EVI INDUSTRIES, INC.
For the period ended Jun 30, 2026. Filed Sep 8, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Sep 8, 2026
EVI$20.83-1.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-06-30; filed 2025-09-11.
0002077096-25-000107
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-06-30; filed 2026-09-08.
0001437749-26-029759
Item 7. 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 80 previous paragraphs and 75 current paragraphs.
46 unchanged; 26 reworded; 3 added; 5 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 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 (3)
Current report
During July 2026, the Company announced its plans to expand into the consumer garment care services industry and, in connection therewith, the Company entered into a definitive agreement to acquire Miami, Florida-based Sudsies, Inc. (“Sudsies”), a well-established operator in the garment care sector and one of South Florida's premier garment care businesses. The acquisition of Sudsies was consummated on September 1, 2026 for a total purchase price of $37.4 million, which is subject to post-closing adjustments. The Company has established a new division, which will be a separate operating and reportable segment, for its consumer garment care services operations and investments. The expansion into the consumer garment care services industry marks the Company’s first dedicated expansion beyond the commercial laundry distribution and service industry since the Company began executing its “buy-and-build” growth strategy in 2016. This planned expansion is based on the Company's belief that consumer garment care, which is a multibillion dollar industry, represents a compelling long-term opportunity. The consumer garment care services industry serves an essential market has historically displayed steady, recurring demand, and is served by thousands of independent, often family-owned businesses. As consumers place growing value on quality, convenience, and service experience, the Company sees a significant opportunity to build a leading consumer garment care business of national scale.
Current report
During fiscal 2026, the Company acquired New York-based ASN Laundry Group and Ohio-based Belenky, Inc. The total consideration for these transactions consisted of $3.9 million, consisting of $3.1 million in cash and $0.8 million in amounts payable to the sellers as of June 30, 2026.
Current report
On July 28, 2026, the Company's Board of Directors approved a share repurchase program which authorizes the repurchase of up to $10.0 million of the Company's outstanding common stock. Under the share repurchase program, the Company may repurchase shares of its common stock from time to time in management’s discretion through solicited or unsolicited open market transactions, in privately negotiated transactions, or by other means in accordance with applicable federal securities laws, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The timing, manner, price, and amount of shares which may be repurchased under the program will be at management’s discretion based on market conditions, the trading price of the Company’s common stock, the Company’s financial condition, results of operations and capital requirements, general business conditions, alternative investment opportunities, and other factors deemed relevant by management. The share repurchase program does not obligate the Company to repurchase any specific amount of shares, has no expiration date, and may be modified, suspended or terminated at any time without prior notice at the discretion of the Company’s Board of Directors.
Removed paragraphs (5)
Previous report
During fiscal 2024, the Company acquired Pennsylvania-based ALVF, Inc. (d/b/a ALCO Washer Center) and Texas-based Signature Services Corporation (d/b/a Ed Brown Distributors). The total consideration for these transactions consisted of $2.0 million in cash and the issuance of 8,621 shares of the Company’s common stock.
Previous report
In addition to the foregoing, on August 1, 2025, the Company acquired New York-based ASN Laundry Group for total consideration of $0.6 million in cash. The financial position, including assets and liabilities, and results of operations of ASN Laundry Group following the August 1, 2025 closing date of
Previous report
costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $152,000 and $150,000 during fiscal 2025 and fiscal 2024, respectively.
Previous report
Contract Assets and Liabilities
Previous report
Contract assets and liabilities are presented in the Company’s consolidated balance sheets. Contract assets consist of unbilled amounts resulting from sales under longer-term contracts when the cost-to-cost method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer. As noted above, the cost estimation process for these contracts may require significant judgment by management. The Company typically receives progress payments on sales under longer-term contracts as work progresses, although for some contracts the Company may be entitled to receive an advance payment. Contract assets also include retainage. Retainage represents a portion of the contract amount that has been billed, but for which the contract allows the customer to retain a portion of the billed amount (generally, from 5% to 20% of contract billings) until final contract settlement. Retainage amounts are generally classified as current assets within the Company’s consolidated balance sheets. Retainage that has been billed, but is not due until completion of performance and acceptance by customers, is generally expected to be collected within one year. Contract liabilities consist of advanced payments, billings in excess of costs incurred and deferred revenue.
Reworded paragraphs (26)
Previous wording
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Current wording
Item 7. Management**’s Discussion and Analysis of Financial Condition and Results of Operations.
Previous wording
The Company’s growth strategy includes the pursuit of organic growth initiatives and a “buy-and-build” growth strategy. The Company’s “buy-and-build” growth strategy includes (i) the consideration and pursuit of acquisitions and other strategic transactions which management believes may complement the Company’s existing business or otherwise offer growth opportunities for, or benefit, the Company and (ii) the implementation of a growth culture at acquired businesses based on the exchange of ideas and business concepts among the management teams of the Company and the acquired businesses as well as through certain additional initiatives, which may include investments in additional sales and service personnel, new product lines, enhanced service operations and capabilities, new and improved facilities, and advanced technologies. See “Buy-and-Build Growth Strategy” below for information regarding business acquisitions consummated during the fiscal year ended June 30, 2024 (“fiscal 2024”) and the fiscal year ended June 30, 2025 (“fiscal 2025”), as well as an acquisition consummated subsequent to fiscal 2025 year-end.
Current wording
The Company’s growth strategy includes the pursuit of organic growth initiatives and a “buy-and-build” growth strategy. The Company’s “buy-and-build” growth strategy includes (i) the consideration and pursuit of acquisitions and other strategic transactions which management believes may complement the Company’s existing business or otherwise offer growth opportunities for, or benefit, the Company and (ii) the implementation of a growth culture at acquired businesses based on the exchange of ideas and business concepts among the management teams of the Company and the acquired businesses as well as through certain additional initiatives, which may include investments in additional sales and service personnel, new product lines, enhanced service operations and capabilities, new and improved facilities, and advanced technologies. See “Buy-and-Build Growth Strategy” below for information regarding business acquisitions consummated during the fiscal year ended June 30, 2025 (“fiscal 2025”) and the fiscal year ended June 30, 2026 (“fiscal 2026”).
Previous wording
The Company reports its results of operations through a single operating and reportable segment.
Current wording
As of June 30, 2026, the Company reported its results of operations through a single operating and reportable segment.
Previous wording
Total revenues for fiscal 2025 increased by 10% compared to fiscal 2024. The increase was attributable to revenues generated by businesses acquired by the Company during fiscal 2025 as well as price increases established throughout the Company’s product lines and service offerings aimed at maintaining or increasing margins to cover incremental product and operating cost increases.
Current wording
Total revenues for fiscal 2026 increased by 15% compared to fiscal 2025. The increase was attributable to revenues generated by businesses acquired by the Company during fiscal 2025 and 2026.
Previous wording
Net income for fiscal 2025 increased by 33% from fiscal 2024. The increase in net income was primarily attributable to increases in revenue (as described above) and gross margin, partially offset by increases in selling, general, and administrative expenses.
Current wording
Net income for fiscal 2026 increased by 3% from fiscal 2025. The increase in net income was primarily attributable to increases in revenue (as described above) and gross margin, partially offset by increases in selling, general, and administrative expenses, interest expense, and income taxes.
Previous wording
During fiscal 2025, the Company acquired Florida-based Laundry Pro of Florida, Inc., Indiana-based O’Dell Equipment & Supply, Inc., Illinois-based Haiges Machinery, Inc., and Wisconsin-based Girbau North America, Inc. The total consideration for these transactions was $51.0 million, consisting of $50.6 million in cash, net of cash acquired, $4.2 million in amounts payable to a seller as of June 30, 2025 related to post-closing working capital adjustments, and the settlement of acquirer receivables of $3.8 million.
Current wording
During fiscal 2025, the Company acquired Florida-based Laundry Pro of Florida, Inc., Indiana-based O’Dell Equipment & Supply, Inc., Illinois-based Haiges Machinery, Inc., and Wisconsin-based Girbau North America, Inc. The total consideration for these transactions was $51.0 million, consisting of $54.8 million in cash, net of cash acquired, and the settlement of acquirer receivables of $3.8 million.
Previous wording
The acquired companies generally distribute commercial, industrial, and vended laundry products and provide installation and maintenance services to the new and replacement segments of the commercial, industrial and vended laundry industry. Acquisitions are generally effected by the Company through an existing or newly-formed subsidiary which acquires (whether by an asset purchase, stock purchase or merger) and operates the acquired business following the transaction. The Company, indirectly through its subsidiary, also assumes certain of the liabilities of the acquired business. The financial position, including assets and liabilities, and results of operations of the acquired businesses following the respective closing dates of the acquisitions are included in the Company’s consolidated financial statements.
Current wording
The companies acquired during fiscal 2026 and 2025 generally distribute commercial, industrial, and vended laundry products and provide installation and maintenance services to the new and replacement segments of the commercial, industrial and vended laundry industry. Acquisitions are generally effected by the Company through an existing or newly-formed subsidiary which acquires (whether by an asset purchase, stock purchase or merger) and operates the acquired business following the transaction. The Company, indirectly through its subsidiary, also assumes certain of the liabilities of the acquired business. The financial position, including assets and liabilities, and results of operations of the acquired businesses following the respective closing dates of the acquisitions are included in the Company’s consolidated financial statements.
Previous wording
the acquisition will be included in the Company’s consolidated financial statements commencing in the quarter ending September 30, 2025.
Current wording
As previously described, on September 1, 2026, the Company acquired Sudsies, which marked the Company's entry into the consumer garment care service industry. The total consideration paid in the transaction was $37.4 million in cash, which is subject to post-closing adjustments. The financial position, including assets and liabilities, and results of operations of Sudsies following the September 1, 2026 closing date of the acquisition will be included in the Company’s consolidated financial statements commencing in the quarter ending September 30, 2026.
Previous wording
The Company’s total assets increased from $230.7 million at June 30, 2024 to $307.0 million at June 30, 2025. The increase in total assets was primarily attributable to the assets of the businesses acquired during fiscal 2025, including accounts receivable, inventory, intangible assets, and goodwill. The Company’s total liabilities increased from $94.1 million at June 30, 2024 to $163.6 million at June 30, 2025, primarily due to increases in payables related to acquired businesses and long-term debt used to acquire such businesses.
Current wording
The Company’s total assets decreased from $307.0 million at June 30, 2025 to $304.5 million at June 30, 2026. The decrease in total assets was primarily attributable to a decrease in current assets, partially offset by an increase in equipment and improvements and goodwill. The Company’s total liabilities decreased from $163.6 million at June 30, 2025 to $154.4 million at June 30, 2026, primarily due to decreases in accounts payable, customer deposits, and long-term debt.
Previous wording
The Company had approximately $8.9 million of cash at June 30, 2025 compared to $4.6 million of cash at June 30, 2024. The increase in cash was primarily due to cash generated from operations and borrowings on the Company’s credit facility, offset in part by cash consideration paid in connection with the Company’s business acquisitions during fiscal 2025 and capital expenditures, as well the timing of optional payments on the Company’s credit facility. The Company’s primary sources of cash are sales of products and services, and borrowings under its credit facility. The Company’s primary uses of cash are purchases of the products sold by the Company, employee related costs, and the cash consideration paid in connection with business acquisitions.
Current wording
The Company had approximately $6.8 million of cash at June 30, 2026 compared to $8.9 million of cash at June 30, 2025. The decrease in cash was primarily due to cash consideration paid in connection with business acquisitions, capital expenditures, a dividend payment, and optional payments on the Company’s credit facility, offset in part by cash generated from operations. The Company’s primary sources of cash are sales of products and services, and borrowings under its credit facility. The Company’s primary uses of cash are purchases of the products sold by the Company, employee related costs, and the cash consideration paid in connection with business acquisitions.
Previous wording
For fiscal 2025, operating activities provided cash of approximately $21.3 million compared to cash provided by operating activities of approximately $32.7 million in fiscal 2024. The $11.4 million decrease in cash provided by operating activities was primarily attributable to an increase in accounts receivable, offset in part by increases in accounts payable, accrued expenses, and net income.
Current wording
For fiscal 2026, operating activities provided cash of approximately $20.6 million compared to cash provided by operating activities of approximately $21.3 million in fiscal 2025. The $0.7 million decrease in cash provided by operating activities was primarily attributable to decreases in accounts payable, accrued expenses, and customer deposits, offset in part by decreases in accounts receivable and increases in depreciation and amortization, and provision for deferred income taxes.
Previous wording
Investing activities used cash of approximately $51.8 million during fiscal 2025 compared to approximately $6.8 million in fiscal 2024. The $45.0 million increase in cash used by investing activities is due primarily to a greater amount of cash consideration paid in connection with business acquisitions in fiscal 2025 as compared to fiscal 2024.
Current wording
Investing activities used cash of approximately $14.3 million during fiscal 2026 compared to approximately $51.8 million in fiscal 2025. The $37.5 million decrease in cash used by investing activities is due primarily to a greater amount of cash consideration paid in connection with business acquisitions in fiscal 2025 as compared to fiscal 2026.
Previous wording
Financing activities provided cash of approximately $34.8 million in fiscal 2025 compared to cash used by financing activities of approximately $27.2 million in fiscal 2024. The $62.0 million increase in
Current wording
Financing activities used cash of approximately $8.4 million in fiscal 2026 compared to cash provided by financing activities of approximately $34.8 million in fiscal 2025. The $43.2 million decrease in cash provided by financing activities was attributable primarily to an increase in borrowings under the Company’s credit facility to fund the Company’s acquisitions in fiscal 2025.
Previous wording
The Company is party, as borrower, to a syndicated credit agreement (the “Credit Agreement”). Prior to the amendment described below, the agreement allowed for borrowings in the maximum aggregate principal amount of up to $100 million, with an accordion feature to increase the revolving credit facility by up to $40 million for a total of $140 million. On March 26, 2025, the Company amended the Credit Agreement to increase the maximum aggregate principal amount from $100 million to $150 million and increase the accordion feature from $40 million to $50 million, for a total of $200 million. A portion of the revolving credit facility is available for swingline loans and for the issuance of standby letters of credit. The amendment increased the sublimit for swingline loans from $5 million to $7.5 million and the sublimit for standby letters of credit from $10 million to $15 million. In addition, as part of the amendment, the maturity date of the Credit Agreement was extended from May 6, 2027 to March 26, 2030. As of June 30, 2025, $56.1 million was available to borrow under the revolving credit facility.
Current wording
The Company is party, as borrower, to a syndicated credit agreement (the “Credit Agreement”). The Credit Agreement allows for borrowings in the maximum aggregate principal amount of up to $150 million, with an accordion feature to increase the revolving credit facility by up to $50 million for a total of $200 million. A portion of the revolving credit facility is available for swingline loans of up to a sublimit of $7.5 million and for the issuance of standby letters of credit of up to a sublimit of $15 million. The maturity date of the Credit Agreement is March 26, 2030. As of June 30, 2026, $52.2 million was available to borrow under the revolving credit facility.
Previous wording
Pursuant to the terms of the Credit Agreement, in connection with the discontinuation of the Bloomberg Short-Term Bank Yield Index rate (the “BSBY rate”), during October 2024, the BSBY rate was replaced as the reference rate under the Credit Agreement by the Secured Overnight Financing Rate (“SOFR”) plus a SOFR adjustment ranging from a minimum of 0.11% to a maximum of 0.43%. As a result, borrowings (other than swingline loans) under the Credit Agreement bear interest, at a rate, at the Company’s election at the time of borrowing, equal to (a) SOFR plus 0.11% to 0.43%, plus an additional adjustment margin that ranges between 1.25% and 1.75% depending on the Company’s consolidated leverage ratio, which is a ratio of consolidated funded indebtedness to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) (the “Consolidated Leverage Ratio”) or (b) the highest of (i) prime, (ii) the federal funds rate plus 50 basis points, and (iii) SOFR plus 100 basis points (such highest rate, the “Base Rate”), plus a margin that ranges between 0.25% and 0.75% depending on the Consolidated Leverage Ratio. Swingline loans generally bear interest at the Base Rate plus a margin that ranges between 0.25% and 0.75% depending on the Consolidated Leverage Ratio.
Current wording
Borrowings (other than swingline loans) under the Credit Agreement bear interest, at a rate, at the Company’s election at the time of borrowing, equal to (a) the Secured Overnight Financing Rate (“SOFR”) plus 0.11% to 0.43%, plus an additional adjustment margin that ranges between 1.25% and 1.75% depending on the Company’s consolidated leverage ratio, which is a ratio of consolidated funded indebtedness to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) (the “Consolidated Leverage Ratio”) or (b) the highest of (i) prime, (ii) the federal funds rate plus 50 basis points, and (iii) SOFR plus 100 basis points (such highest rate, the “Base Rate”), plus a margin that ranges between 0.25% and 0.75% depending on the Consolidated Leverage Ratio. Swingline loans generally bear interest at the Base Rate plus a margin that ranges between 0.25% and 0.75% depending on the Consolidated Leverage Ratio. As of June 30, 2026, the Company had approximately $51.0 million of outstanding borrowings under the Credit Agreement, which accrued interest at a weighted average rate of 5.24%.
Previous wording
Revenues for fiscal 2025 increased by approximately $36.3 million (10%) from fiscal 2024. The increase was primarily attributable to revenues generated by businesses acquired by the Company during fiscal 2025 as well as price increases established throughout the Company’s product lines and service offerings aimed at maintaining or increasing margins to cover incremental product and operating cost increases.
Current wording
Revenues for fiscal 2026 increased by approximately $56.7 million (15%) from fiscal 2025. The increase was primarily attributable to revenues generated by businesses acquired by the Company during fiscal 2025 and fiscal 2026.
Previous wording
Cost of sales, expressed as a percentage of revenues, decreased to 69.6% in fiscal 2025 from 70.2% in fiscal 2024, representing gross margins of 30.4% in fiscal 2025 and 29.8% in fiscal 2024. The decrease in cost of sales as a percentage of revenues and increase in gross margin were primarily attributable to favorable changes in product and customer mix. The increase in gross margin is also attributable to the Company’s efforts to drive higher quality sales opportunities from promoting solution selling as a value-added distributor.
Current wording
Cost of sales, expressed as a percentage of revenues, decreased to 68.5% in fiscal 2026 from 69.6% in fiscal 2025, representing gross margins of 31.5% in fiscal 2026 and 30.4% in fiscal 2025. The decrease in cost of sales as a percentage of revenues and increase in gross margin were primarily attributable to favorable changes in product and customer mix. The increase in gross margin is also attributable to the Company’s efforts to drive higher quality sales opportunities from promoting solution selling as a value-added distributor.
Previous wording
Selling, general and administrative expenses increased by approximately $11.0 million (12%) in fiscal 2025 compared to fiscal 2024, primarily due to (a) operating expenses of acquired businesses, including additional operating expenses at the acquired businesses in pursuit of future growth and in connection with the Company’s optimization initiatives, (b) increases in salary, stock compensation, rent, technology costs, professional fees, and insurance costs to support the Company’s growth, and (c) depreciation and amortization. As a percentage of revenues, selling, general and administrative expenses increased to 26.8% in fiscal 2025 from 26.5% in fiscal 2024.
Current wording
Selling, general and administrative expenses increased by approximately $20.4 million (20%) in fiscal 2026 compared to fiscal 2025, primarily due to (a) operating expenses of acquired businesses, including additional operating expenses at the acquired businesses in pursuit of future growth and in connection with the Company’s optimization initiatives, (b) increases in salary, stock compensation, rent, technology costs, professional fees, and insurance costs to support the Company’s growth, and (c) depreciation and amortization. As a percentage of revenues, selling, general and administrative expenses increased to 28.0% in fiscal 2026 from 26.8% in fiscal 2025.
Previous wording
Interest expense, net remained flat in fiscal 2025 compared to fiscal 2024 as increases in the average outstanding debt balances were offset by decreases in the effective interest rate incurred on outstanding borrowings.
Current wording
Interest expense, net increased by approximately $1.2 million (44%) in fiscal 2026 compared to fiscal 2025 as the average outstanding debt balances were higher in fiscal 2026, partially offset by decreases in the effective interest rate incurred on outstanding borrowings.
Previous wording
The Company’s effective income tax rate was 32.0% for fiscal 2025 compared to 36.4% in fiscal 2024. The decrease in the effective income tax rate in fiscal 2025 is attributable to a decrease in the net impact of permanent book-tax differences resulting primarily from nondeductible compensation and higher net income.
Current wording
The Company’s effective income tax rate was 34.5% for fiscal 2026 compared to 32.0% in fiscal 2025. The increase in the effective income tax rate in fiscal 2026 is attributable to an increase in the net impact of permanent book-tax differences resulting primarily from nondeductible compensation, partially offset by decreases in the Company's taxable presence in the jurisdictions where the Company operates.
Previous wording
Inflation did not have a significant effect on the Company’s results during fiscal 2025 or fiscal 2024. However, the Company faces risks relating to inflation, including the current inflationary trend, and other price increases (including due to the imposition of tariffs), which may have an adverse impact on the market for the Company’s products and services, including that there is no assurance that the Company will be able to effectively increase the price of its products and services to offset increased costs.
Current wording
Inflation did not have a significant effect on the Company’s results during fiscal 2026 or fiscal 2025. However, the Company faces risks relating to inflation and other price increases (including due to the imposition of tariffs), which may have an adverse impact on the market for the Company’s products and services, including that there is no assurance that the Company will be able to effectively increase the price of its products and services to offset increased costs.
Previous wording
On October 10, 2016, the Company’s wholly-owned subsidiary, Western State Design, entered into a lease agreement pursuant to which it leases 17,600 square feet of warehouse and office space from an affiliate of Dennis Mack, a director and employee of the Company, and Tom Marks, Executive Vice President, Business Development and President of the West Region of the Company. The lease had an initial term of five years and provides for two successive three-year renewal terms at the option of the Company. The Company exercised its option to renew the lease for the first three-year renewal term, which commenced in October 2021, and the second three-year renewal term, which commenced in October 2024. Base rent for the first renewal term was $19,000 per month. Base rent for the second renewal term is $21,000 per month. In addition to base rent, Western State Design is responsible under the lease for costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $244,000 and $252,000 during fiscal 2025 and fiscal 2024, respectively.
Current wording
On October 10, 2016, the Company’s wholly-owned subsidiary, Western State Design, entered into a lease agreement pursuant to which it leases 17,600 square feet of warehouse and office space from an affiliate of Dennis Mack, a director and employee of the Company, and Tom Marks, Executive Vice President, Business Development and President of the West Region of the Company. The lease had an initial term of five years and provides for two successive three-year renewal terms at the option of the Company. The Company exercised its option to renew the lease for the first three-year renewal term, which commenced in October 2021, and the second three-year renewal term, which commenced in October 2024. Base rent for the first renewal term was $19,000 per month. Base rent for the second renewal term is $21,000 per month. In addition to base rent, Western State Design is responsible under the lease for costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $252,000 and $244,000 during fiscal 2026 and fiscal 2025, respectively.
Previous wording
On November 1, 2018, the Company’s wholly-owned subsidiary, AAdvantage Laundry Systems, entered into a lease agreement pursuant to which it leases warehouse and office space from an affiliate of Mike Zuffinetti, former Chief Executive Officer of AAdvantage. Pursuant to the lease agreement, on January 1, 2019, the lease expanded to cover additional warehouse space. The lease had an initial term of five years and provides for two successive three-year renewal terms at the option of the Company. The Company exercised its option to renew the lease for the first three-year renewal term, which commenced in November 2023. Base rent for the initial term was $36,000 per month. Base rent for the first renewal term is $40,000 per month. In addition to base rent, AAdvantage is responsible under the lease for costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $480,000 and $464,000 during fiscal 2025 and fiscal 2024, respectively.
Current wording
On November 1, 2018, the Company’s wholly-owned subsidiary, AAdvantage Laundry Systems, entered into a lease agreement pursuant to which it leases warehouse and office space from an affiliate of Mike Zuffinetti, former Chief Executive Officer of AAdvantage. Pursuant to the lease agreement, on January 1, 2019, the lease expanded to cover additional warehouse space. The lease had an initial term of five years and provides for two successive three-year renewal terms at the option of the Company. The Company exercised its option to renew the lease for the first three-year renewal term, which commenced in November 2023. Base rent for the initial term was $36,000 per month. Base rent for the first renewal term is $40,000 per month. In addition to base rent, AAdvantage is responsible under the lease for costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $480,000 during fiscal 2026 and fiscal 2025.
Previous wording
On November 3, 2020, the Company’s wholly-owned subsidiary, Yankee Equipment Systems, entered into a lease agreement pursuant to which it leases a total of 12,500 square feet of warehouse and office space from an affiliate of Peter Limoncelli, President of Yankee Equipment Systems. The lease had an initial term of three years and provides for three successive three-year renewal terms at the option of the Company. The Company exercised its option to renew this lease for the first three-year renewal term, which commenced in November 2023. Base rent for the initial term was $11,000 per month. Base rent for the first year of the renewal term was $12,500 per month. Base rent for the second year of the renewal term is $12,750 per month. In addition to base rent, Yankee Equipment Systems is responsible under the lease for
Current wording
On November 3, 2020, the Company’s wholly-owned subsidiary, Yankee Equipment Systems, entered into a lease agreement pursuant to which it leases a total of 12,500 square feet of warehouse and office space from an affiliate of Peter Limoncelli, President of Yankee Equipment Systems. The lease had an initial term of three years and provides for three successive three-year renewal terms at the option of the Company. The Company exercised its option to renew this lease for the first three-year renewal term, which commenced in November 2023. Base rent for the initial term was $11,000 per month. Base rent for the first year of the renewal term was $12,500 per month. Base rent for the second year of the renewal term is $12,750 per month. Base rent for the third year of the renewal term is $13,000 per month. In addition to base rent, Yankee Equipment Systems is responsible under the lease for costs related to real estate taxes, utilities, maintenance, repairs and insurance. Payments under this lease totaled approximately $155,000 and $152,000 during fiscal 2026 and fiscal 2025, respectively.
Previous wording
Revenue primarily consists of revenues from the sale or leasing of commercial and industrial laundry and dry cleaning equipment and steam and hot water boilers manufactured by others; the sale of related replacement parts and accessories; and the provision of installation and maintenance services. The Company generates revenue primarily from the sale of equipment and parts to customers. Therefore, the majority of the Company’s contracts are short-term in nature and have a single performance obligation (to deliver products), and the Company’s performance obligation is satisfied when control of the product is transferred to the customer. Other contracts contain a combination of equipment sales and services expected to be performed in the near-term, which services are distinct and accounted for as separate performance obligations. Judgment may be required by management to identify the distinct performance obligations within each contract. Revenue is recognized on these contracts when control transfers to the Company’s customers via shipment of products or provision of services and the Company has the right to receive consideration for these products and services. Additionally, from time to time, the Company enters into longer-termed contracts which provide for the sale of equipment by the Company and the provision by the Company of related installation and construction services. The installation on these types of contracts is usually completed within six to twelve months. The Company recognizes a portion of its revenue over time using the cost-to-cost measure of progress, which measures a contract’s progress toward completion based on the ratio of actual contract costs incurred to date to the Company’s estimated costs at completion adjusted for uninstalled materials, as necessary. Significant judgment may be required by management in the cost estimation process for these contracts, which is based on the knowledge and experience of the Company’s project managers, subcontractors and financial professionals. Changes in job performance and job conditions are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and the Company’s revenue recognition. The determination of the total estimated cost and progress toward completion requires management to make significant estimates and assumptions. Total estimated costs to complete projects include various costs such as direct labor, material and subcontract
Current wording
From time to time, the Company enters into longer-termed contracts which provide for the sale of equipment by the Company and the provision by the Company of related installation and construction services. The installation on these types of contracts is usually completed within six to twelve months. The Company recognizes a portion of its revenue over time using the cost-to-cost measure of progress, which measures a contract’s progress toward completion based on the ratio of actual contract costs incurred to date to the Company’s estimated costs at completion adjusted for uninstalled materials, as necessary. Significant judgment may be required by management in the cost estimation process for these contracts, which is based on the knowledge and experience of the Company’s project managers, subcontractors and financial professionals. Changes in job performance and job conditions are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and the Company’s revenue recognition. The determination of the total estimated cost and progress toward completion requires management to make significant estimates and assumptions. Total estimated costs to complete projects include various costs such as direct labor, material and subcontract costs. Changes in these estimates can have a significant impact on the revenue recognized each period. From time to time, the Company also enters into maintenance and service contracts. These longer-term contracts, maintenance and service contracts have a single performance obligation where revenue is recognized over time using the cost-to-cost measure of progress, which best depicts the continuous transfer of control of goods or services to the customer.
Previous wording
The Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate that the carrying value may not be recoverable. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit's carrying value is compared to its fair value. If the fair value is determined to be less than the carrying value, a second step is performed to measure the amount of impairment loss. This step compares the current implied goodwill in the reporting unit to its carrying amount. If the carrying amount of the goodwill exceeds the implied goodwill, an impairment is recorded for the excess. The identification and measurement of goodwill impairment
Current wording
The Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate that the carrying value may not be recoverable. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit's carrying value is compared to its fair value. If the fair value is determined to be less than the carrying value, a second step is performed to measure the amount of impairment loss. This step compares the current implied goodwill in the reporting unit to its carrying amount. If the carrying amount of the goodwill exceeds the implied goodwill, an impairment is recorded for the excess. The identification and measurement of goodwill impairment involves the estimation of the fair value of the reporting unit and involves uncertainty because management must use judgment in determining appropriate assumptions to be used in the measurement of fair value. The Company performed its annual impairment test in the fourth quarter of fiscal 2026 and determined there was no impairment.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
cash provided by financing activities was attributable primarily to borrowings under the Company’s credit facility to fund the Company’s acquisitions in fiscal 2025.
Previous report — wording carried elsewhere
costs. Changes in these estimates can have a significant impact on the revenue recognized each period. From time to time, the Company also enters into maintenance and service contracts. These longer-term contracts, maintenance and service contracts have a single performance obligation where revenue is recognized over time using the cost-to-cost measure of progress, which best depicts the continuous transfer of control of goods or services to the customer.
Previous report — wording carried elsewhere
involves the estimation of the fair value of the reporting unit and involves uncertainty because management must use judgment in determining appropriate assumptions to be used in the measurement of fair value. The Company performed its annual impairment test on April 1, 2025 and determined there was no impairment.