TECHPRECISION CORP
For the period ended Sep 30, 2024. Filed Jan 21, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Jan 21, 2025
TPCS$4.90-2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-11-07.
0001410578-24-001803
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-09-30; filed 2025-01-21.
0001410578-25-000033
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 119 previous paragraphs and 154 current paragraphs.
68 unchanged; 48 reworded; 25 added; 2 removed; 1 previous and 13 current paragraphs rearranged.
Tables are not compared: 30 previous and 33 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
(in thousands, except per share data)
Current report
TechPrecision, through our wholly owned subsidiaries, is a manufacturer of large - scale metal fabricated and machined precision components and equipment. These components are used in a variety of markets, primarily defense and aerospace, and secondarily precision industrial. All our operations and customers are in the United States.
Current report
We work with our customers to manufacture components in accordance with the customers’ drawings and specifications. Our work complies with specific military specifications and standards as well as national and international codes and standards required by our customers. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service.
Current report
On December 19, 2024, Ranor and the other Borrowers entered into a Tenth Amendment to Amended and Restated Loan Agreement and Sixth Amendment to Second Amended and Restated Promissory Note, or the “Tenth Amendment”, with Berkshire Bank. The Tenth Amendment, among other things, extended the maturity date of the Revolver Loan from January 15, 2025 to April 30, 2025
Current report
*Consolidated –*Revenue was $8,946 for the three months ended September 30, 2024, or 12% higher when compared to revenue of $7,970 for the three months ended September 30, 2023. Revenue increased at Stadco and Ranor by $617 and $295, respectively.
Current report
*Ranor –*Revenue was $4,790 for the three months ended September 30, 2024, an increase of $295 or 7%, on a favorable project mix.
Current report
*Stadco –*Revenue was $4,223 for the three months ended September 30, 2024, an increase of $617, or 17%, driven by an favorable project mix when compared the same period prior year.
Current report
*Ranor –*Gross profit increased by $474, when compared to the same period a year ago. Cost of revenue was $179 lower, due to efficient production with higher absorbed overhead added to our work-in-progress when compared with the same period a year ago. Gross margin increased to 17% from 13% for the three months ended September 30, 2024 compared to the three months ended September 30, 2023.
Current report
*Stadco –*Gross profit was negative $504 for the three months ended September 30, 2024, as our losses increased by $495 when compared to the same period a year ago. Production issues remain as factory overhead was under absorbed, and repairs and maintenance and certain project losses increased year-over-year. Gross margin decreased to (6)% for the three months ended September 30, 2024 compared to 0% for the three months ended September 30, 2023. The Stadco projects executed had overall relatively higher contract values as compared with the same period a year ago. However, higher relative contracts prices do not necessarily have higher gross profit or gross margin.
Current report
*Consolidated –*Total selling, general and administrative expenses decreased by $130, or 8%, primarily due to a decrease in spending for outside advisory services in connection with due diligence for the terminated Votaw acquisition a year ago.
Current report
Ranor – SG&A expense increased by $6 as an increase in compensation slightly offset a decrease in office costs when compared with the same period a year ago.
Current report
Stadco – SG&A expense increased by $7 due primarily to a slight increase in compensation when compared with the same period a year ago.
Current report
Corporate and unallocated – SG&A decreased by approximately $143, primarily on a reduction for outside advisory services in connection with due diligence for the terminated Votaw acquisition which was evident in the same period of the prior year.
Current report
Ranor – Operating income increased by 70% due to a favorable three month period of operating execution and throughput.
Current report
Corporate and unallocated – Operating loss decreased by $109, primarily on a reduction for outside advisory services in connection with due diligence for the terminated Votaw acquisition which was evident in the same period of the prior year.
Current report
Six Months Ended September 30, 2024 and 2023
Current report
Revenue
Current report
Gross Profit and Gross Margin
Current report
Operating (loss) income
Current report
Other Income (Expense), net
Current report
Interest expense increased by $2 when compared with the six months ended September 30, 2023, due primarily to a slightly increase in interest expense for borrowings under the revolver loan.
Current report
Income Tax expense (benefit)
Current report
Net Loss
Current report
On July 3, 2024, the Company sold 521,800 shares of the Company’s common stock, par value $0.0001 per share, and 521,800 common stock purchase warrants to purchase 521,800 shares of Common Stock in a private placement at an aggregate purchase price of $1,801. Placement agent’s fees in connection with the offering totaled $213.
Current report
On December 19, 2024, Ranor and the other Borrowers entered into a Tenth Amendment to Amended and Restated Loan Agreement and Sixth Amendment to Second Amended and Restated Promissory Note, or the “Tenth Amendment”, with Berkshire Bank. the Tenth Amendment, among other things, extended the maturity date of the Revolver Loan from January 15, 2025 to April 30, 2025.
Removed paragraphs (2)
Previous report
Cash provided by operating activities for the three months ended June 30, 2023, was approximately $0.1 million. Cash provided by operating activities included reimbursements under a certain customer project program and was almost entirely offset by payments for obligations for goods and services that had been acquired on open account from suppliers.
Previous report
On December 23, 2022, Ranor and certain affiliates of the Company entered into a Fifth Amendment to Amended and Restated Loan Agreement, Fifth Amendment to Promissory Note and First Amendment to Second Amended and Restated Promissory Note, or the “Amendment”. Effective as of December 20, 2022, the Amendment, among other things (i) extends the maturity date of the loan originally made to Ranor by Berkshire Bank in 2016, or the “Ranor Term Loan”, to December 15, 2027, (ii) extends the maturity date of the Revolver Loan from December 20, 2022 to December 20, 2023, (iii) increases the interest rate on the Ranor Term Loan from 5.21% to 6.05% per annum, (iv) decreases the monthly payment on the Ranor Term Loan from $19,260 to $16,601, (v) replaces LIBOR as an option for the benchmark interest rate for the Revolver Loan with SOFR, (vi) replaces LIBOR-based interest pricing conventions with SOFR-based pricing conventions, including benchmark replacement provisions, and (vii) solely with respect to the fiscal quarter ending December 31, 2022, lowers the debt service coverage ratio from at least 1.2 to 1.0 to 1.1 to 1.0. Our capital expenditures are limited to $1.5 million annually and contain loan-to-value, and balance sheet leverage covenants.
Reworded paragraphs (48)
Previous wording
All manufacturing at Stadco is performed in accordance with customer requirements. Stadco is an AS 9100 D and ISO 9001:2015 certificate holder and a NADCAP NonDestructive Testing certificate holder. Stadco is a US defense-centric company with over 60% of its revenue in the defense sector. Stadco is registered and compliant with ITAR.
Current wording
All manufacturing at Stadco is performed in accordance with customer requirements. Stadco is an AS 9100 D and ISO 9001:2015 certificate holder and a NADCAP NonDestructive Testing certificate holder. Stadco is a US defense-centric company with almost all of its revenue in the defense sector. Stadco is registered and compliant with ITAR.
Previous wording
On May 28, 2024, Ranor and the other Borrowers entered into an Eighth Amendment to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note, or the “Eighth Amendment”, with Berkshire Bank. Effective May 24, 2024, the Eighth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amends the maximum principal amount of the Revolver Loan from $5,000,000 to $4,500,000; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Current wording
On May 28, 2024, Ranor and the other Borrowers entered into an Eighth Amendment to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note, or the “Eighth Amendment”, with Berkshire Bank. Effective May 24, 2024, the Eighth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amends the maximum principal amount of the Revolver Loan from $5,000 to $4,500; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Previous wording
On July 3, 2024, the Company entered into a Securities Purchase Agreement (the “PIPE Agreement”), with certain accredited investors (the “PIPE Purchasers”) pursuant to which we agreed to sell in a private placement (the “July Private Placement”) at an aggregate purchase price of $2,298,045, (i) 666,100 shares of our common stock (the “PIPE Shares”), and (ii) common stock purchase warrants to purchase up to 666,100 shares of our common stock (the “PIPE Warrants”). The combined purchase price for one PIPE Share and one PIPE Warrant was $3.45. The purpose of the July Private Placement was to raise working capital for use by the Company. The closing of the July Private Placement occurred on July 8, 2024 (the “PIPE Closing Date”). Placement agent fees totaled $126,014. Proceeds under the agreement were received after June 30, 2024.
Current wording
On July 3, 2024, the Company entered into a Securities Purchase Agreement with certain accredited investors, pursuant to which the Company sold 521,800 shares of the Company’s common stock, par value $0.0001 per share, and 521,800 common stock purchase warrants to purchase 521,800 shares of Common Stock in a private placement at an aggregate purchase price of $1,801.The combined purchase price for one share and one warrant was $3.45. The purpose of the private placement was to raise working capital for use by the Company. The closing of the offering occurred on July 8, 2024. Placement agent’s fees in connection with the offering totaled $123. In addition, the Company issued to the placement agent common stock purchase warrants to purchase up to 19,983 shares of common stock
Previous wording
Consolidated – Cost of revenue consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of revenue for the three months ended June 30, 2024, was $7.7 million, or 16% higher when compared to the three months ended June 30, 2023. The increase in cost of revenue was primarily the result of higher production costs and under-absorbed overhead at Stadco. As a result, gross profit decreased by $0.5 million, or 66% when compared to the same period a year ago. Gross margin for the three months ended June 30, 2024 was 3.0% compared to 9.4% in the same period a year ago.
Current wording
*Consolidated –*Cost of revenue consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of revenue for the three months ended September 30, 2024, was $7,932, or 14% higher when compared to the three months ended September 30, 2023. The increase in cost of revenue was primarily the result of higher production costs and under-absorbed overhead at Stadco. As a result, gross profit decreased by $21, or 2% when compared to the same period a year ago. Gross margin for the three months ended September 30, 2024 was 11% compared to 13% in the same period a year ago.
Previous wording
Interest expense increased by approximately $40,000 when compared with the three months ended June 30, 2023, due primarily to an increase in borrowings under the revolver loan, and a reduction in capitalized interest. That increase was offset in part by lower amounts of interest expense paid in connection with the term loans.
Current wording
Interest expense decreased by $38 when compared with the three months ended September 30, 2023, due primarily to a decrease in borrowings under the revolver loan. We also paid lower amounts of interest in connection with the term loans.
Previous wording
Amortization of debt issue costs for the three months ended June 30, 2024, was slightly lower when compared to three months ended June 30, 2023, according to the term loan periods.
Current wording
Amortization of debt issue costs for the three months ended September 30, 2024, was slightly higher when compared to three months ended September 30, 2023, according to the term loan periods.
Previous wording
Other income, net, in the table above, for the three months ended June 30, 2024, includes a vendor rebate for approximately $11,000.
Current wording
Other income, net for the three months ended September 30, 2023 includes a gain from the disposal of fixed assets.
Previous wording
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 and carryforwards are expected to be recovered or settled. The valuation allowance on deferred tax assets at June 30, 2024 was approximately $5.6 million. We believe that it is more likely than not that the benefit from certain state NOL carryforwards and other deferred tax assets will not be realized. The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels. In recognition of this risk, we continue to provide a valuation allowance on these items.
Current wording
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 and carryforwards are expected to be recovered or settled. We believe that it is more likely than not that the benefit from certain state NOL carryforwards and other deferred tax assets will not be realized. The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels. In recognition of this risk, we continue to provide a valuation allowance on these items.
Previous wording
For the three months ended June 30, 2024, there has been no change in our judgment about the realizability of deferred tax assets in future years, and, therefore, no expense or benefit provided for income taxes. For the three months ended June 30, 2023, the Company recorded an income tax benefit of ($146,430) with an effective tax rate of 21.7%.
Current wording
For the three months ended September 30, 2024, there has been no change in our judgment about the realizability of deferred tax assets in future years, and, therefore, no expense or benefit provided for income taxes. For the three months ended September 30, 2023, the Company recorded a tax benefit of $177.
Previous wording
As a result of the foregoing, for the three months ended June 30, 2024, we recorded a net loss of $1.5 million, or $0.16 per share basic and fully diluted, compared with a net loss of $527,455, or $0.06 per share basic and fully diluted for the three months ended June 30, 2023.
Current wording
As a result of the foregoing, for the three months ended September 30, 2024, we recorded a net loss of $601, or $0.06 per share basic and fully diluted, compared with a net loss of $528, or $0.06 per share basic and fully diluted for the three months ended September 30, 2023.
Previous wording
*Consolidated –*Revenue was $8.0 million for the three months ended June 30, 2024, or 8% higher when compared to revenue of $7.4 million for the three months ended June 30, 2023. Revenue increased by $0.6 million at Stadco offset in part by a decrease of $0.1 million at Ranor. As explained below, we realized fewer direct labor hours at both Ranor and Stadco on projects executed during the first quarter of 2024 as compared with the same period a year ago. However, the projects executed had overall relatively higher contract values as compared with the same period a year ago. As described in the gross profit and gross margin section, higher relative contracts prices do not necessarily have higher gross profit or gross margin.
Current wording
*Consolidated –*Revenue was $16,932 for the six months ended September 30, 2024, or 10% higher when compared to revenue of $15,341 for the six months ended September 30, 2023. Revenue increased by $1,254 at Stadco and by $177 at Ranor. As explained below, we realized less direct labor hours at Stadco and Ranor on projects executed during the first six months of fiscal 2025 as compared with the same period a year ago, however, projects executed had overall relatively higher contract values. As described in the gross profit and gross margin section, higher relative contracts prices do not necessarily have higher gross profit or gross margin. Consolidated backlog was $48,641 as of September 30, 2024. Our project order flow from prime defense contactors remains strong.
Previous wording
Ranor – Revenue was $4.4 million for the three months ended June 30, 2024, a decrease of $0.1 million or 3% lower when compared to the same period a year ago. We realized fewer direct labor hours during the first quarter of 2024 as compared with the same period a year ago.
Current wording
Ranor – Revenue was $9,172 for the six months ended September 30, 2024, an increase of $177 or 2% higher when compared to the same period a year ago. We realized fewer direct labor hours during the first six months period of fiscal 2025, however, projects executed had overall relatively higher contract values when compared with the same period a year ago.
Previous wording
The backlog for Ranor remains strong as new orders continue to flow to us from our existing customer base of prime defense contractors. The backlog at Ranor on June 30, 2024 and 2023 was $18.8 million and $21.8 million, respectively.
Current wording
The backlog at Ranor remains strong as new orders continue to flow to us from our existing customer base of prime defense contractors. The backlog at Ranor on September 30, 2024 and 2023 was $21,714 and $19,125, respectively.
Previous wording
Stadco - Revenue was $3.6 million for the three months ended June 30, 2024, compared with revenue of $3.0 million for the three months ended June 30, 2023, an increase of $0.6 million, or 21%. We realized fewer direct labor hours during the first quarter of 2024 as compared with the same period a year ago. However, the projects executed on during the first quarter had overall relatively higher contract values during the first quarter of 2024 as compared with the same period a year ago.
Current wording
*Stadco –*Revenue was $7,827 for the six months ended September 30, 2024, compared with revenue of $6,573 for the six months ended September 30, 2023, an increase of $1,254, or 19%. Our project mix was favorable for the six month period, as projects executed on had overall relatively higher contract values during the first six months of fiscal 2025 as compared with the same period a year ago.
Previous wording
The backlog remains strong as new orders for components related to a variety of programs, including the U.S. Marine Corps heavy lift helicopter programs, continue to flow to us from our existing customer base of prime defense contractors. Stadco’s backlog was $22.4 million and $24.5 million as of June 30, 2024 and 2023, respectively.
Current wording
The backlog remains strong as new orders for components related to a variety of programs, including the U.S. Marine Corps heavy lift helicopter programs, continue to flow to us from our existing customer base of prime defense contractors. Stadco’s backlog was $26,927 and $25,543 as of September 30, 2024 and 2023, respectively.
Previous wording
Ranor – Gross profit decreased by $45,000, basically flat, when compared to the same period a year ago. Cost of revenue was $72,000 lower, as an increase in material costs was more than offset by higher absorbed overhead added to our work-in-progress when compared with the same period in the prior-year.
Current wording
Ranor – Gross profit increased by $430, when compared to the same period a year ago. Cost of revenue decreased by $252, as an increase in material costs was more than offset by higher absorbed overhead added to our work - in - progress when compared with the same six - month period in the prior - year. Gross margin increased to 16% from 15% for the six months ended September 30, 2024 compared to the six months ended September 30, 2023.
Previous wording
Stadco – Gross profit was negative $1.0 million for the three months ended June 30, 2024, as our losses increased when compared to the same period a year ago. Direct labor hours charged to projects were lower compared with the same prior year period a year ago. Therefore, factory overhead was under absorbed, and other production costs, repairs and maintenance and certain project losses increased year-over-year.
Current wording
Stadco – Gross profit was negative $1,502 for the six months ended September 30, 2024, as our losses increased when compared to the same period a year ago. Direct labor hours charged to projects were lower compared with the same prior year period a year ago. Factory overhead was under absorbed, and other production costs, repairs and maintenance and certain project losses increased year - over - year. Gross margin decreased to (9)% from (4)% for the six months ended September 30, 2024 compared to the six months ended September 30, 2023.
Previous wording
*Consolidated –*Total selling, general and administrative expenses for the three months ended June 30, 2024, increased by approximately $0.3 million, or 24%, primarily due to a $0.4 million change in fair value to the accrual for the breakup fee in connection with the terminated Votaw acquisition.
Current wording
*Consolidated –*Total selling, general and administrative expenses increased by $176, or 6%, primarily due to a $419 change in fair value to the accrual for the breakup fee in connection with the terminated Votaw acquisition, which more than offset a decrease in compensation and other outside advisory costs.
Previous wording
Ranor – SG&A expense decreased by $82,000 for compensation and payroll taxes due to staff reductions.
Current wording
Ranor – SG&A expense decreased by $77 because of reduced compensation due to staff reductions and lower spending on travel.
Previous wording
Stadco – SG&A expense for the three months ended June 30, 2024, increased by approximately $19,000. The SG&A expenses for office costs and outside advisory fees increased by approximately $46,000, offset in part by a decrease in compensation and payroll taxes due to staff reductions.
Current wording
Stadco – SG&A expense increased by $26. The SG&A expenses for outside advisory fees increased by $55 which offset a decrease in compensation and payroll taxes due to staff reductions.
Previous wording
Corporate and unallocated – SG&A increased by approximately $0.4 million, primarily for a change in fair value to the accrual for the breakup fee in connection with the terminated Votaw acquisition.
Current wording
Corporate and unallocated – SG&A increased by approximately $226, as a change in fair value to the accrual for the breakup fee in connection with the terminated Votaw acquisition offset reductions in compensation and outside advisory services.
Previous wording
Consolidated – As a result of the foregoing, for the three months ended June 30, 2024, we reported an operating loss of $1.3 million, or $0.8 million higher than the operating loss for the three months ended June 30, 2023. The change was primarily due to operating losses at Stadco and an accrual for the change in fair value to the breakup fee in connection with the terminated Votaw acquisition.
Current wording
Consolidated – For the six months ended September 30, 2024, we reported an operating loss of $1,829, or 55% higher than the operating loss for the six months ended September 30, 2023. The change was primarily due to operating losses at Stadco and the change in fair value to the breakup fee in connection with the terminated Votaw acquisition.
Previous wording
Ranor– Operating income was slightly higher when compared to the same period a year ago, due primarily to lower selling, general and administrative costs.
Current wording
Ranor – Operating income was higher by 33% when compared to the same period a year ago, due primarily to a favorable six-month period of execution and efficient throughput.
Previous wording
Stadco – Operating loss increased by $0.4 million as certain projects with production issues disrupted throughput for the three months ended June 30, 2024.
Current wording
Stadco – Operating loss increased by $932 as certain projects with production issues disrupted throughput for the six months ended September 30, 2024.
Previous wording
Corporate and unallocated – Operating loss increased by approximately $0.4 million, due primarily for a change in the fair value for the breakup fee in connection with the terminated Votaw acquisition.
Current wording
*Corporate and unallocated –*Operating loss increased by $226, due primarily for a change in the fair value for the breakup fee in connection with the terminated Votaw acquisition.
Previous wording
As of June 30, 2024, we had approximately $1.6 million in total available liquidity, consisting primarily of $1.5 million in undrawn capacity under our Revolver Loan. As of March 31, 2024, we had $2.3 million in total available liquidity, consisting of $0.1 million in cash and cash equivalents, and approximately $2.2 million in undrawn capacity under our Revolver Loan.
Current wording
As of September 30, 2024, we had approximately $1,275 in total available liquidity, consisting primarily of approximately $1,143 in undrawn capacity under our Revolver Loan and $132 of available cash. As of March 31, 2024, we had $677 in total available liquidity, consisting of $138 in cash and cash equivalents, and approximately $539 in undrawn capacity under our Revolver Loan.
Previous wording
There was $2.8 million and $2.8 million outstanding under the Revolver Loan at June 30, 2024 and March 31, 2024, respectively. The Company pays interest at an adjusted SOFR-based rate. Interest-only payments on advances made under the Revolver Loan will continue to be payable monthly in arrears. Interest-only payments on advances made under the Revolver Loan during the three months ended June 30, 2024, and 2023 totaled $56,678 and $29,678, respectively. The weighted average interest rate at June 30, 2024 and March 31, 2024 was 7.71% and 7.60%, respectively. The weighted average amount outstanding during the period ending June 30, 2024 was $2.9 million. Unused borrowing capacity at June 30, 2024 and March 31, 2024 was approximately $1.5 million and $0.5 million, respectively.
Current wording
There was $2,600 and $2,800 outstanding under the Revolver Loan at September 30, 2024 and March 31, 2024, respectively. The Company pays interest at an adjusted SOFR-based rate. Interest-only payments on advances made under the Revolver Loan will continue to be payable monthly in arrears. Interest paid and accrued on advances made under the Revolver Loan during the six months ended September 30, 2024, and 2023 totaled $90 and $84, respectively. The weighted average interest rate at September 30, 2024 and March 31, 2024 was 7.81% and 7.60%, respectively. The weighted average amount outstanding during the period ending September 30, 2024 was $2,286. Unused borrowing capacity as of September 30, 2024 and March 31, 2024 was approximately $1,143 and $539, respectively.
Previous wording
At June 30, 2024 and March 31, 2024 our working capital was negative in part because of the reclassification of our long-term debt from noncurrent to current in the condensed consolidated balance sheet.
Current wording
At September 30, 2024 and March 31, 2024 our working capital was negative in part because of the reclassification of our long-term debt from noncurrent to current in the condensed consolidated balance sheet. The table below presents selected liquidity and capital measures as of:
Previous wording
The next table summarizes changes in cash by primary component in the cash flows statements for the fiscal years ended:
Current wording
The next table summarizes changes in cash by primary component in the cash flows statements for the six months ended:
Previous wording
Cash provided by operating activities for the three months ended June 30, 2024, was approximately $0.1 million. Our net loss adjusted by our non-cash adjustments used $0.2 million of cash during the three months ended June 30, 2024, as compared to a use of cash of $79,000 to the same period a year ago. Working capital changes to our balance sheet provided $0.3 million of cash during the three months ended June 30, 2024, as compared to $0.2 million provided by during the same period a year ago.
Current wording
Cash used in operating activities for the six months ended September 30, 2024, was $425. Our net loss adjusted by our non-cash adjustments provided $28 of cash during the six months ended September 30, 2024, as compared to cash used of $288 to the same period a year ago. Working capital changes to our balance sheet used $453 of cash during the six months ended September 30, 2024, as compared to $1,546 used in the same period a year ago.
Previous wording
For the three months ended June 30, 2024, we invested approximately $0.2 million in new factory machinery and equipment and were reimbursed for $0.2 million of certain purchases under a supplier development fund.
Current wording
For the six months ended September 30, 2024, we invested $1,622 in new factory machinery and equipment and were reimbursed for $1,000 of certain purchases under a supplier development fund.
Previous wording
We are subject to certain financial debt covenants and may not spend more than $1.5 million for new machinery and equipment during any single fiscal year, tested on an annual basis at the end of each fiscal year. We estimate that our spending on new machinery and equipment in fiscal 2025 will not exceed the spending limitation.
Current wording
We are subject to certain financial debt covenants and may not spend more than $1,500 for new machinery and equipment during any single fiscal year, excluding supplier development funding, tested on an annual basis at the end of each fiscal year. We estimate that our spending on new machinery and equipment in fiscal 2025 will not exceed the spending limitation.
Previous wording
For the three months ended June 30, 2023, we invested $1.9 million in new factory machinery and equipment.
Current wording
For the six months ended September 30, 2023, we invested $2,659 in new factory machinery and equipment.
Previous wording
We drew down $2.8 million of proceeds under our Revolver Loan during the three months ended June 30, 2024, and repaid $2.8 million during the same period. We also used approximately $0.2 million of cash to pay down debt principal and make periodic lease payments.
Current wording
We drew down $6,746 of proceeds under our Revolver Loan during the six months ended September 30, 2024, and repaid $6,931 during the same period. We also used $314 of cash to pay down debt principal and make periodic lease payments.
Previous wording
For the three months ended June 30, 2023, we drew down $4.5 million of proceeds under the Revolver Loan and repaid $2.9 million during the same period. We also used approximately $154,000 of cash to pay down debt principal and make periodic lease payments.
Current wording
For the six months ended September 30, 2023 we drew down $6,710 of proceeds under the Revolver Loan and repaid $5,460 during the same period. We also used approximately $307 of cash to pay down debt principal and make periodic lease payments.
Previous wording
All of the above activity resulted in a net decrease in cash of $0.1 million for the three months ended June 30, 2024 compared with a net decrease in cash of $0.3 million for the three months ended June 30, 2023.
Current wording
All of the above activity resulted in a net decrease in cash of $6 for the six months ended September 30, 2024 compared with a net decrease in cash of $396 for the six months ended September 30, 2023.
Previous wording
On August 25, 2021, the Company entered into an amended and restated loan agreement with Berkshire Bank (as amended to date, the “Loan Agreement”). Under the Loan Agreement, Berkshire Bank will continue to provide the Ranor Term Loan (as defined below) and the revolving line of credit, or the “Revolver Loan”. In addition, Berkshire Bank provided the Stadco Term Loan (as defined below) in the original amount of $4.0 million. The proceeds of the original Ranor Term Loan of $2.85 million were previously used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company. Payments for the original Ranor Term Loan began on January 20, 2017, and until the facility was amended in December 2022, the Company paid monthly installments of $19,260 each, inclusive of interest at a fixed rate of 5.21% per annum.
Current wording
On August 25, 2021, the Company entered into an amended and restated loan agreement with Berkshire Bank (as amended to date, the “Loan Agreement”). Under the Loan Agreement, Berkshire Bank will continue to provide the Ranor Term Loan (as defined below) and the revolving line of credit, or the “Revolver Loan”. In addition, Berkshire Bank provided the Stadco Term Loan (as defined below) in the original amount of $4,000. The proceeds of the original Ranor Term Loan of $2,850 were previously used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company.
Previous wording
In addition, Berkshire Bank provided to Stadco a term loan in the original amount of $4.0 million, or the “Stadco Term Loan”. On August 25, 2021, Stadco borrowed $4.0 million from Berkshire Bank under the Stadco Term Loan. The proceeds of the Stadco Term Loan were used to support the acquisition of Stadco and refinance existing indebtedness of Stadco. Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021, at a fixed rate per annum equal to the 7-year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%. Since September 25, 2021, and on the 25th day of each month thereafter, Stadco has made and will continue to make monthly payments of principal and interest in the amount of $54,390 each, with all outstanding principal and accrued interest due and payable on August 25, 2028.
Current wording
In addition, Berkshire Bank provided to Stadco a term loan in the original amount of $4,000, or the “Stadco Term Loan”. On August 25, 2021, Stadco borrowed $4,000 from Berkshire Bank under the Stadco Term Loan. The proceeds of the Stadco Term Loan were used to support the acquisition of Stadco and refinance existing indebtedness of Stadco. Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021, at a fixed rate per annum equal to the 7-year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%. Since September 25, 2021, and on the 25th day of each month thereafter, Stadco has made and will continue to make monthly payments of principal and interest in the amount of $54 each, with all outstanding principal and accrued interest due and payable on August 25, 2028.
Previous wording
On December 20, 2023, Ranor and certain affiliates of the Company entered into a Sixth Amendment to Amended and Restated Loan Agreement and Second Amendment to Second Amended and Restated Promissory Note, or the “Sixth Amendment”. The Sixth Amendment, among other things (i) extended the maturity date of the Revolver Loan from December 20, 2023 to March 20, 2024; (ii) limits the use of proceeds from the Revolver Loan by the Company or its affiliates to $1,000,000 in the aggregate for due diligence and related professional costs incurred on or prior to March 20, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
Current wording
On December 20, 2023, Ranor and certain affiliates of the Company entered into a Sixth Amendment to Amended and Restated Loan Agreement and Second Amendment to Second Amended and Restated Promissory Note, or the “Sixth Amendment”. The Sixth Amendment, among other things (i) extended the maturity date of the Revolver Loan from December 20, 2023 to March 20, 2024; (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $1,000 in the aggregate for due diligence and related professional costs incurred on or prior to March 20, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
Previous wording
On March 20, 2024, Ranor and certain affiliates of the Company entered into a Seventh Amendment to Amended and Restated Loan Agreement and Third Amendment to Second Amended and Restated Promissory Note, or the “Seventh Amendment”. Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024; (ii) limits the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions.
Current wording
On March 20, 2024, Ranor and certain affiliates of the Company entered into a Seventh Amendment to Amended and Restated Loan Agreement and Third Amendment to Second Amended and Restated Promissory Note, or the “Seventh Amendment”. Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024, and (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions.
Showing the first 40 of 48 pairs. Open the source sections for the rest.
Rearranged current paragraphs (13)
Current report — wording carried from elsewhere
*Consolidated –*For the three months ended September 30, 2024, we reported an operating loss of $488, or $109 lower than the operating loss for the three months ended September 30, 2023. The change was primarily due to operating income at Ranor and lower corporate expenses which offset an operating loss at Stadco.
Current report — wording carried from elsewhere
Stadco – Operating loss increased by $502 as certain projects with production issues disrupted throughput for the three month period.
Current report — wording carried from elsewhere
The following table presents revenue, cost of revenue and gross profit, consolidated and by reportable segment:
Current report — wording carried from elsewhere
*Consolidated –*Cost of revenue consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of revenue for the six months ended September 30, 2024, was $15,679, or 15% higher when compared to the six months ended September 30, 2023. The increase in cost of revenue was primarily the result of higher production costs and under - absorbed overhead at Stadco. As a result, gross profit decreased by $476, or 28% when compared to the same period a year ago. Gross margin for the six months ended September 30, 2024 was 7% compared to 11% in the same period a year ago.
Current report — wording carried from elsewhere
Selling, General and Administrative (SG&A) Expenses
Current report — wording carried from elsewhere
The following table presents other income (expense) for the six months ended:
Current report — wording carried from elsewhere
Amortization of debt issue costs for the six months ended September 30, 2024, was slightly higher when compared to three months ended September 30, 2023.
Current report — wording carried from elsewhere
Other income, net, in the table above, for the six months ended September 30, 2024, includes a vendor rebate for $11. Other income, net for the three months ended September 30, 2023 includes a gain from the disposal of fixed assets.
Current report — wording carried from elsewhere
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 and carryforwards are expected to be recovered or settled. We believe that it is more likely than not that the benefit from certain state NOL carryforwards and other deferred tax assets will not be realized. The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels. In recognition of this risk, we continue to provide a valuation allowance on these items.
Current report — wording carried from elsewhere
For the six months ended September 30, 2024, there has been no change in our judgment about the realizability of deferred tax assets in future years, and, therefore, no expense or benefit provided for income taxes. For the six months ended September 30, 2023, the Company recorded a tax benefit $323.
Current report — wording carried from elsewhere
As a result of the foregoing, for the six months ended September 30, 2024, we recorded a net loss of $2,061, or $0.22 per share basic and fully diluted, compared with a net loss of $1,056, or $0.12 per share basic and fully diluted for the six months ended September 30, 2023.
Current report — wording carried from elsewhere
Payments for the original Ranor Term Loan began on January 20, 2017, and until the facility was amended in December 2022, the Company paid monthly installments of $19 each, inclusive of interest at a fixed rate of 5.21% per annum.
Current report — wording carried from elsewhere
remedies or to forbear from taking any action authorized by the Loan Documents, the Collateral Documents, or by applicable law while discussions continue.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The table below presents selected liquidity and capital measures at: