,747 |
INCOME TAX EXPENSE | 504,380 | 378,590 |
NET INCOME | 4,721,833 | 1,405,157 |
NET INCOME ATTRIBUTABLE TO NON-CONTROLLING INTERESTS | 228,074 | 142,758 |
NET INCOME ATTRIBUTABLE TO NTIC | $ 4,493,759 | $ 1,262,399 |
NET INCOME ATTRIBUTABLE TO NTIC PER COMMON SHARE: | ||
Basic (in dollars per share) | $ 0.49 | $ 0.14 |
Diluted (in dollars per share) | $ 0.46 | $ 0.13 |
WEIGHTED AVERAGE COMMON SHARES ASSUMED OUTSTANDING: | ||
Basic (in shares) | 9,199,976 | 9,104,623 |
Diluted (in shares) | 9,779,770 | 9,644,630 |
CASH DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share) | $ 0.07 | $ 0 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Net income | $ 4,721,833 | $ 1,405,157 |
OTHER COMPREHENSIVE INCOME (LOSS) – FOREIGN CURRENCY TRANSLATION ADJUSTMENT | (409,064) | 298,665 |
COMPREHENSIVE INCOME | 4,312,769 | 1,703,822 |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTS | (156,065) | 210,663 |
COMPREHENSIVE INCOME ATTRIBUTABLE TO NTIC | $ 4,468,834 | $ 1,493,159 |
Consolidated Statements of Equi
Consolidated Statements of Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Noncontrolling Interest [Member] | Total |
BALANCE (in shares) at Aug. 31, 2020 | 9,099,990 | |||||
BALANCE at Aug. 31, 2020 | $ 182,000 | $ 17,415,043 | $ 42,472,810 | $ (3,410,438) | $ 3,045,026 | $ 59,704,441 |
Stock issued for employee stock purchase plan (in shares) | 4,646 | |||||
Stock issued for employee stock purchase plan | $ 93 | 36,099 | 0 | 0 | 36,192 | |
Stock option expense | 0 | 181,669 | 0 | 0 | 181,669 | |
Net income | 0 | 0 | 1,262,399 | 0 | 142,758 | 1,405,157 |
Comprehensive income (loss) | $ 0 | 0 | 0 | 230,760 | 67,905 | 298,665 |
BALANCE (in shares) at Nov. 30, 2020 | 9,104,636 | |||||
BALANCE at Nov. 30, 2020 | $ 182,093 | 17,632,811 | 43,735,209 | (3,179,678) | 3,255,689 | 61,626,124 |
BALANCE (in shares) at Aug. 31, 2021 | 9,184,811 | |||||
BALANCE at Aug. 31, 2021 | $ 183,696 | 18,736,268 | 46,973,092 | (3,525,030) | 3,382,555 | 65,750,581 |
Stock issued for employee stock purchase plan (in shares) | 2,635 | |||||
Stock issued for employee stock purchase plan | $ 53 | 38,479 | 0 | 0 | 0 | 38,532 |
Stock option expense | 0 | 232,883 | 0 | 0 | 0 | 232,883 |
Net income | 0 | 0 | 4,493,759 | 0 | 228,074 | 4,721,833 |
Comprehensive income (loss) | $ 0 | 0 | 0 | (337,055) | (72,009) | (409,064) |
Stock options exercised (in shares) | 16,000 | |||||
Stock options exercised | $ 320 | 138,880 | 0 | 0 | 0 | 139,200 |
Investment by non-controlling interest | 0 | 0 | 0 | 0 | (200,000) | (200,000) |
Dividends paid to shareholders | $ 0 | 0 | (643,121) | 0 | 0 | (643,121) |
BALANCE (in shares) at Nov. 30, 2021 | 9,203,446 | |||||
BALANCE at Nov. 30, 2021 | $ 184,069 | $ 19,146,510 | $ 50,823,730 | $ (3,862,085) | $ 3,338,620 | $ 69,630,844 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 2 Months Ended | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 4,721,833 | $ 4,721,833 | $ 1,405,157 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Stock-based compensation | 232,883 | 181,669 | |
Depreciation expense | 215,306 | 211,932 | |
Amortization expense | 119,894 | 49,989 | |
Change in allowance for doubtful accounts | 0 | 30,000 | |
Remeasurement gain on acquisition of equity method investee | (3,951,550) | (3,951,550) | 0 |
Equity in income from joint ventures | (1,374,749) | (1,374,749) | (1,825,712) |
Dividends received from joint ventures | 5,042,271 | 1,125,361 | |
Deferred income taxes | 126,852 | 338 | |
Changes in current assets and liabilities: | |||
Trade, excluding joint ventures | (308,325) | (1,334,199) | |
Trade, joint ventures | (166,438) | (199,491) | |
Fees for services provided to joint ventures | 304,258 | (221,879) | |
Income taxes | (119,978) | 10,001 | |
Inventories | 516,283 | 1,242,101 | |
Prepaid expenses and other | (418,888) | (108,751) | |
Accounts payable | 98,545 | 1,046,577 | |
Income tax payable | (102,074) | 156,951 | |
Accrued liabilities | (1,617,099) | (168,924) | |
Net cash provided by operating activities | 3,319,024 | 1,601,120 | |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Acquisition of Zerust India business, net of cash acquired (see Note 3) | (5,062,003) | 0 | |
Purchase of available for sale securities | 0 | (838,063) | |
Purchases of property and equipment | (315,390) | (309,400) | |
Investments in patents | (52,197) | (30,406) | |
Net cash used in investing activities | (5,429,590) | (1,177,869) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from line of credit | 2,500,000 | 0 | |
Dividends paid on NTIC common stock | (643,121) | 0 | |
Proceeds from the exercise of stock options | 139,200 | 0 | |
Dividends received by non-controlling interest | (200,000) | 0 | |
Proceeds from employee stock purchase plan | 38,532 | 36,192 | |
Net cash provided by financing activities | 1,834,611 | 36,192 | |
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS: | 642,879 | 90,866 | |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 366,924 | 550,309 | |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 7,680,641 | 6,403,032 | |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 8,047,565 | $ 8,047,565 | $ 6,953,341 |
Note 1 - Interim Financial Info
Note 1 - Interim Financial Information | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1. INTERIM FINANCIAL INFORMATION In the opinion of management, the accompanying unaudited consolidated financial statements contain all necessary adjustments, which are of a normal recurring nature, and present fairly the consolidated financial position of Northern Technologies International Corporation and its subsidiaries (the Company) as of November 30, 2021 August 31, 2021 three November 30, 2021 2020, three November 30, 2021 2020 three November 30, 2021 2020, These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s annual report on Form 10 August 31, 2021. Management s Discussion and Analysis of Financial Condition and Results of Operations Operating results for the three November 30, 2021 not may August 31, 2022. The Company evaluates events occurring after the date of the consolidated financial statements requiring recording or disclosure in the consolidated financial statements. Impact of COVID- 19 In March 2020, 19 19 first 2022 2022. first 2022, |
Note 2 - Accounting Pronounceme
Note 2 - Accounting Pronouncements | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Accounting Standards Update and Change in Accounting Principle [Text Block] | 2. ACCOUNTING PRONOUNCEMENTS Recently Issued Accounting Pronouncements In June 2016, No. 2016 13, Measurement of Credit Losses on Financial Instruments November 2018, No. 2018 19 April 2019, No. 2019 04 May 2019, No. 2019 05, November 2019, No. 2019 11, December 15, 2022, first Although there are several other new accounting pronouncements issued or proposed by the FASB, which the Company has adopted or will adopt, as applicable, the Company does not |
Note 3 - Business Combination
Note 3 - Business Combination | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | 3. BUSINESS COMBINATION On September 21, 2021, September 1, 2021, September 1, 2021, The purchase price of $6.25 million was funded with cash on hand and borrowings under the Company’s revolving line of credit, which was increased in connection with the transaction to $5.0 million. Because the Company increased its ownership interest in Zerust India to 100%, the acquisition of Zerust India has been accounted for in accordance with Accounting Standards Codification (ASC) 805, September 1, 2021, The following table summarizes the preliminary purchase price allocation that includes the fair values of the separately identifiable assets acquired and liabilities assumed as of September 1, 2021: Cash and cash equivalents $ 1,187,997 Trade account receivable 1,954,769 Inventories 886,650 Prepaid expenses and other 396,545 Property, plant and equipment 219,077 Operating lease, right of use asset 355,000 Customer relationships 6,347,000 Goodwill 4,782,376 Current liabilities (1,370,314 ) Deferred tax liability (1,904,100 ) Operating lease (355,000 ) Net assets acquired $ 12,500,000 Less: Fair value of previously held equity method investment (1,637,362 ) Cumulative foreign currency translation (661,088 ) Gain recognized on acquisition (3,951,550 ) (6,250,000 ) Cash paid for acquisition $ 6,250,000 The excess of the fair value of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions. The fair values of assets acquired and liabilities assumed may not one The fair value of the intangible asset associated with customer relationships was estimated using a discounted cash flow method with the application of the multi-period excess earnings method. Under this method, an intangible asset’s fair value is equal to the present value of the incremental after-tax cash flows attributable to only the subject intangible asset after deducting contributory asset charges. The rate used to discount the estimated future net cash flows to their present values for the intangible assets was based upon a weighted average cost of capital calculation. The discount rate was determined after consideration of market rates of return on debt and equity capital, the weighted average return on invested capital and the risk associated with achieving forecasted sales related to the assets acquired from Zerust India. The weighted average discount rate used to determine the fair value of the customer relationships was 15.3%. The amortization period for the intangible assets is 15 Authoritative guidance on accounting for business combinations requires that an acquirer re-measure its previously held equity interest in the acquisition at its acquisition date fair value and recognize the resulting gain or loss in earnings. As such, since the Company acquired the remaining 50% September 1, 2021, three November 30, 2021. three November 30, 2021. The Company has included the financial results of Zerust India in the consolidated financial statements from September 1, 2021. three November 30, 2021. Unaudited consolidated pro forma information assuming the acquisition had occurred on September 1, 2020. three November 30, 2020 September 1, 2020 three November 30, 2020 not not may not may may |
Note 4 - Inventories
Note 4 - Inventories | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | 4. INVENTORIES Inventories consisted of the following: November 30, 2021 August 31, 2021 Production materials $ 4,590,008 $ 4,453,688 Finished goods 6,849,730 6,660,519 $ 11,439,738 $ 11,114,207 |
Note 5 - Property and Equipment
Note 5 - Property and Equipment, Net | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | 5. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following: November 30, 2021 August 31, 2021 Land $ 310,365 $ 310,365 Buildings and improvements 13,723,824 13,149,258 Machinery and equipment 5,477,338 5,453,679 19,511,527 18,913,302 Less accumulated depreciation (7,316,853 ) (7,091,844 ) $ 12,194,674 $ 11,821,458 |
Note 6 - Patents and Trademarks
Note 6 - Patents and Trademarks, Net | 3 Months Ended |
Nov. 30, 2021 | |
Patents and Trademarks [Member] | |
Notes to Financial Statements | |
Intangible Assets Disclosure [Text Block] | 6. PATENTS AND TRADEMARKS, NET Patents and trademarks, net consisted of the following: November 30, 2021 August 31, 2021 Patents and trademarks $ 3,070,704 $ 3,018,507 Less accumulated amortization (2,360,829 ) (2,308,935 ) $ 709,875 $ 709,572 Patent and trademark costs are amortized over seven four |
Note 7 - Investments in Joint V
Note 7 - Investments in Joint Ventures | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | 7. INVESTMENTS IN JOINT VENTURES The consolidated financial statements of the Company’s foreign joint ventures are initially prepared using the accounting principles accepted in the respective joint ventures’ countries of domicile. Amounts related to foreign joint ventures reported in the below tables and the accompanying consolidated financial statements have subsequently been adjusted to conform with U.S. GAAP in all material respects. All material profits on sales recorded that remain on the consolidated balance sheet from the Company to its joint ventures and from joint ventures to other joint ventures have been eliminated for financial reporting purposes. Financial information from the audited and unaudited financial statements of the Company’s joint venture in Germany, Excor Korrosionsschutz – Technologien und Produkte GmbH (EXCOR), and all the Company’s other joint ventures are summarized as follows: As of November 30, 2021 Total EXCOR All Other Current assets $ 54,945,793 $ 25,127,390 $ 29,818,403 Total assets 58,833,491 27,282,965 31,550,526 Current liabilities 14,079,093 4,139,822 9,939,271 Noncurrent liabilities 1,288,670 - 1,288,670 Joint ventures’ equity 43,465,728 23,143,143 20,322,585 Northern Technologies International Corporation’s share of joint ventures’ equity 21,357,911 11,571,573 9,786,338 Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings 19,142,941 11,540,668 7,602,273 Three Months Ended November 30, 2021 Total EXCOR All Other Net sales $ 27,022,995 $ 11,300,228 $ 15,722,767 Gross profit 11,032,959 5,468,986 5,563,973 Net income 2,777,605 1,821,547 956,058 Northern Technologies International Corporation’s share of equity in income from joint ventures 1,374,749 910,773 463,976 Northern Technologies International Corporation's dividends received from joint ventures 5,042,271 4,255,200 787,071 As of August 31, 2021 Total EXCOR All Other(1) Current assets $ 69,394,796 $ 33,886,655 $ 35,508,141 Total assets 73,814,402 36,211,520 37,602,882 Current liabilities 16,366,398 5,386,377 10,980,021 Noncurrent liabilities 1,455,524 — 1,455,524 Joint ventures’ equity 55,992,480 30,825,144 25,167,336 Northern Technologies International Corporation’s share of joint ventures’ equity 27,623,768 15,412,574 12,211,194 Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings 24,702,778 14,697,490 10,005,288 Three Months Ended November 30, 2020 Total EXCOR All Other(1) Net sales $ 26,777,343 $ 9,551,483 $ 17,225,860 Gross profit 12,441,761 5,699,007 6,742,754 Net income 3,651,424 2,021,074 1,630,350 Northern Technologies International Corporation’s share of equity in income from joint ventures 1,825,712 1,010,537 815,175 Northern Technologies International Corporation's dividends received from joint ventures 1,125,361 — 1,125,361 __________________ ( 1 Includes Zerust India since Zerust India was not August 31, 2021 November 30, 2020. 3 |
Note 8 - Intangible Assets, Net
Note 8 - Intangible Assets, Net | 3 Months Ended |
Nov. 30, 2021 | |
Customer Relationships and Assembled Workforce [Member] | |
Notes to Financial Statements | |
Intangible Assets Disclosure [Text Block] | 8. INTANGIBLE ASSET, NET Intangible asset, net consisted of the following as of November 30, 2021: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 6,347,000 $ (68,000 ) $ 6,279,000 The customer relationships was established as a part of purchase accounting related to our Zerust India acquisition. See Note 3 three November 30, 2021. five |
Note 9 - Corporate Debt
Note 9 - Corporate Debt | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | 9. CORPORATE DEBT The Company has a revolving line of credit with PNC Bank, National Association (“PNC Bank”) of $5,000,000 as of November 30, 2021. August 31, 2021. November 30, 2021 August 31, 2021. three November 30, 2021 February 22, 2022. 1.10:1.00. November 30, 2021, As of November 30, 2021 August 31, 2021, not November 30, 2021 August 31, 2021, 2021 2022. |
Note 10 - Stockholders' Equity
Note 10 - Stockholders' Equity | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | 10. STOCKHOLDERS EQUITY On April 23, 2020, 19 not three November 30, 2020. January 15, 2021, October 20, 2021, November 17, 2021 November 3, 2021. During the three November 30, 2021 2020, During the three November 30, 2021, 2019 2019 three November 30, 2021, During the three November 30, 2020, 2019 three November 30, 2020, no The Company issued 2,636 and 4,646 shares of common stock on September 1, 2021 2020, November 30, 2021, |
Note 11 - Net Income Per Common
Note 11 - Net Income Per Common Share | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | 11. NET INCOME PER COMMON SHARE Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted net income per share assumes the exercise of stock options using the treasury stock method, if dilutive. The following is a reconciliation of the net income per share computation for the three November 30, 2021 2020: Three Months Ended Numerator: November 30, 2021 November 30, 2020 Net income attributable to NTIC $ 4,493,759 $ 1,262,399 Denominator: Basic – weighted shares outstanding 9,199,976 9,104,623 Weighted shares assumed upon exercise of stock options 579,794 540,007 Diluted – weighted shares outstanding 9,779,770 9,644,630 Basic net income per share: $ 0.49 $ 0.14 Diluted net income per share: $ 0.46 $ 0.13 The dilutive impact summarized above relates to the periods when the average market price of the Company’s common stock exceeded the exercise price of the potentially dilutive option securities granted. Net income per common share was based on the weighted average number of common shares outstanding during the periods when computing basic net income per share. When dilutive, stock options are included as equivalents using the treasury stock market method when computing the diluted net income per share. Excluded from the computation of diluted net income per share for the three November 30, 2021 three November 30, 2020 |
Note 12 - Stock-based Compensat
Note 12 - Stock-based Compensation | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Share-based Payment Arrangement [Text Block] | 12. STOCK-BASED COMPENSATION The Company has three 2019 2007 2007 2019 2007 no may 2007 The 2019 January 15, 2021, 2019 2019 2019 ten one three one November 30, 2021, 2019 2019 November 30, 2021, 2007 The Company granted options to purchase an aggregate of 174,840 and 419,874 shares of its common stock during the three November 30, 2021 2020, three November 30, 2021 2020, November 30, 2021, not 2022, 2023 2024, November 30, 2021. The fair value of each option grant is estimated on the grant date using the Black-Scholes option pricing model with the following assumptions and results for the grants: November 30, 2021 2020 Dividend yield 1.65 % 2.37 % Expected volatility 45.4 % 45.6 % Expected life of option (in years) 10 10 Average risk-free interest rate 0.77 % 0.28 % The weighted average per share fair value of options granted during the three November 30, 2021 2020 November 30, 2021 2020 |
Note 13 - Segment and Geographi
Note 13 - Segment and Geographic Information | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | 13. SEGMENT AND GEOGRAPHIC INFORMATION Segment Information The Company’s chief operating decision maker is its Chief Executive Officer. The Company’s business is organized into two reportable segments: ZERUST® and Natur-Tec®. The Company has been selling its proprietary ZERUST® rust and corrosion inhibiting products and services to the automotive, electronics, electrical, mechanical, military and retail consumer markets for over 45 The following table sets forth the Company’s net sales for the three November 30, 2021 2020 Three Months Ended November 30, 2021 November 30, 2020 ZERUST® net sales $ 14,423,785 $ 10,220,551 Natur-Tec® net sales 3,769,628 2,558,561 Total net sales $ 18,193,413 $ 12,779,112 The following table sets forth the Company’s cost of goods sold for the three November 30, 2021 2020 November 30, 2021 % of Product Sales* November 30, 2020 % of Product Sales* Direct cost of goods sold ZERUST® $ 8,706,667 60.4 % $ 5,771,089 56.5 % Natur-Tec® 2,922,098 77.5 % 1,767,630 69.1 % Indirect cost of goods sold 861,718 NA 774,602 NA Total net cost of goods sold …. $ 12,490,483 $ 8,313,321 * The percent of segment sales is calculated by dividing the direct cost of goods sold for each individual segment category by the net sales for each segment category. The Company utilizes product net sales and direct and indirect cost of goods sold for each product in reviewing the financial performance of a product type. Further allocation of Company expenses or assets, aside from amounts presented in the tables above, is not Geographic Information Net sales by geographic location for the three November 30, 2021 2020 Three Months Ended November 30, 2021 November 30, 2020 Inside the U.S.A. to unaffiliated customers $ 6,156,322 $ 4,861,355 Outside the U.S.A. to: Joint ventures in which the Company is a shareholder directly and indirectly 840,439 580,304 Unaffiliated customers 11,196,652 7,337,453 $ 18,193,413 $ 12,779,112 Net sales by geographic location are based on the location of the customer. Fees for services provided to joint ventures by geographic location as a percentage of total fees for services provided to joint ventures during the three November 30, 2021 2020 Three Months Ended November 30, 2021 % of Total Fees for Services Provided to Joint Ventures November 30, 2020 % of Total Fees for Services Provided to Joint Ventures Germany $ 218,430 17.3 % $ 228,826 17.1 % Poland 176,927 14.1 % 189,410 14.2 % Japan 166,807 13.3 % 179,962 13.5 % France 116,292 9.2 % 105,907 7.9 % Sweden 108,070 8.6 % 90,489 6.8 % United Kingdom 94,927 7.5 % 61,915 4.6 % Thailand 87,554 7.0 % 89,932 6.7 % Finland 80,173 6.4 % 76,283 5.7 % Czech Republic 70,098 5.6 % 69,353 5.2 % South Korea 62,626 5.0 % 85,079 6.4 % Other 76,954 6.0 % 71,197 5.3 % $ 1,258,858 100.0 % $ 1,336,561 100.0 % The geographical distribution of total property and equipment and net sales is as follows: As of November 30, 2021 As of August 31, 2021 China $ 5,380,922 $ 5,110,071 Other 668,393 453,199 United States 6,145,359 6,258,188 Total property and equipment, net $ 12,194,674 $ 11,821,458 Three Months Ended November 30, 2021 November 30, 2020 China $ 4,057,853 $ 4,543,978 Brazil 1,296,217 713,853 India 4,476,984 1,200,468 Other 2,206,037 1,459,458 United States 6,156,322 4,861,355 Total net sales $ 18,193,413 $ 12,779,112 Long-lived assets consist of property and equipment and intangible assets. These assets are periodically reviewed to assure the net realizable value from the estimated future production based on forecasted sales exceeds the carrying value of the assets. Sales to the Company’s joint ventures are included in the foregoing segment and geographic information; however, sales by the Company’s joint ventures to other parties are not All joint venture operations, including equity in income, fees for services and related dividends, are primarily related to ZERUST® products and services. |
Note 14 - Commitments and Conti
Note 14 - Commitments and Contingencies | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | 14. COMMITMENTS AND CONTINGENCIES Annual Bonus Plan On August 26, 2021, August 31, 2022. 2022, 2022 2022, may 2022. three November 30, 2021 three November 30, 2020. Concentrations Two joint ventures (consisting of the Company’s joint ventures in the Korea and Japan) accounted for 42.4% of the Company’s trade joint venture receivables as of November 30, 2021, three November 30, 2020. Legal Matters From time to time, the Company is subject to various other claims and legal actions in the ordinary course of its business. The Company records a liability in its consolidated financial statements for costs related to claims, including future legal costs, settlements and judgments, where the Company has assessed that a loss is probable, and an amount could be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no not not may November 30, 2021, not |
Note 15 - Fair Value Measuremen
Note 15 - Fair Value Measurements | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Fair Value Measurement and Measurement Inputs, Recurring and Nonrecurring [Text Block] | 15. FAIR VALUE MEASUREMENTS Assets and liabilities that are measured at fair value on a recurring basis primarily relate to marketable equity securities. These items are marked-to-market at each reporting period, and the Company estimates that market value approximates costs. The following tables provide information by level for assets and liabilities that are measured at fair value on a recurring basis: Fair Value Measurements Using Inputs Considered as Fair value as of November 30, 2021 Level 1 Level 2 Level 3 Available for sale securities $ 4,634 $ 4,634 $ — $ — Fair Value Measurements Using Inputs Considered as Fair value as of August 31, 2021 Level 1 Level 2 Level 3 Available for sale securities $ 4,634 $ 4,634 $ — $ — There were no 1, 2, 3 three November 30, 2021 2020. |
Note 16 - Supplemental Cash Flo
Note 16 - Supplemental Cash Flow Information | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Cash Flow, Supplemental Disclosures [Text Block] | 16. SUPPLEMENTAL CASH FLOW INFORMATION Supplemental disclosures of cash flow information consisted of: Three Months Ended November 30, 2021 November 30, 2020 Cash paid for interest $ 2,891 $ 2,368 |
Note 17 - Income Taxes
Note 17 - Income Taxes | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 17. INCOME TAXES Income tax expense for the three November 30, 2021 November 30, 2021 August 31, 2021. |
Note 18 - Subsequent Event
Note 18 - Subsequent Event | 3 Months Ended |
Nov. 30, 2021 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | 18. SUBSEQUENT EVENT On January 4, 2022, January 7, 2023 February 23, 2022 January 7, 2023, not |
Note 3 - Business Combination (
Note 3 - Business Combination (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | Cash and cash equivalents $ 1,187,997 Trade account receivable 1,954,769 Inventories 886,650 Prepaid expenses and other 396,545 Property, plant and equipment 219,077 Operating lease, right of use asset 355,000 Customer relationships 6,347,000 Goodwill 4,782,376 Current liabilities (1,370,314 ) Deferred tax liability (1,904,100 ) Operating lease (355,000 ) Net assets acquired $ 12,500,000 Less: Fair value of previously held equity method investment (1,637,362 ) Cumulative foreign currency translation (661,088 ) Gain recognized on acquisition (3,951,550 ) (6,250,000 ) Cash paid for acquisition $ 6,250,000 |
Note 4 - Inventories (Tables)
Note 4 - Inventories (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | November 30, 2021 August 31, 2021 Production materials $ 4,590,008 $ 4,453,688 Finished goods 6,849,730 6,660,519 $ 11,439,738 $ 11,114,207 |
Note 5 - Property and Equipme_2
Note 5 - Property and Equipment, Net (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | November 30, 2021 August 31, 2021 Land $ 310,365 $ 310,365 Buildings and improvements 13,723,824 13,149,258 Machinery and equipment 5,477,338 5,453,679 19,511,527 18,913,302 Less accumulated depreciation (7,316,853 ) (7,091,844 ) $ 12,194,674 $ 11,821,458 |
Note 6 - Patents and Trademar_2
Note 6 - Patents and Trademarks, Net (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Patents and Trademarks [Member] | |
Notes Tables | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | November 30, 2021 August 31, 2021 Patents and trademarks $ 3,070,704 $ 3,018,507 Less accumulated amortization (2,360,829 ) (2,308,935 ) $ 709,875 $ 709,572 |
Note 7 - Investments in Joint_2
Note 7 - Investments in Joint Ventures (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Condensed Balance Sheet [Table Text Block] | As of November 30, 2021 Total EXCOR All Other Current assets $ 54,945,793 $ 25,127,390 $ 29,818,403 Total assets 58,833,491 27,282,965 31,550,526 Current liabilities 14,079,093 4,139,822 9,939,271 Noncurrent liabilities 1,288,670 - 1,288,670 Joint ventures’ equity 43,465,728 23,143,143 20,322,585 Northern Technologies International Corporation’s share of joint ventures’ equity 21,357,911 11,571,573 9,786,338 Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings 19,142,941 11,540,668 7,602,273 As of August 31, 2021 Total EXCOR All Other(1) Current assets $ 69,394,796 $ 33,886,655 $ 35,508,141 Total assets 73,814,402 36,211,520 37,602,882 Current liabilities 16,366,398 5,386,377 10,980,021 Noncurrent liabilities 1,455,524 — 1,455,524 Joint ventures’ equity 55,992,480 30,825,144 25,167,336 Northern Technologies International Corporation’s share of joint ventures’ equity 27,623,768 15,412,574 12,211,194 Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings 24,702,778 14,697,490 10,005,288 |
Condensed Income Statement [Table Text Block] | Three Months Ended November 30, 2021 Total EXCOR All Other Net sales $ 27,022,995 $ 11,300,228 $ 15,722,767 Gross profit 11,032,959 5,468,986 5,563,973 Net income 2,777,605 1,821,547 956,058 Northern Technologies International Corporation’s share of equity in income from joint ventures 1,374,749 910,773 463,976 Northern Technologies International Corporation's dividends received from joint ventures 5,042,271 4,255,200 787,071 Three Months Ended November 30, 2020 Total EXCOR All Other(1) Net sales $ 26,777,343 $ 9,551,483 $ 17,225,860 Gross profit 12,441,761 5,699,007 6,742,754 Net income 3,651,424 2,021,074 1,630,350 Northern Technologies International Corporation’s share of equity in income from joint ventures 1,825,712 1,010,537 815,175 Northern Technologies International Corporation's dividends received from joint ventures 1,125,361 — 1,125,361 |
Note 8 - Intangible Assets, N_2
Note 8 - Intangible Assets, Net (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Customer Relationships and Assembled Workforce [Member] | |
Notes Tables | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 6,347,000 $ (68,000 ) $ 6,279,000 |
Note 11 - Net Income Per Comm_2
Note 11 - Net Income Per Common Share (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended Numerator: November 30, 2021 November 30, 2020 Net income attributable to NTIC $ 4,493,759 $ 1,262,399 Denominator: Basic – weighted shares outstanding 9,199,976 9,104,623 Weighted shares assumed upon exercise of stock options 579,794 540,007 Diluted – weighted shares outstanding 9,779,770 9,644,630 Basic net income per share: $ 0.49 $ 0.14 Diluted net income per share: $ 0.46 $ 0.13 |
Note 12 - Stock-based Compens_2
Note 12 - Stock-based Compensation (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | November 30, 2021 2020 Dividend yield 1.65 % 2.37 % Expected volatility 45.4 % 45.6 % Expected life of option (in years) 10 10 Average risk-free interest rate 0.77 % 0.28 % |
Note 13 - Segment and Geograp_2
Note 13 - Segment and Geographic Information (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Three Months Ended November 30, 2021 November 30, 2020 ZERUST® net sales $ 14,423,785 $ 10,220,551 Natur-Tec® net sales 3,769,628 2,558,561 Total net sales $ 18,193,413 $ 12,779,112 |
Reconciliation of Cost of Goods Sold from Segments to Consolidated [Table Text Block] | November 30, 2021 % of Product Sales* November 30, 2020 % of Product Sales* Direct cost of goods sold ZERUST® $ 8,706,667 60.4 % $ 5,771,089 56.5 % Natur-Tec® 2,922,098 77.5 % 1,767,630 69.1 % Indirect cost of goods sold 861,718 NA 774,602 NA Total net cost of goods sold …. $ 12,490,483 $ 8,313,321 |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] | Three Months Ended November 30, 2021 November 30, 2020 Inside the U.S.A. to unaffiliated customers $ 6,156,322 $ 4,861,355 Outside the U.S.A. to: Joint ventures in which the Company is a shareholder directly and indirectly 840,439 580,304 Unaffiliated customers 11,196,652 7,337,453 $ 18,193,413 $ 12,779,112 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | As of November 30, 2021 As of August 31, 2021 China $ 5,380,922 $ 5,110,071 Other 668,393 453,199 United States 6,145,359 6,258,188 Total property and equipment, net $ 12,194,674 $ 11,821,458 |
Revenue from External Customers by Geographic Areas [Table Text Block] | Three Months Ended November 30, 2021 November 30, 2020 China $ 4,057,853 $ 4,543,978 Brazil 1,296,217 713,853 India 4,476,984 1,200,468 Other 2,206,037 1,459,458 United States 6,156,322 4,861,355 Total net sales $ 18,193,413 $ 12,779,112 |
Fees for Services Provided to Joint Ventures [Member] | |
Notes Tables | |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Three Months Ended November 30, 2021 % of Total Fees for Services Provided to Joint Ventures November 30, 2020 % of Total Fees for Services Provided to Joint Ventures Germany $ 218,430 17.3 % $ 228,826 17.1 % Poland 176,927 14.1 % 189,410 14.2 % Japan 166,807 13.3 % 179,962 13.5 % France 116,292 9.2 % 105,907 7.9 % Sweden 108,070 8.6 % 90,489 6.8 % United Kingdom 94,927 7.5 % 61,915 4.6 % Thailand 87,554 7.0 % 89,932 6.7 % Finland 80,173 6.4 % 76,283 5.7 % Czech Republic 70,098 5.6 % 69,353 5.2 % South Korea 62,626 5.0 % 85,079 6.4 % Other 76,954 6.0 % 71,197 5.3 % $ 1,258,858 100.0 % $ 1,336,561 100.0 % |
Note 15 - Fair Value Measurem_2
Note 15 - Fair Value Measurements (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | Fair Value Measurements Using Inputs Considered as Fair value as of November 30, 2021 Level 1 Level 2 Level 3 Available for sale securities $ 4,634 $ 4,634 $ — $ — Fair Value Measurements Using Inputs Considered as Fair value as of August 31, 2021 Level 1 Level 2 Level 3 Available for sale securities $ 4,634 $ 4,634 $ — $ — |
Note 16 - Supplemental Cash F_2
Note 16 - Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Notes Tables | |
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block] | Three Months Ended November 30, 2021 November 30, 2020 Cash paid for interest $ 2,891 $ 2,368 |
Note 3 - Business Combination_2
Note 3 - Business Combination (Details Textual) - USD ($) | Sep. 01, 2021 | Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | Aug. 31, 2021 | Aug. 30, 2021 |
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain (Loss), Net, Total | $ 3,951,550 | $ 3,951,550 | $ 0 | |||
Revenues, Total | 18,193,413 | 12,779,112 | ||||
Revolving Credit Facility [Member] | PNC Bank [Member] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | $ 5,000,000 | 5,000,000 | $ 5,000,000 | $ 3,000,000 | |
Harita-NTI Limited [Member] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 50.00% | |||||
Business Combination, Consideration Transferred, Total | $ 6,250,000 | |||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Percentage | 50.00% | |||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, including Subsequent Acquisition, Percentage, Total | 100.00% | |||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain (Loss), Net, Total | $ 3,951,550 | 3,951,550 | ||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 2,452,812 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 292,528 | |||||
Business Combination, Acquisition Related Costs | $ 50,000 | |||||
Business Acquisition, Pro Forma Revenue | $ 14,806,403 | |||||
Harita-NTI Limited [Member] | Customer Relationships [Member] | ||||||
Acquired Finite-lived Intangible Assets, Weighted Average Discount Rate | 15.30% | |||||
Harita-NTI Limited [Member] | Customer Relationships and Assembled Workforce [Member] | ||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life (Year) | 15 years |
Note 3 - Business Combination -
Note 3 - Business Combination - Preliminary Purchase Price Allocation (Details) - USD ($) | Sep. 01, 2021 | Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | Aug. 31, 2021 |
Goodwill | $ 4,782,376 | $ 4,782,376 | $ 0 | ||
Gain recognized on acquisition | $ (3,951,550) | (3,951,550) | $ 0 | ||
Harita-NTI Limited [Member] | |||||
Cash and cash equivalents | $ 1,187,997 | ||||
Trade account receivable | 1,954,769 | ||||
Inventories | 886,650 | ||||
Prepaid expenses and other | 396,545 | ||||
Property, plant and equipment | 219,077 | ||||
Customer relationships | 6,347,000 | ||||
Goodwill | 4,782,376 | ||||
Current liabilities | (1,370,314) | ||||
Deferred tax liability | (1,904,100) | ||||
Operating lease | (355,000) | ||||
Net assets acquired | 12,500,000 | ||||
Fair value of previously held equity method investment | (1,637,362) | ||||
Cumulative foreign currency translation | (661,088) | ||||
Gain recognized on acquisition | (3,951,550) | $ (3,951,550) | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest, Total | (6,250,000) | ||||
Cash paid for acquisition | 6,250,000 | ||||
Harita-NTI Limited [Member] | Customer Relationships [Member] | |||||
Operating lease, right of use asset | $ (355,000) |
Note 4 - Inventories - Inventor
Note 4 - Inventories - Inventories (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Production materials | $ 4,590,008 | $ 4,453,688 |
Finished goods | 6,849,730 | 6,660,519 |
Total inventory | $ 11,439,738 | $ 11,114,207 |
Note 5 - Property and Equipme_3
Note 5 - Property and Equipment, Net - Components of Property and Equipment, Net (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Land | $ 310,365 | $ 310,365 |
Buildings and improvements | 13,723,824 | 13,149,258 |
Machinery and equipment | 5,477,338 | 5,453,679 |
Gross | 19,511,527 | 18,913,302 |
Less accumulated depreciation | (7,316,853) | (7,091,844) |
Net | $ 12,194,674 | $ 11,821,458 |
Note 6 - Patents and Trademar_3
Note 6 - Patents and Trademarks, Net (Details Textual) - Patents and Trademarks [Member] | 3 Months Ended |
Nov. 30, 2021USD ($) | |
Finite-Lived Intangible Asset, Useful Life (Year) | 7 years |
Finite-Lived Intangible Asset, Expected Amortization, Year One | $ 190,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 190,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 190,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | $ 190,000 |
Note 6 - Patents and Trademar_4
Note 6 - Patents and Trademarks, Net - Patents and Trademarks, Net (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Patents and trademarkes, net | $ 6,279,000 | $ 0 |
Patents and Trademarks [Member] | ||
Patents and trademarks | 3,070,704 | 3,018,507 |
Less accumulated amortization | (2,360,829) | (2,308,935) |
Patents and trademarkes, net | $ 709,875 | $ 709,572 |
Note 7 - Investments in Joint_3
Note 7 - Investments in Joint Ventures - Condensed Balance Sheet of EXCOR and All Other Joint Ventures (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 | |
Current assets | $ 37,265,090 | $ 33,747,089 | |
Total assets | 83,244,745 | 74,370,879 | |
Current liabilities | 11,389,728 | 8,516,196 | |
Noncurrent liabilities | 2,224,173 | 104,102 | |
Joint ventures’ equity | 66,292,224 | 62,368,026 | |
Investments in joint ventures | 21,357,911 | 27,623,768 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | |||
Current assets | 54,945,793 | 69,394,796 | |
Total assets | 58,833,491 | 73,814,402 | |
Current liabilities | 14,079,093 | 16,366,398 | |
Noncurrent liabilities | 1,288,670 | 1,455,524 | |
Joint ventures’ equity | 43,465,728 | 55,992,480 | |
Investments in joint ventures | 21,357,911 | 27,623,768 | |
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings | 19,142,941 | 24,702,778 | |
EXCOR [Member] | |||
Current assets | 25,127,390 | 33,886,655 | |
Total assets | 27,282,965 | 36,211,520 | |
Current liabilities | 4,139,822 | 5,386,377 | |
Noncurrent liabilities | 0 | 0 | |
Joint ventures’ equity | 23,143,143 | 30,825,144 | |
Investments in joint ventures | 11,571,573 | 15,412,574 | |
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings | 11,540,668 | 14,697,490 | |
All Other [Member] | |||
Current assets | 29,818,403 | ||
Total assets | 31,550,526 | ||
Current liabilities | 9,939,271 | ||
Noncurrent liabilities | 1,288,670 | ||
Joint ventures’ equity | 20,322,585 | ||
Investments in joint ventures | 9,786,338 | ||
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings | $ 7,602,273 | ||
Joint Ventures in France [Member] | |||
Current assets | [1] | 35,508,141 | |
Total assets | [1] | 37,602,882 | |
Current liabilities | [1] | 10,980,021 | |
Noncurrent liabilities | [1] | 1,455,524 | |
Joint ventures’ equity | [1] | 25,167,336 | |
Investments in joint ventures | [1] | 12,211,194 | |
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings | [1] | $ 10,005,288 | |
[1] | Includes Harita-NTI since Harita-NTI was not a consolidated subsidiary of the Company as of Augut 31, 2021 or November 30, 2020. See Note 3. |
Note 7 - Investments in Joint_4
Note 7 - Investments in Joint Ventures - Condensed Income Statement of EXCOR and All Other Joint Ventures (Details) - USD ($) | 2 Months Ended | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | ||
Revenues, Total | $ 18,193,413 | $ 12,779,112 | ||
Gross profit | 5,702,930 | 4,465,791 | ||
Net income | 4,493,759 | 1,262,399 | ||
Northern Technologies International Corporation’s share of equity in income from joint ventures | $ 1,374,749 | 1,374,749 | 1,825,712 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | ||||
Revenues, Total | 27,022,995 | 26,777,343 | ||
Gross profit | 11,032,959 | 12,441,761 | ||
Net income | 2,777,605 | 3,651,424 | ||
Northern Technologies International Corporation’s share of equity in income from joint ventures | 1,374,749 | 1,825,712 | ||
Northern Technologies International Corporation's dividends received from joint ventures | 5,042,271 | 1,125,361 | ||
EXCOR [Member] | ||||
Revenues, Total | 11,300,228 | 9,551,483 | ||
Gross profit | 5,468,986 | 5,699,007 | ||
Net income | 1,821,547 | 2,021,074 | ||
Northern Technologies International Corporation’s share of equity in income from joint ventures | 910,773 | 1,010,537 | ||
Northern Technologies International Corporation's dividends received from joint ventures | 4,255,200 | 0 | ||
All Other [Member] | ||||
Revenues, Total | 15,722,767 | |||
Gross profit | 5,563,973 | |||
Net income | 956,058 | |||
Northern Technologies International Corporation’s share of equity in income from joint ventures | 463,976 | |||
Northern Technologies International Corporation's dividends received from joint ventures | $ 787,071 | |||
Joint Ventures in France [Member] | ||||
Revenues, Total | [1] | 17,225,860 | ||
Gross profit | [1] | 6,742,754 | ||
Net income | [1] | 1,630,350 | ||
Northern Technologies International Corporation’s share of equity in income from joint ventures | [1] | 815,175 | ||
Northern Technologies International Corporation's dividends received from joint ventures | [1] | $ 1,125,361 | ||
[1] | Includes Harita-NTI since Harita-NTI was not a consolidated subsidiary of the Company as of Augut 31, 2021 or November 30, 2020. See Note 3. |
Note 8 - Intangible Assets, N_3
Note 8 - Intangible Assets, Net (Details Textual) - Customer Relationships and Assembled Workforce [Member] | 3 Months Ended |
Nov. 30, 2021USD ($) | |
Finite-Lived Intangible Asset, Useful Life (Year) | 15 years |
Amortization of Intangible Assets, Total | $ 68,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 423,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 423,000 |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 423,000 |
Finite-Lived Intangible Asset, Expected Amortization, Year Five | $ 423,000 |
Note 8 - Intangible Assets, N_4
Note 8 - Intangible Assets, Net (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Customer relationships | $ 6,279,000 | $ 0 |
Customer Relationships [Member] | ||
Patents and trademarks | 6,347,000 | |
Less accumulated amortization | (68,000) | |
Customer relationships | $ 6,279,000 |
Note 9 - Corporate Debt (Detail
Note 9 - Corporate Debt (Details Textual) | 3 Months Ended | |||
Nov. 30, 2021USD ($) | Sep. 01, 2021USD ($) | Aug. 31, 2021USD ($) | Aug. 30, 2021USD ($) | |
PNC Bank [Member] | Revolving Credit Facility [Member] | ||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | $ 3,000,000 |
Long-term Line of Credit, Total | $ 2,500,000 | 0 | ||
Debt, Weighted Average Interest Rate | 2.57% | |||
Debt Instrument, Covenants, Fixed Charge Coverage Ratio | 1.10 | |||
Letters of Credit Outstanding, Amount | $ 0 | 0 | ||
PNC Bank [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | |||
JP Morgan Chase Bank [Member] | ||||
Letters of Credit Outstanding, Amount | $ 104,363 | $ 104,363 |
Note 10 - Stockholders' Equity
Note 10 - Stockholders' Equity (Details Textual) - $ / shares | Oct. 20, 2021 | Sep. 01, 2021 | Sep. 01, 2020 | Nov. 30, 2021 | Nov. 30, 2020 |
Common Stock, Dividends, Per Share, Declared (in dollars per share) | $ 0.07 | $ 0.07 | $ 0 | ||
Dividends Payable, Date Declared | Nov. 17, 2021 | ||||
Stock Repurchased and Retired During Period, Shares (in shares) | 0 | 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 174,840 | 419,874 | |||
Stock Issued During Period, Shares, Employee Stock Purchase Plans (in shares) | 2,636 | 4,646 | |||
Dividends Payable, Date of Record | Nov. 17, 2021 | ||||
The 2019 Plan [member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 895,484 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares) | 704,516 | ||||
The 2019 Plan [member] | Employees and Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 174,840 | 419,874 | |||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share) | $ 16.97 | $ 8.24 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period (in shares) | 16,000 | 0 | |||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price (in dollars per share) | $ 8.70 | ||||
ESPP [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares) | 72,186 |
Note 11 - Net Income Per Comm_3
Note 11 - Net Income Per Common Share (Details Textual) - shares | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Share-based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares) | 311,061 | 605,629 |
Note 11 - Net Income Per Comm_4
Note 11 - Net Income Per Common Share - Reconciliation of the Earnings Per Share Computations (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Net income | $ 4,493,759 | $ 1,262,399 |
Basic – weighted shares outstanding (in shares) | 9,199,976 | 9,104,623 |
Weighted shares assumed upon exercise of stock options (in shares) | 579,794 | 540,007 |
Diluted – weighted shares outstanding (in shares) | 9,779,770 | 9,644,630 |
Basic net income per share: (in dollars per share) | $ 0.49 | $ 0.14 |
Diluted net income per share: (in dollars per share) | $ 0.46 | $ 0.13 |
Note 12 - Stock-based Compens_3
Note 12 - Stock-based Compensation (Details Textual) - USD ($) | Jan. 15, 2021 | Nov. 30, 2021 | Nov. 30, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 174,840 | 419,874 | |
Share-based Payment Arrangement, Expense | $ 232,883 | $ 181,669 | |
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | 1,708,368 | ||
Allocated Share-based Compensation Expense, Estimate Remainder of Fiscal Year | 698,649 | ||
Allocated Share-based Compensation Expense, Estimate, Fiscal Year Two | 671,526 | ||
Allocated Share Based Compensation Expense, Estimate, Fiscal Year Three | $ 338,193 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share) | $ 7.29 | $ 3.12 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term (Year) | 6 years 4 months 28 days | 6 years 10 months 24 days | |
The 2019 Plan [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized (in shares) | 800,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares) | 1,600,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year) | 10 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 895,484 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares) | 704,516 | ||
The 2019 Plan [member] | One Year after Date of Grant [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year) | 1 year | ||
The 2019 Plan [member] | One Year after Date of Grant [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year) | 3 years | ||
The 2007 Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance (in shares) | 690,007 |
Note 12 - Stock-based Compens_4
Note 12 - Stock-based Compensation - Black-Scholes Option-pricing Model Assumptions (Details) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Dividend yield | 1.65% | 2.37% |
Expected volatility | 45.40% | 45.60% |
Expected life of option (in years) (Year) | 10 years | 10 years |
Average risk-free interest rate | 0.77% | 0.28% |
Note 13 - Segment and Geograp_3
Note 13 - Segment and Geographic Information (Details Textual) | 3 Months Ended |
Nov. 30, 2021 | |
Number of Reportable Segments | 2 |
Note 13 - Segment and Geograp_4
Note 13 - Segment and Geographic Information - Net Sales by Segment (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Revenues, Total | $ 18,193,413 | $ 12,779,112 |
ZERUST [Member] | ||
Revenues, Total | 14,423,785 | 10,220,551 |
NaturTec [Member] | ||
Revenues, Total | $ 3,769,628 | $ 2,558,561 |
Note 13 - Segment and Geograp_5
Note 13 - Segment and Geographic Information - Cost of Goods Sold by Segment (Details) - USD ($) | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | ||
Cost of goods sold | $ 12,490,483 | $ 8,313,321 | |
Direct Cost of Goods Sold [Member] | ZERUST [Member] | |||
Cost of goods sold | $ 8,706,667 | $ 5,771,089 | |
Percent of product sales | [1] | 60.40% | 56.50% |
Direct Cost of Goods Sold [Member] | NaturTec [Member] | |||
Cost of goods sold | $ 2,922,098 | $ 1,767,630 | |
Percent of product sales | [1] | 77.50% | 69.10% |
Indirect Cost of Goods Sold [Member] | |||
Cost of goods sold | $ 861,718 | $ 774,602 | |
[1] | The percent of segment sales is calculated by dividing the direct cost of goods sold for each individual segment category by the net sales for each segment category. |
Note 13 - Segment and Geograp_6
Note 13 - Segment and Geographic Information - Net Sales by Geographic Location (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Revenues, Total | $ 18,193,413 | $ 12,779,112 |
Inside the USA to Unaffiliated Customers [Member] | ||
Revenues, Total | 6,156,322 | 4,861,355 |
Joint Ventures in Which the Company is a Shareholder Directly and Indirectly Outside the USA [Member] | ||
Revenues, Total | 840,439 | 580,304 |
Unaffiliated Customers Outside the USA [Member] | ||
Revenues, Total | $ 11,196,652 | $ 7,337,453 |
Note 13 - Segment and Geograp_7
Note 13 - Segment and Geographic Information - Fees for Services Provided to Joint Ventures by Geographic Location as a Percentage of Total Fees (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Fees | $ 1,258,858 | $ 1,336,561 |
Percentage of Total Fees | 100.00% | 100.00% |
GERMANY | ||
Fees | $ 218,430 | $ 228,826 |
Percentage of Total Fees | 17.30% | 17.10% |
POLAND | ||
Fees | $ 176,927 | $ 189,410 |
Percentage of Total Fees | 14.10% | 14.20% |
JAPAN | ||
Fees | $ 166,807 | $ 179,962 |
Percentage of Total Fees | 13.30% | 13.50% |
FRANCE | ||
Fees | $ 116,292 | $ 105,907 |
Percentage of Total Fees | 9.20% | 7.90% |
SWEDEN | ||
Fees | $ 108,070 | $ 90,489 |
Percentage of Total Fees | 8.60% | 6.80% |
UNITED KINGDOM | ||
Fees | $ 94,927 | $ 61,915 |
Percentage of Total Fees | 7.50% | 4.60% |
THAILAND | ||
Fees | $ 87,554 | $ 89,932 |
Percentage of Total Fees | 7.00% | 6.70% |
FINLAND | ||
Fees | $ 80,173 | $ 76,283 |
Percentage of Total Fees | 6.40% | 5.70% |
CZECHIA | ||
Fees | $ 70,098 | $ 69,353 |
Percentage of Total Fees | 5.60% | 5.20% |
KOREA, REPUBLIC OF | ||
Fees | $ 62,626 | $ 85,079 |
Percentage of Total Fees | 5.00% | 6.40% |
Other Countries [Member] | ||
Fees | $ 76,954 | $ 71,197 |
Percentage of Total Fees | 6.00% | 5.30% |
Note 13 - Segment and Geograp_8
Note 13 - Segment and Geographic Information - Total Long-lived Assets by Geographic Distribution (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Total long-lived assets | $ 12,194,674 | $ 11,821,458 |
CHINA | ||
Total long-lived assets | 5,380,922 | 5,110,071 |
Other Countries [Member] | ||
Total long-lived assets | 668,393 | 453,199 |
UNITED STATES | ||
Total long-lived assets | $ 6,145,359 | $ 6,258,188 |
Note 13 - Segment and Geograp_9
Note 13 - Segment and Geographic Information - Total Net Sales by Geographic Distribution (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Revenues, Total | $ 18,193,413 | $ 12,779,112 |
CHINA | ||
Revenues, Total | 4,057,853 | 4,543,978 |
BRAZIL | ||
Revenues, Total | 1,296,217 | 713,853 |
INDIA | ||
Revenues, Total | 4,476,984 | 1,200,468 |
Other Countries [Member] | ||
Revenues, Total | 2,206,037 | 1,459,458 |
UNITED STATES | ||
Revenues, Total | $ 6,156,322 | $ 4,861,355 |
Note 14 - Commitments and Con_2
Note 14 - Commitments and Contingencies (Details Textual) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Accrued Bonuses | $ 483,334 | $ 516,667 |
Entity Wide Trade Joint Venture Receivables, Two Joint Ventures, Percentage | 42.40% | |
Entity Wide Trade Joint Venture Receivables, Three Joint Ventures, Percentage | 55.60% | |
Fiscal 2018 Bonus Plan [Member] | Executive Officer [Member] | ||
Percentage of Individual Bonus Payout Determined by Actual Versus Targeted EBITOI Results | 75.00% | |
Percentage of Individuals Payout Determined Upon Achievement of Certain Pre-Established Individual Performance Objectives | 25.00% |
Note 15 - Fair Value Measurem_3
Note 15 - Fair Value Measurements - Assets and Liabilities Measured at Fair Value Recurring Basis (Details) - Fair Value, Recurring [Member] - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 |
Available for sale securities | $ 4,634 | $ 4,634 |
Fair Value, Inputs, Level 1 [Member] | ||
Available for sale securities | 4,634 | 4,634 |
Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Available for sale securities | $ 0 | $ 0 |
Note 16 - Supplemental Cash F_3
Note 16 - Supplemental Cash Flow Information - Supplemental Disclosures of Cash Flow Information (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Cash paid for interest | $ 2,891 | $ 2,368 |
Note 17 - Income Taxes (Details
Note 17 - Income Taxes (Details Textual) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Income Tax Expense (Benefit), Total | $ 504,380 | $ 378,590 |
Note 18 - Subsequent Event (Det
Note 18 - Subsequent Event (Details Textual) - Revolving Credit Facility [Member] - PNC Bank [Member] - USD ($) | Jan. 04, 2022 | Feb. 23, 2022 | Nov. 30, 2021 | Sep. 01, 2021 | Aug. 31, 2021 | Aug. 30, 2021 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | $ 3,000,000 | ||
Forecast [Member] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 3,000,000 | |||||
Bloomberg Short-Term Bank Yield Index [Member] | Subsequent Event [Member] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% |