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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
____________
FORM
For the quarterly period ended
OR
For the transition period from to
Commission File Number
INTEGRATED BIOPHARMA, INC.
(Exact name of registrant, as specified in its charter)
|
|
|
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |
(Address of principal executive offices) (Zip Code)
(
(Registrant ’ s telephone number, including Area Code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Exchange Act:
|
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
|
None |
None |
None |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
|
Smaller reporting company
|
||||||
|
Large accelerated filer ☐ |
Accelerated filer ☐ |
|
Emerging growth company
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
As of November 10, 2025, there were
INTEGRATED BIOPHARMA, INC. AND SUBSIDIARIES
FORM 10-Q QUARTERLY REPORT
For the Three Months Ended September 30, 2025
INDEX
|
Page |
||
|
Part I. Financial Information |
||
|
Item 1. |
Condensed Consolidated Statements of Income for the Three Months Ended September 30, 2025 and 2024 (unaudited) |
2 |
|
Condensed Consolidated Balance Sheets as of September 30, 2025 and June 30, 2025 (unaudited) |
3 |
|
|
Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended September 30, 2025 and 2024 (unaudited) |
4 |
|
|
Condensed Consolidated Statements of Cash Flows for the Three Months Ended September 30, 2025 and 2024 (unaudited) |
5 |
|
|
Notes to the Condensed Consolidated Financial Statements (unaudited) |
6 |
|
|
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
16 |
|
Item 3. |
Quantitative and Qualitative Disclosures about Market Risk |
21 |
|
Item 4. |
Controls and Procedures |
21 |
|
Part II. Other Information |
||
|
Item 1. |
Legal Proceedings |
21 |
|
Item 1A. |
Risk Factors |
21 |
|
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
21 |
|
Item 3. |
Defaults Upon Senior Securities |
22 |
|
Item 4. |
Mine Safety Disclosure |
22 |
|
Item 5. |
Other Information |
22 |
|
Item 6. |
Exhibits |
22 |
|
Other |
||
|
Signatures |
23 |
|
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this Quarterly Report on Form 10-Q may constitute “forward-looking” statements as defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Private Securities Litigation Reform Act of 1995 (the “PSLRA”) or in releases made by the Securities and Exchange Commission (“SEC”), all as may be amended from time to time. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of Integrated BioPharma, Inc. and its subsidiaries (collectively, the “Company”) or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, changes in general economic and business conditions; loss of market share through competition; introduction of competing products by other companies; the timing of regulatory approval and the introduction of new products by the Company; changes in industry capacity; pressure on prices from competition or from purchasers of the Company's products; regulatory changes in the pharmaceutical manufacturing industry and nutraceutical industry; regulatory obstacles to the introduction of new technologies or products that are important to the Company; availability of qualified personnel; the loss of any significant customers or suppliers; inflation (including those caused by tariffs) and tightened labor markets; and other factors both referenced and not referenced in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (“Form 10-K”) as filed with the SEC. Statements that are not historical fact are forward-looking statements. Forward-looking statements can be identified by, among other things, the use of forward-looking language, such as the words, “plan”, “believe”, “expect”, “anticipate”, “intend”, “estimate”, “project”, “may”, “will”, “would”, “could”, “should”, “seeks”, or “scheduled to”, or other similar words, or the negative of these terms or other variations of these terms or comparable language, or by discussion of strategy or intentions. These cautionary statements are being made pursuant to the Securities Act, the Exchange Act and the PSLRA with the intention of obtaining the benefits of the “safe harbor” provisions of such laws. The Company cautions investors that any forward-looking statements made by the Company are not guarantees or indicative of future performance. Important assumptions and other important factors that could cause actual results to differ materially from those forward-looking statements with respect to the Company, include, but are not limited to, the risks and uncertainties affecting their businesses described in Item 1A of the Company’s Form 10-K and in other filings by the Company with the SEC. Although the Company believes that its plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, actual results could differ materially from a projection or assumption in any of its forward-looking statements. The Company’s future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made only as of the date hereof and the Company does not have or undertake any obligation to update or revise any forward-looking statements whether as a result of new information, subsequent events or otherwise, unless otherwise required by law.
ITEM 1. FINANCIAL STATEMENTS
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share amounts)
(Unaudited)
|
Three months ended |
||||||||
|
September 30, |
||||||||
|
2025 |
2024 |
|||||||
|
Sales, net |
$ |
|
$ |
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||||
|
Cost of sales |
|
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Gross profit |
|
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Selling and administrative expenses |
|
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|
Operating income |
|
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| Interest income, net |
|
|
||||||
|
Income before income taxes |
|
|
||||||
|
Income tax expense, net |
|
|
||||||
|
Net income |
$ |
|
$ |
|
||||
|
Basic net income per common share |
$ |
|
$ |
|
||||
| Diluted net income per common share | $ |
|
$ |
|
||||
|
Weighted average common shares outstanding - basic |
|
|
||||||
| Add: Equivalent shares outstanding - Stock Options |
|
|
||||||
| Weighted average common shares outstanding - diluted |
|
|
||||||
See accompanying notes to unaudited condensed consolidated financial statements.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except share and per share amounts)
(Unaudited)
|
September 30, |
June 30, |
|||||||
|
2025 |
2025 |
|||||||
|
Assets |
||||||||
|
Current Assets: |
||||||||
|
Cash |
$ |
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$ |
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||||
|
Accounts receivable (less allowance of credit losses of $ ) |
|
|
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Inventories |
|
|
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Other current assets |
|
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Total current assets |
|
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||||||
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Property and equipment, net |
|
|
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Operating lease right-of-use assets (includes $ and $ with a related party) |
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| Finance lease right-of-use assets |
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Deferred tax assets, net |
|
|
||||||
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Security deposits and other assets |
|
|
||||||
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Total Assets |
$ |
|
$ |
|
||||
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Liabilities and Stockholders' Equity: |
||||||||
|
Current Liabilities: |
||||||||
|
Accounts payable |
$ |
|
$ |
|
||||
|
Accrued expenses and other current liabilities |
|
|
||||||
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Current portion of financed lease obligation |
|
|
||||||
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Current portion of operating lease liabilities (includes $ and $ with a related party) |
|
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Total current liabilities |
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| Finance lease obligations |
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Operating lease liabilities |
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Total liabilities |
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Commitments and Contingencies (Note 6) |
||||||||
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Stockholders' Equity : |
||||||||
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Common Stock, $ par value; shares authorized; |
||||||||
|
and shares issued and outstanding, respectively |
|
|
||||||
|
Additional paid-in capital |
|
|
||||||
|
Accumulated deficit |
(
|
) |
(
|
) | ||||
|
Less: Treasury stock, at cost, shares |
(
|
) |
(
|
) | ||||
|
Total Stockholders' Equity |
|
|
||||||
|
Total Liabilities and Stockholders' Equity |
$ |
|
$ |
|
||||
See accompanying notes to unaudited condensed consolidated financial statements.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF STOCKHOLDERS ’ EQUITY
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 and 2024
(in thousands, except share and per share amounts)
(Unaudited)
| FOR THE THREE MONTHS ENDED September 30, 2025: |
Total |
|||||||||||||||||||||||||||
|
Common Stock |
Additional |
Accumulated |
Treasury Stock |
Stockholders' |
||||||||||||||||||||||||
|
Shares |
Par Value |
Paid-in-Capital |
Deficit |
Shares |
Cost |
Equity |
||||||||||||||||||||||
|
Balance, July 1, 2025 |
|
$ |
|
$ |
|
$ |
(
|
) |
|
$ |
(
|
) | $ |
|
||||||||||||||
|
Stock compensation expense for employee stock options |
- |
|
|
|
- |
|
|
|||||||||||||||||||||
|
Net income |
- |
|
|
|
- |
|
|
|||||||||||||||||||||
|
Balance, September 30, 2025 |
|
$ |
|
$ |
|
$ |
(
|
) |
|
$ |
(
|
) | $ |
|
||||||||||||||
| FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024: | ||||||||||||||||||||||||||||
| Total | ||||||||||||||||||||||||||||
|
Common Stock |
Additional |
Accumulated |
Treasury Stock |
Stockholders' |
||||||||||||||||||||||||
|
Shares |
Par Value |
Paid-in-Capital |
Deficit |
Shares |
Cost |
Equity |
||||||||||||||||||||||
|
Balance, July 1, 2024 |
|
$ |
|
$ |
|
$ |
(
|
) |
|
$ |
(
|
) | $ |
|
||||||||||||||
|
Stock compensation expense for employee stock options |
- |
|
|
|
- |
|
|
|||||||||||||||||||||
|
Net income |
- |
|
|
|
- |
|
|
|||||||||||||||||||||
|
Balance, September 30, 2024 |
|
$ |
|
$ |
|
$ |
(
|
) |
|
$ |
(
|
) | $ |
|
||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, except share and per share amounts)
(Unaudited)
|
Three Months ended |
||||||||
|
September 30, |
||||||||
|
2025 |
2024 |
|||||||
|
Cash flows provided by operating activities: |
||||||||
|
Net income |
$ |
|
$ |
|
||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
|
Amortization of right-of-use assets |
|
|
||||||
| Depreciation and amortization |
|
|
||||||
|
Stock based compensation |
|
|
||||||
|
Change in deferred tax assets |
|
|
||||||
|
Other, Net |
|
|
||||||
|
Changes in operating assets and liabilities: |
||||||||
|
Decrease (increase) in: |
||||||||
|
Accounts receivable, net |
|
|
||||||
|
Inventories |
(
|
) |
|
|||||
|
Other current assets |
(
|
) |
(
|
) | ||||
|
(Decrease) increase in: |
||||||||
|
Accounts payable |
|
|
||||||
|
Accrued expenses and other liabilities |
|
(
|
) | |||||
|
Operating lease obligations |
(
|
) |
(
|
) | ||||
|
Net cash provided by operating activities |
|
|
||||||
|
Cash flows from investing activities: |
||||||||
|
Purchase of property and equipment |
(
|
) |
(
|
) | ||||
|
Net cash used in investing activities |
(
|
) |
(
|
) | ||||
|
Cash flows from financing activities: |
||||||||
|
Payments under finance lease obligations |
(
|
) |
(
|
) | ||||
|
Net cash used in financing activities |
(
|
) |
(
|
) | ||||
|
Net increase in cash |
|
|
||||||
|
Cash at beginning of period |
|
|
||||||
|
Cash at end of period |
$ |
|
$ |
|
||||
|
Supplemental disclosures of cash flow information: |
||||||||
|
Interest paid |
$ |
|
$ |
|
||||
|
Supplemental disclosures of non-cash flow transactions: |
||||||||
| Transfer of finance right-of-use asset, net to property and equipment, net | $ |
|
$ |
|
See accompanying notes to unaudited condensed consolidated financial statements.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
Note 1. Nature of Operations, Principles of Consolidation and Basis of Presentation of Interim Financial Statements
Nature of Operations
Integrated BioPharma, Inc., a Delaware corporation (together with its subsidiaries, the “Company”), is engaged primarily in the business of manufacturing, distributing, marketing and sales of vitamins, nutritional supplements and herbal products. The Company’s customers are located primarily in the United States and Luxembourg. The Company was originally incorporated in the state of Delaware on August 31, 1995 under the name Chem International, Inc., on December 5, 2000, changed its name to Integrated Health Technologies, Inc. and on January 29, 2003 changed its name to Integrated BioPharma, Inc. The Company restated its certificate of incorporation in Delaware in June 2006. The Company continues to do business as Chem International, Inc. with certain of its customers and certain vendors.
The Company’s business segments include: (a) Contract Manufacturing operated by Manhattan Drug Company, Inc. (“MDC”), which manufactures vitamins and nutritional supplements for sale to distributors, multilevel marketers and specialized health-care providers and (b) Other Business Lines which includes the operations of (i) MDC Warehousing and Distribution, Inc. (“MDCWHD”), a service provider for warehousing and fulfillment services, (ii) Chem International, Inc. (“Chem”), a distributor of certain raw materials for DSM Nutritional Products LLC and the holding entity of the Company and (iii) all other inactive subsidiaries of the Company.
Principles of Consolidation
The accompanying condensed consolidated financial statements for the interim periods are unaudited and include the accounts of Company. Intercompany transactions and accounts have been eliminated in consolidation.
Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation.
Basis of Presentation of Interim Financial Statements
The accompanying condensed consolidated financial statements for the interim periods are unaudited and include the accounts of Integrated BioPharma, Inc., a Delaware corporation (together with its subsidiaries, the “Company”). The interim condensed consolidated financial statements have been prepared in conformity with Rule 8 - 03 of Regulation S- X of the Securities and Exchange Commission (“SEC”) and therefore do not include information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States of America (“GAAP”). However, all adjustments (consisting only of normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the periods presented have been included. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10 -K for the fiscal year ended June 30, 2025 ( “Form 10 -K”), as filed with the SEC. The June 30, 2025 balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
The preparation of the unaudited condensed consolidated financial statements in conformity with these accounting principles requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the period. Ultimate results could differ from the estimates of management. The results of operations for the three months ended September 30, 2025 are not necessarily indicative of the results for the full fiscal year ending June 30, 2026 or for any other period.
Significant Accounting Policies
Revenue Recognition. The Company recognizes product sales revenue, the prices of which are fixed and determinable, when title and risk of loss have transferred to the customer, when estimated provisions for product returns, rebates, charge-backs and other sales allowances are reasonably determinable, and when collectability is reasonably assured. Accruals for these items are presented in the condensed consolidated financial statements as reductions to sales. The Company’s net sales represent gross sales invoiced to customers, less certain related charges for discounts, returns, rebates, charge-backs and other allowances. Cost of sales includes the cost of raw materials and all labor and overhead associated with the manufacturing and packaging of the products. Gross margins are affected by, among other things, changes in the relative sales mix among our products and valuation and/or charge off of slow moving, expired or obsolete inventories. The Company also recognizes revenue for warehousing and fulfillment services provided to MDCWH customers. To perform revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps:
|
● |
identification of the promised goods or services in the contract; |
|
● |
determination of whether the promised goods or serves are performance obligations including whether they are distinct in the context of the contract; |
|
● |
measurement of the transaction price, including the constraint on variable consideration; |
|
● |
allocation of the transaction price to the performance obligations based on estimated selling prices; and |
|
● |
recognition of revenue when (or as) the Company satisfies each performance obligation. A performance obligation is a promise to transfer a distinct good or service to the customer and is the unit of account in ASC 606. |
Income Taxes.
The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective. Tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than
not
that all or a portion of a deferred tax asset will
not
be realized. For the
three
months ended
September 30, 2025
and
2024,
the Company had federal income tax expense of $
Leases. The Company determines if an arrangement is a lease at inception. Operating and finance leases are included in right-of-use (“ROU”) assets, other current liabilities, and lease obligations on its condensed consolidated balance sheets.
Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as vehicles, the Company accounts for the lease and non-lease components as a single lease component.
Earnings Per Share. Basic earnings per common share amounts are based on weighted average number of common shares outstanding. Diluted earnings per share amounts are based on the weighted average number of common shares outstanding, plus the incremental shares that would have been outstanding upon the assumed exercise of all potentially dilutive stock options, subject to anti-dilution limitations using the treasury stock method.
The following options and potentially dilutive shares for stock options were not included in the computation of weighted average diluted common shares outstanding as the effect of doing so would be anti-dilutive for the three months ended September 30, 2025 and 2024:
|
Three Months Ended |
||||||||
|
September 30, |
||||||||
|
2025 |
2024 |
|||||||
|
Anti-dilutive stock options |
|
|
||||||
|
Total anti-dilutive shares |
|
|
||||||
Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued Accounting Standards Update ("ASU") 2023 - 09 - Income Taxes (Topic 740 ): Improvements to Income Tax Disclosures, which requires public entities to provide greater disaggregation within their annual rate reconciliation, including new requirements to present reconciling items on a gross basis in specified categories, disclose both percentages and dollar amounts, and disaggregate individual reconciling items by jurisdiction and nature when the effect of the items meet a quantitative threshold. The guidance also requires disaggregating the annual disclosure of income taxes paid, net of refunds received, by federal (national), state, and foreign taxes, with separate presentation of individual jurisdictions that meet a quantitative threshold. The guidance is effective for the Company's annual periods beginning July 1, 2025 on a prospective basis, with a retrospective option, and early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard on its condensed consolidated financial statements and disclosures.
In November 2024, the FASB issued ASU 2024 - 03 (updated ASU 2025 - 01 issued in January 2025), Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220 - 40 ): Disaggregation of Income Statement Expenses, which requires the disaggregation of certain expense captions into specified categories in disclosures within the notes to the financial statements to provide enhanced transparency into the expense captions presented on the face of the income statement. The guidance is effective for the Company’s annual periods beginning July 1, 2027, and interim periods thereafter, on a prospective basis, with a retrospective option, and early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2024 - 03.
In July 2025, the FASB issued ASU 2025 - 05 - Financial Instruments - Credit Losses (Topic 326 ): Measurement of Credit Losses for Accounts Receivable and Contract Assets which will provide an election for practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. The update is effective for the Company’s annual periods beginning July 1, 2027, and interim periods thereafter, on a prospective basis, with a retrospective option, and early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025 - 05.
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
Note 2. Inventories
Inventories are stated at the lower of cost or net realizable value using the first -in, first -out method and consist of the following:
|
September 30, |
June 30, |
|||||||
|
2025 |
2025 |
|||||||
|
Raw materials |
$ |
|
$ |
|
||||
|
Work-in-process |
|
|
||||||
|
Finished goods |
|
|
||||||
|
Total |
$ |
|
$ |
|
||||
Note 3. Property and Equipment, net
Property and equipment, net consists of the following:
|
September 30, |
June 30, |
|||||||
|
2025 |
2025 |
|||||||
|
Land and building |
$ |
|
$ |
|
||||
|
Leasehold improvements |
|
|
||||||
|
Machinery and equipment |
|
|
||||||
|
|
|
|||||||
|
Less: Accumulated depreciation and amortization |
(
|
) |
(
|
) | ||||
|
Total |
$ |
|
$ |
|
||||
Depreciation and amortization expense recorded on property and equipment for the
three
months ended
September 30, 2025
and
2024
was $
Note 4 . Lines of Credit
On
April 15, 2025,
the Company entered into a Loan Agreement (the “Loan Agreement”) with PNC Bank, National Association (“PNC”). As of
September 30, 2025
and
June 30, 2025,
the Company had
The Loan Agreement provides a committed revolving line of credit under which the Company
may
request, and the PNC will make advances to the Company from time to time until
April 5, 2026, (
the "Expiration Date"), in an aggregate amount outstanding at any time
not
to exceed $
The Line of Credit bears interest at a rate per annum which is equal to the sum of (A) Daily
one
-month
plus (B)
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
Prior to any Conversion Date, amounts outstanding under the Convertible ELOC will bear interest at a rate per annum (the "Daily Rate”) equal to the sum of (i) Daily
one
-month SOFR plus (ii)
The Company also entered into a Reimbursement Agreement for Standby and Commercial Letter(s) of Credit whereby, from time to time, the Borrower may request the issuance of one or more letters of credit (each a "Credit"). The Credit bears interest at the same rate as the Line of Credit under the Loan Agreement as described above.
In addition, in connection with the Loan Agreement, the Company and MDC (collectively, the "Grantors") each entered into a Security Agreement with PNC, pursuant to which each of the Grantors assigned and granted to PNC, as secured party, a continuing lien on and security interest in all right, title and interest of such Grantor in, to, and under all of the assets of such Grantor.
Note 5. Significant Risks and Uncertainties
(a) Major Customers.
For the
three
months ended
September 30, 2025
and
2024,
approximately
The loss of any of these customers could have an adverse effect on the Company’s operations. Major customers are those customers who account for more than 10% of net sales.
(b) Other Business Risks.
Approximately
The Company has seen a slight negative impact in its margins due to inflation and tightened labor markets as the Company strives to increase prices to customers as its operating costs increase. The Company may not be able to timely increase its selling prices to its customer resulting from price increases from its suppliers due to various economic factors, including tariffs and other inflationary costs, labor and shipping costs and its own increases in shipping, labor and other operating costs. The Company’s results of operations may also be affected by economic conditions, including tariffs and other inflationary pressures, that can impact consumer disposable income levels and spending habits, thereby reducing the orders it may receive from the Company’s significant customers.
Note 6. Leases and other Commitments and Contingencies
(a) Leases.
The Company has operating and finance leases for its corporate and sales offices, warehousing and packaging facilities and certain machinery and equipment, including office equipment. The Company’s leases have remaining terms of less than
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
The components of lease expense for the three months ended September 30, 2025 and 2024 were as follows:
|
Three months ended September 30, |
||||||||||||||||||||||||
|
2025 |
2024 |
|||||||||||||||||||||||
|
Related Party - Vitamin Realty |
Other Leases |
Totals |
Related Party - Vitamin Realty |
Other Leases |
Totals |
|||||||||||||||||||
|
Operating lease costs |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||||||
|
Finance Lease Costs: |
||||||||||||||||||||||||
| Amortization of right-of use assets | $ |
|
$ |
|
|
$ |
|
$ |
|
$ |
|
|||||||||||||
|
Total finance lease cost |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||||||
Rent and lease amortization costs are included in cost of sales and selling and administrative expenses in the accompanying Condensed Consolidated Statements of Income.
Operating Lease Liabilities
Related Party Operating Lease Liabilities.
Warehouse and office facilities are leased from Vitamin Realty Associates, LLC (“Vitamin Realty”), which is
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
Rent expense and lease amortization costs for the
three
months ended
September 30, 2025
and
2024
on these leases were $
Other Operating Lease Liabilities. The Company has entered into certain non-cancelable operating lease agreements expiring up through May 9, 2027 related to machinery and equipment and office equipment.
As of September 30, 2025, the Company’s right-of-use assets, lease obligations and remaining cash commitment on these leases were as follows:
|
Right-of-use Assets |
Current Portion of Operating Lease Obligations |
Operating Lease Obligations |
Remaining Cash Commitment |
|||||||||||||
|
Vitamin Realty Leases |
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
|
Warehouse Lease |
|
|
|
|
||||||||||||
| Transportation equipment lease |
|
|
|
|
||||||||||||
|
Office equipment leases |
|
|
|
|
||||||||||||
| $ |
|
$ |
|
$ |
|
$ |
|
|||||||||
As of June 30, 2025, the Company’s ROU assets, lease obligations and remaining cash commitment on these leases were as follows:
|
Right-of-use Assets |
Current Portion Operating Lease Obligations |
Operating Lease Obligations |
Remaining Cash Commitment |
|||||||||||||
|
Vitamin Realty Leases |
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
|
Warehouse lease |
|
|
|
|
||||||||||||
| Transportation equipment lease |
|
|
|
|
||||||||||||
| Office equipment leases |
|
|
|
|
||||||||||||
| $ |
|
$ |
|
$ |
|
$ |
|
|||||||||
As of
September 30, 2025
and
June 30, 2025,
the Company’s weighted average discount rate for operating leases was approximately
Financed Lease Obligations.
As of September 30, 2025, the Company’s ROU assets, lease obligations and remaining cash commitment on such leases is as follows:
|
Right-of-use Assets |
Current Portion Finance Lease Obligations |
Finance Lease Obligations |
Remaining Cash Commitment |
|||||||||||||
|
US Bank |
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
|
ByLine Financial Group |
|
|
|
|
||||||||||||
| $ |
|
$ |
|
$ |
|
$ |
|
|||||||||
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
As of June 30, 2025, the Company’s ROU assets, lease obligations and remaining cash commitment on such leases is as follows:
|
Right-of-use Assets |
Current Portion Finance Lease Obligations |
Finance Lease Obligations |
Remaining Cash Commitment |
|||||||||||||
|
US Bank |
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
|
ByLine Financial Group |
|
|
|
|
||||||||||||
| $ |
|
$ |
|
$ |
|
$ |
|
|||||||||
As of
September 30, 2025
and
June 30, 2025,
the Company’s weighted average discount rate is
Supplemental cash flows information related to leases for the three months ended September 30, 2025 is as follows:
|
Related Party - Vitamin Realty |
Other Leases |
Totals |
||||||||||
|
Cash paid for amounts included in the measurement of lease liabilities: |
||||||||||||
|
Operating cash flows from operating leases |
$ |
|
$ |
|
$ |
|
||||||
|
Operating cash flows from finance leases |
|
|
|
|||||||||
|
Financing cash flows from finance lease obligations |
|
|
||||||||||
Supplemental cash flows information related to leases for the three months ended September 30, 2024, is as follows:
|
Related Party - Vitamin Realty |
Other Leases |
Totals |
||||||||||
|
Cash paid for amounts included in the measurement of lease liabilities: |
||||||||||||
|
Operating cash flows from operating leases |
$ |
|
$ |
|
$ |
|
||||||
|
Operating cash flows from finance leases |
|
|
|
|||||||||
|
Financing cash flows from finance lease obligations |
|
|
|
|||||||||
Maturities of operating lease liabilities as of September 30, 2025 were as follows:
|
Operating |
Related Party |
Finance | ||||||||||||||
|
Year ending |
Lease |
Operating Lease |
Lease | |||||||||||||
|
June 30, |
Commitments |
Commitment |
Commitments |
Total |
||||||||||||
|
2026, remaining |
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
|
2027 |
|
|
|
|
||||||||||||
| 2028 |
|
|
|
|
||||||||||||
| 2029 |
|
|
|
|
||||||||||||
|
2030 |
|
|
|
|
||||||||||||
|
Total minimum lease payments |
|
|
|
|
||||||||||||
|
Imputed interest |
(
|
) |
(
|
) | ) |
(
|
) | |||||||||
|
Total |
$ |
|
$ |
|
|
$ |
|
|||||||||
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
(b) Legal Proceedings.
The Company is subject, from time to time, to claims by third parties under various legal theories. The defense of such claims, or any adverse outcome relating to any such claims, could have a material adverse effect on the Company’s liquidity, financial condition and cash flows.
Note 7. Related Party Transactions
Information related to related party transactions are disclosed in Note 6 (a). Leases for related party lease transactions.
Note 8. Equity Transactions and Stock-Based Compensation
For the
three
months ended
September 30, 2025
and
2024,
the Company incurred stock-based compensation expenses of $
The Company had the following stock options outstanding as of
June 30, 2025
and
September 30, 2025
and exercisable as of
September 30, 2025:
|
Weighted |
||||||||
|
Average |
||||||||
|
Exercise |
||||||||
|
Options |
Price |
|||||||
|
Outstanding as of June 30, 2025 |
|
$ |
|
|||||
|
|
||||||||
| Outstanding as of September 30, 2025 |
|
$ |
|
|||||
|
|
||||||||
|
Exercisable at September 30, 2025 |
|
$ |
|
|||||
Note 9. Segment Information and Disaggregated Revenue
In its operation of the business, management, including its chief operating decision makers (“CODMs”), who are also the Company’s Co-Chief Executive Officers, review certain financial information, including segmented internal profit and loss statements. The primary profitability measure used by the CODMs to review segment operating results is gross profit. The CODM uses gross profit to allocate resources during our annual planning process and throughout the year, as well as to assess the performance of the Company’s segments, primarily by monitoring actual results compared to prior periods and expected results. During the periods presented, the Company reported its financial performance based on the following segments: Contract Manufacturing and Other Business Lines.
The basis for presenting segment results generally is consistent with overall Company reporting. The Company reports information about its operating segments in accordance with GAAP which establishes standards for reporting information about a company’s operating .
The international sales, concentrated primarily in Europe, for the
three
months ended
September 30, 2025
and
2024
were $
INTEGRATED BIOPHARMA, INC. AND ITS SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)
(Unaudited)
Financial information relating to the three months ended September 30, 2025 and 2024 operations by business segment and disaggregated revenues was as follows:
|
Sales, Net |
|
||||||||||||||||||||||||||||
|
U.S. |
International |
Cost of |
Gross |
Capital |
|||||||||||||||||||||||||
|
Customers |
Customers |
Total |
Sales |
Profit |
Depreciation |
Expenditures |
|||||||||||||||||||||||
|
Contract Manufacturing |
2025 |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||||||||
|
2024 |
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Other Business Lines |
2025 |
|
|
|
|
|
|
|
|||||||||||||||||||||
|
2024 |
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Total Company |
2025 |
|
|
|
|
|
|
|
|||||||||||||||||||||
|
2024 |
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Total Assets as of |
||||||||
|
September 30, |
June 30, |
|||||||
|
2025 |
2025 |
|||||||
|
Contract Manufacturing |
$ |
|
$ |
|
||||
| Other Nutraceutical Businesses |
|
|
||||||
|
Total Company |
$ |
|
$ |
|
||||
Item 2. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANICAL CONDITION AND RESULTS OF OPERATION (dollars in thousands)
Certain statements set forth under this caption constitute “forward-looking statements.” See “Disclosure Regarding Forward-Looking Statements” on page 1 of this Quarterly Report on Form 10-Q for additional factors relating to such statements. The following discussion should also be read in conjunction with the condensed consolidated financial statements of the Company and Notes thereto included herein and the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
The Company is engaged primarily in the business of manufacturing, distributing, marketing and sales of vitamins, nutritional supplements and herbal products. The Company’s customers are located primarily in the United States and Luxembourg.
Business Outlook
Our future results of operations and the other forward-looking statements contained in this Quarterly Report on Form 10-Q, including this “Management’s Discussion and Analysis of Financial Condition and Results of Operation”, involve a number of risks and uncertainties—in particular, the statements regarding our goals and strategies, new product introductions, plans to cultivate new businesses, future economic conditions, revenue, pricing, gross margin and costs, competition, the tax rate, and potential legal proceedings. We are focusing our efforts to improve operational efficiency and reduce spending that may have an impact on expense levels and gross margin. In addition to the various important factors discussed above, a number of other important factors could cause actual results to differ significantly from our expectations. See the risks described in “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
For the three months ended September 30, 2025, our net sales from operations decreased by $928 to approximately $12,689 from approximately $13,617 in the three months ended September 30, 2024. Our net sales in the Contract Manufacturing Segment and in Other Business Lines decreased by $806 and $122, respectively. The decrease in net sales in our Contract Manufacturing Segment of $806 was primarily due to decreased sales volumes to Herbalife and Life Extension in the amounts of $307 and $215 and other customers of $284. For the three months ended September 30, 2025 and 2024, a significant portion of our consolidated net sales, approximately 87% and 85%, respectively, were concentrated among two customers, Life Extension and Herbalife, in our Contract Manufacturing Segment. Life Extension and Herbalife represented approximately 71% and 20% and 68% and 21%, respectively, of our Contract Manufacturing Segment’s net sales in the three months ended September 30, 2025 and 2024, respectively. The loss of any of these customers could have a significant adverse impact on our financial condition and results of operations. Revenues in the three months ended September 30, 2025 were lower than the three months ended September 30, 2024 in our Other Business Lines Segment by $122 due to decreased sales in MDC WHD in the amount of $175, offset by an increase in sales from Chem’s distributor business in the amount of $53.
Our net income for the three months ended September 30, 2025 was approximately $123 compared to a net income of approximately $259 in the three months ended September 30, 2024, a decrease of approximately $136. The decrease was primarily the result of decreased operating income of $327, offset by the decrease in income tax expense of $172. Our profit margins decreased from approximately 10.1% of net sales in the three months ended September 30, 2024 to approximately 8.0% of net sales in the three months ended September 30, 2025, primarily as a result of the decrease in net sales of approximately 6.8% while our cost of goods sold decreased by approximately 4.7%, resulting in less sales available to cover our fixed manufacturing expenses. Our selling and administrative expenses were substantially the same for the three months ended September 30 2025 and 2024, approximately $856 to $881, respectively.
Our revenue from our two significant customers in our Contract Manufacturing Segment is dependent on their demand within their respective distribution channels for the products we manufacture for them. As in any competitive market, our ability to match or beat other contract manufacturers pricing for the same items may also alter our outlook and the ability to maintain or increase revenues. We will continue to focus on our core businesses and push forward in maintaining our cost structure in line with our sales and expanding our customer base.
We have seen a slight negative impact in our margins due to inflation and tightened labor markets as we strive to increase prices to our customers as our operating costs increase. We may not be able to timely increase our selling prices to our customers resulting from price increases from our suppliers due to various economic factors, including tariffs and other inflationary costs, labor and shipping costs and our own increases in shipping, labor and other operating costs. Our results of operations may also be affected by economic conditions, including tariffs and other inflationary pressures, that can impact consumer disposable income levels and spending habits, thereby reducing the orders we may receive from our significant customers.
Critical Accounting Estimates
There have been no changes to our critical accounting estimates in the three months ended September 30, 2025. Critical accounting estimates made in accordance with our accounting policies are regularly discussed by management with our Audit Committee. Those estimates are discussed under “Critical Accounting Estimates” in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 of our Annual Report on Form 10-K for the year ended June 30, 2025.
Results of Operations (in thousands, except share and per share amounts)
Our results from operations in the following table, sets forth the income statement data of our results as a percentage of net sales for the periods indicated:
|
For the three months |
||||||||
|
ended September 30, |
||||||||
|
2024 |
2024 |
|||||||
|
Sales, net |
100.0 | % | 100.0 | % | ||||
|
Costs and expenses: |
||||||||
|
Cost of sales |
92.9 | % | 89.9 | % | ||||
|
Selling and administrative |
6.7 | % | 6.5 | % | ||||
| 98.7 | % | 96.4 | % | |||||
|
Operating income |
1.3 | % | 3.6 | % | ||||
| Interest income, net | 0.2 | % | 0.1 | % | ||||
|
Income before income taxes |
1.5 | % | 3.7 | % | ||||
|
Income tax expense, net |
0.5 | % | 1.8 | % | ||||
|
Net income |
1.0 | % | 1.9 | % | ||||
For the Three Months Ended September 30, 2025 compared to the Three Months Ended September 30, 2024
Sales, net. Sales, net, for the three months ended September 30, 2025 and 2024 were $12,689 and $13,617, respectively, a decrease of 6.8%, and are comprised of the following:
|
Three Months ended |
Dollar |
Percentage |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2025 |
2024 |
2025 vs 2024 |
2025 vs 2024 |
|||||||||||||
|
(amounts in thousands) |
||||||||||||||||
|
Contract Manufacturing: |
||||||||||||||||
|
US Customers |
$ | 10,131 | $ | 10,788 | $ | (657 | ) | (6.1% | ) | |||||||
|
International Customers |
2,036 | 2,185 | (149 | ) | (6.8% | ) | ||||||||||
|
Net sales, Contract Manufacturing |
12,167 | 12,973 | (806 | ) | (6.2% | ) | ||||||||||
|
Other Nutraceuticals: |
||||||||||||||||
|
US Customers |
522 | 644 | (122 | ) | (18.9% | ) | ||||||||||
|
International Customers |
- | - | - | - | ||||||||||||
|
Net sales, Other Nutraceuticals |
522 | 644 | (122 | ) | (18.9% | ) | ||||||||||
|
Total net sales |
$ | 12,689 | $ | 13,617 | $ | (928 | ) | (6.8% | ) | |||||||
For the three months ended September 30, 2025 and 2024, a significant portion of our consolidated net sales, approximately 87% and 85%, respectively, were concentrated among two customers, Life Extension and Herbalife, in our Contract Manufacturing Segment. Life Extension and Herbalife, represented approximately 71% and 20% and 68% and 21%, respectively, of our Contract Manufacturing Segment’s net sales in the three months ended September 30, 2025 and 2024, respectively.
The decrease in net sales in our Contract Manufacturing Segment of $806 was primarily due to decreased sales volumes to Herbalife and Life Extension in the amounts of $307 and $215 and other customers of $284.
Revenues in the three months ended September 30, 2025 were lower than the three months ended September 30, 2024 in our Other Business Lines Segment by $122 due to decreased sales in MDC WHD in the amount of $175, offset by an increase in sales from Chem’s distributor business in the amount of $53. Three other different customers in the Other Business Lines Segment, while not significant customers of the Company’s consolidated net sales, represented approximately 21%, 19% and 12% and 10%, 28% and 39%, respectively, of net sales of the Other Business Lines Segment in the three months ended September 30, 2025 and 2024, respectively.
Cost of sales. Cost of sales decreased by approximately $576 to $11,670 for the three months ended September 30, 2025, as compared to $12,246 for the three months ended September 30, 2024, or approximately 4.7%. Cost of sales increased as a percentage of sales to 92.0% for the three months ended September 30, 2025 as compared to 89.9% for the three months ended September 30, 2024. The increase in the cost of sales as a percentage of sales of approximately 2.1% increased primarily as the result of decreased sales while our cost to manufacture increased by approximately 2.5%.
Selling and Administrative Expenses. Selling and administrative expenses were substantially the same for the three months ended September 30 2025 and 2024, approximately $856 to $881, respectively. As a percentage of sales, net, selling and administrative expenses were approximately 6.7% and 6.5% in the three months ended September 30, 2025 and 2024, respectively. The decrease of $25 was primarily from decreases in our employee salaries and benefits in the amount of $43 and all other general expenses in the amount of $28, offset by an increase in professional and consulting fees of $46. No other general expense decreased or increased by more than $14.
Interest Income, net. Interest income, net was approximately $33 and $14 for the three months ended September 30, 2025 and 2024 and represents interest earned on our cash in the bank offset by interest expense and other financing costs under our Lines of Credit with PNC.
Income tax expense, net. For the three months ended September 30, 2025 and 2024, the Company had federal income tax expense of $51 and $190, respectively and state income tax expense, net of approximately $22 and $55, in the three months ended September 30, 2025 and 2024, respectively.
Net income. Our net income for the three months ended September 30, 2025 and 2024 was approximately $123 and $259, respectively, a decrease of approximately $136. The decrease of approximately $136 was primarily the result of decreased operating income of $327, offset by the decrease income tax expense of $172.
Seasonality
The nutraceutical business can be seasonal. Due to our current customer base in our contract manufacturing segment, we have not experienced a seasonality impact on our sales volumes as we had seen in the past. In the past we had experienced some seasonality in the December quarters based on the demands of our customer base at the time.
The Company believes that there are non-seasonal factors that may influence the variability of quarterly results including, but not limited to, general economic and industry conditions that affect consumer spending, changing consumer demands and current news on nutritional supplements. Accordingly, a comparison of the Company’s results of operations from consecutive periods is not necessarily meaningful, and the Company’s results of operations for any period are not necessarily indicative of future periods.
Liquidity and Capital Resources
The following table sets forth, for the periods indicated, the Company’s net cash flows used in operating, investing and financing activities, its period end cash and cash equivalents and other operating measures:
|
For the Three Months ended |
||||||||
|
September 30, |
||||||||
|
2025 |
2024 |
|||||||
|
(dollars in thousands) |
||||||||
|
Net cash provided by operating activities |
$ | 1,301 | $ | 657 | ||||
|
Net cash used in investing activities |
$ | (173 | ) | $ | (56 | ) | ||
|
Net cash used in financing activities |
$ | (11 | ) | $ | (7 | ) | ||
|
Cash at end of period |
$ | 4,732 | $ | 2,271 | ||||
As of September 30, 2025, our working capital was approximately $14,860, an increase of $345 from our working capital of $14,515 as of June 30, 2025. The increase in our working capital was the result of our current assets increasing by $861 and our current liabilities decreasing by $516. The increase in our currents assets was from $1,117, $1,107, and $84 in cash, inventories and other current assets, respectively, offset by a decrease in accounts receivable of $1,447.
Operating Activities
Net cash provided by operating activities of $1,301 in the three months ended September 30, 2025 includes net income of approximately $123. After excluding the effects of non-cash expenses, including depreciation and amortization, and changes in deferred tax assets, the adjusted cash provided from operations before the effect of the changes in working capital components was $570. Net cash provided from our operations in the three months ended September 30, 2025 from our working capital assets and liabilities was approximately $731 and was primarily the result of cash provided by a decrease in accounts receivable of $1,447 and an aggregate increase in accounts payable, accrued expenses and other liabilities of $721, offset by increases in our inventories and other current assets of $1,107 and $87, respectively and a decrease in obligations under operating leases of $243.
Net cash provided by operating activities of $657 in the three months ended September 30, 2024 includes net income of approximately $259. After excluding the effects of non-cash expenses, including depreciation and amortization, and changes in deferred tax assets, the adjusted cash provided from operations before the effect of the changes in working capital components was $832. Net cash used in our operations in the three months ended September 30, 2024 from our working capital assets and liabilities was approximately $175 and was primarily the result of cash used from an aggregate decrease in accounts payable, accrued expenses and other liabilities of $329, offset by a decrease in our accounts receivable and inventories of $283 and $20, respectively.
Investing Activities
Cash used in investing activities in the three months ended September 30, 2025 and 2024, of approximately $173 and $56 was for the purchase of machinery and equipment, respectively.
Financing Activities
Cash used in financing activities was approximately $11 and $7 of principal payments under financed lease obligations for the three months ended September 30, 2025 and 2024, respectively.
As of September 30, 2025, we had cash of $4,732, funds available under our credit lines of approximately $4,500 and working capital of approximately $14,860 and operating income of $163 in the three months ended September 30, 2025. After taking into consideration our interim results and current projections, management believes that operations, together with the revolving credit facility will support our working capital requirements at least through the period ending November 10, 2026.
Our current total annual commitments as of September 30, 2025 for long term non-cancelable leases of approximately $505 consists of obligations under operating leases for office and warehouse facilities and for the rental of machinery, transportation and office equipment.
Capital Expenditures
The Company's capital expenditures for the three months ended September 30, 2025 and 2024 were approximately $173 and $56, respectively. The Company has budgeted approximately $500 for capital expenditures for fiscal year 2026. The total amount is expected to be funded from lease financing and cash provided from the Company’s operations.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
Recent Accounting Pronouncements
See Note 1. Nature of Operations, Principles of Consolidation and Basis of Presentation of Interim Financial Statements to the Condensed Consolidated Financial Statements in Item 1 in this Quarterly Report,
Impact of Inflation
The Company may not be able to timely increase its selling prices to its customer resulting from price increases from its suppliers due to various economic factors, including tariffs and other inflationary factors, labor and shipping costs and its own increases in shipping, labor and other operating costs. The Company’s results of operations may also be affected by economic conditions, including tariffs and other inflationary pressures, that can impact consumer disposable income levels and spending habits, thereby reducing the orders it may receive from the Company’s significant customers.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
Item 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized, and reported within the time periods specified by the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to management, including the Co-Chief Executive Officers and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Under the supervision and with the participation of management, including the Co-Chief Executive Officers and Chief Financial Officer, the Company has evaluated the effectiveness of its disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2025, and, based upon this evaluation, the Co-Chief Executive Officers and Chief Financial Officer have concluded that these controls and procedures are effective in providing reasonable assurance of compliance.
Changes in Internal Control over Financial Reporting
No change in our internal control over financial reporting occurred during the three months ended September 30, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II – OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
From time to time, we may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. However, litigation is subject to inherent uncertainties and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results.
Item 1A. Risk Factors
There have been no material changes to the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Recent Sales of Unregistered Securities
None
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. MINE SAFETY DISCLOSURE
Not Applicable.
Item 5. OTHER INFORMATION
Item 6. EXHIBITS
(a) Exhibits
Exhibit
Number
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31.1 |
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31.2 |
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Chief Financial Officer. |
|
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32.1 |
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32.2 |
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101.INS*** |
Inline XBRL Instance |
Furnished herewith |
|
101.SCH*** |
Inline XBRL Taxonomy Extension Schema |
Furnished herewith |
|
101.CAL*** |
Inline XBRL Taxonomy Extension Calculation |
Furnished herewith |
|
101.DEF*** |
Inline XBRL Taxonomy Extension Definition |
Furnished herewith |
|
101.LAB*** |
Inline XBRL Taxonomy Extension Labels |
Furnished herewith |
|
101.PRE*** |
Inline XBRL Taxonomy Extension Presentation |
Furnished herewith |
|
104 |
Cover Page Interactive Date File (formatted as Inline XBRL and contained in Exhibit 101) |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
INTEGRATED BIOPHARMA, INC.
| Date: November 10, 2025 | By: /s/ Christina Kay |
| Christina Kay, | |
| Co-Chief Executive Officer | |
| Date: November 10, 2025 | By: /s/ Riva Sheppard |
| Riva Sheppard, | |
| Co-Chief Executive Officer | |
| Date: November 10, 2025 | By: /s/ Dina L. Masi |
| Dina L. Masi, | |
| Chief Financial Officer & Senior Vice President |