SOLITRON DEVICES INC

Previous wording

During the fiscal year ended February 28, 2025, the Company’s book-to-bill ratio was approximately 1.48 to 1 as compared to approximately 1.01 to 1 for the fiscal year ended February 29, 2024, reflecting an increase in the volume of orders booked. Historically, the Company has experienced seasonality in its bookings, with the fiscal fourth quarter experiencing the highest level of bookings. Going forward we expect more variability in bookings.

Current wording

During the fiscal year ended February 28, 2026, the Company’s book-to-bill ratio was approximately 1.54 to 1 as compared to approximately 1.48 to 1 for the fiscal year ended February 28, 2025, reflecting an increase in the volume of orders booked. Historically, the Company has experienced seasonality in its bookings, with the fiscal fourth quarter experiencing the highest level of bookings. Going forward we expect more variability in bookings.

Previous wording

*Revenue.*Net sales for the fiscal year ended February 28, 2025, increased by approximately 10% to $14,049,000 versus $12,757,000 for the fiscal year ended February 29, 2024. The increase was primarily attributable to the acquisition of MEI in fiscal 2024.

Current wording

*Revenue.*Net sales for the fiscal year ended February 28, 2026, increased by approximately 21% to $16,970,000 versus $14,049,000 for the fiscal year ended February 28, 2025. The increase in net sales was largely due to increased backlog in fiscal year 2026 as compared to fiscal year 2025 and the associated delivery dates of those orders

Previous wording

Net bookings for the fiscal year ended February 28, 2025, were approximately 48% more than net sales. Backlog increased by approximately 62% to $18,108,000 as of February 28, 2025, from $11,207,000 as of February 29, 2024. The increase was due to increased order activity by our customers and the acquisition of MEI.

Current wording

Net bookings for the fiscal year ended February 28, 2026, were approximately 54% more than net sales. Backlog increased by approximately 51% to $27,281,000 as of February 28, 2026, from $18,108,000 as of February 28, 2025. The increase was due to anticipated increased order activity by our customers. The backlog includes a previously noted significant AMRAAM program order, which the Company received during the year.

Previous wording

During the fiscal year ended February 28, 2025, the Company shipped 73,319 units as compared with 74,924 units shipped during the fiscal year ended February 29, 2024. It should be noted that since the Company manufactures a wide variety of products with an average sales price ranging from a few dollars to several hundred dollars, such periodic variations in the Company’s volume of units shipped might not be a reliable indicator of the Company’s performance.

Current wording

During the fiscal year ended February 28, 2026, the Company shipped 83,967 units as compared with 73,319 units shipped during the fiscal year ended February 28, 2025. It should be noted that since the Company manufactures a wide variety of products with an average sales price ranging from a few dollars to several hundred dollars, such periodic variations in the Company’s volume of units shipped might not be a reliable indicator of the Company’s performance.

Previous wording

Cost of Sales. Cost of sales for the fiscal year ended February 28, 2025, increased to $10,057,000 from $8,950,000 for the fiscal year ended February 29, 2024. Expressed as a percentage of sales, cost of sales increased to 72% for the fiscal year ended February 28, 2025, as compared to 70% for the fiscal year ended February 29, 2024. Included in cost of sales in fiscal 2024 was $718,000 of non-cash cost due to the fair value adjustment of inventory as required in the MEI acquisition. The increase is primarily due to the acquisition of MEI.

Current wording

Cost of Sales. Cost of sales for the fiscal year ended February 28, 2026, increased to $11,851,000 from $10,057,000 for the fiscal year ended February 28, 2025. However, expressed as a percentage of sales, cost of sales decreased to 70% for the fiscal year ended February 28, 2026, as compared to 72% for the fiscal year ended February 28, 2025.

Previous wording

*Gross Profit.*Gross profit for the fiscal year ended February 28, 2025, increased to $3,992,000 from $3,807,000 for the fiscal year ended February 29, 2024, due primarily to increased net sales and the acquisition of MEI. Expressed as a percentage of sales, actual gross profit for the fiscal year ended February 28, 2025, decreased to 28% as compared to 30% for the fiscal year ended February 29, 2024.

Current wording

*Gross Profit.*Gross profit for the fiscal year ended February 28, 2026, increased to $5,119,000 from $3,992,000 for the fiscal year ended February 28, 2025, due primarily to increased net sales. Expressed as a percentage of sales, actual gross profit for the fiscal year ended February 28, 2026, increased to 30% as compared to 28% for the fiscal year ended February 28, 2025.

Previous wording

Selling, General & Administrative Expenses. During the fiscal year ended February 28, 2025, selling, general and administrative expenses, as a percentage of sales, decreased to approximately 21% as compared to 23% for the year ended February 29, 2024. In terms of dollars, selling, general and administrative expenses increased 4% to $2,994,000 for the fiscal year ended February 28, 2025, from $2,873,000 for the fiscal year ended February 29, 2024. This increase is primarily due to the acquisition of MEI.

Current wording

Selling, General & Administrative Expenses. During the fiscal year ended February 28, 2026, selling, general and administrative expenses increased 17% to $3,501,000 for the fiscal year ended February 28, 2026, from $2,994,000 for the fiscal year ended February 28, 2025. Expressed as a percentage of sales, selling, general and administrative expenses for the fiscal year ended February 28, 2026, remained constant at approximately 21%, which was the same for the year ended February 28, 2025. The Company experienced higher administration expenses during the 2026 fiscal year due to stock awarded to senior management and directors of $361,000, higher corporate salaries and with increased sales expenses related to greater net sales during the period.

Previous wording

Operating Income. Operating income for the fiscal year ended February 28, 2025, was $998,000 as compared to an operating income of $934,000 for the fiscal year ended February 29, 2024. The increase in operating income was mainly attributable to the increase in net sales.

Current wording

Operating Income. Operating income for the fiscal year ended February 28, 2026, was $1,618,000 as compared to an operating income of $998,000 for the fiscal year ended February 28, 2025. The increase in operating income was mainly attributable to the increase in net sales.

Previous wording

Total Other Income. Interest income and dividend income were $6,000 and $70,000, respectively for the fiscal year ended February 28, 2025, compared to $29,000 and $29,000, respectively for the fiscal year ended February 29, 2024. Interest expense was ($272,000) for the fiscal year ended February 28, 2025, compared to ($177,000) for the fiscal year ended February 29, 2024. The increase in interest expense was primarily due to the purchase of MEI's property and building, which occurred in May 2024. Realized gains (losses) on investments for the fiscal year ended February 28, 2025, was $127,000 compared to $332,000 for the fiscal year ended February 29, 2024. The change in unrealized gains (loss) on investments for the fiscal year ended February 28, 2025, was $64,000 compared to a loss of ($579,000) for the fiscal year ended February 29, 2024. Bargain purchase gain on the acquisition of MEI was $0 in the fiscal year ended February 28, 2025, versus $2,236,000 in the fiscal year ended February 29, 2024. Other income (expense) was $0 in the fiscal year ended February 28, 2025, as compared to ($27,000) in the fiscal year ended February 29, 2024.

Current wording

Total Other Income. Interest income and dividend income were $163,000 and $97,000, respectively for the fiscal year ended February 28, 2026, compared to $6,000 and $70,000, respectively for the fiscal year ended February 28, 2025. The increase in interest income was a result of the Company's long-term investment, which was acquired in the 2026 fiscal year. Interest expense was ($263,000) for the fiscal year ended February 28, 2026, compared to ($272,000) for the fiscal year ended February 28, 2025. Realized gains (losses) on investments for the fiscal year ended February 28, 2026, was $285,000 compared to $127,000 for the fiscal year ended February 28, 2025. The change in unrealized gains (loss) on investments for the fiscal year ended February 28, 2026, was a loss of ($465,000) compared to a gain of $64,000 for the fiscal year ended February 28, 2025. Other income (expense) was $7,000 in the fiscal year ended February 28, 2026, as compared to $0 in the fiscal year ended February 28, 2025. Contingent consideration expense was $346,000 for the fiscal year ended February 28, 2026, compared to $0 for the fiscal year ended February 28, 2025. This adjustment to the contingent consideration was due to the increase in MEI's backlog for the fiscal year ended February 28, 2026.

Previous wording

Income Taxes. Income taxes for the fiscal year ended February 28, 2025, were ($178,000) as compared to a benefit of $3,024,000 for the fiscal year ended February 29, 2024. The tax benefit for fiscal year 2024 was due to the release of the Company’s deferred tax valuation.

Current wording

Income Taxes. Income taxes for the fiscal year ended February 28, 2026, were ($289,000) as compared to ($178,000) for the fiscal year ended February 28, 2025. The increase in tax expense was due to higher operating income during the year.

Previous wording

Net Income. Net income for the fiscal year ended February 28, 2025, was $815,000 as compared to net income of $5,801,000 for the fiscal year ended February 29, 2024. The decrease in net income was mainly attributable to the bargain purchase gain and release of the Company's deferred tax valuation recorded in fiscal year 2024 as part of the MEI acquisition as noted above.

Current wording

Net Income. Net income for the fiscal year ended February 28, 2026, was $807,000 as compared to net income of $815,000 for the fiscal year ended February 28, 2025. The decrease in net income was mainly attributable to the adjustment to the contingent consideration for the MEI acquisition, as noted above.

Previous wording

Net cash provided by operating activities was $1,917,000 for the year ended February 29, 2024, primarily reflecting net income of $5,801,000, a decrease in inventory of $945,000, and depreciation and amortization of $611,000 partially offset by non-cash gain on purchase of $2,236,000, non-cash deferred tax benefit of $3,024,000 and an increase in accounts receivable of $1,269,000.

Current wording

Net cash provided by operating activities was$1,350,000 for the year ended February 28, 2026, primarily reflecting net income of $807,000, depreciation and amortization of $579,000 and $210,000, respectively, stock based compensation of $361,000, deferred income tax benefit of $290,000, a decrease in other assets non-current of $232,000, an increase in contingent consideration of $346,000, an increase in accrued expenses of $221,000 offset by an increase in accounts receivable of $1,238,000 and an increase in inventory of $692,000.

Previous wording

Net cash used in investing activities was ($1,037,000) for the year ended February 29, 2024, primarily reflecting ($2,425,000) in cash paid for acquisition, ($355,000) in purchases of property and equipment, and ($139,000) in purchases of marketable securities, partially offset by $1,000,000 in maturities of short-term investments and $882,000 from proceeds from the sale of marketable securities.

Current wording

Net cash used in investing activities was ($2,135,000) for the year ended February 28, 2026, primarily reflecting $1,650,000 for the purchase of a long-term investment, $895,000 of cash paid for earn out payment, contingent consideration, $327,000 in purchases of property and equipment and $682,000 in purchases of marketable securities, partially offset by $1,419,000 from proceeds from the sale of marketable securities.

Previous wording

Net cash used in financing activities was ($110,000) for the year ended February 29, 2024, primarily reflecting ($107,000) in principal payments on the mortgage loan.

Current wording

Net cash provided by financing activities was $600,000 for the year ended February 28, 2026, primarily reflecting $815,000 in proceeds from issuance of stock, partially offset by $152,000 in principal payments on mortgage loans.

Previous wording

At February 28, 2025 and February 29, 2024, the Company had cash and cash equivalents of approximately $4,099,000 and $2,217,000, respectively. The cash increase for the year ended February 28, 2025, was primarily due to cash from operating activities.

Current wording

At February 28, 2026 and February 28, 2025, the Company had cash and cash equivalents of approximately $3,914,000 and $4,099,000, respectively. The cash decrease for the year ended February 28, 2026, was primarily due to cash used in investing activities to purchase the long-term investment offset by proceeds from the sale of marketable securities.

Previous wording

At February 28, 2025 and February 29, 2024, the Company had investments in securities of approximately $919,000 and $904,000, respectively.

Current wording

At February 28, 2026 and February 28, 2025, the Company had investments in securities of approximately $2,000 and $919,000, respectively.

Previous wording

At February 28, 2025, the Company had working capital of $8,594,000 as compared with working capital at February 29, 2024 of $6,227,000. The increase for the year ended February 28, 2025, was due primarily to the acquisition of MEI.

Current wording

At February 28, 2026, the Company had working capital of $9,025,000 as compared with working capital at February 28, 2025 of $8,594,000. The increase for the year ended February 28, 2026, was due primarily to increased revenue during the 2026 fiscal year.

Previous wording

The Company had approximately $3,000,000 in cash and equivalents on hand as of April 30, 2025. Management estimates this amount will be sufficient to fund the Company’s operations and working capital requirements for the next twelve months.

Current wording

The Company had approximately$5,600,000 in cash and equivalents on hand as of April 30,2026. Management estimates this amount will be sufficient to fund the Company’s operations and working capital requirements for the next twelve months.

Previous wording

The Company’s previously authorized stock repurchase program permits the Company to acquire up to $2,000,000 of its outstanding common stock from time to time. Purchases under the amended stock repurchase program may be made through the open market or privately negotiated transactions as determined by the Company’s management, and in accordance with the requirements of the Securities and Exchange Commission. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements and other conditions.

Current wording

The Company currently has a repurchase program under which the Company may repurchase up to $2,000,000 of its outstanding common stock without an expiration date to the repurchase program. Under the current repurchase program, repurchases may be made by the Company from time to time in the open market or through privately negotiated transactions depending on market conditions, stock price, corporate and regulatory requirements, and other factors. The Company repurchased 3,850 shares of common stock at an average price of $16.19 per share for a total expense of approximately $63,000 during fiscal 2026 and did not repurchase any shares during the fiscal year ended February 28, 2025.

Previous wording

During the fiscal year ended February 28, 2025, the Company’s net bookings were $20,759,000 in new orders as compared with $12,836,000 for the year ended February 29, 2024, reflecting an increase in bookings of approximately 62%. The* Company’s *backlog increased to $18,108,000 at February 28, 2025 as compared with $11,207,000 as of February 29, 2024, reflecting an increase of approximately 62% in backlog.

Current wording

During the fiscal year ended February 28, 2026, the Company’s net bookings were $26,144,000 in new orders as compared with $20,759,000 for the year ended February 28, 2025, reflecting an increase in bookings of approximately 26%. The* Company’s *backlog increased to $27,281,000 at February 28, 2026 as compared with $18,108,000 as of February 28, 2025, reflecting an increase of approximately 51% in backlog.

Previous wording

The Company relies on various foreign suppliers for raw materials used in the manufacture and production of our products. If the proposed increased tariffs are implemented, this may have a significant impact on the cost of the materials the Company purchases and therefore our expenses and revenues.

Current wording

The Company relies on various foreign suppliers for raw materials used in the manufacture and production of our products. Increased tariffs implemented during 2025 had a significant impact on the cost of the materials the Company purchased and therefore our expenses and revenues. Based on the uncertainty of tariffs in the future, the Company expects it will continue to experience higher material costs going forward.