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What changed in Perma-Pipe International Holdings, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Perma-Pipe International Holdings, Inc.'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.

+111 added−114 removedSource: 10-K (2025-05-01) vs 10-K (2024-04-26)

Top changes in Perma-Pipe International Holdings, Inc.'s 2025 10-K

111 paragraphs added · 114 removed · 100 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe Company's fiscal year ends on January 31. Years, results and balances described as 2024 , 2023 and 2022 are for the fiscal year ending January 31, 2025 and the fiscal years ended January 31, 2024 and 2023 , respectively. PRODUCTS AND SERVICES The Company engineers, designs, manufactures and sells specialty piping systems and leak detection systems.
Biggest changeThe Company's common stock is traded on the Nasdaq Global Market and reported under the ticker symbol "PPIH". The Company's fiscal year ends on January 31. Years, results and balances described as 2025, 2024 and 2023 are for the fiscal year ending January 31, 2026 and the fiscal years ended January 31, 2025 and 2024, respectively.
Additionally, a s a result of the Company's contracts having a duration of less than one year, a practical expedient was applied regarding disclosure of the aggregate amount and future timing of performance obligations that are unsatisfied or partially satisfied as of the end of the reporting period. Intellectual property.
Additionally, as a result of the Company's contracts having a duration of less than one year, a practical expedient was applied regarding disclosure of the aggregate amount and future timing of performance obligations that are unsatisfied or partially satisfied as of the end of the reporting period. Intellectual property.
The Company employs a direct sales force to market and sell products and services in Canada, India, Egypt, and in several countries in the Middle East. On a country-by-country basis, and where advantageous, the Company uses an agent network to assist in marketing and selling the Company's products and services.
The Company employs a direct sales force to market and sell products and services in Canada, India, Egypt, and across several countries in the Middle East. On a country-by-country basis, and where advantageous, the Company uses an agent network to assist in marketing and selling the Company's products and services.
Lewicki served as Corporate Controller of HMT Holdings Corp, Inc., a global oil and gas manufacturing and infrastructure services company, consisting of manufacturing of above-ground storage tanks and associated materials, oilfield maintenance and repair services, and inspection services. In this position, Mr.
Lewicki served as Corporate Controller of HMT Holdings Corp, Inc., a global oil and gas manufacturing and infrastructure services company, consisting of the manufacturing of above-ground storage tanks and associated materials, oilfield maintenance and repair services, and inspection services. In this position, Mr.
Riyadh, Kingdom of Saudi Arabia Beni Suef, Egypt Perma-Pipe India Pvt. Ltd Gandhidham, India Customers and sales channels. The Company's customer base is industrially and geographically diverse.
Riyadh, Kingdom of Saudi Arabia Beni Suef, Egypt Medina, Kingdom of Saudi Arabia Perma-Pipe India Pvt. Ltd Gandhidham, India Customers and sales channels. The Company's customer base is industrially and geographically diverse.
These impacts are expected to continue throughout 2024 , and the resulting future disruptions to the Company’s operations are uncertain. Competition. The piping systems market is highly competitive. The Company believes that quality, service, engineering design capabilities and support, a comprehensive product line, timely execution, plant location and price are key competitive factors in the industry.
These impacts are expected to continue throughout 2025, and the resulting future disruptions to the Company’s operations are uncertain. Competition. The piping systems market is highly competitive. The Company believes that quality, service, engineering design capabilities and support, a comprehensive product line, timely execution, plant location and price are key competitive factors in the industry.
For the years ended January 31, 2024 and 2023 , no one customer accounted for greater than 10% of the Company's consolidated net sales. As of January 31, 2024 and 2023, no one customer accounted for greater than 10% of accounts receivable. Backlog.
For the years ended January 31, 2025 and 2024 , no one customer accounted for greater than 10% of the Company's consolidated net sales. As of January 31, 2025 and 2024, no one customer accounted for greater than 10% of accounts receivable. Backlog.
The Company considers its relationship with its employees to be good. 3 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS The following table sets forth information regarding the executive officers of the Company as of April 26, 2024 : Executive officer of the Name Offices and Positions; Age Company since David J.
The Company considers its relationship with its employees to be good. 3 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS The following table sets forth information regarding the executive officers of the Company as of May 1, 2025: Executive officer of the Name Offices and Positions; Age Company since David J.
Lewicki was responsible for overseeing financial reporting and SEC compliance, and financial planning and analysis which consisted of strategic planning, budgeting, forecasting, mergers and acquisition integration, and investment strategy. He is a Certified Public Accountant in the State of Texas.
Lewicki was responsible for overseeing financial reporting and SEC compliance, and financial planning and analysis, which consisted of strategic planning, budgeting, forecasting, mergers and acquisition integration, and investment strategy. He began his career in public accounting at Deloitte and is a Certified Public Accountant in the State of Texas.
Mansfield served in numerous roles including Vice President Controller, and Commercial General Manager, Europe, Africa & the former Soviet Union region, and played a key role in strategy development and merger and acquisition activities as the company grew from annual revenues of $100 million to over $900 million .
Mansfield served in numerous roles including Vice President Controller, and Commercial General Manager, Europe, Africa & the former Soviet Union region, and played a key role in strategy development and merger and acquisition activities as the company grew from annual revenues of $100 million to over $900 million. He is a Fellow member of the Association of Chartered Certified Accountants.
Mansfield Director, President and Chief Executive Officer; Age 64 2016 Matthew E. Lewicki Vice President and Chief Financial Officer; Age 41 2023 David J. Mansfield: President, Chief Executive Officer ("CEO") and member of the Board of Directors since November 2016. From 2015 to 2016, Mr.
Mansfield Director, Chief Executive Officer; Age 65 2016 Saleh Sagr President; Age 55 2025 Matthew E. Lewicki Vice President and Chief Financial Officer; Age 42 2023 David J. Mansfield: Chief Executive Officer ("CEO") and member of the Board of Directors since November 2016. From 2015 to 2016, Mr.
However, by industry practice, orders may be canceled or modified at any time. In the event of a cancellation, the customer is normally responsible for all finished goods produced or shipped, all direct and indirect costs incurred, and also for a reasonable allowance for anticipated profits. No assurance can be given that these amounts will be recovered after cancellation.
In the event of a cancellation, the customer is normally responsible for all finished goods produced or shipped, all direct and indirect costs incurred, and also for a reasonable allowance for anticipated profits. No assurance can be given that these amounts will be recovered after cancellation.
EMPLOYEES As of January 31, 2024 , the Company had approximately 179 full-time employees working in the United States, of which approximately 76 were under two collective bargaining agreements expiring on April 30, 2024 and March 31, 2025 . As of January 31, 2024 , there were approximately 640 full-time employees working at the Company's international locations.
EMPLOYEES As of January 31, 2025, the Company had approximately 175 full-time employees working in the United States, of which approximately 79 were under two collective bargaining agreements expiring on April 30, 2027 and May 5, 2025. As of January 31, 2025, there were approximately 575 full-time employees working at the Company's international locations.
Item 1. BUSINESS Perma-Pipe International Holdings, Inc., collectively with its subsidiaries ("PPIH", the "Company" or the "Registrant"), is engaged in the manufacture and sale of products in one reportable segment: Piping Systems. The Company was incorporated in Delaware on October 12, 1993. The Company's common stock is traded on the Nasdaq Global Market and reported under the ticker symbol "PPIH".
ITEM 1. BUSINESS Perma-Pipe International Holdings, Inc., collectively with its subsidiaries ("PPIH", the "Company", "we", "our" or the "Registrant"), is engaged in the manufacture and sale of products in one reportable segment: Piping Systems. The Company was incorporated in Delaware on October 12, 1993.
The Company’s backlog on January 31, 2024 was $68.4 million, compared to $38.5 million on January 31, 2023 , most of which is expected to be completed within the year ending January 31, 2025 .
The Company’s backlog on January 31, 2025 was $138.1 million, compared to $68.4 million on January 31, 2024, most of which is expected to be completed within the year ending January 31, 2026. The increase in the backlog was the result of new awards year-over-year in excess of completed projects during the year in North America and the Middle East.
He is a Fellow member of the Association of Chartered Certified Accountants . Matthew E. Lewicki: Appointed Vice President and CFO in October 2023, and previously served as Chief Accounting Officer from May 2023 to October 2023. From 2019 to 2023, Mr.
Lewicki: Vice President and CFO since October 2023 and previously served as Chief Accounting Officer from May 2023 to October 2023. From 2019 to 2023, Mr.
The increase in the backlog was the result of new awards year-over-year in excess of completed projects during the year in North America and the Middle East. The Company defines backlog as the expected total revenue value resulting from confirmed customer purchase orders that have not yet been recognized as revenue.
The Company defines backlog as the expected total revenue value resulting from confirmed customer purchase orders that have not yet been recognized as revenue. However, by industry practice, orders may be canceled or modified at any time.
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PRODUCTS AND SERVICES The Company engineers, designs, manufactures and sells specialty piping systems and leak detection systems.
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Saleh Sagr: Appointed President in April 2025 and has previously served as the Company’s Senior Vice President of the MENA region since June 2021, where he was responsible for overseeing operations in the U.A.E., Saudi Arabia, India, and Egypt. He joined the Company in May 2019 as Vice President of the MENA region. Prior to joining Perma-Pipe, Mr.
Added
Sagr served as General Manager for Global Anti Corrosion Techniques Co. Ltd, in Saudi Arabia, a Saudi pipeline company he co-founded in 2005. From 1995 to 2005, Mr. Sagr held various positions for BrederoShaw, such as engineering, startups, and operations management. Matthew E.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCertain of the Company's contracts recognize revenues using periodic recognition of income. For these contracts, the Company uses the "over time" accounting method. This methodology allows revenue and profits to be recognized proportionally over the life of a contract by comparing the amount of the cost incurred to date against the total amount of cost expected to be incurred.
Biggest changeThis methodology allows revenue and profits to be recognized proportionally over the life of a contract by comparing the amount of the cost incurred to date against the total amount of cost expected to be incurred. The effect of revisions to revenue and total estimated cost is recorded when amounts are known or can be reasonably estimated.
This volatility may negatively impact market conditions thus reducing project activity and the Company's results of operations. If the United States or other countries in which the Company operates impose tariffs on imports of raw materials, including steel, used in the Company's operations, could have an adverse impact on the business.
This volatility may negatively impact market conditions thus reducing project activity and the Company's results of operations. If the United States or other countries in which the Company operates impose tariffs on imports of raw materials, including steel, used in the Company's operations, could have an adverse impact on the Company's business.
Any reduction or cancellation of orders may result in revenues that are lower than expected. The Company's results of operations could be adversely affected by changes in international regulations and other activities of government agencies related to the Company’s operations . International sales represent a significant portion of the Company's total sales.
Any reduction or cancellation of orders may result in revenues that are lower than expected. The Company's results of operations could be adversely affected by changes in international regulations and other activities of government agencies related to the Company’ s operations . International sales represent a significant portion of the Company's total sales.
The Company’s net operating loss (“NOL”) carryforwards in the U.S. could expire unused and be unavailable to offset future income tax liabilities because of their limited duration or because of restrictions under U.S. tax law.
The Company’s net operating loss carryforwards (“NOLs”) in the U.S. could expire unused and be unavailable to offset future income tax liabilities because of their limited duration or because of restrictions under U.S. tax law.
The Company’s inability to successfully achieve profitability and positive cash flows may result in it experiencing a serious liquidity deficiency resulting in material adverse consequences that could threaten its viability.
The Company’s inability to successfully maintain profitability and positive cash flows may result in it experiencing a serious liquidity deficiency resulting in material adverse consequences that could threaten its viability.
The Company may be unable to achieve sustained levels of profitability or positive cash flows in the future. There is no guarantee that the Company will be able to achieve profitability or positive cash flows in the future.
The Company may be unable to maintain sustained levels of profitability or positive cash flows in the future. There is no guarantee that the Company will be able to maintain profitability or positive cash flows in the future.
Due to the long-term nature of the receivable, $ 1.4 million and $ 2.5 million were included in other long-term assets as of January 31, 2024 and 2023 , respectively.
Due to the long-term nature of the receivable, $1.2 million and $1.4 million were included in other long-term assets as of January 31, 2025 and 2024, respectively.
The Company has approximately $ 3.5 million becoming due in the year ending January 31, 2025 under its various foreign revolving lines of credit. The Company’s credit arrangements used by its Middle Eastern subsidiaries are renewed on an annual basis. In addition to these credit arrangements, the Company also obtains financing in the Middle East on a project-by-project basis.
The Company has approximately $2.0 million becoming due in the year ending January 31, 2026 under its various foreign revolving lines of credit. The Company’s credit arrangements used by its Middle Eastern subsidiaries are renewed on an annual basis. In addition to these credit arrangements, the Company also obtains financing in the Middle East on a project-by-project basis.
One of the Company’s accounts receivable in the total amount of $ 2.2 million and $ 2.7 million as of January 31, 2024 and 2023 , respectively, has been outstanding for several years. As of January 31, 2024 , the entire balance represents a retention asset that is payable upon the commissioning of the system.
One of the Company’s accounts receivable in the total amount of $1.8 million and $2.2 million as of January 31, 2025 and 2024, respectively, has been outstanding for several years. As of January 31, 2025, the entire balance represents a retention asset that is payable upon the commissioning of the system.
The state NOLs expire at various dates from 2029 to 2053 . In addition, the Company's ability to use its NOLs may be limited in the event of future changes in its stock ownership.
The state NOLs expire at various dates from 2025 to 2044. In addition, the Company's ability to use its NOLs may be limited in the event of future changes in its stock ownership.
The Company's sales to foreign customers were 65.6% and 63.8% in the years ended January 31, 2024 and 2023 , respectively. The Company's anticipated growth and profitability may require increasing foreign sales volume and may necessitate further international expansion.
The Company's sales to foreign customers were 66.6% and 65.6% in the years ended January 31, 2025 and 2024 , respectively. The Company's anticipated growth and profitability may require increasing foreign sales volume and may necessitate further international expansion.
The Company’s management is responsible for establishing and maintaining effective internal control over financial reporting. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States.
Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States.
Further, the Company has been engaged by the customer to perform additional work in the year ending January 31, 2024 under customary trade credit terms which supports the continued cooperation between the Company and the customer. As a result, the Company did not reserve any allowance against this outstanding receivable as of January 31, 2024 .
Additionally, the Company has been engaged by the customer to perform additional work in 2025 under customary trade credit terms that support the continued cooperation between the Company and the customer. As a result, the Company did not reserve any allowance against this outstanding receivable as of January 31, 2025 .
The Company completed all of its deliverables in 2015 under the related contract, but the system has not yet been commissioned by the customer as additional activities must be completed prior to the overall system completion and commissioning. Nevertheless, the Company has been actively involved in ongoing efforts to collect this outstanding amount.
The Company completed all of its deliverables in 2015 under the related contract, but the system has not yet been commissioned by the customer as additional activities must be completed prior to the overall system completion and commissioning.
As of January 31, 2024 , the Company had $ 30.1 million of gross federal NOLs and $ 21.0 million of gross state NOLs available to offset the Company’s future taxable income. Of the gross federal NOL amount, $ 22.7 million will begin to expire between tax years 2036 and 2037 and the remainder has an indefinite carryforward.
As of January 31, 2025 , the Company had $ 23.8 million of gross federal NOLs and $21.9 million of gross state NOLs available to offset the Company’s future taxable income. Of the gross federal NOL amount, $16.4 million will begin to expire between tax years 2036 and 2037 and the remainder has an indefinite carryforward.
The effect of revisions to revenue and total estimated cost is recorded when amounts are known or can be reasonably estimated. Revisions can occur at any time and could be material. On a historical basis, management believes that reasonably reliable estimates of the progress towards completion on long-term contracts have been made.
Revisions can occur at any time and could be material. On a historical basis, management believes that reasonably reliable estimates of the progress towards completion on long-term contracts have been made.
The Company's ability to meet its strategic and financial goals will depend to a significant extent on the continued contributions of its senior management and key personnel. Future success will also depend in large part on the Company's ability to identify, attract, motivate, effectively utilize and retain highly qualified managerial, sales, marketing and technical personnel.
Future success will also depend in large part on the Company's ability to identify, attract, motivate, effectively utilize and retain highly qualified managerial, sales, marketing and technical personnel.
The Company has approximately $ 0.1 million becoming due in the year ending January 31, 2025 under its project financing agreements.
The Company has insignificant borrowings becoming due in the year ending January 31, 2026 under its project financing agreements.
The Company continues to engage with the customer to ensure full payment of open balances. Additionally, at various times throughout 2023 and in June 2022, the Company received a partial payment to settle $0.6 million and $0.9 million of the customer's outstanding balances, respectively.
Nevertheless, the Company continues to actively engage in ongoing collection efforts with the customer to ensure full payment of open balances , and at various times throughout 2024 and 2023, the Company received a partial payment to settle $ 0.4 million and $0.6 million of the customer's outstanding balances, respectively, including an additional $0.5 million that was received subsequent to the end of the year.
A successful attack could adversely affect the Company's reputation and results of operations, including through lawsuits by third parties. The Audit Committee of the Board of Directors is responsible for overseeing the adequacy and effectiveness of the Company's cybersecurity policies and programs.
A successful attack could adversely affect the Company's reputation and results of operations, including through lawsuits by third parties.
Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that the Company would prevent or detect a misstatement of its financial statements or fraud. The Company may experience changes in estimates which could result in a reduction or elimination of previously recorded revenues and profit in connection with "over time" revenue recognition.
Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that the Company would prevent or detect a misstatement of its financial statements or fraud. If we are not able to remediate the material weaknesses and maintain effective internal control over financial reporting, our business and financial results could be harmed.
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The Company’s management is responsible for establishing and maintaining effective internal control over financial reporting. However, there are material weaknesses in internal controls such that our internal control over financial reporting has been determined not to be effective.
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The Company may experience changes in estimates which could result in a reduction or elimination of previously recorded revenues and profit in connection with "over time" revenue recognition. Certain of the Company's contracts recognize revenues using periodic recognition of income. For these contracts, the Company uses the "over time" accounting method.
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The Company's ability to meet its strategic and financial goals will depend to a significant extent on the continued contributions of its senior management and key personnel, or the successful transition of responsibilities of departing senior management and key personnel.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeManagement routinely evaluates the Company's security processes, procedures, and systems to determine if enhancements are needed to reduce the possibility of a future cybersecurity event. This includes safeguards implemented by the Company, such as a multi-factor authentication process for remote access to systems; restricted firewall settings; network monitoring, email phishing tests, and enhancing the Company's backup recovery strategy, among others.
Biggest changeManagement routinely evaluates the Company's security processes, procedures, and systems to determine if enhancements are needed to reduce the possibility of a future cybersecurity event. This includes safeguards implemented by the Company, such as a multi-factor authentication process; restricted firewall settings; network monitoring, email phishing tests, and enhancing the Company's backup recovery strategy, among others.
Further, the Director of Information Technology maintains an open dialog regarding any significant developments in cybersecurity risks, ensuring the Audit Committee's oversight is proactive and responsive.
Further, the Director of Information Technology maintains an open dialogue regarding any significant developments in cybersecurity risks, ensuring the Audit Committee's oversight is proactive and responsive.
Risk Factors "The Company's information technology systems may be negatively affected by cybersecurity threats." Governance The Audit Committee of the Board of Director's has the responsibility of overseeing the Company's cybersecurity risks. The Director of Information Technology provides periodic updates to the Board of Director's regarding actions taken to mitigate the Company's exposure and protection to cybersecurity risks.
Risk Factors "The Company's information technology systems may be negatively affected by cybersecurity threats." Governance The Audit Committee of the Board of Directors has the responsibility of overseeing the Company's cybersecurity risks. The Director of Information Technology provides periodic updates to the Board of Directors regarding actions taken to mitigate the Company's exposure and protection from cybersecurity risks.
The Company's cybersecurity program focuses on the following areas: • Technological safeguards that are designed to protect the Company's information systems from cybersecurity threats, including the prevention and detection of systems, access controls, and firewalls, which the Company assesses the vulnerability and cybersecurity threat and makes necessary improvements. • Utilization of third parties as part of the Company's risk-based approach in identifying and overseeing cybersecurity risks. • The Company maintains an incident plan that addresses the Company's response to a cybersecurity event, which is periodically reviewed and updated.
The Company's cybersecurity program focuses on the following areas: • Technological safeguards that are designed to protect the Company's information systems from cybersecurity threats, including the prevention and detection of system applications, access controls, and firewalls, which the Company assesses the vulnerability and severity of potential cybersecurity threats and makes necessary improvements. • Utilization of third parties as part of the Company's risk-based approach in identifying and overseeing cybersecurity risks. • The Company maintains an incident plan that addresses the Company's response to a cybersecurity event, which is periodically reviewed and updated.
This ensures the highest level of management are informed of potential risks associated with cybersecurity that could have a material and adverse effect on the Company.
This ensures the highest level of management are informed of potential risks associated with cybersecurity that could have a material and adverse effect on the Company. 10 Table of Contents

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeSuch accruals are based on developments to date, the Company's estimates of the outcomes with respect to any legal proceedings, and its experience in contesting, litigating and settling other similar matters.
Biggest changeSuch accruals are based on developments to date, the Company's estimates of the outcomes with respect to any legal proceedings, and its experience in contesting, litigating, and settling other similar matters. As of January 31, 2025, the Company had no material pending litigation.
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As of January 31, 2024 , the Company was actively involved in a legal proceeding that arose in 2018 with an existing customer which was resolved subsequent to the end of the year. For further information, see Note 13 - Subsequent events, in the Notes to Consolidated Financial Statements.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES The Company's common stock is traded on the Nasdaq Global Market under the symbol "PPIH". As of April 26, 2024 , there were approximately 50 stockholders of record and other additional stockholders for whom securities firms or banks acted as nominees.
Biggest changeITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES The Company's common stock is traded on the Nasdaq Global Market under the symbol "PPIH". As of April 21, 2025, there were approximately 44 stockholders of record and other additional stockholders for whom securities firms or banks acted as nominees.
Removed
Issuer Purchases of Equity Securities The repurchase program approved on October 4, 2021, authorized the Company to use up to $3.0 million for the purchase of its outstanding shares of common stock. Stock repurchases were permitted to be executed through open market or privately negotiated transactions, depending upon current market conditions and other factors.
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Issuer Purchases of Equity Securities The Company did not make any purchases of its common stock during fiscal 2024. 12 Table of Contents ITEM 6. [RESERVED]
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On December 7, 2022, the Board of Directors authorized the use of $1.0 million remaining under the share repurchase program previously approved on October 4, 2021 that expired on October 3, 2022. During the 12 months ended January 31, 2024, the Company used the remaining $1.0 million of the $3.0 million authorized to repurchase its outstanding shares of common stock.
Removed
The following table sets forth information with respect to repurchases by the Company of its shares of common stock during 2022 and 2023 (In thousands, except per share data) : Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under the plans or programs January 1, 2022 - January 31, 2022 98 $ 8.81 98 $ 1,008 July 1, 2022 - July 31, 2022 5 8.85 5 964 December 1, 2022 - December 31, 2022 3 8.61 3 939 July 1, 2023 - July 31, 2023 37 8.51 37 628 August 1, 2023 - August 31, 2023 62 8.67 62 92 September 1, 2023 - September 30, 2023 10 8.95 10 - Total 215 215 10 Table of Contents

Item 7. Management's Discussion & Analysis

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

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Biggest changeSince the Company's revenues are significantly dependent upon discrete projects, the Company's operating results in any reporting period could be negatively impacted as a result of variations in the level of the Company's discrete project orders or delays in the timing of the specific project phases. 11 Table of Contents Results of Operations Consolidated Results of Operations (In thousands, except per share data, or unless otherwise specified) Year Ended January 31, 2024 2023 Change favorable (unfavorable) Amount Percent of Net Sales Amount Percent of Net Sales Amount Net sales $ 150,668 $ 142,569 $ 8,099 Gross profit 41,458 28 % 38,301 27 % 3,157 General and administrative expenses 22,591 15 % 21,994 15 % (597 ) Selling expense 5,508 4 % 5,163 4 % (345 ) Interest expense 2,266 2,119 (147 ) Other (expense) income (1,202 ) 533 (1,735 ) Income before income tax 9,891 9,558 333 Income tax (benefit) expense (3,320 ) 3,613 6,933 Net income 13,211 5,945 7,266 Less: Net income attributable to non-controlling interest 2,740 - 2,740 Net income attributable to common stock 10,471 5,945 4,526 Year ended January 31, 2024 Compared to year ended January 31, 2023 Net sales Net sales were $ 150.7 million and $ 142.6 million in the years ended January 31, 2024 and 2023 , respectively.
Biggest changeThe tabular information presented throughout this MD&A is in thousands, except per share data, or unless otherwise specified. 13 Table of Contents Results of Operations Consolidated Results of Operations Year Ended January 31, 2025 2024 Change favorable (unfavorable) Amount Percent of Net Sales Amount Percent of Net Sales Amount Net sales $ 158,384 $ 150,668 $ 7,716 Gross profit 53,248 34 % 41,458 28 % 11,790 General and administrative expenses 28,000 18 % 22,591 15 % (5,409 ) Selling expense 4,947 3 % 5,508 4 % 561 Interest expense 1,940 2,266 326 Other income (expense) 107 (1,202 ) 1,309 Income before income tax 18,468 9,891 8,577 Income tax expense (benefit) 5,377 (3,320 ) (8,697 ) Net income 13,091 13,211 (120 ) Less: Net income attributable to non-controlling interest 4,108 2,740 1,368 Net income attributable to common stock 8,983 10,471 (1,488 ) Year ended January 31, 2025 Compared to year ended January 31, 2024 Net sales Net sales were $158.4 million and $150.7 million in the years ended January 31, 2025 and 2024, respectively.
Further, the North American Loan Parties may not make repurchases of the Company's common stock in excess of $3.0 million. 14 Table of Contents The Renewed Senior Credit Facility also contains financial covenants requiring the North American Loan Parties to achieve a ratio of its EBITDA (as defined in the Renewed Senior Credit Facility) to the sum of scheduled cash principal payments on indebtedness for borrowed money and interest payments on the advances under the Renewed Senior Credit Facility to be not less than 1.10 to 1.00 for any five consecutive days in which the undrawn availability is less than $3.0 million or any day in which the undrawn availability is less than $2.0 million.
Further, the North American Loan Parties may not make repurchases of the Company's common stock in excess of $3.0 million. 16 Table of Contents The Renewed Senior Credit Facility also contains financial covenants requiring the North American Loan Parties to achieve a ratio of its EBITDA (as defined in the Renewed Senior Credit Facility) to the sum of scheduled cash principal payments on indebtedness for borrowed money and interest payments on the advances under the Renewed Senior Credit Facility to be not less than 1.10 to 1.00 for any five consecutive days in which the undrawn availability is less than $3.0 million or any day in which the undrawn availability is less than $2.0 million.
For additional information, see Note 5 - Debt, in the Notes to Consolidated Financial Statements. 13 Table of Contents The Company believes it will have the ability to satisfy all working capital needs and any planned capital expenditures for the twelve months following the issuance of the Consolidated Financial Statements, based on its existing cash on hand, cash flows from operations, and available credit facilities.
For additional information, see Note 5 - Debt, in the Notes to Consolidated Financial Statements. 15 Table of Contents The Company believes it will have the ability to satisfy all working capital needs and any planned capital expenditures for the twelve months following the issuance of the Consolidated Financial Statements, based on its existing cash on hand, cash flows from operations, and available credit facilities.
The Company was in compliance with respect to these covenants as of January 31, 2024 . The Renewed Senior Credit Facility contains customary events of default. If an event of default occurs and is continuing, then PNC may terminate all commitments to extend further credit and declare all amounts outstanding under the Renewed Senior Credit Facility due and payable immediately.
The Company was in compliance with respect to these covenants as of January 31, 2025 . The Renewed Senior Credit Facility contains customary events of default. If an event of default occurs and is continuing, then PNC may terminate all commitments to extend further credit and declare all amounts outstanding under the Renewed Senior Credit Facility due and payable immediately.
The line is secured by the contract for a project being financed by the Company's Egyptian subsidiary. The facility has an interest rate of approximately 20.75% and, as of November 2022, is no longer available for borrowings by the Company. The facility will expire in connection with final customer balance collections and the completion of the project.
The line is secured by the contract for a project being financed by the Company's Egyptian subsidiary. The facility has an interest rate of approximately 20.8% and, as of November 2022, is no longer available for borrowings by the Company. The facility will expire in connection with final customer balance collections and the completion of the project.
The foreign revolving line balances were included as current maturities of long-term debt in the Company's consolidated balance sheets as of January 31, 2024 and January 31, 2023, respectively. In June 2023, the Company assumed a promissory note of approximately $2.8 million in connection with the formation of the joint venture with GIG.
The foreign revolving line balances were included as current maturities of long-term debt in the Company's consolidated balance sheets as of January 31, 2025 and January 31, 2024. In June 2023, the Company assumed a promissory note of approximately $ 2.8 million in connection with the formation of the joint venture with GIG.
As this project has progressed and the Company received collections, the facility has decreased to a current amount of 2.1 million Egyptian Pounds (approximately $ 0.1 million at January 31, 2024). This credit arrangement is in the form of project financing at rates competitive in Egypt.
As this project has progressed and the Company received collections, the facility has decreased to a current amount of 2.1 million Egyptian Pounds (approximately $0.1 million at January 31, 2025). This credit arrangement is in the form of project financing at rates competitive in Egypt.
Saudi Arabia In March 2022, the Company's Saudi Arabian subsidiary entered into a credit arrangement with a bank in Saudi Arabia for a revolving line of 37.0 million Saudi Riyal (approximately $ 9.9 million at January 31, 2024 .) This credit arrangement is in the form of project financing at rates competitive in Saudi Arabia.
Saudi Arabia In March 2022, the Company's Saudi Arabian subsidiary entered into a credit arrangement with a bank in Saudi Arabia for a revolving line of 37.0 million Saudi Riyal (approximately $ 9.9 million at January 31, 2025 ). This credit arrangement is in the form of project financing at rates competitive in Saudi Arabia.
Further, as of January 31, 2024 and January 31, 2023, the Company had unused borrowing capacity of $3.2 million and $2.0 million, respectively. In December 2021, the Company entered into a credit arrangement for project financing with a bank of Egypt for 28.2 million Egyptian Pounds.
Further, as of January 31, 2025 and January 31, 2024 , the Company had unused borrowing capacity of $2.0 million and $3.2 million, respectively. In December 2021, the Company entered into a credit arrangement for project financing with a bank of Egypt for 28.2 million Egyptian Pounds.
Years, results and balances described as 2023 and 2022 are for the fiscal years ended January 31, 2024 and 2023 , respectively. The Company is engaged in the manufacture and sale of products in one reportable segment: Piping Systems.
Years, results and balances described as 2024 and 2023 are for the fiscal years ended January 31, 2025 and 2024, respectively. The Company is engaged in the manufacture and sale of products in one reportable segment: Piping Systems.
There was no restricted cash held in the United States on January 31, 2024 or January 31, 2023 . Restricted cash held by foreign subsidiaries was $ 1.4 million and $ 1.0 million as of January 31, 2024 and 2023 , respectively. Restricted cash held by foreign subsidiaries related to fixed deposits that also serve as security deposits and guarantees.
There was no restricted cash held in the United States on January 31, 2025 or January 31, 2024. Restricted cash held by foreign subsidiaries was $1.4 million as of January 31, 2025 and 2024, respectively. Restricted cash held by foreign subsidiaries related to fixed deposits that also serve as security deposits and guarantees.
The Company had borrowed an aggregate of $3.2 million and $1.1 million as of January 31, 2024 and January 31, 2023, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
The Company had borrowed an aggregate of $1.5 million and $3.2 million as of January 31, 2025 and January 31, 2024, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2024 , interest rates were based on (i) the Emirates Inter Bank Offered Rate plus 3.0% to 3.5% per annum for the U.A.E. credit arrangements, two of which have a minimum interest rate of 4.5% per annum; (ii) either the Central Bank of Egypt corporate loan rate plus 1.5% to 3.5% per annum or the stated interest rate in the agreements for the Egypt credit arrangements; and (iii) the Saudi Inter Bank Offered Rate plus 3.5% for the Saudi Arabia credit arrangement.
I nterest rates were based on (i) the Emirates Inter Bank Offered Rate plus 3.0% to 3.5% per annum for the U.A.E. credit arrangements, two of which have a minimum interest rate of 4.5% per annum; (ii) either the Central Bank of Egypt corporate loan rate plus 1.5% to 3.5% per annum or the stated interest rate in the agreements for the Egypt credit arrangements; and (iii) the Saudi Inter Bank Offered Rate plus 3.5% for the Saudi Arabia credit arrangement.
Under the Lease Agreement, the Company has four consecutive options to extend the term of the lease by five years for each such option. As of January 31, 2024 and 2023, the Company had a net book value relating to this asset of $1.9 million and $2.1 million, respectively.
Under the Lease Agreement, the Company has four consecutive options to extend the term of the lease by five years for each such option. As of January 31, 2025 and 2024, the Company had a net book value relating to this asset of $1.8 million and $1.9 million, respectively.
The unused borrowing availability attributable to this credit arrangement at January 31, 2024 and January 31, 2023, was $6.1 million and $2.3 million, respectively. These credit arrangements are in the form of overdraft facilities and project financing at rates competitive in the countries in which the Company operates.
The unused borrowing availability attributable to this credit arrangement at January 31, 2025 and January 31, 2024, was $3.0 million and $6.1 million, respectively. These credit arrangements are in the form of overdraft facilities and project financing at rates competitive in the countries in which the Company operates.
Based on the amount of such debt on January 31, 2024 , and the weighted average interest rate of 10.0% on that debt, such interest was being incurred at an annual rate of approximately $ 0.6 million. (2) Scheduled maturities, excluding interest. (3) Scheduled maturities of foreign revolver line, excluding interest.
Based on the amount of such debt on January 31, 2025, and the weighted average interest rate of 9.0% on that debt, such interest was being incurred at an annual rate of approximately $0.6 million. (2) Scheduled maturities, excluding interest. (3) Scheduled maturities of foreign revolver line, excluding interest.
The principal balance is included as a component of long-term debt, less current maturities in the Company's consolidated balance sheets and is presented net of issuance costs of $0.1 million as of January 31, 2024 and January 31, 2023, respectively. 16 Table of Contents Finance obligation - buildings and land.
The principal balance is included as a component of long-term debt, less current maturities in the Company's consolidated balance sheets and is presented net of issuance costs of $0.1 million as of January 31, 2025 and January 31, 2024. 18 Table of Contents Finance obligation - buildings and land.
As of January 31, 2024 , the calculated ratio was greater than 1.10 to 1.00.
As of January 31, 2025 , the calculated ratio was greater than 1.10 to 1.00.
On July 28, 2016, the Company entered into a mortgage agreement secured by the Company's manufacturing facility located in Alberta, Canada that matures on December 23, 2042. As of January 31, 2024 , the remaining balance on the mortgage in Canada is approximately 6.1 million Canadian Dollars ("CAD") (approximately $ 4.5 million at January 31, 2024 ).
On July 28, 2016, the Company entered into a mortgage agreement secured by the Company's manufacturing facility located in Alberta, Canada that matures on December 23, 2042. As of January 31, 2025, the remaining balance on the mortgage in Canada is approximately 5.7 million Canadian Dollars ("CAD") (approximately $4.0 million at January 31, 2025).
As of January 31, 2024 and January 31, 2023, the Company had unused borrowing availability of approximately $1.0 million and $1.8 million, respectively. 15 Table of Contents In June 2021, and as renewed or amended subsequently thereafter, the Company's Egyptian subsidiary entered into a credit arrangement with a bank in Egypt for a revolving line of 100.0 million Egyptian Pounds (approximately $ 3.2 million at January 31, 2024).
As of January 31, 2025 and January 31, 2024, the Company had unused borrowing availability of approximately $9.0 million and $1.0 million, respectively. 17 Table of Contents Egypt In June 2021, and as renewed or amended subsequently thereafter, the Company's Egyptian subsidiary entered into a credit arrangement with a bank in Egypt for a revolving line of 100.0 million Egyptian Pounds (approximately $2.0 million at January 31, 2025).
The current portion of the finance obligation of $ 0.2 million is recognized in current maturities of long-term debt and the long-term portion of $ 9.0 million is recognized in long-term finance obligation on the Company's consolidated balance sheets as of January 31, 2024 .
The current portion of the finance obligation of $ 0.2 million is recognized in current maturities of long-term debt and the long-term portion of $ 8.8 million is recognized in long-term finance obligation on the Company's consolidated balance sheets as of January 31, 2025 .
Further, the Company has been engaged by the customer to perform additional work in 2024 under customary trade terms that supports the continued cooperation between the Company and the customer. As a result, the Company did not reserve any allowance against the remaining outstanding balances as of January 31, 2024 .
Additionally, the Company has been engaged by the customer to perform additional work in 2025 under customary trade terms that support the continued cooperation between the Company and the customer. As a result, the Company did not reserve any allowance against the remaining outstanding balances as of January 31, 2025 .
Nevertheless, the Company has settled approximately $ 39.7 million as of January 31, 2024 , with a remaining balance due in the amount of $ 2.2 million, all of which pertains to retention clauses within the agreements with the Company's customer, and which become payable by the customer when this project is fully tested and commissioned.
Nevertheless, the Company has settled approximately $ 40.1 million as of January 31, 2025 , with a remaining balance due in the amount of $ 1.8 million, all of which pertains to retention clauses within the agreements with the Company's customer, and which become payable by the customer when this project is fully tested and commissioned.
As of January 31, 2024 , $ 8.3 million of availability was used to support letters of credit to guarantee amounts committed for inventory purchases and for performance guarantees. Additionally, the Company had borrowed approximately $6.4 million and had an additional $15.4 million of remaining borrowing capacity available under the foreign revolving credit arrangements.
As of January 31, 2025, $ 16.9 million of availability was used to support letters of credit to guarantee amounts committed for inventory purchases and for performance guarantees. Additionally, the Company had borrowed approximately $2.1 million and had an additional $ 15.6 million of remaining borrowing capacity available under the foreign revolving credit arrangements.
On April 14, 2021, the Company entered into a purchase and sale agreement (the "Purchase and Sale Agreement"). Pursuant to the terms of the Purchase and Sale Agreement, the Company sold the Property for $10.4 million. The transaction generated net cash proceeds of $9.1 million.
On April 14, 2021, the Company entered into a purchase and sale agreement (the "Purchase and Sale Agreement") to sell its land and buildings in Lebanon, Tennessee (the "Property"). Pursuant to the terms of the Purchase and Sale Agreement, the Company sold the Property for $10.4 million. The transaction generated net cash proceeds of $9.1 million.
The Company had approximately $ 0.1 million and $ 0.4 million outstanding as of January 31, 2024 and January 31, 2023, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2025, the Company had an insignificant amount outstanding, and approximately $ 0.1 million outstanding at January 31, 2024, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2024 , the Company had borrowed an aggregate of $ 5.5 million at a rate of 10.0% and had $ 4.0 million available under the Renewed Senior Credit Facility.
As of January 31, 2025, the Company had borrowed an aggregate of $ 6.8 million at a rate of 9.0% and had $ 3.7 million available under the Renewed Senior Credit Facility. As of January 31, 2024, the Company had borrowed an aggregate of $ 5.5 million and had $ 4.0 million available under the Renewed Senior Credit Facility.
As of January 31, 2024, the facility has an interest rate of approximately 20.75% and expired in August 2023. This credit arrangement was subsequently renewed in November 2023 with substantially the same terms and conditions and expires in November 2024.
As of January 31, 2025, the facility has an interest rate of approximately 20.8%. Additionally, this credit arrangement was renewed in November 2024 with substantially the same terms and conditions and expires in November 2025.
The Company continues to engage with the customer to ensure full payment of open balances, and at various times throughout 2023 and in June 2022, the Company received a partial payment to settle $0.6 million and $0.9 million of the customer's outstanding balances, respectively.
The Company continues to actively engage in ongoing collection efforts with the customer to ensure full payment of open balances, and at various times throughout 2024 and 2023, the Company received a partial payment to settle $ 0.4 million and $0.6 million of the customer's outstanding balances, respectively.
The Company is now recognizing a tax benefit on losses in the United States after removal of a partial valuation allowance applied against its deferred tax assets. The Company recognizes a tax position in its consolidated financial statements only after determining that the relevant tax authority would more likely than not sustain the position following an audit.
The Company maintains a partial valuation allowance in the United States against certain deferred tax assets. The Company recognizes a tax position in its consolidated financial statements only after determining that the relevant tax authority would more likely than not sustain the position following an audit.
The Company also has credit arrangements used by its Middle Eastern subsidiaries in the U.A.E., Egypt, and Saudi Arabia as further described below: United Arab Emirates The Company has a revolving line for 8.0 million U.A.E.
Revolving lines - foreign . The Company also has credit arrangements used by its Middle Eastern subsidiaries in the U.A.E., Egypt, and Saudi Arabia as further described below: United Arab Emirates The Company has a revolving line for 8.0 million U.A.E. Dirhams (approximately $ 2.2 million at January 31, 2025) from a bank in the U.A.E.
The Company had $ 5.5 million borrowed under the Renewed Senior Credit Facility and $ 6.4 million borrowed under its foreign revolving credit agreements at January 31, 2024 . Net cash from operating activities in the years ended January 31, 2024 and 2023 was $ 14.7 million and $ (1.2) million, respectively.
The Company had $6.8 million borrowed under the Renewed Senior Credit Facility and $4.8 million borrowed under its foreign revolving credit agreements at January 31, 2025. Net cash provided by operating activities in the years ended January 31, 2025 and 2024 was $13.9 million and $14.7 million, respectively.
The increase of $ 0.2 million was related to increased borrowings and, to a lesser extent, higher interest rates. Other expense Other expense was $ 1.2 million, as compared to other income of $ 0.5 million in the years ended January 31, 2024 and 2023 , respectively.
The decrease of $0.4 million was related to decreased borrowings and, to a lesser extent, lower interest rates. Other income (expense) Other income was $0.1 million, as compared to other expense of $(1.2) million in the years ended January 31, 2025 and 2024, respectively.
The Company had borrowed an aggregate of $0.1 million and $1.0 million as of January 31, 2024 and January 31, 2023, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2025, the facility has an interest rate of approximately 7.9% and expires in August 2025. The Company had borrowed an aggregate of $0.1 million as of January 31, 2025 and January 31, 2024, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
Based on these rates, as of January 31, 2024, the Company's interest rates ranged from 8.00% to 20.75% , with a weighted average rate of 10.71% , and the Company had facility limits totaling $ 24.5 million under these credit arrangements.
Based on these rates, as of January 31, 2025, the Company's interest rates ranged from 7.9% to 20.8%, with a weighted average rate of 11.6%, and the Company had facility limits totaling $ 34.6 million under these credit arrangements.
The Company had borrowed an aggregate of $0.2 million and $0.6 million as of January 31, 2024 and January 31, 2023, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2025, the facility has an interest rate of approximately 7.9% and expires in July 2025. The Company had borrowed an aggregate of $0.4 million and $0.2 million as of January 31, 2025 and January 31, 2024, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
Additionally, a net repayment was made from borrowings under the Company's credit facilities of approximately $6.8 million, as compared to net proceeds received from borrowings of approximately $5.5 million during the year ended January 31, 2023 . Further, d ebt totaled $ 25.7 million and $ 24.4 million as of January 31, 2024 and 2023 , respectively.
Additionally, a net repayment was made of borrowings under the Company's credit facilities of approximately $0.2 million, as compared to a net repayment of approximately $1.3 million during the year ended January 31, 2024. Further, debt totaled $24.5 million and $25.7 million as of January 31, 2025 and 2024, respectively.
The increase of $ 3.2 million was driven primarily by higher sales volumes and improved gross margins in Saudi Arabia. General and administrative expense General and administrative expenses were $ 22.6 million and $ 22.0 million in the years ended January 31, 2024 and 2023 , respectively. The increase of $ 0.6 million was primarily related to higher compensation costs.
The increase of $11.7 million was driven by higher sales volumes and improved gross margins in the Middle East and Canada. General and administrative expense General and administrative expenses were $28.0 million and $22.6 million in the years ended January 31, 2025 and 2024, respectively. The increase of $5.4 million was primarily related to higher compensation costs and professional fees.
The line is secured by certain assets (such as accounts receivable) of the Company's Saudi Arabian subsidiary, and as of January 31, 2024, the facility has an interest rate of approximately 9.50% and is set to expire in May 2024.
The line is secured by certain assets (such as accounts receivable) of the Company's Saudi Arabian subsidiary. The facility was renewed in May 2024 with substantially the same terms and conditions and expires in May 2025. As of January 31, 2025 , the facility has an interest rate of approximately 9.0% .
As of January 31, 2024 and January 31, 2023, the Company had unused borrowing availability of approximately $1.9 million and $1.6 million, respectively. The Company has a revolving line for 20.5 million U.A.E.
As of January 31, 2025 and January 31, 2024, the Company had unused borrowing availability of approximately $1.6 million and $1.9 million, respectively. The Company has a revolving line for 65.2 million U.A.E. Dirhams (approximately $ 17.7 million at January 31, 2025) from a bank in the U.A.E.
The Company had borrowed an aggregate of $1.4 million and $3.1 million as of January 31, 2024 and January 31, 2023, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
As of January 31, 2025 , the Company had an immaterial amount outstanding with respect to this credit arrangement, and approximately $1.4 million outstanding at January 31, 2024, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.
The interest rate is variable, and was 10.19% at January 31, 2024 .
The interest rate is variable, and was 7.1% at January 31, 2025.
The increase of $ 8.1 million was primarily a result of higher sales volumes in Saudi Arabia. Gross profit Gross profit was $ 41.5 million, or 28% of net sales and $ 38.3 million, or 27% of net sales, in the years ended January 31, 2024 and 2023 , respectively.
The increase of $7.7 million was primarily a result of higher sales volumes in the Middle East and Canada. Gross profit Gross profit was $53.2 million, or 34% of net sales and $41.5 million, or 28% of net sales, in the years ended January 31, 2025 and 2024, respectively.
As o f January 31, 2024 , the Company had $ 4.0 million of borrowing capacity under the Renewed Senior Credit Facility in North America and $ 15.4 million of borrowing capacity under its foreign revolving credit agreements.
The Company's working capital was $54.7 million on January 31, 2025 compared to $41.1 million on January 31, 2024 . As o f January 31, 2025, the Company had $3.7 million of borrowing capacity under the Renewed Senior Credit Facility (as defined below) in North America and $15.6 million of borrowing capacity under its foreign revolving credit agreements.
The increase of $ 0.3 million was driven by higher payroll expenses. 12 Table of Contents Interest expense Interest expense remained consistent and was $ 2.3 million and $ 2.1 million in the years ended January 31, 2024 and 2023 , respectively.
Selling expenses Selling expenses were $4.9 million and $5.5 million in the years ended January 31, 2025 and 2024, respectively. The decrease of $0.6 million was driven by lower payroll expenses during the year. 14 Table of Contents Interest expense Interest expense was $1.9 million and $2.3 million in the years ended January 31, 2025 and 2024, respectively.
The increase in net income was a result of the changes discussed above, less amounts attributable to non-controlling interest. Liquidity and capital resources Cash and cash equivalents were $5.8 million as of January 31, 2024 and January 31, 2023 , respectively.
Net income attributable to common stock Net income attributable to common stock was $9.0 million and $10.5 million in the years ended January 31, 2025 and 2024, respectively. The decrease in net income was a result of the changes discussed above, less amounts attributable to non-controlling interest.
The decrease of $7.8 million during the year ended January 31, 2024 consisted of using the remaining $1.0 million authorized as part of the Company's share repurchase program to reacquire its outstanding shares of common stock, as compared to $0.1 million during the year ended January 31, 2023.
The decrease of $2.4 million during the year ended January 31, 2025 consisted, in part, from no share repurchase activity as compared to the use of the remaining $1.0 million authorized as part of the Company's share repurchase program during the year ended January 31, 2024.
The Company guarantees only a portion of the subsidiaries' debt, including foreign debt. The amount of foreign subsidiary debt guaranteed by the Company was approximately $0.1 at January 31, 2024 and January 31, 2023, respectively.
The Company guarantees only a portion of the subsidiaries' debt, including foreign debt. The amount of foreign subsidiary debt guaranteed by the Company was approximately $10 million at January 31, 2025 and January 31, 2024. The Company was in compliance with the covenants under the credit arrangements in the U.A.E., Egypt and Saudi Arabia as of January 31, 2025 .
Of this retention amount, $ 1.4 million is classified in a long-term asset account. The Company has been actively involved in ongoing efforts to collect the outstanding amount.
Of this retention amount, $ 1.2 million is classified in a long-term asset account.
On January 31, 2024 , approximately $ 0.1 million was held in the United States, and $ 5.7 million was held by the Company's foreign subsidiaries. The Company's working capital was $ 41.1 million on January 31, 2024 compared to $ 41.9 million on January 31, 2023 .
Liquidity and capital resources Cash and cash equivalents were $15.7 million and $5.8 million as of January 31, 2025 and January 31, 2024 , respectively. On January 31, 2025 , approximately $ 0.3 million was held in the United States, and $ 15.4 million was held by the Company's foreign subsidiaries.
The current year increase of $ 15.9 million was due primarily to a rise customer deposits and accounts payable, partially offset by increases in accounts receivable, unbilled accounts receivable, and prepaid expenses and other current assets, as compared to the prior year.
The current year decrease of $0.8 million was due primarily to a decrease in accounts payable and customer deposits, partially offset by a reduction in receivables, prepaid expenses and other current assets, as compared to the prior year. Net cash used in investing activities in the years ended January 31, 2025 and 2024 was $2.8 million and $11.1 million, respectively.
The following table summarizes the Company's estimated contractual obligations on January 31, 2024 Year Ending January 31, Contractual obligations Total 2025 2026 2027 2028 2029 Thereafter Revolving line - North America (1) $ 5,519 $ 5,519 $ - $ - $ - $ - $ - Mortgage note (2) 4,512 239 239 239 239 239 3,317 Revolving lines - foreign (3) 3,632 3,632 - - - - - Long-term finance obligation (4) 9,203 175 210 247 287 329 7,955 Subtotal 22,866 9,565 449 486 526 568 11,272 Finance lease obligations 113 25 34 37 17 - - Operating lease obligations (5) 15,709 1,871 1,714 1,701 1,656 1,286 7,481 Uncertain tax position obligations (6) 1,112 - - - - - 1,112 Loan payable to GIG (7) 2,753 - - - - - 2,753 Total $ 42,553 $ 11,461 $ 2,197 $ 2,224 $ 2,199 $ 1,854 $ 22,618 (1) Interest obligations exclude floating rate interest on debt payable under the North American revolving line of credit.
The following table summarizes the Company's estimated contractual obligations on January 31, 2025: Year Ending January 31, Contractual obligations Total 2025 2026 2027 2028 2029 Thereafter Revolving line - North America (1) $ 6,765 $ 6,765 $ - $ - $ - $ - $ - Mortgage note (2) 3,956 221 221 221 221 221 2,853 Revolving lines - foreign (3) 2,010 2,010 - - - - - Long-term finance obligation (4) 9,023 225 263 305 349 400 7,481 Subtotal 21,754 9,221 484 526 570 621 10,334 Finance lease obligations 75 32 34 9 - - (0 ) Operating lease obligations (5) 15,966 1,900 2,094 2,120 1,791 899 7,162 Uncertain tax position obligations (6) 1,225 - - - - - 1,225 Loan payable to GIG (7) 2,753 - - - - - 2,753 Total $ 41,773 $ 11,153 $ 2,612 $ 2,655 $ 2,361 $ 1,520 $ 21,474 (1) Interest obligations exclude floating rate interest on debt payable under the North American revolving line of credit.
During the 12 months ended January 31, 2024, the Company used the remaining $1.0 million of the $3.0 million authorized to repurchase its outstanding shares of common stock. 17 Table of Contents Critical accounting estimates and policies The Company's significant accounting policies are discussed in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
The retirement was recorded as a reduction to common stock based on the par value of the shares, and the excess over par value was recorded as a decrease in retained earnings in accordance with ASC 505-30, Equity - Treasury Stock . 19 Table of Contents Critical accounting estimates and policies The Company's significant accounting policies are discussed in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
Net cash from investing activities in the years ended January 31, 2024 and 2023 was $ 11.1 million and $ 6.4 million, respectively. The increase of $ 4.7 million was primarily due to investments capital assets in the Middle East and Canada during the period.
The decrease of $8.3 million was due to less investment activity in capital assets during the year, mainly in the United States and Canada. Net cash used in financing activities in the years ended January 31, 2025 and 2024 was $0.9 million and $3.3 million, respectively.
Income taxes The Company's worldwide effective tax rates ("ETR") were (33.6%) and 37.8% in the years ended January 31, 2024 and 2023 , respectively. The change in ETR was largely due to a partial release of the U.S. valuation allowance and changes in the mix of income and loss in various tax jurisdictions.
The change in ETR was largely due to changes in the mix of income and loss in various tax jurisdictions and the release of the partial domestic valuation allowance in the prior year. For further information, see Note 7 - Income taxes, in the Notes to Consolidated Financial Statements.
Removed
Selling expenses Selling expenses were $ 5.5 million and $ 5.2 million in the years ended January 31, 2024 and 2023 , respectively.
Added
Since the Company's revenues are significantly dependent upon discrete projects, the Company's operating results in any reporting period could be negatively impacted as a result of variations in the level of the Company's discrete project orders or delays in the timing of the specific project phases.
Removed
The current year amount includes certain one-time adjustments, including a charge associated with the termination of the Company's pension plan and the settlement of a legal proceeding.
Added
The change relates mainly to a certain one-time non-recurring charge in connection with a non-cash pre-tax settlement resulting from the termination of the Company's pension plan. Income taxes The Company's worldwide effective tax rates ("ETR") were 29.1% and (33.6%) in the years ended January 31, 2025 and 2024, respectively.
Removed
The prior year amount includes income from the release of the Company's liability for a past project and insurance recovery income, partially offset by a non-cash pre-tax settlement charge resulting from the termination of the Company's pension plan.
Added
During the twelve months ended January 31, 2024, the Company used the remaining $1.0 million of the $3.0 million authorized to repurchase its outstanding shares of common stock. Accordingly, there was no repurchase activity with respect to the Company's shares of common stock during the twelve months ended January 31, 2025.
Removed
For further information, see Note 7 - Income taxes, in the Notes to Consolidated Financial Statements. Net income attributable to common stock Net income attributable to common stock was $10.5 million and $5.9 million in the years ended January 31, 2024 and 2023 , respectively.
Added
On August 29, 2024, the Company retired all remaining treasury stock previously acquired under the stock repurchase program.
Removed
Net cash from financing activities in the years ended January 31, 2024 and 2023 was $ (3.3) million and $ 4.5 million, respectively.
Removed
As of January 31, 2023 , the Company had borrowed an aggregate of $ 4.4 million and had $ 9.9 million available under the Renewed Senior Credit Facility. Revolving lines - foreign .
Removed
Dirhams (approximately $ 2.2 million at January 31, 2024 ) from a bank in the U.A.E. as of January 31, 2024, the facility has an interest rate of approximately 9.00% and is set to expire in May 2024.
Removed
Dirhams (approximately $ 5.6 million at January 31, 2024 ) from a bank in the U.A.E. as of January 31, 2024, the facility has an interest rate of approximately 9.00% and is set to expire in May 2024.
Removed
The Company was in compliance with the covenants under the credit arrangements in the U.A.E., Egypt and Saudi Arabia as of January 31, 2024 , with the exception of those arrangements that may have expired and have not yet been renewed.
Removed
Although certain of the arrangements may have expired and the borrowings could be required to be repaid immediately by the banks, the Company is in regular communication with the respective banks throughout the renewal process and all of the arrangements have continued without interruption or penalty.

Other PPIH 10-K year-over-year comparisons