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What changed in GRAHAM CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of GRAHAM CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+289 added−286 removedSource: 10-K (2025-06-09) vs 10-K (2024-06-07)

Top changes in GRAHAM CORP's 2025 10-K

289 paragraphs added · 286 removed · 203 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

93 edited+27 added−22 removed198 unchanged
Biggest changeOur Products, Customers and Markets We manufacture high quality, highly reliable custom-engineered products for critical applications: • Defense Power plant systems - ejectors, surface condensers Torpedo ejection, propulsion & power systems - turbines, alternators, regulators, pumps, blowers Thermal management systems - pumps, blowers, drive electronics • Energy Heat transfer & vacuum systems - ejectors, process condensers, surface condensers, liquid ring pumps, heat exchangers, nozzles Power generation systems - turbines, generators, compressors, pumps Thermal management systems - pumps, blowers, electronics • Chemical and Petrochemical Processing Heat transfer & vacuum systems - ejectors, process condensers, surface condensers, liquid ring pumps, heat exchangers, nozzles • Space Rocket propulsion systems - turbopumps, fuel pumps, nuclear fluid pump Cooling systems - pumps, compressors, fans, blowers Life support systems - fans, pumps, blowers 3 Our products are used in a wide range of applications, including: • Defense Aircraft carrier program (CVN) Virginia fast-attack submarine program (SSN) Columbia and Ohio ballistic submarine program (SSBN) U.S.
Biggest changeAs part of this change, revenue previously classified as Refining, Chemical/Petrochemical, and Other, which included New Energy product sales, will now be consolidated into one market, which has been renamed “Energy & Process.” The Defense and Space end market classifications remain unchanged. • Defense Power plant systems - ejectors, surface condensers Torpedo ejection, propulsion & power systems - turbines, alternators, regulators, pumps, blowers Thermal management systems - pumps, blowers, drive electronics • Energy & Process Heat transfer & vacuum systems - ejectors, process condensers, surface condensers, liquid ring pumps, heat exchangers, nozzles Power generation systems - turbines, generators, compressors, pumps Thermal management systems - pumps, blowers, electronics • Space Rocket propulsion systems - turbopumps, fuel pumps, cryogenic pumps, nuclear propellant pump Cooling systems - pumps, compressors, fans, blowers Life support systems - fans, pumps, blowers 3 Our products are used in a wide range of applications, including: • Defense Aircraft carrier program (CVN) Virginia fast-attack submarine program (SSN) Columbia and Ohio ballistic submarine program (SSBN) U.S.
Item 1. Business Graham Corporation ("we," "us," "our" or the "Company") is a global leader in the design and manufacture of mission critical fluid, power, heat transfer and vacuum technologies for the defense, space, energy and process industries. We design and manufacture custom-engineered vacuum, heat transfer, cryogenic pump and turbomachinery technologies.
Item 1. Business Graham Corporation ("we," "us," "our" or the "Company") is a global leader in the design and manufacture of mission critical fluid, power, heat transfer and vacuum technologies for the Defense, Energy & Process, and Space industries. We design and manufacture custom-engineered vacuum, heat transfer, cryogenic pump and turbomachinery technologies.
Our foreign operations and sales could be adversely affected as a result of: • nationalization of private enterprises and assets; • trade policies incentivizing domestic trade over international trade; • political or economic instability in certain countries and regions, such as the ongoing instability throughout the Middle East and/or portions of the former Soviet Union; • the global economic impact as a result of global health concerns; • political relationships between the U.S. and certain countries and regions; • differences in foreign laws, including difficulties in protecting intellectual property and uncertainty in enforcement of contract rights; • the possibility that foreign governments may adopt regulations or take other actions that could directly or indirectly harm our business and growth strategy; • credit risks; • currency fluctuations; 13 • tariff and tax increases; • export and import restrictions and restrictive regulations of foreign governments; • shipping products during times of crisis or war; • our failure to comply with U.S. laws regarding doing business in foreign jurisdictions, such as FCPA; or • other factors inherent in maintaining foreign operations.
Our foreign operations and sales could be adversely affected as a result of: • nationalization of private enterprises and assets; • trade policies incentivizing domestic trade over international trade; • political or economic instability in certain countries and regions, such as the ongoing instability throughout the Middle East and/or portions of the former Soviet Union; • the global economic impact as a result of global health concerns; • political relationships between the U.S. and certain countries and regions; • differences in foreign laws, including difficulties in protecting intellectual property and uncertainty in enforcement of contract rights; • the possibility that foreign governments may adopt regulations or take other actions that could directly or indirectly harm our business and growth strategy; • credit risks; • currency fluctuations; • tariff and tax increases; • export and import restrictions and restrictive regulations of foreign governments; • shipping products during times of crisis or war; • our failure to comply with U.S. laws regarding doing business in foreign jurisdictions, such as FCPA; or • other factors inherent in maintaining foreign operations.
A substantial portion of our sales is derived from fixed-price contracts, which may involve long-term fixed-price commitments by us to our customers. While we believe our contract management processes are strong, we nevertheless could experience difficulties 9 in executing large contracts, including but not limited to, estimating errors, cost overruns, supplier failures and customer disputes.
A substantial portion of our sales is derived from fixed-price contracts, which may involve long-term fixed-price commitments by us to our customers. While we believe our contract management processes are strong, we nevertheless could experience difficulties in executing large contracts, including but not limited to, estimating errors, cost overruns, supplier failures and customer disputes.
While these projects are spread across multiple contractors and programs for the U.S. Navy, the end customer for these projects is the same. This concentration of business could add additional risk to us should there be a disruption, short or long term, in the funding for these projects or our participation in these defense programs.
While these projects are spread across multiple contractors and programs, the end customer for these projects, primarily the U.S. Navy, is the same. This concentration of business could add additional risk to us should there be a disruption, short or long term, in the funding for these projects or our participation in these Defense programs.
There are strong and long-standing relationships throughout the supply chain between the many parties involved in serving the end user of our products. A change in the landscape between engineering and procurement companies, original equipment suppliers, others in the supply chain, and/or with the end users could have a material adverse effect on our business and results of operations.
There are strong and long-standing relationships throughout the supply chain between the many parties involved in serving the end users of our products. A change in the landscape between engineering and procurement companies, original equipment suppliers, others in the supply chain, and/or with the end users could have a material adverse effect on our business and results of operations.
In 14 addition, changes in demand could result from increased competition from local Chinese manufacturers who have cost advantages or who may be preferred suppliers for Chinese end users. Also, China's commercial laws, regulations and interpretations applicable to non-Chinese owned market participants, such as us, are continually changing.
In addition, changes in demand could result from increased competition from local Chinese manufacturers who have cost advantages or who may be preferred suppliers for Chinese end users. Also, China's commercial laws, regulations and interpretations applicable to non-Chinese owned market participants, such as us, are continually changing.
For more information on this performance indicator see "Orders, Backlog and Book-to-Bill Ratio" below. Our Strengths Our core strengths include: • We have a value-enhancing engineering sales and product development platform. We believe our customer-facing platform of technical sales, project estimating and application engineering are competitive advantages.
For more information on this performance indicator see "Orders, Backlog and Book-to-Bill Ratio" below. 4 Our Strengths Our core strengths include: • We have a value-enhancing engineering sales and product development platform. We believe our customer-facing platform of technical sales, project estimating and application engineering are competitive advantages.
The MCD can be used in new designs or retrofit applications and can work with any pump or compressor that utilizes a centrifugal impeller. SCAMP is a family of positive displacement pumps for low flow, high pressure cryogenic applications compatible with oxygen, hydrogen, methane and nitrogen.
The MCD can be used in new designs or retrofit applications and can work with any pump or compressor that utilizes a centrifugal 6 impeller. SCAMP is a family of positive displacement pumps for low flow, high pressure cryogenic applications compatible with oxygen, hydrogen, methane and nitrogen.
Additionally, we may be subject to criminal and civil penalties, suspension or debarment from future government contracts, and qui tam litigation brought by private individuals on behalf of the U.S. government under the False Claims Act, which could include claims for treble damages.
Additionally, we may be subject to criminal and civil penalties, suspension or debarment from future 10 government contracts, and qui tam litigation brought by private individuals on behalf of the U.S. government under the False Claims Act, which could include claims for treble damages.
In the event that we believe or have reason to believe that our employees or agents have or may have violated applicable anti-corruption laws, including the FCPA, we may be required to investigate or have outside counsel investigate the relevant facts and circumstances, which can be expensive and requires significant time and attention from senior management.
In the event that we believe or have reason to believe that our employees or agents have or may have violated applicable anti-corruption laws, including the FCPA, we may be required to investigate or have outside counsel investigate the relevant facts and circumstances, which can be expensive and requires significant 12 time and attention from senior management.
Availability of Raw Materials As discussed more fully in Item 1A “Risk Factors” of this report, inflation has accelerated in the U.S. and globally due in part to global supply chain issues, a rise in energy prices, labor shortages, and strong consumer demand.
Availability of Raw Materials As discussed more fully in Item 1A “Risk Factors” of this report, inflation has accelerated in the U.S. and globally due in part to global supply chain issues, a rise in energy prices, labor shortages, tariffs, and strong consumer demand.
We may also lose new employees to our competitors in any of our markets before we realize the benefit of our investment in recruiting and training them. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business would be materially and adversely affected. 20
We may also lose new employees to our competitors in any of our markets before we realize the benefit of our investment in recruiting and training them. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business would be materially and adversely affected.
If we are unable to successfully implement our business strategy and compete against entities with greater resources than us or against competitors who have a relative cost advantage, we risk losing market share to current and future competitors. We encounter competition in all of our markets.
If we are unable to successfully implement our business strategy and compete against entities with greater resources than we have or against competitors who have a relative cost advantage, we risk losing market share to current and future competitors. We encounter competition in all of our markets.
Although our Board of Directors is permitted to amend our bylaws at any time, our stockholders may only amend our bylaws upon the affirmative vote of both 75% of our outstanding shares entitled to vote and a majority of the shares entitled to vote not owned by any person who owns 50% or more of our shares.
Although our Board of Directors is permitted to amend our bylaws at any time, our stockholders may only amend our bylaws upon the affirmative vote of both 75% of our outstanding 19 shares entitled to vote and a majority of the shares entitled to vote not owned by any person who owns 50% or more of our shares.
See Note 17 to our consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional information. 11 Many of our large international customers are nationalized or state-owned businesses.
See Note 17 to our consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional information. Many of our large international customers are nationalized or state-owned businesses.
These changes, or others, might occur through industry consolidations such as mergers, acquisitions or other business partnerships, and could have a material impact on our business and negatively impact our financial results. 12 Our acquisition strategy may not be successful or may increase business risk.
These changes, or others, might occur through industry consolidations such as mergers, acquisitions or other business partnerships, and could have a material impact on our business and negatively impact our financial results. Our acquisition strategy may not be successful or may increase business risk.
Because of the complex nature of many of our products and services, we are generally dependent on a thoroughly trained and highly skilled workforce, including, for example, our engineers and welders. In many of the geographies where we operate, we face a potential shortage of qualified employees.
Because of the complex nature of many of our products and services, we are generally dependent on a thoroughly trained 20 and highly skilled workforce, including, for example, our engineers and welders. In many of the geographies where we operate, we face a potential shortage of qualified employees.
If third parties infringe upon our intellectual property or if we were to infringe upon the intellectual property of third parties, we may expend significant resources enforcing or defending our rights or suffer competitive injury. 17 Our success depends in part on our proprietary technology.
If third parties infringe upon our intellectual property or if we were to infringe upon the intellectual property of third parties, we may expend significant resources enforcing or defending our rights or suffer competitive injury. Our success depends in part on our proprietary technology.
In addition, a number of our customers may have limited resources and may not have a history of creditworthiness that we can audit to determine reliability for payment of accounts receivable.
In addition, a number of our customers may have limited resources and may not have a history of creditworthiness that we can audit to determine 16 reliability for payment of accounts receivable.
Information systems are subject to numerous and evolving cybersecurity threats and sophisticated computer crimes, which pose a risk to the stability and security of our information systems, computer technology, and business.
Information systems are subject to numerous and evolving cybersecurity threats and sophisticated computer crimes, which pose a risk to the stability and security of our information systems, computer technology, and 17 business.
A delay, long-term extension or cancellation of any of these projects could have a material adverse effect on our business and results of operations. Further, certain defense contracts we secure may be designated a program of highest national priority requiring production preference over commercial orders which could impact our commercial backlog and result in production delays.
A delay, long-term extension, lack of funding, or cancellation of any of these projects could have a material adverse effect on our business and results of operations. Further, certain Defense contracts we secure may be designated a program of highest national priority requiring production preference over commercial orders which could impact our commercial backlog and result in production delays.
In addition, if the counter-parties to such exchange contracts do not fulfill their obligations to deliver the contractual foreign currencies, we could be at risk for fluctuations, if any, required to settle the obligation. Any of the foregoing could adversely affect our business and results of operations. At March 31, 2024, we held no forward foreign currency exchange contracts.
In addition, if the counter-parties to such exchange contracts do not fulfill their obligations to deliver the contractual foreign currencies, we could be at risk for fluctuations, if any, required to settle the obligation. Any of the foregoing could adversely affect our business and results of operations. At March 31, 2025, we held no forward foreign currency exchange contracts.
Our enterprise resource planning system utilized at our facilities in Batavia, NY is aging, and we may experience issues from implementation of a new enterprise resource planning system. We have an enterprise resource planning system (“ERP”) to assist with the collection, storage, management and interpretation of data from our business activities to support future growth and to integrate significant processes.
Our enterprise resource planning system utilized at our facilities in Batavia, NY is aging, and we may experience issues from implementation of a new enterprise resource planning system. We have an enterprise resource planning system ("ERP") to assist with the collection, storage, management and interpretation of data from our business activities to support future growth and to integrate significant processes.
One of our growth strategies is to increase our penetration of U.S. Navy-related opportunities. Projects for the U.S. Navy and its contractors generally have a much longer order-to-shipment time period than our commercial orders. The time between the awarding of an order and the completion of shipment can take three to seven years.
One of our growth strategies is to increase our penetration of Defense opportunities, primarily U.S. Navy-related. Projects for the U.S. Navy and its contractors generally have a much longer order-to-shipment time period than our commercial orders. The time between the awarding of an order and the completion of shipment can take three to seven years.
Current economic uncertainty and market volatility is anticipated to continue as a 19 result of higher inflation, increased interest rates, supply chain disruptions, fluctuating foreign currency exchange rates and other geopolitical events.
Current economic uncertainty and market volatility is anticipated to continue as a result of higher inflation, increased tariffs, increased interest rates, supply chain disruptions, fluctuating foreign currency exchange rates and other geopolitical events.
The prices of crude oil and natural gas have historically had periods when they have been very volatile, as evidenced by the extreme volatility in oil prices over the past few years, in part due to the COVID-19 pandemic, the Ukraine-Russia war, the Israel-Hamas war, political uncertainty and agendas, and macroeconomic impacts.
The prices of crude oil and natural gas have historically had periods when they have been very volatile, as evidenced by the extreme volatility in oil prices over the past few years, in part due to the Ukraine-Russia war, the Israel-Hamas war, political uncertainty and agendas, and macroeconomic impacts.
Our future success may be affected by our current and future indebtedness. As of March 31, 2024, we had $0 outstanding under our revolving credit facility with Wells Fargo Bank, National Association ("Wells Fargo"). We may borrow additional funds in the future to support our growth and working capital needs.
Our future success may be affected by indebtedness. As of March 31, 2025, we had $0 outstanding under our revolving credit facility with Wells Fargo Bank, National Association ("Wells Fargo"). We may borrow additional funds in the future to support our growth and working capital needs.
In addition, governmental policy can affect the relative importance of various forms of energy sources. For example, non-fossil based sources may receive government tax incentives to foster investment. If these incentives become more prominent, our refinery and petrochemical businesses could be negatively impacted. Climate change and greenhouse gas regulations may affect our customers’ investment decisions.
In addition, governmental policy can affect the relative importance of various forms of energy sources. For example, non-fossil based sources may receive government tax incentives to foster investment. If these incentives become more prominent, our Energy business could be negatively impacted. Climate change and greenhouse gas regulations may affect our customers’ investment decisions.
Acquisition - On November 9, 2023, we completed our acquisition of P3, a privately-owned custom turbomachinery engineering, product development, and manufacturing business located in Jupiter, Florida that serves the space, new energy, defense and medical industries. We believe this acquisition advances our growth strategy, further diversifies our market and product offerings, and broadens our turbomachinery solutions.
Acquisition - On November 9, 2023, we completed our acquisition of P3, a privately-owned custom turbomachinery engineering, product development, and manufacturing business located in Jupiter, FL that serves the Space, New Energy, Defense and Medical markets. We believe this acquisition advances our growth strategy, further diversifies our market and product offerings, and broadens our turbomachinery solutions.
We expect to accomplish our goals through the development of our full lifecycle product model serving multiple markets while leveraging business unit synergies to optimize profitability and stability. Additionally, we believe we must develop a highly engaged team that will drive continual 5 improvement for the long term.
We expect to accomplish our goals through the development of our full lifecycle product model serving multiple markets while leveraging our technology across our markets and driving business unit synergies to optimize profitability and stability. Additionally, we believe we must develop a highly engaged team that will drive continual improvement for the long term.
For our U.S. Navy projects, these fixed-priced contracts have order to shipment periods which can exceed five years. This additional time-based risk, which we believe is manageable, increases the likelihood of cost fluctuation, which could have a material adverse effect on our business and results of operation.
For our Defense projects, these fixed-priced contracts have order to shipment periods which can exceed five years. This additional time-based risk, which we believe is manageable, increases the likelihood of cost fluctuation, which could have a material adverse effect on our business and results of operation.
Our ERP at our Batavia, NY operations is aging and we began implementing a new ERP during fiscal 2024. ERP implementations are complex, distracting to the business and management, and time-consuming and involve substantial expenditures on system software and implementation activities, as well as changes in business processes.
Our ERP at our Batavia, NY operations is aging and we began implementing a new ERP during fiscal 2024 and is scheduled to go live in fiscal 2026. ERP implementations are complex, distracting to the business and management, and time-consuming and involve substantial expenditures on system software and implementation activities, as well as changes in business processes.
For example, sales to our top ten customers, who can vary each year, accounted for 57%, 46% and 42% of consolidated net sales in fiscal 2024, fiscal 2023, and fiscal 2022, respectively. We expect that a limited number of customers will continue to represent a substantial portion of our sales for the foreseeable future.
For example, sales to our top ten customers, who can vary each year, accounted for 60%, 57% and 46% of consolidated net sales in fiscal 2025, fiscal 2024, and fiscal 2023, respectively. We expect that a limited number of customers will continue to represent a substantial portion of our sales for the foreseeable future.
We are committed to creating a work environment which embraces inclusion regardless of race, color, religion, gender, sexual orientation, gender identity, national origin, age, genetic information, marital status, pregnancy, childbirth, disability, veteran status, medical conditions, or any protected status. • Diversity: Our Management recognizes that a diverse workforce and a culture of equity and inclusion helps us compete more effectively for talent, sustain success as a business, and build an engaged employee base.
We are committed to creating a work environment which embraces inclusion regardless of race, color, religion, gender, sexual orientation, gender identity, national origin, age, genetic information, marital status, pregnancy, childbirth, disability, veteran status, medical conditions, or any protected status. • Diversity: Our Management recognizes that fostering an inclusive environment helps us compete more effectively for talent, sustain success as a business, and build an engaged employee base.
Risks Related to our Business We may experience customer concentration risk related to strategic growth for U.S. Navy projects. During fiscal 2024, sales to the defense industry continued to grow and represented 54% of our business compared with 42% and 51% of sales to the defense industry in fiscal 2023 and 2022, respectively.
Risks Related to our Business We may experience customer concentration risk related to strategic growth for U.S. Navy projects. During fiscal 2025, sales to the Defense industry continued to grow and represented 58% of our business compared with 54% and 42% of sales to the Defense industry in fiscal 2024 and 2023, respectively.
Additionally, with the acquisition of P3, we added scalable and adaptable patent-protected intellectual property that we intend to leverage across our customer base. This includes P3's patented multi-channel diffuser ("MCD") and self-contained actuating magnetic pump ("SCAMP"). P3's MCD technology improves the efficiency of pumps and compressors by increasing pressure recovery and measurably increasing operating range.
Additionally, with the acquisition of P3, we added scalable and adaptable patent-protected intellectual property that we are leveraging across our customer base. This includes P3's patented multi-channel diffuser ("MCD") and self-contained actuating magnetic pump ("SCAMP"). P3's MCD technology improves the efficiency of pumps and compressors by increasing pressure recovery and measurably increasing operating range.
The impact of such reductions could have a material adverse effect on our business and results of operations, as well as our growth opportunities. U.S. Navy orders are subject to annual government funding. A disruption in funding or a lapse in funding could materially and adversely impact our business.
The impact of such reductions could have a material adverse effect on our business and results of operations, as well as our growth opportunities. Defense orders are subject to annual government funding. A disruption in funding or a lapse in funding could materially and adversely impact our business.
We refer to our fiscal year, which ended March 31, 2024, as fiscal 2024. Likewise, we refer to our fiscal years that will end or have ended March 31, 2025, March 31, 2023 and March 31, 2022 as fiscal 2025, fiscal 2023 and fiscal 2022, respectively.
We refer to our fiscal year, which ended March 31, 2025, as fiscal 2025. Likewise, we refer to our fiscal years that will end or have ended March 31, 2027, March 31, 2026, March 31, 2024 and March 31, 2023 as fiscal 2027, fiscal 2026, fiscal 2024, and fiscal 2023, respectively.
At Graham, we believe our most important asset is our people. We are committed to fostering and embracing a Graham community in which employees share a mutual understanding and respect for each other.
We believe that our relationship with our employees is good. At Graham, we believe our most important asset is our people. We are committed to fostering and embracing a Graham community in which employees share a mutual understanding and respect for each other.
Additionally, international conflicts and other geopolitical events, including the ongoing war between Russia and the Ukraine and the Israel-Hamas war, have further contributed to increased supply chain costs due to shortages in raw materials, increased costs for transportation and energy, and disruptions in supply chains.
Additionally, international conflicts and other geopolitical events, including the ongoing war between Russia and the Ukraine, the Israel-Hamas war, and recent trade-related actions, have further contributed to increased supply chain costs due to shortages in raw materials, increased costs for transportation and energy, tariffs, and disruptions in supply chains.
We have foreign operations and a percentage of our sales occur outside of the U.S. As a result, we are subject to the economic, political, regulatory and other risks of international operations. For fiscal 2024, 16% of our revenue was from customers located outside of the U.S.
We have foreign operations and a percentage of our sales occur outside of the U.S. As a result, we are subject to the economic, political, regulatory and other risks of international operations. 13 For fiscal 2025, 19% of our revenue was from customers located outside of the U.S.
Our competitors listed in alphabetical order by market include: North America Market Principal Competitors Navy Nuclear Propulsion Program / Defense DC Fabricators; Joseph Oat; PCC; Triumph Aerospace; Xylem Refining vacuum distillation Croll Reynolds Company, Inc.; Gardner Denver, Inc.; GEA Wiegand GmbH Chemicals/petrochemicals Croll Reynolds Company, Inc.; Gardner Denver, Inc.; Schutte Koerting Turbomachinery OEM – defense and aerospace/space Ametek, Inc.; Concepts NREC; Curtiss Wright; Florida Turbine Technologies; Honeywell; Kratos Defense & Security Solns Turbomachinery OEM – refining, petrochemical Donghwa Entec Co., Ltd..; KEMCO; Oeltechnik GmbH Turbomachinery OEM – power and power producer Holtec; KEMCO; Maarky Thermal Systems; Thermal Engineering International (USA), Inc. international Market Principal Competitors Refining vacuum distillation Edwards, Ltd.; Gardner Denver, Inc.; GEA Wiegand GmbH; Korting Hannover AG; Westlake Vacuum Chemicals/petrochemicals Croll Reynolds Company, Inc.; Edwards, Ltd.; Gardner Denver, Inc.; GEA Wiegand GmbH; Korting Hannover AG; Schutte Koerting Turbomachinery OEM – refining, petrochemical Chem Process Systems; Donghwa Entec Co., Ltd.; Hangzhou Turbine Equipment Co., Ltd.; KEMCO; Mazda (India); Oeltechnik GmbH Turbomachinery OEM – power and power producer Chem Process Systems; Holtec; KEMCO; Mazda (India); SPX Heat Transfer; Thermal Engineering International 6 Intellectual Property Our success depends in part on our ability to protect our proprietary technologies.
Our competitors listed in alphabetical order by market include: North America Market Principal Competitors Defense DC Fabricators; Joseph Oat; PCC; Triumph Aerospace; Xylem Energy & Process Croll Reynolds Company, Inc.; Gardner Denver, Inc.; Schutte Koerting; GEA Wiegand GmbH Turbomachinery OEM – Defense and Space Ametek, Inc.; Concepts NREC; Curtiss Wright; Honeywell; Kratos Defense & Security Solns Turbomachinery OEM – Energy & Process Donghwa Entec Co., Ltd.; KEMCO; Oeltechnik GmbH Turbomachinery OEM – power and power producer Holtec; KEMCO; Maarky Thermal Systems; Thermal Engineering International (USA), Inc. international Market Principal Competitors Energy & Process Croll Reynolds Company, Inc.; Edwards, Ltd.; Gardner Denver, Inc.; GEA Wiegand GmbH; Korting Hannover AG; Schutte Koerting Turbomachinery OEM – Energy & Process Chem Process Systems; Donghwa Entec Co., Ltd.; Hangzhou Turbine Equipment Co., Ltd.; KEMCO; Mazda (India); Oeltechnik GmbH Turbomachinery OEM – power and power producer Chem Process Systems; Holtec; KEMCO; Mazda (India); SPX Heat Transfer; Thermal Engineering International Intellectual Property Our success depends in part on our ability to protect our proprietary technologies.
A representative list of our customers include: Aerojet Rocketdyne, Air Liquide, Applied Research Laboratory at Pennsylvania State University, Aramco, Bechtel Plant Machinery Inc., Blue Origin, Boeing, CERN, China State-owned Refiners, Cummins, DuPont, Dow Chemical, General Atomics, General Dynamics, ExxonMobil, Fluor Corporation, Jacobs Engineering Group Inc., Kairos Power, Koch Fertilizer ENID LLC, Lockheed Martin, MHI Compressor International Corporation, NASA, Newport News Shipbuilding, Northrop Grumman, Oak Ridge National Laboratory, Raytheon Technologies, Rolls-Royce North America, SAIC, Sierra Space, U.S.
A representative list of our customers include: Air Liquide, Applied Research Laboratory at Pennsylvania State University, Aramco, Axiom Space, Bechtel Plant Machinery Inc., Blue Origin, Boeing, CERN, China State-owned Refiners, Cummins, Dow Chemical, DuPont, Echogen Power Systems, General Atomics, General Dynamics, ExxonMobil, Fluor Corporation, Intuitive Machines, Jacobs Engineering Group Inc., Kairos Power, Koch Fertilizer ENID LLC, L3Harris, Lockheed Martin, MHI Compressor International Corporation, NASA, Newport News Shipbuilding, Northrop Grumman, Oak Ridge National Laboratory, Radiant Nuclear, Raytheon Technologies, Relativity, Rolls-Royce North America, SAIC, SES, Sierra Space, U.S.
Navy, United Launch Alliance, and Varian. Our products are sold by a team of sales engineers whom we employ directly. Two customers each accounted for more than 10% of our revenue in the fiscal 2024. As a result of our diversification efforts to more extensively support the U.S.
Navy, United Launch Alliance, and Varian. Our products are sold by a team of sales engineers whom we employ directly. Two customers each accounted for more than 10% of our revenue in the fiscal 2025. As a result of our diversification efforts to more extensively support the U.S. Navy we have increased our concentration in domestic and Defense sales.
We believe that a focus on environmental stewardship is important to the work we do every day to serve our customers, create value for our stockholders, and benefit our global community. We have taken steps to improve energy efficiencies and air quality and manage water consumption and waste. These efforts are focused on reducing our impact on the environment.
We believe that a focus on environmental stewardship is important to the work we do every day to serve our customers, create value for our stockholders, and benefit our global community. We have taken steps to improve energy efficiencies and air quality and manage water consumption and waste.
Navy torpedoes (all size classes) Refueling, overhaul replacement, and fleet sustainment equipment • Energy Conventional oil refining Oil sands extraction and upgrading Ethanol plants Cogeneration power plants Geothermal and biomass power plants with lithium extraction Concentrated solar power Molten salt reactor development Small modular nuclear reactor development Hydrogen fuel cell power Zero-emission aviation • Chemical and Petrochemical Processing Ethylene, methanol and nitrogen producing plants Urea and fertilizer plants Plastics, resins and fibers plants Downstream petrochemical plants Coal-to-chemicals plants Gas-to-liquids plants • Space NASA xEMU next-generation space suit and commercial derivatives In-space nuclear thermal propulsion turbomachinery Propellant recirculation pumps Space exploration blowers Satellite active cooling pumps Various commercial space propulsion, fluid and heat transfer applications • Cryogenic Fluid Processes Superconducting cable and magnet cooling Particle physics and neutrino research Helium recovery Space simulation chambers Hydrogen production, transportation, distribution, fueling Our principal customers include tier one and tier two suppliers to the defense and aerospace industry, refineries, petrochemical plants, large engineering companies that build installations for companies in the energy and process industries (or Engineering Procurement Contractors, and original equipment manufacturers ("OEM").
Navy torpedoes (all size classes) Refueling, overhaul replacement, and fleet sustainment equipment Advanced radar and laser systems • Energy & Process Conventional oil refining Oil sands extraction and upgrading Ethanol plants Cogeneration power plants Geothermal and biomass power plants with lithium extraction Concentrated solar power Molten salt reactor development Small modular nuclear reactor development Hydrogen fuel cell power Hydrogen production, transportation, distribution, fueling Zero-emission aviation Ethylene, methanol and nitrogen producing plants Urea and fertilizer plants Plastics, resins and fibers plants Downstream petrochemical plants Coal-to-chemicals plants Gas-to-liquids plants Edible oil plants Food & beverage plants Pulp & paper plants • Space NASA xEMU next-generation space suit and commercial derivatives In-space nuclear thermal propulsion turbomachinery Propellant recirculation pumps Space exploration blowers Satellite active cooling pumps Various commercial space propulsion, fluid and heat transfer applications Space simulation chambers Our principal customers include tier one and tier two suppliers to the Defense and Aerospace industry, refineries, petrochemical plants, large engineering companies that build installations for companies in the Energy & Process industries (or Engineering Procurement Contractors), and original equipment manufacturers ("OEM").
Moreover, delay of contract execution by our customers can result in volatility in our operating results. Our current backlog contains a number of large orders from the U.S. Navy. In addition, we are continuing to pursue business in this end market which offers large multi-year projects which have an added risk profile beyond that of our historic customer base.
Moreover, delay of contract execution by our customers can result in volatility in our operating results. Our current backlog contains a number of funded and unfunded large Defense orders. In addition, we are continuing to pursue business in this end market which offers large multi-year projects which have an added risk profile beyond that of our historic customer base.
Over the last few years, we have transitioned from a highly cyclical energy business to a diversified company serving multiple markets including the defense, space and alternative energy industries. Our long-term goal is to drive 8% to 10% average annualized organic revenue growth and low to mid-teen adjusted EBITDA margins by the fiscal year ended March 31, 2027.
Over the last several years, we have transitioned from a highly cyclical Energy business to a diversified company serving multiple markets including the Defense, Energy & Process, and Space. Our long-term goal is to drive 8% to 10% average annualized organic revenue growth and low to mid-teen adjusted EBITDA margins by fiscal 2027.
For the defense industry, our equipment is used in nuclear and non-nuclear propulsion, power, fluid transfer, and thermal management systems. For the space industry our equipment is used in propulsion, power and energy management systems, and for life support systems.
For the Defense industry, our equipment is used in nuclear and non-nuclear propulsion, power, fluid transfer, and thermal management systems.
Energy policy in the U.S. and other countries where we sell our products is evolving rapidly and we anticipate that energy policy will continue to be an important legislative priority in the jurisdictions where we sell our products.
Changes in U.S. and foreign energy policy regulations could adversely affect our business. 15 Energy policy in the U.S. and other countries where we sell our products is evolving rapidly and we anticipate that energy policy will continue to be an important legislative priority in the jurisdictions where we sell our products.
GIPL provides sales and engineering support for us in India and the Middle East. We were incorporated in Delaware in 1983 and are the successor to Graham Manufacturing Co., Inc., which was incorporated in New York in 1936. Our stock is traded on the NYSE under the ticker symbol "GHM". Our fiscal year ends on March 31 of each year.
We were incorporated in Delaware in 1983 and are the successor to Graham Manufacturing Co., Inc., which was incorporated in New York in 1936. Our stock is traded on the New York Stock Exchange ("NYSE") under the ticker symbol "GHM". Our fiscal year ends on March 31 of each year.
The loss of any of our major customers, a decrease or delay in orders or anticipated spending by such customers, or a delay in the production of existing orders could materially adversely affect our revenues and results of operations. The size of our contracts with the U.S. Navy may produce volatility in short term financial results.
The loss of any of our major customers, a decrease or delay in orders or anticipated spending by such customers, or a delay in the production of existing orders could materially adversely affect our revenues and results of operations. The size of our contracts with the Defense industry, primarily the U.S.
We believe our strategy to increase the penetration of U.S. Navy related opportunities, which are often much larger contracts than our commercial contracts, can, on occasion, be delayed before or during the revenue recognition cycle.
Navy, may produce volatility in short term financial results. 8 We believe our strategy to increase the penetration of Defense related opportunities, primarily the U.S. Navy, which are often much larger contracts than our commercial contracts, can, on occasion, be delayed before or during the revenue recognition cycle.
If our customers look to foreign competitors to source equipment of the type we manufacture, there could be a material and adverse impact on our results of operations and business. Our efforts to expand our U.S. Navy business and changes in the competitive environment for U.S.
If our customers look to foreign competitors to source equipment of the type we manufacture, there could be a material and adverse impact on our results of operations and business. Our efforts to expand our Defense business and changes in the competitive environment for Defense procurement could materially and adversely impact our ability to grow this portion of our business.
Executed effectively, we expect our strategy to create more enduring, recurring opportunities and profitable growth. Fiscal 2023 and 2024 were characterized by continual improvement and increasing profitability and formed the initial steps along our path to achieve our fiscal 2027 goals. We remain focused on our strategy which will continue to advance in fiscal 2025 in step with our progress.
Executed effectively, we expect our strategy to create more enduring, recurring opportunities and profitable growth. 5 Fiscal 2023, 2024, and 2025 were characterized by continual improvement and increasing profitability, and formed the initial steps along our path to achieve our fiscal 2027 goals through investments in our business.
We are diligent at managing ongoing risks related to projects and the requirements of our customers. In addition, we secure business insurance coverage to minimize the impact of a major failure or liability related to our customers. Due to certain U.S. government procurement policies, we may take on the risk of a liability for large U.S.
In addition, we secure business insurance coverage to minimize the impact of a major failure or liability related to our customers. Due to certain U.S. government procurement policies, we may take on the risk of a liability for large U.S. Defense projects in excess of our insurance coverage and at a level which is higher than our commercial projects.
If we are unable to expand in Arvada our growth may be limited, we may be required to relocate our campus or we may have to incur substantial capital expenditures to redevelop our Arvada campus.
Our BN campus is landlocked and there are limited opportunities to expand our manufacturing footprint in Arvada, CO. If we are unable to expand in Arvada our growth may be limited, we may be required to relocate our campus or we may have to incur substantial capital expenditures to redevelop our Arvada campus.
It is possible we may accumulate losses either on a large project or more than one project such that, in a short time period, for example a reporting quarter, these losses may have a meaningful impact on the earnings for that period.
It is possible we may accumulate losses either on a large project or more than one project such that, in a short time period, for example a reporting quarter, these losses may have a meaningful impact on the earnings for that period. Our operating results could be adversely affected by customer contract cancellations and delays.
Moreover, through our subsidiaries, we maintain a sales and engineering support office in China and a sales and engineering support office in India. We intend to continue to expand our international operations to the extent that suitable opportunities become available.
Moreover, through our subsidiaries, we maintain a sales and engineering support office in China and a sales and engineering support office in India. We also service our foreign customers through the use of subcontract vendors that are located in those countries. We intend to continue to expand our international operations to the extent that suitable opportunities become available.
Competition for qualified management, including our executive management, and key technical and sales personnel in our industry is intense. Moreover, our technology is highly specialized, and it may be difficult to replace the loss of any of our key technical and sales personnel.
Moreover, our technology is highly specialized, and it may be difficult to replace the loss of any of our key technical and sales personnel.
Our growth is contingent upon expanding our manufacturing facilities in Arvada, CO and Batavia, NY If we are unable to expand our manufacturing facilities in Arvada or Batavia our results of operations and financial condition may be adversely affected and/or we may not be able to meet our growth goals and objectives.
If we are unable to expand our manufacturing facilities in Arvada or Batavia our results of operations and financial condition may be adversely affected and/or we may not be able to meet our growth goals and objectives. 18 As a manufacturer, our ability to grow revenue is constrained by our ability to expand our manufacturing facilities.
The impact of potential changes in customs and trade policies and tariffs imposed by the U.S. and those imposed in response by other countries, including China, as well as rapidly changing trade relations, could materially and adversely affect our business and results of operations.
The impact of potential changes in customs and trade policies and tariffs imposed by the U.S. and those imposed in response by other countries, including China, as well as rapidly changing trade relations, could materially and adversely affect our business and results of operations. 14 The U.S. government has made proposals that are intended to address trade imbalances, which include encouraging increased production in the U.S.
There can be no assurance that we will be able to obtain any required approvals for future acquisitions, investments or operations in India, or that we will be able to obtain such approvals on satisfactory terms. Changes in U.S. and foreign energy policy regulations could adversely affect our business.
There can be no assurance that we will be able to obtain any required approvals for future acquisitions, investments or operations in India, or that we will be able to obtain such approvals on satisfactory terms.
Accordingly, such events may disrupt or reduce the efficiency of our entire operations and have a material adverse effect on our operating results and cash flows.
Accordingly, such events may disrupt or reduce the efficiency of our entire operations and have a material adverse effect on our operating results and cash flows. Our growth is contingent upon expanding our manufacturing facilities in Arvada, CO and Batavia, NY.
As a result, we do not believe we have a significant cash exposure to projects which may be cancelled. Open orders are reviewed continuously through communications with customers. If it becomes evident to us that a project is delayed well beyond its original shipment date, management will move the project into "placed on hold" (i.e., suspended) category.
Open orders are reviewed continuously through communications with customers. If it becomes evident to us that a project is delayed well beyond its original shipment date, management will move the project into "placed on hold" (i.e., suspended) category. Furthermore, if a project is cancelled by our customer, it is removed from our backlog.
As a result, volatility in the prices of oil and natural gas may negatively impact our operating results. A portion of our revenue is derived from the sale of our products to companies in the chemical, petrochemical, and petroleum refining industries, or to firms that design and construct facilities for these industries.
Our Energy & Process revenue is derived from the sale of our products to companies in the chemical, petrochemical, and petroleum refining industries, or to firms that design and construct facilities for these industries. These industries are highly cyclical, and are subject to the prices of crude oil and natural gas.
The majority of our R&D is funded by our customers and is specific to help solve our customers’ problems in order to improve efficiencies, address challenging environments, or redesign for form and function.
Research and Development Activities During fiscal 2025, fiscal 2024 and fiscal 2023, we spent $4,039, $3,944 and $4,144, respectively, on research and development ("R&D") activities. The majority of our R&D is funded by our customers and is specific to help solve our customers’ problems in order to improve efficiencies, address challenging environments, or redesign for form and function.
A sustained deterioration in any of the chemical, petrochemical, and petroleum refining industries we serve, would materially and adversely affect our business and operating results because our customers would not likely have the resources necessary to purchase our products, nor would they likely have the need to build additional facilities or improve existing facilities.
A sustained deterioration in any of the chemical, petrochemical, and petroleum refining industries we serve, would materially and adversely affect our business and operating results because our customers would not likely have the resources necessary to purchase our products, nor would they likely have the need to build additional facilities or improve existing facilities. 11 The relative costs of oil, natural gas, nuclear power, hydropower and numerous forms of alternative energy production, and transitions in consumer demand toward different types of energy, may have a material and adverse impact on our business and operating results.
Our operating results could be adversely affected by customer contract cancellations and delays. 15 Adverse economic or specific project conditions can lead to a project being placed on hold or cancelled by our customers. We had one material project cancelled in both fiscal 2024 and fiscal 2023, and no material projects cancelled in fiscal 2022.
Adverse economic or specific project conditions can lead to a project being placed on hold or cancelled by our customers. We had no material projects cancelled in fiscal 2025 and one material contract cancelled in fiscal 2024 and one in fiscal 2023. We had two material contracts on hold at March 31, 2025.
Accordingly, if we are unable to collect upon our accounts receivable as they come due in an efficient and timely manner, our business, financial condition or results of operations may be materially and adversely affected. 16 Given our size and the specialization of our business, if we lose any member of our management, technical or sales team and we experience difficulty in finding a qualified replacement, our business could be harmed.
Accordingly, if we are unable to collect upon our accounts receivable as they come due in an efficient and timely manner, our business, financial condition or results of operations may be materially and adversely affected.
Navy may delay projects and may impact our ability to grow this portion of our business. Certain U.S. Navy vessels are implementing new technologies, unrelated to any of the equipment that we provide.
A claim related to one of these projects could have an adverse impact on our financial results. New technology used by the ships for the U.S. Navy may delay projects and may impact our ability to grow this portion of our business. 9 Certain U.S. Navy vessels are implementing new technologies, unrelated to any of the equipment that we provide.
These suits may remain under seal (and hence, be unknown to us) for some time while the government decides whether to intervene on behalf of the qui tam plaintiff.
These suits may remain under seal (and hence, be unknown to us) for some time while the government decides whether to intervene on behalf of the qui tam plaintiff. Our failure to comply with regulations applicable to government contracts could have a material adverse impact on our financial condition and operating results.
If we are unable to reallocate resources to other projects, we may see an increase in volatility in our near-term financial results that may impact our ability to effectively provide accurate investor guidance. 8 Efforts to reduce large U.S. federal budget deficits could result in government cutbacks or shifts in focus in defense spending or in reduced incentives to pursue alternative energy projects, resulting in reduced demand for our products, which could harm our business and results of operations.
Efforts to reduce large U.S. federal budget deficits could result in government cutbacks or shifts in focus in Defense spending or in reduced incentives to pursue alternative energy projects, resulting in reduced demand for our products, which could harm our business and results of operations.
Our priorities are our targeted markets, operational excellence, and serving our stakeholders. As we generate cash, we also will instill strong capital discipline with smart capital deployment in our strategic thinking.
We remain focused on our strategy which we will continue to advance in fiscal 2026 as we focus on getting better every day. Our priorities are our targeted markets, operational excellence, and serving our stakeholders. As we generate cash, we also will maintain strong capital discipline with smart capital deployment in our strategic thinking.
Due to risks in these areas, we cannot provide assurance that we will not incur material costs or liabilities in the future, which could adversely affect us. Seasonality No material part of our business is seasonal in nature. However, our energy business is highly cyclical as it depends on the willingness of our customers to invest in major capital projects.
We do not expect environmental costs or contingencies to be material or to have a material adverse effect on our financial performance. Due to risks in these areas, we cannot provide assurance that we will not incur material costs or liabilities in the future, which could adversely affect us. Seasonality No material part of our business is seasonal in nature.
Our failure to comply with regulations applicable to government contracts could have a material adverse impact on our financial condition and operating results. 10 The markets we serve include the petroleum refining and petrochemical industries. These industries are both highly cyclical in nature and dependent on the prices of crude oil and natural gas.
The Energy markets we serve include the petroleum refining and petrochemical industries. These industries are both highly cyclical in nature and dependent on the prices of crude oil and natural gas. As a result, volatility in the prices of oil and natural gas may negatively impact our operating results.
The inflationary environment has increased the cost of our raw materials and labor, which impacted our financial results, especially given that a large percentage of our contracts are fixed-price in nature. To help mitigate this risk, we place orders for raw materials when the purchase orders are received from the customer to lock-in raw material pricing.
The inflationary environment has increased the cost of our raw materials and labor, which impacts our financial results, especially given that a large percentage of our contracts are fixed-price in nature.
Navy and the acquisition of BN, we have increased our concentration in domestic and defense sales. Domestic sales accounted for approximately 84% of total sales in fiscal 2024, while sales to the defense industry were 54%. 4 Our backlog at March 31, 2024 was $390,868 compared with $301,734 at March 31, 2023.
Domestic sales accounted for approximately 81% of total sales in fiscal 2025, while sales to the Defense industry were 58%. Our funded and unfunded backlog at March 31, 2025 was $412,335 compared with $390,868 at March 31, 2024.
We had no projects on hold at March 31, 2024. We attempt to mitigate the risk of cancellation by structuring contracts with our customers to maximize the likelihood that progress payments made to us for individual projects cover the costs we have incurred.
We attempt to mitigate the risk of cancellation by structuring contracts with our customers to maximize the likelihood that progress payments made to us for individual projects cover the costs we have incurred. As a result, we do not believe we have a significant cash exposure to projects which may be cancelled.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeSee Item 1A, Risk Factors for more information about the risk posed to us by cybersecurity threats.
Biggest changeWe are currently in the process of integrating P3 into our CRMP and IRPs processes for BN. We expect such integration to be completed during fiscal 2026. We may be the subject of cyber incidents in the future. See Item 1A, Risk Factors for more information about the risk posed to us by cybersecurity threats.
Our cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment including risks associated with ransomware; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers, suppliers, and vendors.
Our cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment including risks associated with ransomware; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; 21 • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers, suppliers, and vendors.
Governance Our Audit Committee, through their responsibilities designated to them in the Audit Committee Charter, oversees cybersecurity risk management as part of its risk oversight function and oversees management’s implementation of our CRMP. 21 The Audit Committee receives periodic reports from management and the IT Managers for Graham Corporation and BN on our cybersecurity risks at least annually.
Governance Our Audit Committee, through their responsibilities designated to them in the Audit Committee Charter, oversees cybersecurity risk management as part of its risk oversight function and oversees management’s implementation of our CRMP. The Audit Committee receives periodic reports from management and the IT Managers for Graham Corporation and BN on our cybersecurity risks at least annually.
Our CRMP is integrated into our overall enterprise risk management program. We have designated our Senior IT Manager to oversee the implementation and maintenance of the IRP for Graham Corporation. For BN, we have designated BN’s IT Manager to implement and maintain the IRP for BN.
O ur CRMP is integrated into our overall enterprise risk management program. We have designated our Senior IT Manager to oversee the implementation and maintenance of the IRP for Graham Corporation. For BN, we have designated BN’s IT Manager to implement and maintain the IRP for BN.
Item 1C. Cybersecurity Risk Management and Strategy We have developed and implemented cybersecurity risk management procedures (“CRMP”) intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our CRMP consists of procedures designed for Graham Corporation and certain subsidiaries and separate procedures designed specifically for Barber-Nichols (“BN”).
Item 1C. Cybersecurity Risk Management and Strategy We have developed and implemented cybersecurity risk management procedures (“CRMP”) intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our CRMP consists of procedures designed for Graham Corporation and certain subsidiaries and separate procedures designed specifically for BN.
We have developed processes to identify and oversee risks from cybersecurity threats associated with our third-party service providers, which includes the information security team assisting with and assessing cybersecurity robustness during vendor onboarding as well as risk-based monitoring of vendors on an ongoing basis. We may be the subject of cyber incidents in the future.
We have developed processes to identify and oversee risks from cybersecurity threats associated with our third-party service providers, which includes the information security team assisting with and assessing cybersecurity robustness during vendor onboarding as well as risk-based monitoring of vendors on an ongoing basis.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeDuring fiscal 2024, we received a $13,500 strategic investment from a major defense customer to expand and enhance our Batavia, NY production capabilities. This expansion will include the construction of a new 30,000 square foot manufacturing facility beginning in fiscal 2025 on our existing campus, and the purchase of production and automated welding equipment.
Biggest changeThis expansion will include the construction of a new 30,000 square foot manufacturing facility on our existing campus, and the purchase of production and automated welding equipment to be used in that facility.
Location Products/Operations Square Footage Owned or Leased 1 Batavia, NY Corporate Headquarters 43,000 Owned 2 Batavia, NY Manufacturing, Warehousing and R&D 270,000 Owned 3 Arvada, CO Office 18,000 Leased 4 Arvada, CO Manufacturing and Warehousing 83,000 Leased 5 Houston, TX Sales Office 1,500 Leased 6 Jupiter, FL Manufacturing and R&D 16,900 Leased 7 Suzhou, China Sales and Engineering 4,900 Leased 8 Ahmedabad, India Sales and Engineering 800 Leased We believe that our properties are generally in good condition, are well maintained, and are suitable and adequate to carry on our business.
Location Products/Operations Square Footage Owned or Leased 1 Batavia, NY Corporate Headquarters 43,000 Owned 2 Batavia, NY Manufacturing, Warehousing and R&D 270,000 Owned 3 Arvada, CO Office 18,000 Leased 4 Arvada, CO Manufacturing and Warehousing 83,000 Leased 5 Houston, TX Sales Office 1,500 Leased 6 Jupiter, FL Manufacturing and R&D 16,900 Leased 7 Suzhou, China Sales and Engineering 4,900 Leased 8 Ahmedabad, India Sales and Engineering 800 Leased 9 Pune, India Sales and Engineering 175 Leased We believe that our properties are generally in good condition, are well maintained, and are suitable and adequate to carry on our business.
Item 2. Pr operties As of March 31, 2024, we conducted our business from the following locations.
Item 2. Pr operties As of March 31, 2025, we conducted our business from the following locations.
Removed
We also anticipate that additional manufacturing space will be needed over the next several years in order to support our organic growth at BN. We believe we will be able to obtain or build this additional space on commercially reasonable terms. Item 3 .
Added
However, in order to support our future growth, we have initiated the following capital projects: • During fiscal 2024, we received a $13,500 strategic investment from a major Defense customer to expand and enhance our Batavia, NY production capabilities.
Added
This facility is scheduled to be completed in the first quarter of fiscal 2026. • During fiscal 2025, we purchased a plot of land adjacent to the BN campus in order to support organic growth.
Added
We intend to construct an additional manufacturing facility on that site some time in 2026, but only if future anticipated demand warrants it. • During fiscal 2025, we purchased land and began construction of a cryogenic (liquid hydrogen, oxygen, methane) testing facility near our P3 subsidiary.
Added
This facility enhances our capabilities and will allow us to provide quality assurance testing for our customers.
Added
This facility is scheduled to be completed in the first quarter of fiscal 2026. • During fiscal 2025, we received a $2,200 strategic investment from a major Defense customer to support the implementation of new Radiographic Testing (“RT”) equipment at our Batavia, NY facility.
Added
We intend to contribute an additional $1,400 towards this project for a total project cost of $3,600. This expansion is expected to be completed in the third quarter of fiscal 2026. We believe we will be able to construct these facilities on commercially reasonable terms.
Added
We expect to spend between 7% to 10% of revenue on capital expenditures each year for the next several years in order to fund our future growth. Item 3 .

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe did not pay any dividends during fiscal 2024 and have no current intention to pay dividends in the future. There can be no guarantee that we will pay dividends in the future.
Biggest changeWe did not pay any dividends during fiscal 2025 and currently have no intention to pay dividends for the foreseeable. There can be no guarantee that we will pay dividends in the future.
Any determination by our Board of Directors regarding dividends in the future will depend on a variety of factors, including our future financial performance, organic growth opportunities, general economic conditions and financial, competitive, regulatory, and other factors, many of which are beyond our control.
Any determination by our Board of Directors regarding dividends in the future will depend on a variety of factors, including our future financial performance, organic and inorganic growth opportunities, general economic conditions and financial, competitive, regulatory, and other factors, many of which are beyond our control.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NYSE exchange under the symbol "GHM". As of June 5, 2024, there were 10,871 shares of our common stock outstanding held by approximately 289 stockholders of record.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NYSE under the symbol "GHM". As of June 5, 2025, there were 10,948 shares of our common stock outstanding held by approximately 299 stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYear Ended March 31, 2024 2023 Net income $ 4,556 $ 367 Acquisition & integration costs 432 54 Amortization of intangible assets 2,157 2,476 Debt amendment costs 781 194 Employee Retention Tax Credit (702 ) - ERP Implementation costs 241 - Tax impact of adjustments (1) (669 ) (572 ) Adjusted net income (2) $ 6,796 $ 2,519 GAAP net income per diluted share $ 0.42 $ 0.03 Adjusted net income per diluted share $ 0.63 $ 0.24 Diluted weighted average common shares outstanding 10,844 10,654 (1) Applies a normalized tax rate to non-GAAP adjustments, which are pre-tax, based upon the statutory tax rate of 23%.
Biggest changeA reconciliation of adjusted EBITDA, adjusted net income, and adjusted net income per diluted share to net income in accordance with GAAP is as follows: 30 Year Ended March 31, 2025 2024 Net income $ 12,230 $ 4,556 Acquisition & integration (income) expense (1,170 ) 432 Equity-based compensation 1,957 1,279 ERP implementation costs 882 241 Debt amendment costs - 781 Employee Retention Tax Credit, net - (702 ) Net interest (income) expense (583 ) 248 Income tax expense 3,177 1,018 Depreciation & amortization 5,936 5,432 Adjusted EBITDA $ 22,429 $ 13,285 Net Sales 209,896 185,533 Net income as a % of revenue 5.8 % 2.5 % Adjusted EBITDA as a % of revenue 10.7 % 7.2 % Year Ended March 31, 2025 2024 Net income $ 12,230 $ 4,556 Acquisition & integration (income) expense (1,170 ) 432 Amortization of intangible assets 2,218 2,157 ERP implementation costs 882 241 Debt amendment costs - 781 Employee Retention Tax Credit - (702 ) Normalized tax rate (1) (444 ) (669 ) Adjusted net income $ 13,716 $ 6,796 GAAP net income per diluted share $ 1.11 $ 0.42 Adjusted net income per diluted share $ 1.24 $ 0.63 Diluted weighted average common shares outstanding 11,066 10,844 (1) Applies a normalized tax rate to non-GAAP adjustments, which are pre-tax, based upon the statutory tax rate.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Amounts in thousands, except per share data) Overview We are a global leader in the design and manufacture of mission critical fluid, power, heat transfer and vacuum technologies for the defense, space, energy and process industries.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Amounts in thousands, except per share data) Overview We are a global leader in the design and manufacture of mission critical fluid, power, heat transfer and vacuum technologies for the Defense, Energy & Process, and Space industries.
Adjusted EBITDA, adjusted net income and adjusted net income per diluted share are key metrics used by management and our board of directors to assess the Company’s financial and operating performance and adjusted net income and adjusted EBITDA is a basis for a significant portion of management's performance-based compensation.
Adjusted EBITDA, adjusted net income and adjusted net income per diluted share are key metrics used by management and our board of directors to assess the Company’s financial and operating performance and adjusted EBITDA is a basis for a significant portion of management's performance-based compensation.
Any determination by our Board of Directors regarding dividends in the future will depend on a variety of factors, including our future financial performance, organic growth opportunities, general economic conditions and financial, competitive, regulatory, and other factors, many of which are beyond our control.
Any determination by our Board of Directors regarding dividends in the future will depend on a variety of factors, including our future financial performance, organic and inorganic growth opportunities, general economic conditions and financial, competitive, regulatory, and other factors, many of which are beyond our control.
Goodwill is recorded when the purchase price exceeds the estimated fair value of the net identifiable tangible and intangible assets acquired. Definite lived intangible assets are amortized over their estimated useful lives and 35 are assessed for impairment if certain indicators are present.
Goodwill is recorded when the purchase price exceeds the estimated fair value of the net identifiable tangible and intangible assets acquired. Definite lived intangible assets are amortized over their estimated useful lives and are assessed for impairment if certain indicators are present.
As part of our ongoing financial reporting process, a collaborative effort is undertaken involving our managers with functional responsibilities for financial, credit, tax, engineering, manufacturing and benefit matters, and outside advisors such as lawyers, consultants and actuaries.
As part of our ongoing financial reporting process, a collaborative effort is undertaken involving our managers with functional responsibilities for financial, credit, tax, engineering, manufacturing and benefit matters, and outside advisors such as lawyers, and consultants.
Stockholders' Equity The following discussion should be read in conjunction with our consolidated statements of changes in stockholders' equity that can be found in Item 8 of Part II of this Annual Report on Form 10-K.
Stockholders' Equity 32 The following discussion should be read in conjunction with our consolidated statements of changes in stockholders' equity that can be found in Item 8 of Part II of this Annual Report on Form 10-K.
Acquisition On November 9, 2023, we completed our acquisition of P3, a privately-owned custom turbomachinery engineering, product development, and manufacturing business located in Jupiter, Florida that serves the space, new energy, defense, and medical industries. We believe this acquisition advances our growth strategy, further diversifies our market and product offerings, and broadens our turbomachinery solutions.
Acquisition On November 9, 2023, we completed our acquisition of P3, a privately-owned custom turbomachinery engineering, product development, and manufacturing business located in Jupiter, FL that serves the Space, New Energy, Defense, and Medical industries. We believe this acquisition advances our growth strategy, further diversifies our market and product offerings, and broadens our turbomachinery solutions.
Over the long-term, we expect that population growth, an expanding global middle class, and an increasing desire for improved quality of life and access to consumer products will drive increased demand for industrial goods within the plastics and resins value chain along with fertilizers and related products.
Over the long-term, we expect that population growth, an expanding global middle class, and an increasing desire for improved quality of life and access to consumer products will drive increased demand for industrial goods within the plastics and resins value chain along with fertilizers and related Process markets.
At certain times, we may enter into forward foreign currency exchange agreements to hedge our exposure against potential unfavorable changes in foreign currency values on significant sales and purchase contracts negotiated in foreign currencies. Forward foreign currency exchange contracts were not used in fiscal 2024 and as of March 31, 2024, we held no forward foreign currency contracts.
At certain times, we may enter into forward foreign currency exchange agreements to hedge our exposure against potential unfavorable changes in foreign currency values on significant sales and purchase contracts negotiated in foreign currencies. Forward foreign currency exchange contracts were not used in fiscal 2025 and as of March 31, 2025, we held no forward foreign currency contracts.
We are also participating in future aerospace power and propulsion system development through supply of fluid and thermal management systems components. Small power dense systems are imperative for these applications, and we believe our technology and expertise will enable us to achieve sales growth in this market as well.
We are also participating in future aerospace power and propulsion system development through supply of fluid and thermal management systems components. Small, power dense systems are imperative for these applications, and we believe our technology and expertise will enable us to achieve sales growth in this market.
Such information is located in Item 7 – Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the fiscal year ended March 31, 2023. Our fiscal year ends on March 31 of each year. We refer to our fiscal year, which ended March 31, 2024, as fiscal 2024.
Such information is located in Item 7 – Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the fiscal year ended March 31, 2024. Our fiscal year ends on March 31 of each year. We refer to our fiscal year, which ended March 31, 2025, as fiscal 2025.
Adjusted EBITDA excludes charges for depreciation, amortization, interest expense, taxes, acquisition related expenses, equity-based compensation, debt amendment costs, ERP implementation costs, and other unusual/nonrecurring expenses. Adjusted net income and adjusted net income per diluted share exclude intangible amortization, acquisition related expenses, other unusual/nonrecurring expenses and the related tax impacts of those adjustments.
Adjusted EBITDA excludes charges for depreciation, amortization, interest (income) expense, income taxes, acquisition related (income) expenses, equity-based compensation, ERP implementation costs, and other unusual/nonrecurring expenses. Adjusted net income and adjusted net income per diluted share exclude intangible amortization, acquisition related (income) expenses, other unusual/nonrecurring expenses and the related tax impacts of those adjustments.
For discussion of the newly issued accounting pronouncements see ''Accounting and reporting changes'' in Note 1 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K. Item 7A .
For discussion of the newly issued accounting pronouncements see ''Accounting and reporting changes'' in Note 1 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional information. Item 7A .
We believe that cash generated from operations, combined with the liquidity provided by available financing capacity under our credit facility, will be adequate to meet our cash needs for the immediate future.
We believe that cash generated from operations, combined with the liquidity provided by available financing capacity under the New Revolving Credit Facility, will be adequate to meet our cash needs for the immediate future.
Goodwill and intangible assets deemed to have indefinite lives are not amortized but are subject to impairment testing annually or earlier if an event or change in circumstances indicates that the fair value of a reporting unit or the indefinite lived asset may have been reduced below its carrying value. Pension and Postretirement Benefits.
Goodwill and intangible assets deemed to have indefinite lives are not amortized but are subject to impairment testing annually or earlier if an event or change in circumstances indicates that the fair value of a reporting unit or the indefinite lived asset may have been reduced below its carrying value.
See "Debt" in Note 9 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for more information on our debt arrangement. 38
See "Debt" in Note 9 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for more information on our debt arrangement. 37
As of March 31, 2024, we were in compliance with the financial covenants of the New Revolving Credit Facility and our leverage ratio as calculated in accordance with the terms of the New Revolving Credit Facility was 0.5x.
As of March 31, 2025, we were in compliance with the financial covenants of the New Revolving Credit Facility and our leverage ratio as calculated in accordance with the terms of the New Revolving Credit Facility was 0.5x.
As of March 31, 2024, we are subject to the claims noted above, as well as other legal proceedings and potential claims that have arisen in the ordinary course of business.
As of March 31, 2025, we are subject to the claims noted above, as well as other legal proceedings and potential claims that have arisen in the ordinary course of business.
P3 will be managed through BN and is highly complementary to BN's technology and enhances its turbomachinery solutions. The purchase price for P3 was $11,238 and was comprised of 125 shares of our common stock, representing a value of $1,930, and cash consideration of $7,098, subject to certain potential adjustments, including a customary working capital adjustment.
P3 is managed through BN and is highly complementary to BN's technology and enhances its turbomachinery solutions. The purchase price for P3 was $11,238 and was comprised of 125 shares of our common stock, representing a value of $1,930, and cash consideration of $7,268, subject to certain potential adjustments, including a customary working capital adjustment.
As part of our risk management activities, we evaluate the use of interest rate derivatives to add stability to interest expense and to manage our exposure to interest rate movements. As of March 31, 2024, we had $0 variable rate debt outstanding on our revolving credit facility and no interest rate derivatives outstanding.
As part of our risk management activities, we evaluate the use of interest rate derivatives to add stability to interest expense and to manage our exposure to interest rate movements. As of March 31, 2025, we had no variable rate debt outstanding on our revolving credit facility and no interest rate derivatives outstanding.
Contingencies and Commitments We have been named as a defendant in lawsuits alleging personal injury from exposure to asbestos allegedly contained in or accompanying our products. We are a co-defendant with numerous other defendants in these lawsuits and intend to vigorously defend ourselves against these claims.
Contingencies and Commitments We have been named as a defendant in lawsuits alleging personal injury from exposure to asbestos allegedly contained in or accompanying our products or from exposure to asbestos at the Company's facilities. We are a co-defendant with numerous other defendants in these lawsuits and intend to vigorously defend ourselves against these claims.
Non-GAAP Measures Adjusted net income before net interest expense, income taxes, depreciation and amortization ("EBITDA"), adjusted net income, and adjusted net income per diluted share are provided for information purposes only and are not measures of financial performance under accounting principles generally accepted in the U.S. ("GAAP").
Non-GAAP Measures Adjusted net income before interest (income) expense, income taxes, depreciation and amortization ("EBITDA"), adjusted net income, and adjusted net income per diluted share are provided for informational purposes only and are not measures of financial performance under the U.S.'s generally accepted accounting principles ("GAAP").
(See Note 9 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K). We did not have any off-balance sheet arrangements as of March 31, 2024 other than letters of credit incurred in the ordinary course of business.
(See Note 9 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional information). We did not have any off-balance sheet arrangements as of March 31, 2025 other than letters of credit incurred in the ordinary course of business.
We design and manufacture custom-engineered vacuum, heat transfer, cryogenic pump and turbomachinery technologies. For the defense industry, our equipment is used in nuclear and non-nuclear propulsion, power, fluid transfer, and thermal management systems. For the space industry, our equipment is used in propulsion, power and energy management systems, and for life support systems.
We design and manufacture custom-engineered vacuum, heat transfer, cryogenic pump and turbomachinery technologies. For the Defense industry, our equipment is used in nuclear and non-nuclear propulsion, power, fluid transfer, and thermal management systems.
In connection with the acquisition of BN, we entered into a Performance Bonus Agreement to provide employees of BN with a supplemental performance-based award based on the achievement of BN performance objectives for fiscal years ending March 31, 2024, 2025, and 2026 which can range between $2,000 to $4,000 per year (the "BN Performance Bonus").
In connection with the acquisition of BN, we entered into a Performance Bonus Agreement to provide employees of BN with a supplemental bonus based on the achievement of BN performance objectives for fiscal 2024, 2025, and 2026, which can range between $2,000 to $4,000 per year (the "BN Performance Bonus").
The following table shows the balance of stockholders' equity on the dates indicated: March 31, 2024 March 31, 2023 $ 105,566 $ 96,933 Orders, Backlog and Book-to-Bill Ratio In addition to the non-GAAP measures discussed above, management uses the following key performance metrics to analyze and measure the Company’s financial performance and results of operations: orders, backlog, and book-to-bill ratio.
The following table shows the balance of stockholders' equity on the dates indicated: March 31, 2025 March 31, 2024 $ 119,577 $ 105,566 Orders, Backlog and Book-to-Bill Ratio In addition to the non-GAAP measures discussed above, management uses the following key performance metrics to analyze and measure the Company’s financial performance and results of operations: orders, backlog, and book-to-bill ratio.
We believe that the amounts recorded in the consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K related to revenue, contingencies, pensions, other postretirement benefits and other matters requiring the use of estimates and judgments are reasonable, although actual outcomes could differ materially from our estimates.
We believe that the amounts recorded in the consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K related to revenue, contingencies, business combinations and intangible assets, and other matters requiring the use of estimates and judgments are reasonable, although actual outcomes could differ materially from our estimates.
Given that each of orders, backlog and book-to-bill ratio is an operational measure and that the Company's methodology for calculating orders, backlog and book-to-bill ratio does not meet the definition of a non-GAAP measure, as that term is defined by the U.S. Securities and Exchange Commission, a quantitative reconciliation for each is not required or provided.
Given that each of orders, backlog and book-to-bill ratio is an operational measure and that the Company's methodology for calculating orders, backlog and book-to-bill ratio does not meet the definition of a non-GAAP measure, as that term is defined by the SEC, a quantitative reconciliation for each is not required or provided.
Current Market Conditions Demand for our equipment and systems for the defense industry is expected to remain strong and continue to expand, based on defense budget plans, accelerated ship build schedules due to geopolitical tensions, the projected build schedule of submarines, aircraft carriers and undersea propulsion and power systems and the solutions we provide. In addition to U.S.
Defense - Demand for our equipment and systems for the Defense industry is expected to remain strong and continue to expand, based on Defense budget plans, accelerated ship build schedules due to geopolitical tensions, the projected build schedule of submarines, aircraft carriers and undersea propulsion and power systems, and the solutions we provide.
The other misconduct totaled $150 over a period of four years and was isolated to GIPL. All involved employees have been terminated and we have implemented remedial actions, including strengthening our compliance program and internal controls.
The investigation identified evidence supporting the complaint and other misconduct by employees. The other misconduct totaled $150 over a period of four years and was isolated to GIPL. All involved employees have been terminated and we have implemented remedial actions, including strengthening our compliance program and internal controls.
Adjusted net income and adjusted net income per diluted share for fiscal 2024 were $6,796 and $0.63 per share, respectively, compared with $2,519 and $0.24 per share, respectively, for fiscal 2023. See "Non-GAAP Measures" below for important information about these measures and a reconciliation of adjusted net income and adjusted net income per diluted share to the comparable GAAP amount.
Adjusted net income and adjusted net income per diluted share for fiscal 2025 were $13,716 and $1.24 per share, respectively, compared with $6,796 and $0.63 per share, respectively, for fiscal 2024. See "Non-GAAP Measures" below for important information about these measures and a reconciliation of adjusted net income and adjusted net income per diluted share to the comparable GAAP amount.
We expect that the systemic changes in the energy markets, which are influenced by the increasing use by consumers of alternative fuels and government policies to stimulate their usage, will lead to demand growth for fossil-based fuels that is less than the global growth rate. The timing and catalyst for a recovery in this market remains uncertain.
We expect that the systemic changes in the Energy markets, which are influenced by the increasing use by consumers of alternative fuels and government policies to stimulate their usage, will lead to demand growth for fossil-based fuels that is less than the global growth rate.
For fiscal 2024, foreign currency exchange rate fluctuations reduced our cash balances by $53 primarily due to the strengthening of the U.S. dollar relative to the Chinese RMB and India INR. 37 We have limited exposure to foreign currency purchases. In fiscal 2024, our purchases in foreign currencies represented 4% of the cost of products sold.
For fiscal 2025, foreign currency exchange rate fluctuations reduced our cash balances by $30 primarily due to the strengthening of the U.S. dollar relative to the Chinese RMB and India INR. We have limited exposure to foreign currency purchases. In fiscal 2025, our purchases in foreign currencies represented approximately 5% of the cost of products sold.
The assumptions applied in preparing the following qualitative and quantitative disclosures regarding foreign currency exchange rate, price risk and interest rate risk are based upon volatility ranges experienced by us in relevant historical periods, our current knowledge of the marketplace, and our judgment of the probability of future volatility based upon the historical trends and economic conditions of the markets in which we operate.
The assumptions applied in preparing the following qualitative and quantitative disclosures regarding foreign currency exchange rate, price risk and interest rate risk are based upon volatility ranges experienced by us in relevant historical periods, our current knowledge of the marketplace, and our judgment of the probability of future volatility based upon the historical trends and economic conditions of the markets in which we operate. 36 Foreign Currency International consolidated sales for fiscal 2025 were 19% of total sales.
Price Risk Operating in a global marketplace requires us to compete with other global manufacturers which, in some instances, benefit from lower production costs and more favorable economic conditions.
Price Risk Operating in a global market place requires us to compete with other global manufacturers which, in some instances, benefit from lower production costs and more favorable economic conditions, such as lower tariffs.
As a result of the investigation, during the third quarter of fiscal 2024, the statutory auditor and bookkeeper of GIPL tendered their resignations and new firms were appointed. We have voluntarily reported the findings of our investigation to the appropriate authorities in India and the U.S. Department of Justice and the Securities and Exchange Commission.
As a result of the investigation, during the third quarter of fiscal 2024, the statutory auditor and bookkeeper of GIPL tendered their resignations and new firms were appointed. We have voluntarily reported the findings of our investigation to the appropriate authorities in India, the U.S. Department of Justice, and the SEC and will continue to cooperate with those authorities.
Additionally, we have faced, and may continue to face, significant cost inflation, specifically in labor costs, raw materials, and other supply chain costs due to increased demand for raw materials and resources caused by the broad disruption of the global supply chain, including those associated with the impact of COVID-19.
Additionally, we have faced, and may continue to face, significant cost inflation, specifically in labor costs, raw materials, tariffs, and other supply chain costs due to increased demand for raw materials and resources caused by the broad disruption of the global supply chain.
See "Non-GAAP Measures" below for important information about these measures and a reconciliation of adjusted net income and adjusted net income per diluted share to the comparable GAAP amount. • Orders booked in fiscal 2024 were $268,447 compared to $202,686 in fiscal 2023 and were 145% of sales during fiscal 2024.
See "Non-GAAP Measures" below for important information about these measures and a reconciliation of adjusted net income and adjusted net income per diluted share to the comparable GAAP amount. • Orders booked in fiscal 2025 were $231,112 compared to $268,447 in fiscal 2024.
Our expected effective tax rate for fiscal 2025 is approximately 20% to 22%. The net result of the above is that net income and net income per diluted share for fiscal 2024 were $4,556 and $0.42 per share, respectively, compared with $367 and $0.03 per share, respectively, for fiscal 2023.
Our effective tax rate for fiscal 2026 is expected to be approximately 20% to 22%. The net result of the above is that net income and net income per diluted share for fiscal 2025 were $12,230 and $1.11 per share, respectively, compared with $4,556 and $0.42 per share, respectively, for fiscal 2024.
On October 13, 2023, we terminated our revolving credit facility and repaid our term loan with Bank of America and entered into a new five-year revolving credit facility with Wells Fargo that provides a $35,000 line of credit that automatically increases to $50,000 upon the Company satisfying specified covenants (the "New Revolving Credit Facility").
On October 13, 2023, we terminated our revolving credit facility and repaid our term loan with Bank of America and entered into a new five-year revolving credit facility with Wells Fargo that provides a $50,000 line of credit (the "New Revolving Credit Facility").
These estimates are based on historical experience and information obtained from the management of the acquired company and are inherently uncertain. During fiscal 2022, we completed the acquisition of BN for an aggregate purchase price of $72,014.
These estimates are based on historical experience and information obtained from the management of the acquired company and are inherently uncertain. During fiscal 2024, we completed the acquisition of P3 for an aggregate purchase price of $11,238.
Accordingly, we believe that in the near term the quantity of projects available for us to compete for will remain low and that new project pricing will remain challenging. Additionally, we believe that the majority of orders in our traditional energy markets will be outside the United States.
Accordingly, we believe that in the near term the quantity of projects available for us to compete for will remain low and that new project pricing will remain challenging. Additionally, we believe that the majority of new capital investment orders in our traditional Energy markets will be outside the U.S., such as India and the Middle-East.
Adjusted net income and adjusted net income per diluted share for fiscal 2024 were $6,796 and $0.63 per share, respectively, compared with $2,519 and $0.24 per share, respectively, for fiscal 2023.
Adjusted net income and adjusted net income per diluted share for fiscal 2025 were $13,716 and $1.24 per share, respectively, compared with $6,796 and $0.63 per share, respectively, for fiscal 2024.
Revenue from contracts that is recognized upon shipment accounted for approximately 23% of revenue in fiscal 2024. Revenue from contracts that is recognized over time accounted for approximately 77% of revenue in fiscal 2024.
Revenue from contracts that is recognized upon shipment accounted for approximately 20% of revenue in fiscal 2025. Revenue from contracts that is recognized over time accounted for approximately 80% of revenue in fiscal 2025.
As of March 31, 2024, there were no borrowings and $1,890 letters of credit outstanding on the New Revolving Credit Facility and the amount available to borrow was $33,110, subject to interest and leverage covenants.
As of March 31, 2025, there were no borrowings and $5,295 letters of credit outstanding on the New Revolving Credit Facility and the amount available to borrow was $44,705, subject to interest and leverage covenants.
International conflicts or other geopolitical events, including the 2022 Russian invasion of Ukraine and the Israel-Hamas war, may further contribute to increased supply chain costs due to shortages in raw materials, increased costs for transportation and energy, disruptions in supply chains, and heightened inflation.
International conflicts or other geopolitical events, including the on-going Russia and Ukraine war, the Israel-Hamas conflict, and recent trade-related actions, may further contribute to increased supply chain costs due to shortages in raw materials, increased costs for transportation and energy, disruptions in supply chains, increased tariffs, and heightened inflation.
Changes in SG&A expense for fiscal year 2024 compared to fiscal year 2023 are as follows: Change YTD FY24 vs.
Changes in SG&A expense for fiscal 2025 compared to fiscal 2024 are as follows: Change FY25 vs.
In fiscal 2024, substantially all sales by us and our wholly owned subsidiaries, for which we were paid, were denominated in the local currency of the respective subsidiary (U.S. dollars, Chinese RMB, or India INR).
In addition, cash can be adversely impacted by the conversion of sales made by us in a foreign currency to U.S. dollars. In fiscal 2025, substantially all sales by us and our wholly owned subsidiaries, for which we were paid, were denominated in the local currency of the respective subsidiary (U.S. dollars, Chinese RMB, or India INR).
We believe that the most critical accounting estimates used in the preparation of our consolidated financial statements relate to labor hour estimates, total cost, and establishment of operational milestones which are used to recognize revenue over time, accounting for contingencies, under which we accrue a loss when it is probable that a liability has been incurred and the amount can be reasonably estimated, accounting for business combinations and intangible assets, and accounting for pensions and other postretirement benefits.
Critical Accounting Estimates and Judgments We have evaluated the accounting policies used in the preparation of the consolidated financial statements and the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K and believe those policies to be reasonable and appropriate. 35 We believe that the most critical accounting estimates used in the preparation of our consolidated financial statements relate to labor hour estimates, total cost, and establishment of operational milestones which are used to recognize revenue over time, accounting for contingencies, under which we accrue a loss when it is probable that a liability has been incurred and the amount can be reasonably estimated, and accounting for business combinations and intangible assets.
Foreign Currency International consolidated sales for fiscal 2024 were 16% of total sales. Operating in markets throughout the world exposes us to movements in currency exchange rates. Currency movements can affect sales in several ways, the foremost being our ability to compete for orders against foreign competitors that base their prices on relatively weaker currencies.
Operating in markets throughout the world exposes us to movements in currency exchange rates. Currency movements can affect sales in several ways, the foremost being our ability to compete for orders against foreign competitors that base their prices on relatively weaker currencies. Business lost due to competition for orders against competitors using a relatively weaker currency cannot be quantified.
Backlog is defined as the total dollar value of net orders received for which revenue has not yet been recognized. Management believes tracking orders and backlog are useful as it often times is a leading indicator of future performance. In accordance with industry practice, contracts may include provisions for cancellation, termination, or suspension at the discretion of the customer.
Total backlog can include both funded and unfunded orders under government contracts. Management believes tracking orders and backlog are useful as it often times is a leading indicator of future performance. In accordance with industry practice, contracts may include provisions for cancellation, termination, or suspension at the discretion of the customer.
At March 31, 2024, approximately $6,552 of our cash and cash equivalents was used to secure our letters of credit and $1,992 of our cash was held by our subsidiaries in China and India.
At March 31, 2025, approximately $4,659 of our $21,577 cash and cash equivalents was used to secure our letters of credit and $4,607 of our cash was held by our subsidiaries in China and India.
See Note 2 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K. Key Results Key results for fiscal 2024 include the following: • Net sales of $185,533 for fiscal 2024 increased 18% over the prior year period.
See Note 2 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional information. 25 Key Results Key results for fiscal 2025 include the following: • Net sales for fiscal 2025 were $209,896, up $24,363, or 13% over the prior year.
Fiscal 2024 capital expenditures were primarily for machinery and equipment, as well as for buildings and leasehold improvements to fund our growth and productivity improvement initiatives and includes expenditures related to the expansion of production capabilities at our Batavia facility, which is primarily being funded by a $13,500 strategic investment from one of our defense customers.
Capital expenditures for fiscal 2025 were primarily for machinery and equipment, land, buildings, and leasehold improvements to support our growth and productivity improvement initiatives and included expenditures related to the construction of a new 30,000 square foot manufacturing facility to enhance and expand Defense production capabilities at our Batavia, NY facility, which is primarily being funded by a $13,500 strategic grant from one of our Defense customers.
Sales and orders to the space industry are variable in nature and many of our customers, who are key players in the industry, have yet to achieve profitability and may be unable to continue operations without additional funding similar to Virgin Orbit.
Sales and orders to the Space industry are variable in nature and many of our customers, who are key players in the industry, have yet to achieve 27 profitability and may be unable to continue operations without additional funding. As a result, future revenue and growth in this market can be uncertain and may negatively impact our business.
This management's discussion and analysis of financial condition and results of operations omits a comparative discussion regarding the fiscal year ended March 31, 2023 versus the fiscal year ended March 31, 2022.
GIPL provides sales and engineering support for us in India and the Middle East. This management's discussion and analysis of financial condition and results of operations omits a comparative discussion regarding the fiscal year ended March 31, 2024 versus the fiscal year ended March 31, 2023.
Management uses orders and backlog as measures of current and future business and financial performance and these may not be comparable with measures provided by other companies. Orders represent written communications received from customers requesting the Company to provide products and/or services.
Management uses orders and backlog as measures of current and future business and financial performance and these may not be comparable with measures provided by other companies. Orders represent definitive agreements with customers to provide products and/or services. Backlog is defined as the total dollar value of orders received for which revenue has not yet been recognized.
Additionally, during fiscal 2024 we submitted for the Employee Retention Credit which benefited our gross profit by approximately $700. In fiscal 2023, we completed four first article U.S. Navy projects. The remaining two first article projects were completed and shipped during fiscal 2024.
During fiscal 2024 we submitted for the Employee Retention Tax Credit which benefited our gross profit by approximately $700. In fiscal 2024, we completed the last two of six first article U.S. Navy projects, which had impacted our gross margins over the last several years.
Capital expenditures for fiscal 2025 are expected to be between $10,000 to $15,000 of which approximately half is related to the Batavia facility defense expansion. The remaining capital expenditures for fiscal 2025 are discretionary. We estimate that our maintenance capital spend is approximately $2,000 per year.
This expansion is expected to be completed in the third quarter of fiscal 2026. The remaining capital expenditures for fiscal 2026 are discretionary. We estimate that our maintenance capital spend is approximately $2,000 per year.
This increase reflected the increased leverage on fixed overhead costs due to the higher volume of sales discussed above, as well as an improved mix of sales related to higher margin defense and aftermarket sales, and better execution and pricing on defense contracts, partially offset by higher incentive compensation in comparison with the prior year.
This 330 basis point improvement in gross profit margin over fiscal 2024 reflected increased leverage on fixed overhead costs due to the higher volume of sales discussed above, as well as better execution, and improved pricing, partially offset by higher incentive compensation.
This increase reflected the increased leverage on fixed overhead costs due to the higher volume of sales discussed above, as well as an improved mix of sales related to higher margin defense and aftermarket sales, and better execution and pricing on defense contracts, partially offset by higher incentive compensation in comparison with the prior year.
This 330 basis point improvement in gross profit margin over fiscal 2024 reflected increased leverage on fixed overhead costs due to the higher volume of sales discussed above, as well as better execution and improved pricing, partially offset by higher incentive compensation.
The alternative and clean energy opportunities for our heat transfer, power production and fluid transfer systems are expected to continue to grow. We assist in designing, developing and producing equipment for hydrogen production, distribution and fueling systems, concentrated solar power and storage, small modular nuclear systems, bioenergy products, and geothermal power generation with lithium extraction.
We assist in designing, developing, and producing equipment for hydrogen production, distribution and fueling systems, concentrated solar power and storage, small modular nuclear systems, bioenergy products, and geothermal power generation with lithium extraction. We are positioning the Company to be a more significant contributor as these markets continue to develop.
There can be no guarantee that we will pay dividends in the future. 32 In connection with the termination of the old revolving credit facility and term loan with Bank of America, the Company paid $752 in exit costs and recognized an extinguishment charge of $726.
We did not pay any dividends during fiscal 2025 and currently have no intention to pay dividends for the foreseeable future. In connection with the termination of the old revolving credit facility and term loan with Bank of America, the Company paid $752 in exit costs and recognized an extinguishment charge of $726 during fiscal 2024.
We have not reconciled non-GAAP forward-looking Adjusted EBITDA to its most directly comparable GAAP measure, as permitted by Item 10(e)(1)(i)(B) of Regulation S-K. Such reconciliation would require unreasonable efforts to estimate and quantify various necessary GAAP components largely because forecasting or predicting our future operating results is subject to many factors out of our control or not readily predictable.
Such reconciliation would require unreasonable efforts to estimate and quantify various necessary GAAP components largely because forecasting or predicting our future operating results is subject to many factors out of our control or not readily predictable.
Navy applications, we also provide specialty pumps, turbines, compressors, and controllers for various fluid and thermal management systems used in Department of Defense radar, laser, electronics, and power systems. We have built a leading position, and in some instances a sole source position, for certain systems and equipment for the defense industry. Our traditional energy markets are undergoing significant transition.
We have built a leading position, and in some instances a sole source position, for certain systems and equipment for the Defense industry. Energy & Process - Our traditional Energy markets are undergoing significant transition.
Our brands are built upon engineering expertise and close customer collaboration to design, develop, and produce mission critical equipment and systems that enable our customers to meet their economic and operational objectives. Continual improvement of our processes and systems to ensure qualified and compliant equipment are hallmarks of our brand.
For the Space industry our equipment is used in propulsion, power and thermal management systems, and for life support systems. Our brands are built upon engineering expertise and close customer collaboration to design, develop, and produce mission critical equipment and systems that enable our customers to meet their economic and operational objectives.
ERP Implementation Costs relate to consulting costs incurred in connection with the ERP system being implemented throughout our Batavia, N.Y facility in order to enhance efficiency and productivity and are not expected to recur once the project is completed. 31 Liquidity and Capital Resources The following discussion should be read in conjunction with our consolidated statements of cash flows and consolidated balance sheets appearing in Item 8 of Part II of this Annual Report on Form 10-K: March 31, 2024 2023 Cash and cash equivalents $ 16,939 $ 18,257 Working capital (1) 8,112 23,904 Working capital ratio (2) 1.1 1.3 (1) Working capital equals current assets minus current liabilities.
Liquidity and Capital Resources The following discussion should be read in conjunction with our consolidated statements of cash flows and consolidated balance sheets appearing in Item 8 of Part II of this Annual Report on Form 10-K: March 31, 2025 2024 Cash and cash equivalents $ 21,577 $ 16,939 Working capital (1) 5,222 8,112 Working capital ratio (2) 1.0 1.1 (1) Working capital equals current assets minus current liabilities. 31 (2) Working capital ratio equals current assets divided by current liabilities.
(2) Excludes net interest expense, income taxes, depreciation and amortization from net income, as well as approximately $2.0 million to $3.0 million of equity-based compensation and ERP conversion costs included in SG&A expense. See "Cautionary Note Regarding Forward-Looking Statements" and "Non-GAAP Measures" above for additional information about forward-looking statements and non-GAAP measures.
(2) Includes approximately $6,000 to $7,000 of BN Performance Bonus, equity-based compensation, and ERP conversion costs included in SG&A expense. (3) Excludes net interest (income) expense, income taxes, depreciation and amortization from net income, as well as approximately $2,000 to $3,000 of equity-based compensation and ERP conversion costs included in SG&A expense, net.
Likewise, we refer to our fiscal years that will end or have ended March 31, 2025, March 31, 2023, and March 31, 2022, as fiscal 2025, fiscal 2023, and fiscal 2022, respectively.
Likewise, we refer to our fiscal years that will end or have ended March 31, 2026, March 31, 2024, and March 31, 2023, as fiscal 2026, fiscal 2024, and fiscal 2023, respectively. We have updated our end market disclosures to better align with how management evaluates the business and product portfolio.
YTD FY23 BN Performance Bonus $ 4,258 Performance-based compensation 2,227 Professional fees 2,183 Equity-based compensation 473 Acquisition costs 375 Amortization of intangibles 271 ERP implementation costs 241 P3 Technologies 213 Bad Debt expense (1,154 ) All other 338 Total SG&A change $ 9,425 In connection with the acquisition of BN, we entered into a Performance Bonus Agreement to provide employees of BN with a supplemental performance-based award based on the achievement of BN performance objectives for fiscal years ending March 31, 2024, 2025, and 2026, which can range between $2,000 to $4,000 per year plus any applicable employer related taxes.
In connection with the acquisition of BN, we entered into a Performance Bonus Agreement to provide employees of BN with a supplemental performance-based bonus based on the achievement of BN performance objectives for fiscal 2024, 2025, and 2026, which can range between $2,000 to $4,000 per year plus any applicable employer related taxes.
For more information on these matters, see the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K. During fiscal 2024, we completed the acquisition of P3 for an aggregate purchase price of $11,238.
The fair value estimates resulted in identifiable intangible assets, in the aggregate, of $7,200. The resulting goodwill, in the aggregate, from this acquisition was $1,997. For more information on these matters, see the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K.
The following table summarizes our results of operations for the periods indicated: Year Ended March 31, Change 2024 2023 $ % Net sales $ 185,533 $ 157,118 $ 28,415 18 % Gross profit $ 40,585 $ 25,408 $ 15,177 60 % Gross profit margin 21.9 % 16.2 % SG&A expense (1) $ 33,583 $ 24,158 $ 9,425 39 % SG&A as a percent of sales 18.1 % 15.4 % Net income (loss) $ 4,556 $ 367 $ 4,189 1141 % Diluted income (loss) per share $ 0.42 $ 0.03 $ 0.39 1300 % Total assets $ 233,879 $ 203,918 $ 29,961 15 % (1) Selling, general and administrative expense is referred to as "SG&A." 28 Fiscal 2024 Compared with Fiscal 2023 The following tables provides our net sales by product line and geographic region including the percentage of total sales and change in comparison to the prior year for each category and period presented: Year Ended March 31, Change Market 2024 % 2023 % $ % Refining $ 29,087 16 % $ 27,270 17 % $ 1,817 7 % Chemical/Petrochemical 20,893 11 % 21,950 14 % (1,057 ) -5 % Space 13,282 7 % 21,180 13 % (7,898 ) -37 % Defense 99,493 54 % 65,327 42 % 34,166 52 % Other 22,778 12 % 21,391 14 % 1,387 6 % Net sales $ 185,533 100 % $ 157,118 100 % $ 28,415 18 % Geographic Region United States $ 155,908 84 % $ 127,519 81 % $ 28,389 22 % International 29,625 16 % 29,599 19 % 26 0 % Net sales $ 185,533 100 % $ 157,118 100 % $ 28,415 18 % Net sales of $185,533 for fiscal 2024 increased 18% over the prior year period.
The following table summarizes our results of operations for the periods indicated: Year Ended March 31, Change 2025 2024 $ % Net sales $ 209,896 $ 185,533 $ 24,363 13 % Gross profit $ 52,861 $ 40,585 $ 12,276 30 % Gross profit margin 25.2 % 21.9 % SG&A expense $ 38,888 $ 33,583 $ 5,305 16 % SG&A as a percent of sales 18.5 % 18.1 % Net income $ 12,230 $ 4,556 $ 7,674 168 % Diluted income per share $ 1.11 $ 0.42 $ 0.69 164 % Total assets $ 264,110 $ 233,879 $ 30,231 13 % 28 Fiscal 2025 Compared with Fiscal 2024 The following tables provides our net sales by product line and geographic region including the percentage of total sales and change in comparison to the prior year for each category and period presented: Year Ended March 31, Change Market 2025 % 2024 % $ % Defense $ 121,925 58 % $ 99,493 54 % $ 22,432 23 % Energy & Process 73,287 35 % 72,758 39 % 529 1 % Space 14,684 7 % 13,282 7 % 1,402 11 % Net sales $ 209,896 100 % $ 185,533 100 % $ 24,363 13 % Geographic Region United States $ 169,943 81 % $ 155,908 84 % $ 14,035 9 % International 39,953 19 % 29,625 16 % 10,328 35 % Net sales $ 209,896 100 % $ 185,533 100 % $ 24,363 13 % Net sales for fiscal 2025 were $209,896, up $24,363, or 13% over the prior year.
The Employee Retention Tax Credit reflects payroll tax amounts expected to be recovered due to COVID-19 relief programs and is not expected to recur in the future.
Debt amendment costs consist of accelerated write-offs of unamortized deferred debt issuance costs and discounts, prepayment penalties, and attorney fees in connection with the amendment of our credit facility. The Employee Retention Tax Credit reflects payroll tax amounts recovered due to COVID-19 relief programs and is not expected to recur in the future.
Approximately 35% to 40% of orders currently in our backlog are expected to be converted to sales within one year and 25% to 30% after one year but within two years. The majority of the orders that are expected to convert beyond twelve months are for the defense industry, specifically the U.S.
We expect to recognize revenue on approximately 45% of the backlog within one year, 25% to 30% in one to two years and the remaining beyond two years. The majority of the orders that are expected to convert beyond twenty-four months are for the Defense industry, specifically the U.S. Navy that have a long conversion cycle (up to six years).
Further escalation of geopolitical tensions may also lead to changes to foreign exchange rates and financial markets, any of which may adversely affect our business and supply chain, and consequently our results of operation. While there could ultimately be a material impact on our operations and liquidity, at the time of this report, the impact could not be determined.
Further escalation of tariffs or geopolitical tensions may also lead to changes to foreign exchange rates and financial markets, any of which may adversely affect our business and supply chain, and consequently our results of operations. We estimate that the impact of increased tariffs over the prior year will be approximately $2,000 to $5,000 in fiscal 2026.
We supply equipment for vacuum, heat transfer and fluid transfer applications used in energy and new energy markets including oil refining, cogeneration, and multiple alternative and clean power applications including hydrogen. For the chemical and petrochemical industries, our equipment is used in fertilizer, ammonia, ethylene, methanol, and downstream chemical facilities.
For the Energy & Process industries we supply equipment for vacuum, heat transfer, and fluid transfer applications used in oil refining, downstream chemical facilities, fertilizers, ethylene, methanol, edible oil, food & beverage, pulp & paper, and multiple alternative energy applications such as hydrogen, small modular nuclear, concentrated solar and geothermal processes.
We have made significant progress with the advancements in our business, which we believe puts us on schedule in achieving our fiscal 2027 goals of 8% to 10% average annualized organic revenue growth and Adjusted EBITDA margins in the low to mid-teens. 34 Our expectations for sales and profitability assume that we will be able to operate our production facilities at planned capacity, have access to our global supply chain including our subcontractors, do not experience significant global health related disruptions, and assumes no further impact from Virgin Orbit or any other unforeseen events.
Our expectations for sales and profitability assume that we will be able to operate our production facilities at planned capacity, have access to our global supply chain including our subcontractors, do not experience any global disruptions, and experience no impact from any other unforeseen events.
This bonus is in addition to the normal employee bonus program at BN and will expire after fiscal 2026. The increase in performance-based compensation is primarily due to the improved performance in fiscal 2024 compared to fiscal 2023.
This bonus is in addition to the normal employee bonus program at BN and will expire after fiscal 2026 and totaled $4,258 for fiscal 2025 and fiscal 2024 each year including applicable employer related payroll taxes.
Of note, over the last few years we have experienced an increase in our energy and chemical aftermarket orders primarily from the domestic market. Aftermarket orders have historically been a leading indicator of future capital investment by our customers in their facilities for upgrades and expansions.
Finally, over the last few years we have experienced an increase in our Energy & Process aftermarket orders primarily from the domestic market as our customers continue to maintain and invest in the facilities they currently operate.

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