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What changed in SMITH MIDLAND CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of SMITH MIDLAND CORP's 2023 and 2024 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 2024 report.

+85 added−88 removedSource: 10-K (2025-05-27) vs 10-K (2024-05-23)

Top changes in SMITH MIDLAND CORP's 2024 10-K

85 paragraphs added · 88 removed · 75 edited across 4 sections

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAt the time an incident is identified, the Company completes an evaluation and summarizes the incident that is shared with the Board of Directors to effectively manage resources to reduce risk and prevent future incidents. 10 Incident Disclosure To date, the Company has been subject to cyber related incidents, as previously disclosed in the Company’s Quarterly Report for the quarters ended June 30, 2023 and September 30, 2023 and within this Annual Report.
Biggest changeIncident Disclosure To date, the Company has been subject to cyber related incidents, as previously disclosed in the Company’s Quarterly Report for the quarters ended June 30, 2023 and September 30, 2023 and within this Annual Report.
Our cybersecurity program includes, among others: · a cybersecurity education program with on-going employee activities, which include frequent phishing simulation and testing and annual training; · access management and access controls with periodic reviews; · when appropriate, use of external subject matter specialists, including assessors, insurers, and consultants, to provide incident response services and risk assessments; · engagement in security practices that include physical, administrative, and technical safeguards of systems and hardware; The Company continues to invest in its cybersecurity program and performs assessments to identify opportunities to enhance training and awareness and improve processes and technology used to identify, prevent, detect, respond, and recover from cybersecurity incidents.
Our cybersecurity program includes, among others: · a cybersecurity education program with on-going employee activities, which include frequent phishing simulation and testing and annual training; · access management and access controls with periodic reviews; · when appropriate, use of external subject matter specialists, including assessors, insurers, and consultants, to provide incident response services and risk assessments; · engagement in security practices that include physical, administrative, and technical safeguards of systems and hardware; 10 The Company continues to invest in its cybersecurity program and performs assessments to identify opportunities to enhance training and awareness and improve processes and technology used to identify, prevent, detect, respond, and recover from cybersecurity incidents.
Since the identification of the incident, we have implemented additional safeguards designed to detect and prevent cybersecurity events that may have a material adverse effect on the Company.
Since the identification of these incidents, we have implemented additional safeguards designed to detect and prevent cybersecurity events that may have a material adverse effect on the Company.
Our cybersecurity program is overseen by the Chief Financial Officer in conjunction with a third-party service provider. The third-party service provider has the primary responsibility for the Company’s cybersecurity risk management program.
Our cybersecurity program is overseen by the Chief Executive Officer (in view of the absence of a Chief Financial Officer) in conjunction with a third-party service provider. The third-party service provider has the primary responsibility for the Company’s cybersecurity risk management program.
Governance Our Board of Directors has overall responsibility for risk oversight and oversees the implementation and continuous improvement of our cybersecurity program and compliance with disclosure requirements. The Board of Directors receives regular reports and periodic briefings from the Chief Financial Officer on cybersecurity matters, including key risks to the Company, recent developments, and risk mitigation activities.
The Board of Directors receives regular reports and periodic briefings from the Chief Executive Officer (in view of the absence of a Chief Financial Officer) on cybersecurity matters, including key risks to the Company, recent developments, and risk mitigation activities.
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Governance Our Board of Directors has overall responsibility for risk oversight and oversees the implementation and continuous improvement of our cybersecurity program and compliance with disclosure requirements.
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At the time an incident is identified, the Company completes an evaluation and summarizes the incident that is shared with the Board of Directors to effectively manage resources to reduce risk and prevent future incidents.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Company is under contract to double the size of this facility and anticipates construction to be complete in the second half of 2024. The previous North Carolina facility, on 10 acres of owned land, including an 8,000 square foot manufacturing plant with administrative offices, remains operational with future use not determined at this time.
Biggest changeThe previous North Carolina facility, on 10 acres of owned land, including an 8,000 square foot manufacturing plant with administrative offices, remains operational with future use not determined at this time. The Company's third manufacturing facility is located in Hopkins (Columbia), South Carolina.
The Company owns an additional 19 acres in Midland, Virginia, approximately two miles from the operations facility, and is developed as a storage yard for the rental barrier division.
The Company owns an additional 19 acres in Midland, Virginia, approximately two miles from the operations facility, and is utilized as a storage yard for the rental barriers.
The Company's second manufacturing facility is located in Reidsville, North Carolina on 46 acres of owned land and includes a 15,000 square foot manufacturing plant and administrative offices with additional space for future expansion. The facility began production in the fourth quarter 2021.
The Company's second manufacturing facility is located in Reidsville, North Carolina on 46 acres of owned land and includes a 30,000 square foot manufacturing plant and administrative offices with additional space for future expansion. The Company completed a plant expansion in 2024, which doubled the size of this facility.
The South Carolina facility gives the Company sufficient capacity to cover additional territory from the Atlantic Coast region to the northern part of Florida. The Company's present facilities are adequate for its current needs. 11
The facility is located on 39 acres of land owned by the Company and has approximately 40,000 square feet of production space and administrative offices. The South Carolina facility gives the Company sufficient capacity to cover additional territory from the Atlantic Coast region to the northern part of Florida. The Company's present facilities are adequate for its current needs. 11
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The Company's third manufacturing facility is located in Hopkins (Columbia), South Carolina. The facility is located on 39 acres of land owned by the Company and has approximately 40,000 square feet of production space and administrative offices.

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 trades on the NASDAQ Capital Market under the symbol “SMID”. As of April 29, 2024, there were approximately 40 record holders of the Company's Common Stock. Management believes there are at least 1,000 beneficial owners of the Company's Common Stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The Company's Common Stock trades on the NASDAQ Capital Market under the symbol "SMID". As of April 4, 2025, there were approximately 250 record holders of the Company's Common Stock. Management believes there are at least 1,000 beneficial owners of the Company's Common Stock.
Dividends Although the Company has historically paid special dividends, the Company did not declare a dividend in 2023. The Company cannot guarantee payment of dividends due to the internal need for funds in the development and expansion of its business.
Dividends Although the Company has occasionally paid special dividends, the Company did not declare a dividend in 2024. The Company cannot guarantee payment of dividends due to the internal need for funds in the development and expansion of its business.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe following table summarizes the revenue by type and a comparison for the years ended December 31, 2023 and 2022 (in thousands): Revenue by Type (Disaggregated Revenue) 2023 2022 Change % Change Product Sales: Soundwall Sales $ 7,671 $ 4,128 $ 3,543 86 % Architectural Sales 1,131 4,269 (3,138 ) (74 )% SlenderWall Sales 5,312 1,489 3,823 257 % Miscellaneous Wall Sales 6,418 3,475 2,943 85 % Barrier Sales 7,827 6,717 1,110 17 % Easi-Set and Easi-Span Building Sales 4,712 4,089 623 15 % Utility Sales 2,857 2,023 834 41 % Miscellaneous Sales 2,820 1,631 1,189 73 % Total Product Sales 38,748 27,821 10,927 39 % Barrier Rentals 6,330 6,545 (215 ) (3 )% Royalty Income 2,633 2,498 135 5 % Shipping and Installation Revenue 11,869 13,267 (1,398 ) (11 )% Total Service Revenue 20,832 22,310 (1,478 ) (7 )% Total Revenue $ 59,580 $ 50,131 $ 9,449 19 % The revenue items: soundwall sales, architectural panel sales, SlenderWall sales, miscellaneous wall sales, miscellaneous sales, barrier rentals, and royalty income are recognized as revenue over time.
Biggest changeThe following table summarizes the revenue by type and a comparison for the years ended December 31, 2024 and 2023 (in thousands): Revenue by Type (Disaggregated Revenue) 2024 2023 Change % Change Product Sales: Soundwall Sales $ 11,825 $ 7,671 $ 4,154 54 % Architectural Sales 4,205 1,131 3,074 272 % SlenderWall Sales - 5,312 (5,312 ) (100 )% Miscellaneous Wall Sales 5,104 6,418 (1,314 ) (20 )% Barrier Sales 3,882 7,827 (3,945 ) (50 )% Easi-Set and Easi-Span Building Sales 6,666 4,712 1,954 41 % Utility Sales 7,751 2,857 4,894 171 % Miscellaneous Sales 6,191 2,820 3,371 120 % Total Product Sales 45,624 38,748 6,876 18 % Barrier Rentals 12,019 6,330 5,689 90 % Royalty Income 3,261 2,633 628 24 % Shipping and Installation Revenue 17,604 11,869 5,735 48 % Total Service Revenue 32,884 20,832 12,052 58 % Total Revenue $ 78,508 $ 59,580 $ 18,928 32 % The revenue items: soundwall sales, architectural panel sales, SlenderWall sales, miscellaneous wall sales, miscellaneous sales, barrier rentals, and royalty income are recognized as revenue over time.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the Consolidated Financial Statements of the Company (including the Notes thereto) included elsewhere in this report. Dollar amounts are in thousands, except for per share amounts.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the Consolidated Financial Statements of the Company (including the Notes thereto) included elsewhere in this report. Dollar and share amounts are in thousands, except for per share amounts.
The commitment provides for the purchase of equipment for which a note payable will be executed with a term not to exceed five years with an interest rate at the Wall Street Journal prime rate plus 0.50% with a floor of 3.50% per annum. The loan is collateralized by a first lien position on all equipment purchased under the line.
The commitment provided for the purchase of equipment for which a note payable will be executed with a term not to exceed five years with an interest rate at the Wall Street Journal prime rate plus 0.50% with a floor of 3.50% per annum. The loan is collateralized by a first lien position on all equipment purchased under the line.
The Company is continuing this strategy through the development, marketing and sales efforts for its new products. The Company continues to evaluate both production and administrative processes, and has streamlined many of these processes through lean activities. During 2023 and 2022, the Company, through lean activities, continued to see positive effects in production and office areas.
The Company is continuing this strategy through the development, marketing and sales efforts for its new products. The Company continues to evaluate both production and administrative processes, and has streamlined many of these processes through lean activities. During 2024 and 2023, the Company, through lean activities, continued to see positive effects in production and office areas.
The lean business philosophy is a long-term, customer focused approach to continuous improvement by eliminating waste and providing value. It is management's intention to continue on the lean journey while implementing a lean culture throughout the Company to help reach our goals for 2024.
The lean business philosophy is a long-term, customer focused approach to continuous improvement by eliminating waste and providing value. It is management's intention to continue on the lean journey while implementing a lean culture throughout the Company to help reach our goals for 2025.
Key provisions of the line of credit require the Company (i) to obtain bank approval for capital expenditures in excess of $5,000 during the term of the loan and (ii) to obtain bank approval prior to its funding of any acquisition.
Key provisions of the line of credit required the Company (i) to obtain bank approval for capital expenditures in excess of $5,000 during the term of the loan and (ii) to obtain bank approval prior to its funding of any acquisition.
The note carries a ten-year term at a fixed interest rate of 3.64% annually per the Promissory Note Rate Conversion Agreement, with monthly payments of $22, and is secured by all of the assets of Smith-Carolina and a guarantee by the Company. The balance of the note payable at December 31, 2023 was $1,398.
The note carries a ten-year term at a fixed interest rate of 3.64% annually per the Promissory Note Rate Conversion Agreement, with monthly payments of $22, and is secured by all of the assets of Smith-Carolina and a guarantee by the Company. The balance of the note payable at December 31, 2024 was $1,166.
As indicated above, the Company is continuing to shift its focus to barrier rentals compared to barrier sales with the significant increase in the rental fleet that occurred during 2022.
As indicated above, the Company is continuing to shift its focus to barrier rentals compared to barrier sales with the significant increase in the rental fleet that occurred during prior years.
This payment schedule could result in liquidity problems for the Company because it must bear the cost of production for its products before it receives payment. The Company's days sales outstanding (DSO) in 2023 and 2022 were 113 and 99 days, respectively.
This payment schedule could result in liquidity problems for the Company because it must bear the cost of production for its products before it receives payment. The Company's days sales outstanding (DSO) in 2024 and 2023 were 88 and 113 days, respectively.
As a result of these factors, the Company is not always able to earn a profit for each period, therefore, please read Management's Discussion and Analysis of Financial Condition and Results of Operations and the accompanying financial statements with these factors in mind. 13 Overview Overall, the Company’s financial bottom line performance was essentially equal in 2023 when compared to 2022.
As a result of these factors, the Company is not always able to earn a profit for each period, therefore, please read Management's Discussion and Analysis of Financial Condition and Results of Operations and the accompanying financial statements with these factors in mind. 13 Overview Overall, the Company’s financial bottom line performance was significantly greater in 2024 when compared to 2023.
The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, and shipping and installation revenue are recognized as revenue at a point in time. 14 Soundwall Sales – Soundwall panel sales increased by 86% in 2023 compared to 2022.
The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, and shipping and installation revenue are recognized as revenue at a point in time. 14 Soundwall Sales – Soundwall panel sales increased by 54% in 2024 compared to 2023.
The Company anticipates greater sales volumes throughout 2024, although no assurance can be provided.
The Company anticipates greater sales volumes throughout 2025, although no assurance can be provided.
There were 5,258 basic and 5,292 diluted weighted average shares outstanding in 2023, and 5,233 basic and 5,253 diluted weighted average shares outstanding in 2022. 16 Liquidity and Capital Resources The Company financed its capital expenditures for 2023 with cash balances on hand.
There were 5,289 basic and diluted weighted average shares outstanding in 2024, and 5,258 basic and 5,292 diluted weighted average shares outstanding in 2023. 16 Liquidity and Capital Resources The Company financed its capital expenditures for 2024 with cash balances on hand.
As of March 12, 2024, the Company’s sales backlog was approximately $60.8 million, as compared to approximately $52.4 million around the same time in the prior year. It is estimated that most of the projects in the current sales backlog will be produced within 12 months, but a few will be produced over multiple years.
As of March 3, 2025, the Company’s sales backlog was approximately $59.5 million, as compared to approximately $60.8 million around the same time in the prior year. It is estimated that most of the projects in the current sales backlog will be produced within 12 months, but a few will be produced over multiple years.
Backlog As of March 12, 2024, the Company's sales backlog was approximately $60.8 million as compared to approximately $52.4 million at approximately the same time in 2023. It is estimated that most of the projects in the sales backlog will be produced within 12 months, but a few will be produced over multiple years.
Backlog As of March 3, 2025, the Company's sales backlog was approximately $59.5 million as compared to approximately $60.8 million at approximately the same time in 2024. It is estimated that most of the projects in the sales backlog will be produced within 12 months, but a few will be produced over multiple years.
The Company has a mortgage note payable to Summit Community Bank (the “Bank”) for the construction of its North Carolina facility.
The Company has a mortgage note payable to Burke & Herbert Bank & Trust Company, formally Summit Community Bank (the “Bank”) for the construction of its North Carolina facility.
The Company also anticipates funding related to the Infrastructure Investment and Jobs Act to begin coming through the state and local governments in the latter half of 2024 and beyond to further promote growth in the revenue backlog related to the highway and transportation markets, although no assurance can be provided.
The Company also anticipates funding related to the Infrastructure Investment and Jobs Act to continue coming through the state and local governments in 2025 and beyond to further promote growth in the revenue backlog related to the highway and transportation markets, although no assurance can be provided.
The interest rate per the Promissory Note is fixed at 3.99% per annum, with principal and interest payments payable monthly over 120 months in the amount of $27. The loan matures on March 27, 2030. The balance of the note payable at December 31, 2023 was $1,814.
The interest rate per the Promissory Note is fixed at 3.99% per annum, with principal and interest payments payable monthly over 120 months in the amount of $27. The loan matures on March 27, 2030.
Increases in such rates will only affect the interest paid by the Company if new debt is obtained, or the available line of credit is drawn upon, with a variable interest rate.
This leaves the Company almost impervious to fluctuating interest rates. Increases in such rates will only affect the interest paid by the Company if new debt is obtained, or an available line of credit is drawn upon, with a variable interest rate.
The Company had an effective rate of 40.0% for the year ended December 31, 2023 compared to an effective rate of 15.4% for the same period in 2022. The increase in the effective tax rate is attributed to the increase in the Company’s state tax liability for a true-up of state tax expense.
The Company had an effective rate of 21.7% for the year ended December 31, 2024 compared to an effective rate of 40.0% for the same period in 2023. The decrease in the effective tax rate is attributed to the increase in the Company’s state tax liability for a true-up of state tax expense during 2023.
Net Income – The Company had net income of $795 for the year ended December 31, 2023, compared to net income of $800 for the same period in 2022. The basic and diluted earnings per share was $0.15 for 2023 compared to basic and diluted earnings per share of $0.15 for the year ended December 31, 2022.
Net Income – The Company had net income of $7,675 for the year ended December 31, 2024, compared to net income of $795 for the same period in 2023. The basic and diluted earnings per share was $1.45 for 2024 compared to basic and diluted earnings per share of $0.15 for the year ended December 31, 2023.
The Company’s inventory at December 31, 2023 was $5,150 and at December 31, 2022 was $3,818, an increase of $1,331. The annual inventory turns for 2023 and 2022 were 15.0 and 14.1, respectively. Critical Accounting Policies and Estimates The Company’s significant accounting policies are more fully described in its Summary of Accounting Policies to the Company’s consolidated financial statements.
The Company’s inventory at December 31, 2024 was $6,677 and at December 31, 2023 was $5,150, an increase of $1,528. The annual inventory turns for 2024 and 2023 were 10.0 and 15.0, respectively. Critical Accounting Policies and Estimates The Company’s significant accounting policies are more fully described in its Summary of Accounting Policies to the Company’s consolidated financial statements.
Total cost of sales as a percentage of total revenue, not including royalties, increased to 86% for the year ended December 31, 2023 from 85% for the year ended December 31, 2022.
Total cost of sales as a percentage of total revenue, not including royalties, decreased to 78% for the year ended December 31, 2024 from 86% for the year ended December 31, 2023.
The increase in backlog was due to an increase in orders for products to be produced at all three manufacturing facilities, as well as an increase in the barrier rental backlog, as compared to the prior year. The Company expects the backlog to increase with continued bidding on large infrastructure and SlenderWall/architectural projects, although no assurance can be given.
The backlog remained consistent with the prior year level due to continued sales efforts for products to be produced at all three manufacturing facilities, as well as consistent sales efforts in barrier rentals. The Company expects the backlog to increase with continued bidding on large infrastructure and SlenderWall/architectural projects, although no assurance can be given.
The Company anticipates capital spending for 2024 to be approximately $5,000, which includes expansion of the North Carolina manufacturing facility, soundwall forms for increased production capacity, and miscellaneous manufacturing equipment. Anticipated capital expenditures excludes acquisitions. The Company's notes payable are financed at fixed rates of interest. This leaves the Company almost impervious to fluctuating interest rates.
Capital expenditures in 2024 were primarily related to spending for the expansion of the North Carolina production facility and new manufacturing equipment. The Company anticipates capital spending for 2025 to be approximately $5,000, which includes forms for increased production capacity, and miscellaneous manufacturing equipment. Anticipated capital expenditures excludes acquisitions. The Company's notes payable are financed at fixed rates of interest.
Income Tax Expense – The Company had income tax expense of $528 for the year ended December 31, 2023 compared to income tax expense of $145 for the year ended December 31, 2022.
Income Tax Expense – The Company had income tax expense of $2,143 for the year ended December 31, 2024 compared to income tax expense of $528 for the year ended December 31, 2023.
The Company had $5,789 of debt obligations at December 31, 2023, of which $636 is scheduled to mature within twelve months. During the twelve months ended December 31, 2023, the Company made repayments of outstanding debt in the amount $627.
The Company had $5,094 of debt obligations at December 31, 2024, of which $658 is scheduled to mature within twelve months. During the twelve months ended December 31, 2024, the Company made repayments of outstanding debt in the amount $635.
Income tax expense for 2023 was $528, or an effective tax rate of 40.0%, as compared to $145, or an effective tax rate of 15.4% for 2022, adversely affecting net income in 2023. The increase was mainly due to an increase in state tax liability for a true-up of state tax expense.
Income tax expense for 2024 was $2,143, or an effective tax rate of 21.7%, as compared to $528, or an effective tax rate of 40.0% for 2023, adversely affecting net income in 2023. The greater percentage in 2023 was mainly due to an increase in state tax liability for a true-up of state tax expense.
Barrier rental revenue, excluding revenue from special barrier projects, is expected to trend higher in 2024 as compared to barrier rental revenue, excluding revenue from special barrier projects, in 2023, as funding increases related to the Infrastructure Investment and Jobs Act, although no assurance can be given. Royalty Income – Royalties increased by 5% in 2023 as compared to 2022.
Barrier rental revenue, excluding revenue from special barrier projects, is expected to trend higher in 2025 as compared to barrier rental revenue, excluding revenue from special barrier projects, in 2024, as funding is expected to increase related to the Infrastructure Investment and Jobs Act, although no assurance can be given.
Installation revenue results when attaching architectural wall panels to a building, installing an Easi-Set® building at a customers' site, setting highway barrier, or setting any of our other precast products at a site specific to the requirements of the owner. Shipping and installation revenues decreased by 11% for 2023 when compared to 2022.
Installation activities include installation of our products at the customers’ construction site. Installation revenue results when attaching architectural wall panels to a building, installing an Easi-Set ® building at a customers' site, setting highway barrier, or setting any of our other precast products at a site specific to the requirements of the owner.
The commitment for the guidance line of credit matures on October 1, 2024. As of December 31, 2023, the Company had not purchased any equipment pursuant to the $1,500 commitment. 17 At December 31, 2023, the Company had cash totaling $9,175 compared to cash totaling $6,726 at December 31, 2022.
The commitment for the guidance line of credit matured on October 1, 2024. As of October 31, 2024, the Company had not purchased any equipment pursuant to the $1,500 commitment. 17 At December 31, 2024, the Company had cash totaling $7,548 compared to cash totaling $9,175 at December 31, 2023. Cash provided by operations was $5,584.
Inflation Management believes that the Company's operations were affected by inflation in 2023 and 2022, particularly in the purchases of certain raw materials such as cement, aggregates, and steel, and with labor costs. The Company believes that raw material pricing and labor costs will increase in 2024, although no assurance can be given regarding future pricing or costs.
Inflation Management believes that the Company's operations were affected by inflation in 2024 and 2023, particularly in the purchases of labor costs will increase in 2025, although no assurance can be given regarding future pricing or costs.
Utility sales are expected to trend similar during 2024 as compared to 2023, although no assurance can be provided. Miscellaneous Product Sales – Miscellaneous products are products that are produced or sold that do not meet the criteria defined for other revenue categories. Examples would include precast concrete slabs, blocks or small add-on items.
Miscellaneous Product Sales – Miscellaneous products are products that are produced or sold that do not meet the criteria defined for other revenue categories. Examples would include precast concrete slabs, blocks or small add-on items. For 2024, miscellaneous product sales increased by 120% when compared to 2023.
Cost of sales as a percentage of revenue, not including royalties, remained flat at 85% for the fourth quarter 2023 as compared to the fourth quarter 2022. Operating income was $1,118 for 2023, as compared to $854 for 2022. Operating expenses for 2023 was $9,534 compared to $8,614 in 2022.
Cost of sales as a percentage of revenue, not including royalties, decreased to 80% for the fourth quarter 2024 as compared to 85% for the fourth quarter 2023. Operating income was $9,899 for 2024, as compared to $1,118 for 2023. Operating expenses for 2024 was $10,111 compared to $9,534 in 2023.
On February 10, 2022, the Company completed the financing for its acquisition of certain real property in Midland, VA from the fourth quarter of 2021, totaling approximately 29.8 acres, with a note payable to the Bank in the amount of $2,805. The loan is collateralized by a first lien position on the related real property.
On February 10, 2022, the Company completed the financing for its acquisition of certain real property in Midland, VA from the fourth quarter of 2021, totaling approximately 29.8 acres, with a note payable to the Bank. The balance of the note payable at December 31, 2024 was $2,379.
Cost of Sales – Total cost of sales for the year ended December 31, 2023 was $48,928, an increase of $8,266, or 20%, from $40,662 for the year ended December 31, 2022.
Cost of Sales – Total cost of sales for the year ended December 31, 2024 was $58,498, an increase of $9,570, or 20%, from $48,928 for the year ended December 31, 2023.
Results of Operations Year ended December 31, 2023 compared to the year ended December 31, 2022 For the year ended December 31, 2023, the Company had total revenue of $59,580 compared to total revenue of $50,131 for the year ended December 31, 2022, an increase of $9,449 or 19%.
Results of Operations Year ended December 31, 2024 compared to the year ended December 31, 2023 For the year ended December 31, 2024, the Company had total revenue of $78,508 compared to total revenue of $59,580 for the year ended December 31, 2023, an increase of $18,928 or 32%.
The Company also has a note payable to the Bank in the amount of $2,701. The loan is collateralized by a first lien position on the Midland, VA plant, building, and assets. The refinance also released the lien on the Smith-Columbia plant in Hopkins, South Carolina (Columbia).
The Company also has a note payable to the Bank in the amount of $1,536 as of December 31, 2024. The loan is collateralized by a first lien position on the Midland, VA plant, building, and assets.
The interest rate is fixed at 4.09% per annum, with principal and interest payments payable monthly over 180 months for $21. The loan matures on February 10, 2037. The balance of the note payable on December 31, 2023 was $2,547.
The loan is collateralized by a first lien position on the related real property. The interest rate is fixed at 4.09% per annum, with principal and interest payments payable monthly over 180 months for $21. The loan matures on February 10, 2037.
Miscellaneous wall sales increased by 85% in 2023 when compared to 2022 due to the increased amount of wall panel projects in Virginia and increased retaining wall projects in South Carolina. Miscellaneous sales are expected to trend similar in 2024, as compared to 2023, although no assurance can be provided.
Miscellaneous sales are expected to be similar in 2025, as compared to 2024, although no assurance can be provided. Barrier Sales – Barrier sales decreased by 50% in 2024 when compared to 2023. The decrease is due to the completion of large barrier projects in North Carolina and South Carolina during 2023.
Selling expenses increased during 2023 due to additional salespersons hired, increased commissions related to the increased sales, and increased spending for advertising. The Company expects selling expenses to increase in future periods with the plan for additional sales associates and increased advertising spending aligning with the strategy to increase SlenderWall sales and barrier rentals.
Selling Expenses – Selling expenses for the year ended December 31, 2024 increased by $13, or 0%, to $3,557 from $3,544 for the year ended December 31, 2023. The Company expects selling expenses to increase in future periods with the plan for additional sales associates and increased advertising spending aligning with the strategy to increase SlenderWall sales and barrier rentals.
Increased material and labor costs also affected margins for the year ended December 31, 2023 as compared to the same period in 2022. General and Administrative Expenses – For the year ended December 31, 2023, the Company's general and administrative expenses increased by $439, or 8%, to $5,990 from $5,551 during the same period in 2022.
General and Administrative Expenses – For the year ended December 31, 2024, the Company's general and administrative expenses increased by $564, or 9%, to $6,554 from $5,990 during the same period in 2023.
The increase is mainly due to higher production volumes at the North Carolina and South Carolina plants reflecting larger soundwall projects than in the prior period. The Company expects soundwall panel sales to be similar in 2024 as compared to 2023, although no assurance can be provided.
The increase is due to higher production volumes at all three plants, as the Company increased production output to execute and deliver on the Company’s increased backlog. The Company expects soundwall panel sales to be similar in 2025 as compared to 2024, although no assurance can be provided.
The Company additionally has two smaller installment loans with annual interest rates of 2.90% and 3.99%, maturing in 2025, with balances totaling $29. Under the loan covenants with the Bank, the Company is limited to annual capital expenditures of $5,000 and must maintain tangible net worth of $10,000.
The Company additionally has one smaller installment loan with an annual interest rate of 2.90%, maturing in 2025, with a balance totaling $13. Under the loan covenants with the Bank, the Company is limited to annual capital expenditures of $5,000 and has received a waiver for 2024 from the Bank.
Architectural Sales – Architectural panel sales decreased by 74% in 2023 compared to 2022. The decrease is from the completion of two architectural projects in the third quarter of 2022. Architectural sales are expected to be higher during 2024, as compared to 2023, although no assurance can be provided.
Architectural Sales – Architectural panel sales increased by 272% in 2024 compared to 2023. The increase is related to production of two architectural projects that started production at the end of the first quarter of 2024. Architectural sales are expected to be similar in 2025, as compared to 2024, although no assurance can be provided.
The line of credit is evidenced by a commercial revolving promissory note, which carries a variable interest rate of prime, with a floor of 3.50%, and matures on October 1, 2024. The loan is collateralized by a first lien position on the Company's accounts receivable and inventory and a second lien position on all other business assets.
The line of credit was renewed on January 1, 2025 and matures January 1, 2026. The loan is collateralized by a first lien position on the Company's accounts receivable and inventory and a second lien position on all other business assets.
The Company had net income for 2023 of $795 compared to net income of $800 for 2022. Total revenue increased by $9,449 to $59,580 in 2023 from $50,131 in 2022. The increase in sales is mainly from an increase in SlenderWall, soundwall, and miscellaneous wall sales. Fourth quarter 2023 revenues were $16,389 compared to $14,487 in the fourth quarter 2022.
The Company had net income for 2024 of $7,675 compared to net income of $795 for 2023. Total revenue increased by $18,928 to $78,508 in 2024 from $59,580 in 2023. The increase in sales is mainly from barrier rentals, shipping and installation, and utility product sales. Fourth quarter 2024 revenues were $18,528 compared to $16,389 in the fourth quarter 2023.
The Company is in compliance with all covenants pursuant to the loan agreements as of December 31, 2023. In addition to the notes payable discussed above, the Company has a $5,000 line of credit with the Bank with no balance outstanding as of December 31, 2023.
In addition to the notes payable discussed above, the Company has a $5,000 line of credit with the Bank with no balance outstanding as of December 31, 2024. The line of credit is evidenced by a commercial revolving promissory note, which carries a variable interest rate of prime, with a floor of 4.99%.
The increase is due to increased selling costs associated with additional sales personnel and increased general and administrative costs due to increased insurance costs for a specific project in New York. Total operating expense was $2,580 for both the fourth quarter 2023 and the fourth quarter 2022.
The increase is due to a minor increase in general and administrative expenses. Total operating expense was $2,519 for the fourth quarter 2024 and $2,580 for the fourth quarter 2023.
The increase in royalties is mainly due to the increase in barrier royalties during 2023 compared to 2022. As funding increases related to the Infrastructure Investment and Jobs Act, the Company expects 2024 royalties to increase compared to 2023, although no assurance can be given.
As funding increases related to the Infrastructure Investment and Jobs Act, as anticipated, the Company expects 2025 royalties to continue to increase compared to 2024, although no assurance can be given. Shipping and Installation – Shipping revenue results from shipping our products to the customers' final destination and is recognized when the shipping services take place.
The Company continues to focus sales initiatives on SlenderWall, but no assurance can be given as to the success of this endeavor. SlenderWall sales are expected to be lower during 2024, as compared to 2023. Miscellaneous Wall Sales – Miscellaneous wall sales are highly customized precast concrete products or retaining and lagging panels that do not fit other product categories.
Miscellaneous Wall Sales – Miscellaneous wall sales are highly customized precast concrete products or retaining and lagging panels that do not fit other product categories. Miscellaneous wall sales decreased by 20% in 2024 when compared to 2023 due lower production volumes in the second and third quarter 2024.
Barrier sales are expected to trend lower in 2024 than previous years as the Company continues to shift from barrier sales to barrier rentals. Easi-Set® and Easi-Span® Building Sales – The Easi-Set® Buildings program includes Easi-Set®, plant assembled and Easi-Span®, site assembled, and an extensive line of pre-engineered restrooms.
Easi-Set ® and Easi-Span® Building Sales – The Easi-Set ® Buildings program includes Easi-Set ® , plant assembled and Easi-Span ® , site assembled, and an extensive line of pre-engineered restrooms. Building sales increased by 41% in 2024 as compared to 2023 due to increased sales at all locations, reflecting general product sale fluctuations.
Building sales increased by 15% in 2023 as compared to 2022 due to increased sales at all locations, reflecting general product sale fluctuations. Building and restroom sales are expected to continue to trend similar during 2024 as compared to 2023, although no assurance can be provided.
Building and restroom sales are expected to trend higher during 2025 as compared to 2024 due to demand from increased sales and marketing, although no assurance can be provided. Utility Sales – Utility products are mainly comprised of underground utility vaults used in infrastructure construction. Utility product sales increased by 171% in 2024 compared to 2023.
Miscellaneous product sales are expected to trend lower during 2024 as compared to 2023, although no assurance can be provided. 15 Barrier Rentals – Barrier rentals decreased by 3% in 2023 as compared to 2022. Revenue from the Company’s core rental barrier fleet decreased by 43% in 2023 as compared to 2022.
The increase is mainly from the Virginia plant that started production on one large project for the production of precast beams and platforms. Miscellaneous product sales are expected to trend lower during 2025 as compared to 2024, although no assurance can be provided. 15 Barrier Rentals – Barrier rentals increased by 90% in 2024 as compared to 2023.
Operating Income – The Company had operating income for the year ended December 31, 2023 of $1,118 compared to operating income of $854 for the year ended December 31, 2022, an increase of $264, or 31%. The increase in operating income was mainly due to the increase in gross profit and decrease in operating expenses as a percent of revenue.
Operating Income – The Company had operating income for the year ended December 31, 2024 of $9,899 compared to operating income of $1,118 for the year ended December 31, 2023, an increase of $8,781, or 785%.
The increase in revenue for the fourth quarter 2023 as compared to the fourth quarter 2022 was primarily due to an increase in barrier rental and an increase in soundwall sales.
The increase in revenue for the fourth quarter 2024 as compared to the fourth quarter 2023 was primarily due to an increase in soundwall sales, architectural sales, utility sales, miscellaneous sales, Easi-Set building sales, and shipping and installation revenue. Cost of sales as a percentage of revenue, not including royalties, decreased to 78% in 2024 compared to 86% in 2023.
The increase is primarily the result of increased revenue and to a lesser extent, lagging effects of turnover of the accounts receivable position throughout the later part of 2022 and through the first quarter of 2023. The Company expects DSO to trend downwards, with increased collection efforts, although no assurance can be provided.
The Company’s accounts receivable balance, net of allowance for credit losses, at December 31, 2024 was $19,420, compared to accounts receivable balance, net of allowance for credit losses, of $17,209 at December 31, 2023. The increase is primarily the result of increased revenue. The Company expects DSO to trend downwards, with increased collection efforts, although no assurance can be provided.
The Company continues to increase marketing and sales efforts towards SlenderWall sales and barrier rentals, in line with long-term strategic objectives.
State and local programs that support infrastructure spending, including gas tax increases, special tax districts, new funding mechanisms are increasing in number and size as these entities increase their role in infrastructure investment. The Company continues to increase marketing and sales efforts towards SlenderWall sales and barrier rentals, in line with long-term strategic objectives.
The decrease is mainly attributed to the decrease in shipping and installation of SlenderWall and architectural panels. This is associated with the decreased production of SlenderWall and architectural panels that occurred in the third and fourth quarters of 2022 that would typically be shipped and installed throughout 2023.
Shipping and installation revenues increased by 48% for 2024 when compared to 2023. The increase is mainly attributed to the increase in shipping and installation of SlenderWall and architectural panels. This increase in shipping and installation revenue correlates with the increased production of SlenderWall panels that occurred, and for which revenue was previously recognized, throughout 2023.
Utility Sales – Utility products are mainly comprised of underground utility vaults used in infrastructure construction. Utility product sales increased by 41% in 2023 compared to 2022. The increase is related to the increase in the market for dry utility vaults to support the growth in data centers.
The increase is related to the increase in the market for dry utility vaults to support the growth in data centers. Utility sales are expected to be similar during 2025 as compared to 2024, although no assurance can be provided.
The decrease in barrier rental revenue from the core rental in the current year, was offset, in part, by an increase in barrier rental revenue from special barrier projects. Barrier rental revenue from special projects increased 157% in 2023 as compared to 2022.
Revenue from the Company’s core rental barrier fleet increased by 52% in 2024 as compared to 2023. This increase is attributed to an increase in utilization of rental barrier. Barrier rental revenue also increased due to multiple special barrier projects occurring and completed during the third quarter 2024.
The increase in cost of sales as a percentage of revenue, not including royalties, is mainly due to additional costs incurred, approximately $400, for the production of panels remade for one specific project in the second quarter of 2023.
The decrease in cost of sales as a percentage of revenue, not including royalties, is mainly due to higher revenue levels in 2024 than in 2023 having a favorable effect on margins reflecting the absorption of fixed overhead costs.
General and administrative expenses for the year ended December 31, 2023 also increased over the prior year due to an increase in audit fees and an increase in salaries and wages. Selling Expenses – Selling expenses for the year ended December 31, 2023 increased by $480, or 16%, to $3,544 from $3,064 for the year ended December 31, 2022.
General and administrative expenses for the year ended December 31, 2023 increased over the prior year due higher salary and wage rates, and an increase in the allowance for credit losses. General and administrative expenses were 8% and 10% of revenues for the years ended December 31, 2024 and 2023, respectively.
SlenderWall Sales – SlenderWall panel sales increased by 257% in 2023 compared to 2022. The increase is due to two projects being produced consecutively throughout 2023 in comparison to a single project in 2022, which production was completed in the first quarter of 2022.
SlenderWall Sales – SlenderWall panel sales decreased by 100% in 2024 compared to 2023. A SlenderWall project was in production during the first half of 2023, and the Company did not have a SlenderWall project in production during 2024.
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Cost of sales as a percentage of revenue, not including royalties, increased to 86% in 2023 compared to 85% in 2022 due to additional costs, approximately $400, incurred for the remaking of panels for a specific project in the second quarter of 2023.
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In view of the policies of the new Administration and DOGE, including without limitation with respect to government spending cutbacks and tariffs, there can be no assurance of anticipated levels of infrastructure spending.
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Barrier Sales – Barrier sales increased by 17% in 2023 when compared to 2022. The increase is due to large barrier projects at all three manufacturing facilities that had significant production volumes in the first and third quarters of 2023.
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The Company continues to focus sales initiatives on SlenderWall, but no assurance can be given as to the success of this endeavor. SlenderWall sales are expected to increase in 2025 compared to 2024, as several SlenderWall projects are anticipated to start in the first half of 2025.
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For 2023, miscellaneous product sales increased by 73% when compared to 2022. The change is mainly attributed to specialty products produced at the South Carolina plant throughout 2023.
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The decrease is consistent with the Company’s focus to shift from barrier sales to barrier rentals. Barrier sales are expected to trend lower in 2025 than previous years as the Company continues to shift from barrier sales to barrier rentals.
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The decrease in barrier rental revenue from the core rental barrier fleet was due to additional revenue recognized in the prior period related to the barrier buy-back agreement, which was fully recognized as of December 31, 2022.
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Royalty Income – Royalties increased by 24% in 2024 as compared to 2023. The increase in royalties is mainly due to the increase in barrier royalties during 2024 compared to 2023.
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Additionally, the decrease is related to a temporary slowdown in barrier rental projects during the first half of 2023, however the Company saw a significant increase in projects during the fourth quarter of 2023.
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In addition, the decrease in cost of sales as a percentage of revenue, not including royalties, was due to production throughout 2024 related to contracts that factored in the rising inflationary costs experienced throughout 2022 and 2023, and a one-time expense related to panels the Company chose to remake for one specific customer related to defective steel from a supplier used in the initial product in 2023.
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Shipping and Installation – Shipping revenue results from shipping our products to the customers' final destination and is recognized when the shipping services take place. Installation activities include installation of our products at the customers’ construction site.
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The increase in operating income was mainly due to the increase in revenues, decrease in cost of sales as a percentage of revenue, and a relatively flat operating expenses as a percent of revenue.
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To a lesser extent, the margins for the year ended December 31, 2023 were negatively impacted by the decrease in revenues derived from barrier rental revenue, which carry higher margins than product sales. Higher revenue levels in 2023 than in 2022 had a favorable affect on margins reflecting the absorption of fixed overhead costs.
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Also under the loan covenants with the Bank, the Company must maintain tangible net worth of $25,000. The Company is in compliance with all covenants pursuant to the loan agreements as of December 31, 2024.
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The increase is mainly attributed to increased insurance costs for a specific project in New York. The Company previously reported a loss due to a wire fraud incident in the second quarter of 2023. The Company recovered additional funds in the fourth quarter of 2023 resulting in a net loss of $25 for the full year 2023.
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Cash disbursements from investing activity was $6,576. Cash repayments on borrowings was $635. The decrease in cash is primarily the result of cash used for capital expenditures, specifically the expansion of the manufacturing facility in North Carolina. Capital spending, including financed additions, increased from $5,010 in 2023 to $6,629 in 2024.

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