Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
Page |
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PART I. |
FINANCIAL INFORMATION |
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Item 1. |
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3 |
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5 |
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6 |
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7 |
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8 |
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Item 2. |
14 |
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Item 3. |
20 |
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Item 4. |
20 |
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PART II. |
OTHER INFORMATION |
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Item 1. |
22 |
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Item 1A. |
22 |
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Item 2. |
22 |
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Item 3. |
22 |
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Item 4. |
22 |
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Item 5. |
22 |
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Item 6. |
22 |
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23 |
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31.1 |
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31.2 |
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32 |
May 31, 2022 |
February 28, 2022 |
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(unaudited) |
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Assets |
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Current assets |
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Cash and cash equivalents |
$ |
$ | ||||||
Accounts receivable, less allowance for doubtful accounts of $ |
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Employee retention credit refund receivable |
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Inventories, net |
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Contract assets |
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Prepaid expenses and other current assets |
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Total current assets |
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Property, plant, and equipment |
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Buildings |
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Machinery and equipment |
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Accumulated depreciation |
( |
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( |
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Net property, plant, and equipment |
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Right of use assets under operating leases |
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Intangible assets, net |
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Other noncurrent assets |
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Total assets |
$ |
$ | ||||||
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May 31, 2022 |
February 28, 2022 |
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(unaudited) |
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Liabilities and Shareholders’ Equity |
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Current liabilities |
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Accounts payable |
$ |
$ | ||||||
Accrued liabilities |
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Contract liabilities |
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Note payable to officers and directors, current (Note 6) |
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Current maturities of financing lease obligations |
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Current operating lease liabilities |
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Total current liabilities |
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Finance lease obligations less current maturities |
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Long-term operating lease liabilities |
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Total liabilities |
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Shareholders’ Equity |
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Preferred stock, |
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Common stock, |
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Additional paid-in capital |
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Retained earnings |
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Treasury stock, shares at cost; |
( |
) |
( |
) | ||||
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Total shareholders’ equity |
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Total liabilities and shareholders’ equity |
$ |
$ | ||||||
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Three Months Ended May 31, |
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2022 |
2021 |
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Net sales |
$ |
$ |
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Cost of goods sold |
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Gross profit |
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Operating expenses |
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Selling and delivery |
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General and administrative |
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Operating loss |
( |
) |
( |
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Other income (expense) |
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Interest expense, net |
( |
) |
( |
) | ||||
Gain on disposal of equipment, net |
— |
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Other, net |
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Loss before income taxes |
( |
) |
( |
) | ||||
Income tax expense |
— |
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Net loss |
$ |
( |
) |
$ |
( |
) | ||
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Net loss per share: |
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Net loss per share-basic |
$ |
( |
) |
$ |
( |
) | ||
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Net loss per share-diluted |
$ |
( |
) |
$ |
( |
) | ||
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Basic weighted average shares outstanding |
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Diluted weighted average shares outstanding |
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Common Shares* |
Share Amount |
Additional Paid-in Capital |
Retained Earnings |
Treasury Stock |
Total Shareholders’ Equity |
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Balance, February 28, 2022 |
$ | $ | $ | $ | ( |
) | $ | |||||||||||||||||
Net loss |
— |
— |
— |
( |
) |
— |
( |
) | ||||||||||||||||
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Balance, May 31, 2022 (unaudited) |
$ |
$ |
$ |
$ |
( |
) |
$ |
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Common Shares* |
Share Amount |
Additional Paid-in Capital |
Retained Earnings |
Treasury Stock |
Total Shareholders’ Equity |
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Balance, February 28, 2021 |
$ | $ | $ | $ | ( |
) | $ | |||||||||||||||||
Net loss |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
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Balance, May 31, 2021 (unaudited) |
$ | $ | $ | $ | ( |
) | $ | |||||||||||||||||
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* |
Common Shares are shown net of Treasury Shares |
Three Months Ended May 31, |
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2022 |
2021 |
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Operating Activities |
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Net loss |
$ |
( |
) |
$ | ( |
) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
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Depreciation expense |
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Amortization of intangible assets |
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Provision for doubtful accounts |
( |
) | ||||||
Provision for inventory reserve |
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Gain on disposal of equipment |
( |
) |
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Other |
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Changes in working capital items: |
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Accounts receivable |
( |
) |
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Inventories |
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Prepaid expenses and other assets |
( |
) | ||||||
Contract assets |
( |
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Employee retention credit refund receivable |
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Customer deposits |
( |
) | ||||||
Accounts payable and accrued liabilities |
( |
) | ||||||
Net cash (used in) provided by operating activities |
( |
) |
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Investing Activities |
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Capital expenditures |
( |
) | ( |
) | ||||
Proceeds from disposal of equipment |
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Net cash used in investing activities |
( |
) | ||||||
Financing Activities |
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Repayments of long-term debt |
( |
) | ||||||
Repayments on lease financing |
( |
) |
( |
) | ||||
Proceeds from loans with officers and directors |
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Net cash provided by (used in) financing activities |
( |
) | ||||||
Net change in cash and cash equivalents |
( |
) |
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Cash and cash equivalents, beginning of year |
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Cash and cash equivalents, end of period |
$ |
$ | ||||||
May 31, 2022 |
February 28, 2022 |
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Working capital |
$ |
$ | ||||||
Liquid assets |
$ |
$ |
May 31, 2022 |
February 28, 2022 |
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Raw materials |
$ |
$ |
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Work-in-process |
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Finished goods |
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$ |
$ |
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May 31, 2022 |
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Assets |
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Operating lease right-of-use |
$ | |||
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Liabilities |
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Current portion of operating lease liabilities |
$ | |||
Noncurrent portion of operating lease liabilities |
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Total operating lease liabilities |
$ | |||
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May 31, 2022 |
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Weighted average remaining lease term |
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Weighted average discount rate |
% | |||
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FY2023 |
$ | |||
FY2024 |
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FY2025 |
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Total operating lease payments |
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Less imputed interest |
( |
) | ||
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Total operating lease liabilities |
$ | |||
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May 31, 2022 |
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Financing lease right-of-use |
$ | |||
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Current portion of financing lease liabilities |
$ | |||
Noncurrent portion of financing lease liabilities |
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Total financing lease liabilities |
$ | |||
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Fiscal Year |
Amount |
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2023 |
$ | |||
2024 |
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Total finance lease payments |
$ | |||
Less imputed interest |
( |
) | ||
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Total finance lease liabilities |
$ | |||
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Three Months Ended May 31, |
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2022 |
2021 |
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Cash paid for: |
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Interest |
$ |
$ |
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Weighted |
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Average |
Loss |
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Net |
Common Shares |
Per |
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Loss |
Outstanding |
Share |
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Three months ended May 31, 2022 |
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Basic |
$ | ( |
) | $ | ( |
) | ||||||
Effect of dilution: |
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Options |
— | — | — | |||||||||
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Diluted |
$ | ( |
) | $ | ( |
) | ||||||
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Three months ended May 31, 2021 |
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Basic |
$ | ( |
) | $ | ( |
) | ||||||
Effect of dilution: |
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Options |
— | — | — | |||||||||
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Diluted |
$ | ( |
) | $ | ( |
) | ||||||
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• | Simulation and Training Products |
• | Cyber Secure Products – |
• | Data Display CRTs– |
• | Other Computer Products – |
May 31, 2022 |
February 28, 2022 |
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Working capital |
$ |
348 |
$ | 509 | ||||
Liquid assets |
$ |
153 |
$ | 245 |
Three Months Ended May 31 |
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2022 |
2021 |
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Amount |
% |
Amount |
% |
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Net Sales |
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Simulation and Training (VDC Display Systems) |
2,052 |
72.2 |
% |
1,011 |
54.4 |
% | ||||||||||
Data Display CRT (Lexel and Data Display) |
476 |
16.8 |
232 |
12.5 |
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Cyber Secure Products (AYON Cyber Security) |
72 |
2.5 |
204 |
11.0 |
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Other Computer Products (Unicomp) |
241 |
8.5 |
410 |
22.1 |
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Total net sales |
2,841 |
100.0 |
% |
1,857 |
100.0 |
% | ||||||||||
Costs and expenses |
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Cost of goods sold |
2,130 |
75.0 |
% |
1,490 |
80.2 |
% | ||||||||||
Selling and delivery |
149 |
5.2 |
158 |
8.5 |
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General and administrative |
870 |
30.6 |
993 |
53.5 |
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3,149 |
110.8 |
% |
2,641 |
142.2 |
% | |||||||||||
Operating loss |
(308 |
) |
(10.8 |
)% |
(784 |
) |
(42.2 |
)% | ||||||||
Interest (expense), net |
(5 |
) |
(0.2 |
)% |
(10 |
) |
(0.5 |
)% | ||||||||
Other income, net |
18 |
0.6 |
49 |
2.6 |
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Loss before income taxes |
(295 |
) |
(10.4 |
)% |
(745 |
) |
(40.1 |
)% | ||||||||
Income tax expense |
— |
— |
— |
— |
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|
|
|
|
|
|
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|
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Net loss |
(295 |
) |
(10.4 |
)% |
(745 |
) |
(40.1 |
)% | ||||||||
|
|
|
|
|
|
|
|
May 31, 2022 |
February 28, 2022 |
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Working capital |
$ |
348 |
$ | 509 | ||||
Liquid assets |
$ |
153 |
$ | 245 |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. | Defaults upon Senior Securities |
Item 4. | Submission of Matters to a Vote of Security Holders |
Item 5. | Other information |
Item 6. | Exhibits |
VIDEO DISPLAY CORPORATION | ||||||
July 20, 2022 | By: | /s/ Ronald D. Ordway | ||||
Ronald D. Ordway | ||||||
Chief Executive Officer | ||||||
July 20, 2022 | By: | /s/ Gregory L. Osborn | ||||
Gregory L. Osborn | ||||||
Chief Financial Officer |