Note 6 - Investments in Joint Ventures

3 Months Ended

Nov. 30, 2020

Notes to Financial Statements

Equity Method Investments and Joint Ventures Disclosure [Text Block]

6.     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, 2020
	Total		EXCOR		All Other
Current assets	$	61,457,250	$	28,660,652	$	32,796,598
Total assets		65,569,012		31,051,037		34,517,975
Current liabilities		14,569,061		2,997,769		11,571,292
Noncurrent liabilities		331,743		—		331,743
Joint ventures’ equity		50,668,208		28,053,268		22,614,940
Northern Technologies International Corporation’s share of joint ventures’ equity		24,961,205		14,026,636		10,934,569
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings		22,726,127		13,995,731		8,730,396

	Three Months Ended November 30, 2020
	Total		EXCOR		All Other
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

	As of August 31, 2020
	Total		EXCOR		All Other
Current assets	$	55,825,418	$	25,742,619	$	30,082,799
Total assets		60,295,587		28,449,772		31,845,815
Current liabilities		11,002,867		2,424,565		8,578,302
Noncurrent liabilities		365,274		—		365,274
Joint ventures’ equity		48,927,446		26,025,207		22,902,239
Northern Technologies International Corporation’s share of joint ventures’ equity		24,090,826		13,012,606		11,078,220
Northern Technologies International Corporation’s share of joint ventures’ undistributed earnings		21,855,747		12,981,701		8,874,046

	Three Months Ended November 30, 2019
	Total		EXCOR		All Other
Net sales	$	25,460,294	$	9,368,239	$	16,092,055
Gross profit		11,357,134		5,325,488		6,031,646
Net income		2,587,980		1,642,327		945,653
Northern Technologies International Corporation’s share of equity in income from joint ventures		1,293,990		821,163		472,827
Northern Technologies International Corporation's dividends received from joint ventures	$	205,432		—	$	205,432