Company: MGLD
Filing Date: 2025-09-19
Form Type: 10-K
Source: 0001493152-25-014286
Chunk: 64

Company: Marygold Companies, Inc.
Filing Date: 2025-09-19
Form: 10-K
Item: Item 1
Chunk 64
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 of segment reporting, both revenue streams are considered part of the same “food
products” segment, which is how it is evaluated by the Company’s Chief Operating Decision Maker.

Baking
and Printing: Within the baking sector Gourmet Foods has three major customer groups: 1) grocery stores, 2) gasoline convenience
stores, and 3) independent retailers and cafes. The grocery industry in New Zealand is dominated by several large chain operations,
each of which is a customer of Gourmet Foods. There can be no assurance that these customers will continue to purchase products from
Gourmet Foods, however, in view of the length of the relationship with such customers, management believes that such customers will
continue purchasing Gourmet Foods’ products. In the gasoline convenience store market customer group, Gourmet Foods supplies a
marketing consortium of gasoline dealers operating under the same brand and a consortium of gasoline convenience stores. This
consortium comprised 55% of the total revenue for the bakery sector in fiscal 2025. The third major customer group is independent
retailers and cafes. The printing sector of Gourmet Foods’ revenues is comprised of many customers, some large and some small.
The two largest customers in the printing sector represented 59% of printing sector revenue in fiscal 2025.

Sources
and Availability of Materials

Gourmet
Foods, including Printstock, is not dependent upon any one major supplier as many alternative sources are available locally. However,
the after-effects of the COVID-19 pandemic have resulted in increased cost of raw ingredients and local shipping. These cost increases,
coupled with the rising cost of labor, have negatively impacted Gourmet Foods profit margins and, in some instances, its ability to meet
market demand in a timely manner. In response to these pressures, Gourmet Foods has discontinued sales of lower margin products to some grocery outlets
resulting in lower gross sales revenues, but higher margins. Gourmet Foods is focused on securing the best prices available for raw materials
in the local market and joining other manufacturers of food products in efforts to encourage grocery outlets to adopt price increases in
the coming fiscal year.

9

Competition

Gourmet
Foods competes with other commercial-scale manufacturers of meat pies in New Zealand. Competitors’ products may be
more effectively marketed and sold, than products Gourmet Foods may commercialize. Larger competitors in New Zealand
also enjoy economies of scale in production allowing them to offer products at lower retail prices, making it difficult for us to compete
in