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

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

+247 added−284 removedSource: 10-K (2025-07-30) vs 10-K (2024-09-13)

Top changes in TECHPRECISION CORP's 2025 10-K

247 paragraphs added · 284 removed · 191 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe revenue derived from all of our customers in the designated industry groups for the fiscal years ended March 31, 2024 and 2023 are displayed in the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) 2024 2023 Net Sales ​ Amount Percent ​ Amount Percent ​ Defense ​ $ 31,406 ​ 99 % $ 30,935 98 % Precision Industrial ​ $ 185 ​ 1 % $ 497 2 % ​ The following table displays revenue generated by individual customers in specific industry sectors that accounted for 10% or more of our revenue in either fiscal 2024 or fiscal 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) 2024 2023 Net Sales ​ Amount Percent ​ Amount Percent ​ Defense Customer 1 ​ $ 9,050 ​ 28 % $ 6,352 20 % Defense Customer 2 ​ $ * ​ * % $ 4,780 15 % Defense Customer 3 ​ $ 3,831 ​ 12 % $ 3,249 10 % Defense Customer 4 ​ $ 3,258 ​ 10 % $ * * % Defense Customer 5 ​ $ 3,320 ​ 10 % $ 5,839 ​ 19 % * Less than 10% of total On March 31, 2024, we had a backlog of orders totaling $50.0 million.
Biggest changeThe revenue derived from all of our customers in the designated industry groups for the fiscal years ended March 31, 2025 and 2024 are displayed in the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) 2025 2024 Revenue ​ Amount Percent ​ Amount Percent ​ Defense ​ $ 33,599 ​ 99 % $ 31,406 99 % Precision Industrial ​ $ 432 ​ 1 % $ 185 1 % ​ The following table displays revenue generated by individual customers in specific industry sectors that accounted for 10% or more of our revenue in fiscal 2025 and 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) 2025 2024 Revenue ​ Amount Percent ​ Amount Percent ​ Defense Customer A ​ $ 5,795 ​ 17 % $ 10,295 32 % Defense Customer B ​ $ 3,327 ​ 10 % $ 3,320 10 % Defense Customer C ​ $ 4,947 ​ 15 % $ 3,258 10 % Defense Customer D ​ $ * ​ * % $ * * % Defense Customer E ​ $ 7,671 ​ 22 % $ 5,005 ​ 16 % Defense Customer F ​ $ 5,003 15 % $ * * % * Less than 10% of total The following table displays total revenue generated by the individual customers in the above table by segment that accounted for 10% or more of our revenue in fiscal 2025 and 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) ​ 2025 ​ 2024 Revenue Amount Percent Amount Percent Ranor ​ $ 15,576 46 % $ 15,628 49 % Stadco ​ $ 11,167 33 % $ 6,250 19 % ​ On March 31, 2025, we had a backlog of orders totaling $48,625.
Our defense customers are engaged in the development, delivery and support of advanced defense, security, and aerospace systems, including the U.S. Navy’s Virginia-class fast attack submarine program and the U.S. Navy’s Columbia-class ballistic missile submarine program. We also manufacture large flight-critical components on several high-profile commercial and military aircraft programs, including military helicopters.
Our defense customers are engaged in the development, delivery and support of advanced defense and aerospace systems, including the U.S. Navy’s Virginia-class fast attack submarine program and the U.S. Navy’s Columbia-class ballistic missile submarine program. We also manufacture large flight-critical components on several high-profile commercial and military aircraft programs, including military helicopters.
If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such event, we would be at a disadvantage in seeking to obtain that contract.
If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such an event, we would be at a disadvantage in seeking to obtain that contract.
We believe that we are currently in compliance with applicable environmental regulations. As part of our normal business practice, we are required to develop and file reports and maintain logbooks that document all environmental issues within our organization. We may engage outside consultants to assist us in keeping current on developments in environmental regulations.
We believe that we are currently compliant with applicable environmental regulations. As part of our normal business practice, we are required to develop and file reports and maintain logbooks that document all environmental issues within our organization. We may engage outside consultants to assist us in keeping current on developments in environmental regulations.
Expenditures for environmental compliance purposes during fiscal 2024 and 2023 were not material. Occupational Health and Safety Laws Our business and operations are subject to numerous federal, state, and local laws and regulations intended to protect our employees. Due to the nature of manufacturing, we are subject to substantial regulations related to safety in the workplace.
Expenditures for environmental compliance purposes during fiscal 2025 and 2024 were not material. Occupational Health and Safety Laws Our business and operations are subject to numerous federal, state, and local laws and regulations intended to protect our employees. Due to the nature of manufacturing, we are subject to substantial regulations related to safety in the workplace.
We are also subject to laws and regulations applicable to manufacturing operations, such as federal and state occupational health and safety laws, and environmental laws, which are discussed in more detail below under “-Environmental Compliance .” 6 Table of Contents Environmental Compliance We are subject to U.S. federal, state and local environmental laws and regulations that pertain to the use, disposal and cleanup of substances regulated by those laws and the filing of reports with environmental agencies, and we are subject to periodic inspections to monitor our compliance.
We are also subject to laws and regulations applicable to manufacturing operations, such as federal and state occupational health and safety laws, and environmental laws, which are discussed in more detail below under “-Environmental Compliance .” Environmental Compliance We are subject to U.S. federal, state and local environmental laws and regulations that pertain to the use, disposal and cleanup of substances regulated by those laws and the filing of reports with environmental agencies, and we are subject to periodic inspections to monitor our compliance.
On February 24, 2006, we acquired all of the issued and outstanding capital stock of our wholly owned subsidiary Ranor, Inc., or “Ranor.” On March 6, 2006, following the acquisition of Ranor, we changed our corporate name to TechPrecision Corporation. Ranor, together with its predecessors, has been in 3 Table of Contents continuous operation since 1956.
On February 24, 2006, we acquired all of the issued and outstanding capital stock of our wholly owned subsidiary Ranor, Inc., or “Ranor.” On March 6, 2006, following the acquisition of Ranor, we changed our corporate name to TechPrecision Corporation. Ranor, together with its predecessors, has been in continuous operation since 1956.
We provide our employees base wages and salaries that we believe are competitive and consistent with employee positions, and work with local, regional, and state-wide agencies to facilitate workforce hiring and development initiatives. As of March 31, 2024, we had 162 employees, of whom all are full time employees.
We provide our employees with base wages and salaries that we believe are competitive and consistent with employee positions, and work with local, regional, and state-wide agencies to facilitate workforce hiring and development initiatives. As of March 31, 2025, we had 152 employees, of whom all are full-time employees.
In the fiscal year ended March 31, 2023, or “fiscal 2023”, one supplier accounted for 10% or more of our purchased material. Marketing While we have significant customer concentration, we endeavor to broaden our customer base as well as the industries we serve.
In the fiscal year ended March 31, 2024, or “fiscal 2024”, one supplier accounted for 10% or more of our purchased material. Marketing While we have significant customer concentration, we endeavor to broaden our customer base as well as the industries we serve.
A significant loss of business from our largest customer or a combination of several of our significant customers could result in lower operating profitability and/or operating losses if we are unable to replace such lost revenue from other sources.
We historically have experienced, and continue to experience, customer concentration. A significant loss of business from our largest customer or a combination of several of our significant customers could result in lower operating profitability and/or operating losses if we are unable to replace such lost revenue from other sources.
These materials may include, but are not limited to steel, nickel, monel, inconel, aluminum, stainless steel, and other alloys. Certain of these materials are subject to long-lead time delivery schedules. In the fiscal year ended March 31, 2024, or “fiscal 2024”, one supplier accounted for 10% or more of our purchased material.
These materials may include, but are not limited to steel, nickel, monel, inconel, aluminum, stainless steel, and other alloys. Certain of these materials are subject to long-lead time delivery schedules. In the fiscal year ended March 31, 2025, or “fiscal 2025”, four suppliers accounted for 10% or more of our purchased material.
Source of Supply Our manufacturing operations are partly dependent on the availability of raw materials. Most of our contracts with customers require the use of customer-supplied raw materials in the manufacture of their product. Accordingly, raw material requirements vary with each contract and are dependent upon customer requirements and specifications. We have established relationships with numerous suppliers.
Most of our contracts with customers require the use of customer-supplied raw materials in the manufacture of their product. Accordingly, raw material requirements vary with each contract and are dependent upon customer requirements and specifications. We have established relationships with numerous suppliers.
Pursuant to Section 7.01(f) of the Purchase Agreement, in the event that the Closing (as defined in the Purchase Agreement) had not occurred by the Outside Date (as defined in the Purchase Agreement) either the Company or the Seller had the right to terminate the Purchase Agreement, subject to the party terminating having complied with the other required closing conditions.
Pursuant to Section 7.01(f) of the Purchase Agreement, since the Closing (as defined in the Purchase Agreement) did not occur by the Outside Date, March 31, 2024, either the Company or the Seller had the right to terminate the Purchase Agreement, subject to the party terminating having complied with the other required closing conditions.
We expect to deliver the backlog over the course of the next two to three fiscal years. The comparable backlog on March 31, 2023 was $44.0 million. Competition We face competition from both domestic and foreign entities in the manufacture of metal fabricated and machined precision components and equipment.
We expect to deliver the backlog over the course of the next two to three fiscal years. The comparable backlog on March 31, 2024 was $49,500. 6 Table of Contents Competition We face competition from both domestic and foreign entities in the manufacture of metal-fabricated and machined precision components and equipment.
At Ranor and Stadco, 20 and 19 employees are salaried, and 67 and 56 employees are hourly, respectively. None of our employees are represented by a labor union. Available Information We maintain a website at techprecision.com.
At Ranor and Stadco, 21 and 21 employees are salaried, and 60 and 50 employees are hourly, respectively. None of our employees are represented by a labor union. Available Information We maintain a website at techprecision.com.
Our ten largest customers generated approximately 93% and 96% of our total revenue in fiscal 2024 and fiscal 2023, respectively. Our group of largest customers can change from year to year. Our largest single customer in fiscal 2024 and fiscal 2023 was a prime defense contractor and accounted for 28% and 20% of our net sales, respectively.
Our ten largest customers generated 96% and 93% of our total revenue in fiscal 2025 and fiscal 2024, respectively. Our group of largest customers can change from year to year. Our largest single customer in fiscal 2025 and fiscal 2024 was a prime defense contractor and accounted for 23% and 32% of our revenue, respectively.
On August 25, 2021, the Company completed its acquisition of Stadco, a company in the business of manufacturing high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers, pursuant to that certain stock purchase agreement with Stadco New Acquisition, LLC, Stadco Acquisition, LLC, Stadco and each equity holder of Stadco Acquisition, LLC.
From February 24, 2006, until our acquisition of Stadco in August 2021, our primary business has been the business of Ranor. 3 Table of Contents On August 25, 2021, the Company completed its acquisition of Stadco, a company in the business of manufacturing high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers, pursuant to that certain stock purchase agreement with Stadco New Acquisition, LLC, Stadco Acquisition, LLC, Stadco and each equity holder of Stadco Acquisition, LLC.
We have two wholly owned subsidiaries that are each reportable segments: Ranor and Stadco. Each reportable segment focuses on the manufacture and assembly of specific components, primarily for defense and other precision industrial customers. For discussion of the operating results of our reporting business segments, refer to “Item 7.
Each reportable segment focuses on the manufacture and assembly of specific components, primarily for defense and other precision industrial customers. For discussion of the operating results of our reporting business segments, refer to “Item 7.
Although we have non-disclosure policies in place with respect to our personnel and in our contractual relationships, we cannot assure you that we will be able to protect our intellectual property rights with respect to this know-how.
Over the course of our business, we develop know-how for use in the manufacturing process. Although we have non-disclosure policies in place with respect to our personnel and in our contractual relationships, we cannot assure you that we will be able to protect our intellectual property rights with respect to this know-how.
These reports are also available at the SEC’s website at www.sec.gov. 7 Table of Contents
These reports are also available at the SEC’s website at www.sec.gov.
For these reasons, we incurred no expenses for research and development in fiscal 2024 and fiscal 2023. Principal Customers A significant portion of our business is generated by a small number of major customers. The balance of our business consists of discrete projects for numerous other customers. As industry and market demand changes, our major customers may also change.
Principal Customers A significant portion of our business is generated by a small number of major customers. The balance of our business consists of discrete projects for numerous other customers. As industry and market demand changes, our major customers may also change.
We work with our customers to manufacture products in accordance with the customers’ drawings and specifications. Our work complies with specific national and international codes and standards applicable to our industry. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service.
Our work complies with specific military specifications and standards as well as national and international codes and standards required by our customers. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service.
Competitive bid quotations are submitted to the customer for review and award of contract. Negotiation bids typically require the submission of additional information to substantiate the quotation. The bidding process can range from several weeks for a competitive bid to several months for a negotiation bid before the customer awards a contract.
Competitive bid quotations are submitted to the customer for review and award of contract. Negotiation bids typically require the submission of additional information to substantiate the quotation.
Research and Product Development Many of our customers generate drawings illustrating their projected unit design and technology requirements. Our research and product development activities are limited and focused on delivering robust production solutions to such projected unit design and technology requirements. We follow this product development methodology in all our major product lines.
Our research and product development activities are limited and focused on delivering robust production solutions to such projected unit design and technology requirements. We follow this product development methodology in all our major product lines. For these reasons, we incurred no expenses for research and development in fiscal 2025 and fiscal 2024.
The finished products are used in a variety of markets including defense, aerospace, nuclear, medical, and precision industrial. Our mission is to be a leading end-to-end service provider to our customers by furnishing custom, fully integrated solutions for complete products that require custom fabrication, precision machining, assembly, integration, inspection, non-destructive evaluation, and testing.
Our mission is to be a leading end-to-end service provider to our customers by furnishing custom, fully integrated solutions for complete products that require custom fabrication, precision machining, assembly, integration, inspection, non-destructive evaluation, and testing. We work with our customers to manufacture products in accordance with the customers’ drawings and specifications.
It has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries.
Stadco has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries. Stadco also manufactures tooling, molds, fixtures, jigs and dies used in the production of defense-centric aircraft components.
The manufacturing operations of our Stadco subsidiary are situated in an industrial warehouse and office location comprised of approximately 183,000 square feet in Los Angeles, California. At this site, Stadco manufactures large flight-critical components on several high-profile commercial and military aircraft programs, including military helicopters.
The manufacturing operations of our Stadco subsidiary are situated in an industrial self-contained multi-building complex comprised of approximately 183,000 square feet under roof in Los Angeles, California. Stadco manufactures large mission-critical components on several high-profile military aircraft, military helicopter, and military space programs.
It is our policy and practice to comply with all legal and regulatory requirements and our procedures and internal controls are designed to promote such compliance. Expenditures for compliance with occupational health and safety laws and regulations during fiscal 2024 and 2023 were not material.
It is our policy and practice to comply with all legal and regulatory requirements and our procedures and internal controls are designed to promote such compliance.
On May 2, 2024, the Company filed a registration statement on Form S-1, related to the offer and resale by the Seller of up to 320,000 shares of our common stock that were issued to the Seller as the Stock Termination Fee, which cannot be declared effective by the Securities and Exchange Commission until we have filed all of the required financial statements, including our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024.
On April 29, 2024, we issued 320,000 shares of the Company’s common stock as the Stock Termination Fee. On May 2, 2024, the Company filed a registration statement on Form S-1, related to the offer and resale by the Seller of up to 320,000 shares of our common stock that were issued to the Seller as the Stock Termination Fee.
References in this annual report to the “Company,” “we,” “us,” “our” and similar words refer to TechPrecision Corporation and its subsidiaries, unless the context indicates otherwise, while references to “TechPrecision” refer to TechPrecision Corporation and not its subsidiaries. General The manufacturing operations of our Ranor subsidiary are situated on approximately 65 acres in North Central Massachusetts.
References in this annual report to the “Company,” “we,” “us,” “our” and similar words refer to TechPrecision Corporation and its subsidiaries, unless the context indicates otherwise, while references to “TechPrecision” refer to TechPrecision Corporation and not its subsidiaries. General TechPrecision, through our wholly owned subsidiaries, is a manufacturer of large-scale metal fabricated and machined precision components and equipment.
The production-based work is repeat work or a single product with multiple quantity releases. 4 Table of Contents Changes in market demand for our manufacturing expertise can be significant and sudden and require us to be able to adapt to the collective needs of the customers and industries that we serve.
Changes in regulations and market demand for our manufacturing expertise can be significant and sudden and requires us to adapt to the needs of the customers that we serve.
Accordingly, we do not distribute the products that we manufacture on the open market, and we do not market any specific products on an on-going basis. We do not own the intellectual property rights to any proprietary marketed product, and we do not manufacture products in anticipation of orders.
We do not own the intellectual property rights to any proprietary marketed product, and we do not manufacture products in anticipation of orders. Manufacturing operations do not commence on any project before we receive a customer’s purchase order. We only consider contracts that cover specific products within the capability of our resources.
We can also provide manufacturing engineering services to assist customers in optimizing their engineering designs for manufacturing efficiency. We do not design the products we manufacture, but rather manufacture according to “build-to-print” requirements specified by our customers.
We do not design the products we manufacture but rather manufacture according to “build-to-print” requirements specified by our customers. Accordingly, we do not distribute the products that we manufacture on the open market, and we do not market any specific products on an on-going basis.
Understanding this dynamic, we believe we have developed the capability to transform our workforce to manufacture products for customers across different industries. We serve customers in the defense, aerospace, nuclear, medical, and precision industrial markets.
Understanding this dynamic, we focus on the defense industry in order to reliably pivot with our defense customers to jointly develop the capability to transform our workforce to manufacture components in accordance with our own and our external customers’ changing requirements. We primarily serve customers in the defense and aerospace markets, secondarily in the precision industrial sectors.
Intellectual Property Rights Presently, we have no registered intellectual property rights other than certain trademarks for our name and other business and marketing materials. Over the course of our business, we develop know-how for use in the manufacturing process.
Expenditures for compliance with occupational health and safety laws and regulations during fiscal 2025 and 2024 were not material. 7 Table of Contents Intellectual Property Rights At present we have no registered intellectual property rights other than certain trademarks for our name and other business and marketing materials.
Removed
The Purchase Agreement includes a provision that the Stock Termination Fee is increased by 48,000 additional shares of the Company’s common stock under certain circumstances, including if the Company fails to use commercially reasonable efforts to cause a registration statement to effect the resale of the shares composing the Stock Termination Fee to become effective as soon as practicable.
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Our work complies with specific national and international codes and standards applicable to our industry. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service. We have two wholly owned subsidiaries that are each a reportable segment Ranor and Stadco.
Removed
On April 29, 2024, we issued 320,000 shares of the Company’s common stock as the Stock Termination Fee.
Added
The registration statement was declared effective by the U.S. Securities and Exchange Commission on January 31, 2025. About Us We are a Delaware corporation organized in 2005 under the name Lounsberry Holdings II, Inc.
Removed
See Note 17, Subsequent Events , to our consolidated financial statements included in Item 8 and Item 1A, “Risk Factors ,” for additional information on the Stock Termination Fee. About Us We are a Delaware corporation organized in 2005 under the name Lounsberry Holdings II, Inc.
Added
These components are used primarily in the defense and aerospace industries, and secondarily in the precision industrial markets. All our operations and customers are in the United States. We work with our customers to manufacture components in accordance with the customers’ drawings and specifications.
Removed
From February 24, 2006, until our acquisition of Stadco in August 2021, our primary business has been the business of Ranor.
Added
The manufacturing operations of our Ranor subsidiary are situated on approximately 65 acres in Westminster, Massachusetts.
Removed
Our 145,000 square foot facility houses state-of-the-art equipment which gives us the capability to manufacture products as large as 100 tons. We offer a full range of services required to transform raw material into precision finished products.
Added
Leveraging our 145,000 square foot facilities, Ranor provides a full range of custom solutions to transform material into precision finished welded components and precision finished machined components up to 100 tons: manufacturing engineering, materials management and traceability, high-precision heavy fabrication (in-house fabrication operations include cutting, press and roll forming, welding, heat treating, assembly, blasting and painting), heavy high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including portable CMM, NonDestructive Testing, and final packaging.
Removed
Our manufacturing capabilities include fabrication operations (cutting, press and roll forming, assembly, welding, heat treating, blasting and painting) and machining operations including CNC (computer numerical controlled) horizontal and vertical milling centers.
Added
All manufacturing at Ranor is performed in accordance with customer requirements. Ranor is an ISO 9001:2015 certificate holder. Ranor is a U.S. defense-centric company with over 95% of its revenue in the defense sector. Ranor is registered and compliant with regulations under the International Traffic in Arms Regulation (“ITAR”).
Removed
We also provide support services to our manufacturing capabilities: manufacturing engineering (planning, fixture and tooling development, and manufacturing), quality control (inspection and testing), materials procurement, production control (scheduling, project management and expediting), and final assembly.
Added
Our Stadco subsidiary, similar to Ranor, provides a full range of custom solutions: manufacturing engineering, materials management and traceability, high-precision fabrication (in-house fabrication operations include waterjet cutting, press forming, welding, and assembly) and high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including both fixed and portable CMM NonDestructive Testing, and final packaging.
Removed
All manufacturing at Ranor’s facility is done in accordance with our written quality assurance program, which meets specific national codes, and international codes, standards, and specifications. The standards used for each customer project are specific to that customer’s needs, and we have implemented such standards into our manufacturing operations.
Added
In addition, Stadco features a large electron beam welding cell, and two NonDestructive Testing work cells, a unique mission-critical technology set. All manufacturing at Stadco is performed in accordance with customer requirements. Stadco is an AS 9100 D and ISO 9001:2015 certificate holder and a NADCAP NonDestructive Testing certificate holder.
Removed
Stadco also provides tooling, customized molds, fixtures, jigs and dies used in the production of aircraft components and operates a large electron beam welding machine allowing it to weld thick pieces of titanium and other metals. Products We manufacture a wide variety of products pursuant to customer contracts and based on individual customer needs.
Added
Stadco is a U.S. defense-centric company with almost all of its revenue in the defense sector. Stadco is registered and compliant with ITAR. All of the Company’s operations, assets, and customers are located in the U.S.
Removed
Manufacturing operations do not commence on any project before we receive a customer’s purchase order. We only consider contracts that cover specific products within the capability of our resources. Although we seek continuous production programs with predictable cost structures that provide long-term integrated solutions for our customers, our activities include a variety of both custom-based and production-based requirements.
Added
Executive management and the financial reporting function is based in Westminster, Massachusetts through our two reportable segments, Ranor and Stadco. 4 Table of Contents Products We manufacture a wide variety of products pursuant to customer contracts and based on individual customer needs. We can also provide manufacturing engineering services to assist customers in optimizing their engineering designs for manufacturing efficiency.
Removed
The custom-based work is typically either a prototype or unique, one-of-a-kind product.
Added
We primarily target repeating custom programs with relatively mature and stable designs in order to provide long-term solutions for our customers. The multi-unit work is repeat work or a single product with multiple quantity releases. Secondarily, our activities include a variety of both multi-unit and one-off requirements. The one-off work is typically either a prototype or a unique, one-of-a-kind component.
Removed
Examples of products we have manufactured within such industries during recent years include, but are not limited to, custom components for ships and submarines, military helicopters, aerospace equipment, components for nuclear power plants and components for large scale medical systems. We manage and report financial information through our two reportable segments, Ranor and Stadco.
Added
Within these sectors, we have manufactured custom components for U.S. Navy submarines and aircraft carriers, USMC military helicopters, defense and aerospace programs. Our contracts are generated both through negotiation with the customer and from bids made pursuant to a request for proposal.
Removed
We have also served customers who supply components to the nuclear power industry. 5 Table of Contents We historically have experienced, and continue to experience, customer concentration.
Added
Our ability to receive contract awards is dependent upon the contracting party’s perception of such factors as our ability to perform on time, our history of performance, including quality, our financial condition, and our ability to price our services competitively. Source of Supply Our manufacturing operations are partly dependent on the availability of raw materials.
Added
The bidding process can range from several weeks for a competitive bid to several months for a negotiation bid before the customer awards a contract. 5 Table of Contents Research and Product Development Many of our customers generate drawings illustrating their projected unit design and technology requirements.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

76 edited+7 added−24 removed123 unchanged
Biggest changeAdditionally, recent events involving limited liquidity, defaults, non-performance or other adverse developments that affect banks, financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have recently and may in the future lead to market-wide liquidity problems, which could impact demand for our products.
Biggest changeHowever, because of our reliance on certain raw materials and energy supplies, an economic environment of rising government tariffs, costs and interest rates could have an unfavorable impact on our operations and financial condition. 10 Table of Contents Additionally, events involving limited liquidity, defaults, non-performance or other adverse developments that affect banks, financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, may lead to market-wide liquidity problems, which could adversely impact our business, our business partners, or industry in ways that we cannot predict at this time.
We plan to closely monitor our expenses and, if required, will reduce operating costs and capital spending to enhance liquidity. There can be no assurance that we will be successful in these efforts.
We plan to closely monitor our expenses and, if required, reduce operating costs and capital spending to enhance liquidity. There can be no assurance that we will be successful in these efforts.
In addition, if we are unable to acquire timely nickel, steel or aluminum supplies, we may need to decline bid and order opportunities, which could also have an adverse effect on our business, financial position, results of operations or cash flows. All of our manufacturing and production is done at two locations, in California and Massachusetts.
In addition, if we are unable to acquire timely nickel, steel or aluminum supplies, we may need to decline bid and order opportunities, which could also have an adverse effect on our business, financial position, results of operations or cash flows. All our manufacturing and production is done at two locations, in California and Massachusetts.
We are subject to SEC rules regarding disclosure of the use of tin, tantalum, tungsten, gold and certain other minerals, known as conflict minerals, in products manufactured by public companies.
We are subject to SEC rules regarding the disclosure of the use of tin, tantalum, tungsten, gold and certain other minerals, known as conflict minerals, in products manufactured by public companies.
Additionally, we may be negatively affected by contractual disputes with customers, which could have an adverse impact on our financial condition and results of operations. If our customers successfully assert product liability claims against us due to defects in our products, our operating results may suffer and our reputation may be harmed.
Additionally, we may be negatively affected by contractual disputes with customers, which could have an adverse impact on our financial condition and the results of operations. If our customers successfully assert product liability claims against us due to defects in our products, our operating results may suffer, and our reputation may be harmed.
If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such event, we would be at a disadvantage in seeking to obtain that contract.
If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such an event, we would be at a disadvantage in seeking to obtain that contract.
In addition, in the past, when the market price of a stock has been volatile, holders of that stock have instituted securities class action litigation against the company that issued the stock. If any of our stockholders brought a lawsuit against us, even if the lawsuit is without merit, we could incur substantial costs defending the lawsuit.
In addition, in the past, when the market price of a stock has been volatile, holders of that stock have instituted securities class action litigation against the company that issued the stock. If any of our stockholders brought a lawsuit against us, even if the lawsuit is without merit, we could incur substantial costs by defending the lawsuit.
The fabrication of large steel structures involves potential operating hazards that can cause personal injury or loss of life, severe damage to and destruction of property and equipment and suspension of operations. The failure of such structures during and after installation can result in similar injuries and damages.
The fabrication of large steel structures involves potential operating hazards that can cause personal injury or loss of life, severe damage to and destruction of property and equipment and suspension of operations. The failure of such structures during and after installation can result in similar injuries and damage.
Our level of indebtedness could have important consequences, including, without limitation: ● increasing our vulnerability to general economic and industry conditions because our debt payment obligations may limit our ability to use our cash to respond to or defend against changes in the industry or the economy; ● requiring a substantial portion of our cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; ● limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; 15 Table of Contents ● limiting our ability to pursue our growth strategy, including restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; ● placing us at a disadvantage compared to our competitors who are less leveraged and may be better able to use their cash flow to fund competitive responses to changing industry, market or economic conditions; and ● making us more vulnerable in the event of a downturn in our business, our industry, or the economy in general.
Our level of indebtedness could have important consequences, including, without limitation: ● increasing our vulnerability to general economic and industry conditions because our debt payment obligations may limit our ability to use our cash to respond to or defend against changes in the industry or the economy; ● requiring a substantial portion of our cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; ● limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; ● limiting our ability to pursue our growth strategy, including restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; ● placing us at a disadvantage compared to our competitors who are less leveraged and may be better able to use their cash flow to fund competitive responses to changing industry, market or economic conditions; and ● making us more vulnerable in the event of a downturn in our business, our industry, or the economy in general.
The rights of the holders of our common stock may be impaired by the potential issuance of preferred stock. Our certificate of incorporation gives our board of directors the right to create new series of preferred stock.
The rights of the holders of our common stock may be impaired by the potential issuance of preferred stock. Our certificate of incorporation gives our board of directors the right to create a new series of preferred stock.
Delays in scheduling have been and, in the future, may be caused by disruptions relating to epidemics, pandemics and government-imposed lockdowns, or economy-wide supply chain disruptions, while changes in order specifications may result from a number of factors, including a determination by the customer that the product specifications need to be changed after receipt of an initial product or prototype.
Delays in scheduling have been and, in the future, may be caused by disruptions relating to epidemics, pandemics and government-imposed lockdowns, or economy-wide supply chain disruptions, while changes in order specifications may result from several factors, including a determination by the customer that the product specifications need to be changed after receipt of an initial product or prototype.
If we are unable to conclude that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of shares of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.
If we are unable to conclude that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of shares of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. Item 1B.
In addition to extending the maturity date of the revolver loan, the Company acknowledges that a certain event of default has occurred and is continuing under the Loan Agreement because of the Company’s failure to satisfy the Debt Service Coverage Ratio, or DSCR, for the twelve-month period ending March 31, 2024.
In addition to extending the maturity date of the revolver loan, the Company acknowledges that a certain event of default has occurred and is continuing under the Loan Agreement because of the Company’s failure to satisfy the Debt Service Coverage Ratio, or DSCR, for the twelve-month period ending March 31, 2025.
We cannot assure you that our results of operations will not be affected in the future by delays or changes in specifications or that we will ever be able to recoup revenue which was lost as a result of the delays or changes.
We cannot assure you that our results of operations will not be affected in the future by delays or changes in specifications or that we will ever be able to recover revenue which was lost as a result of the delays or changes.
In the event that the lender accelerates the repayment of this indebtedness as the result of one or more breaches of covenant or the maturity date of the revolver loan is not renewed or further extended, we do not expect to have funds available to repay these amounts in full unless we raise additional funds or find alternate financing, which, along with the uncertainty associated with the recurring operating losses at Stadco, raises substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements included in this Annual Report on Form 10-K are issued.
In the event that the lender exercises its right to accelerate the repayment of this indebtedness as the result of one or more breaches of covenant or the maturity date of the revolver loan is not renewed or further extended, we do not expect to have funds available to repay these amounts in full unless we raise additional funds or find alternate financing, which, along with the uncertainty associated with the recurring operating losses at Stadco, raises substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements included in this Annual Report on Form 10-K are issued.
To the extent that these uncertainties cause suppliers and customers to be more cost sensitive, increased energy prices may have an adverse effect on our results of operations and financial condition. The dangers inherent in our operations and the limits on insurance coverage could expose us to potentially significant liability costs and materially interfere with the performance of our operations.
To the extent that these uncertainties cause suppliers and customers to be more cost sensitive, increased energy prices may have an adverse effect on our results of operations and financial condition. 12 Table of Contents The dangers inherent in our operations and the limits on insurance coverage could expose us to potentially significant liability costs and materially interfere with the performance of our operations.
The Company is the borrower under the amended and restated loan agreement with Berkshire Bank (the “Loan Agreement”). The Company has determined that it was not in compliance with the financial covenants in the Loan Agreement as of March 31, 2024.
The Company is the borrower under the amended and restated loan agreement with Berkshire Bank (the “Loan Agreement”). The Company has determined that it was not in compliance with the financial covenants in the Loan Agreement as of March 31, 2025.
It is also possible that Russia’s invasion of Ukraine causes a reorientation of US defense spending away from the naval submarine programs from which we derive substantial portions of our revenue towards land-based military projects, which could involve fewer programs in which our products would be needed.
It is also possible that Russia’s invasion of Ukraine causes a reorientation of U.S. defense spending away from the naval submarine programs from which we derive substantial portions of our revenue towards land-based military projects, which could involve fewer programs in which our products would be needed.
In addition, delisting from Nasdaq could also impair our ability to raise additional necessary capital through equity or debt financing, and could lead to significant dilution to our stockholders caused by our issuing equity in financing or other transactions at a price per share significantly below the then market price.
In addition, delisting from Nasdaq could also impair our ability to raise additional necessary capital through equity or debt financing, and could lead to significant dilution to our stockholders caused by our issuing equity in financing or other transactions at a price per share significantly below the then market price. Our stock price may fluctuate significantly.
The manufacture of some of our products is a complex process and requires long lead times. As a result, we may experience delays or shortages in the supply of raw materials.
The manufacture of some of our products is a complex process and requires long lead time. As a result, we may experience delays or shortages in the supply of raw materials.
We could be adversely affected by reductions in defense spending. Because certain of our products are used in a variety of military applications, including ships, submarines and helicopters, we derive most of our revenue from the defense industry. In fiscal 2024 and 2023, approximately 99% and 98% of our revenue was derived from customers in the defense industry.
We could be adversely affected by reductions in defense spending. Because certain of our products are used in a variety of military applications, including ships, submarines and helicopters, we derive most of our revenue from the defense industry. In fiscal 2025 and 2024, approximately 99% and 99% of our revenue was derived from customers in the defense industry.
The consequences of any default, waiver or forbearance, or the securing of additional equity financing, could materially and adversely affect our business, financial condition, and results of operations. 8 Table of Contents We may pursue acquisitions and other strategic transactions and/or investments to compliment or expand our business that may not be successful.
The consequences of any default, waiver or forbearance, or the securing of additional equity financing could materially and adversely affect our business, financial condition, and results of operations. We may pursue acquisitions and other strategic transactions and/or investments to compliment or expand our business that may not be successful.
We expect to fill most items of backlog within the next three years. However, because orders may be rescheduled or canceled and a significant portion of our net sales is derived from a small number of customers, backlog is not necessarily indicative of future sales levels.
We expect to fill most items of backlog within the next three years. However, because orders may be rescheduled or canceled and a significant portion of our revenue is derived from a small number of customers, backlog is not necessarily indicative of future revenue levels.
We may not be able to take advantage of business opportunities or respond to competitive pressures if we fail to update, replace or make additions to our equipment or our manufacturing processes in a timely manner. The cost to repair or replace much of our equipment or facilities could be significant.
We may not be able to take advantage of business opportunities or respond to competitive pressures if we fail to update, replace or make additions to our equipment or our manufacturing processes in a timely manner. The cost of repairing or replacing much of our equipment or facilities could be significant.
This transfer will occur over time when the Company’s performance does not create an asset that has an 12 Table of Contents alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Otherwise, control to the promised goods or services transfers to customers at a point in time.
This transfer will occur over time when the Company’s performance does not create an asset that has an alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Otherwise, control to the promised goods or services transfers to customers at a point in time.
Our inability to obtain financing on terms and within a time acceptable to us could have an adverse impact on our results of operations, financial condition, and liquidity. Risks Related to our Common Stock If we fail to regain compliance with The Nasdaq Stock Market’s listing standards, our common stock could be delisted from Nasdaq.
Our inability to obtain financing on terms and within a time acceptable to us could have an adverse impact on our results of operations, financial condition, and liquidity. 17 Table of Contents Risks Related to our Common Stock If we fail to regain or maintain compliance with The Nasdaq Stock Market’s listing standards, our common stock could be delisted from Nasdaq.
We believe that customers focus on such factors as quality of work, reputation of the vendor, perception of the vendor’s ability to meet the required schedule, and price in selecting a vendor for their products. Some of our customers have moved manufacturing operations or product sourcing overseas, which can negatively impact our sales.
We believe that customers focus on such factors as quality of work, reputation of the vendor, perception of the vendor’s ability to meet the required schedule, and price in selecting a vendor for their products. Some of our customers have moved manufacturing operations or product sourcing overseas.
Whether or not completed, the announcement and pendency of the potential acquisitions could cause disruptions in our business; and current and prospective employees may experience uncertainty about their future roles, which might adversely affect the ability to retain key employees; and uncertainty regarding the completion of the acquisition may cause customers, suppliers, distributors, vendors, strategic partners or others to delay or defer entering into contracts, make other decisions or seek to change or cancel existing business relationships; and the attention of management may be directed toward the completion of the acquisition.
Whether or not completed, the announcement and pendency of the potential acquisitions could cause disruptions in our business; and current and prospective employees may experience uncertainty about their future roles, which might adversely affect the ability to retain key employees; and uncertainty regarding the completion of the acquisition may cause customers, suppliers, distributors, vendors, strategic partners or others to delay or defer entering into contracts, make other decisions or seek to change or cancel existing business relationships; and the attention of management may be directed toward the completion of the acquisition. 9 Table of Contents We face strong competition in our markets.
Any disputes with customers could also have an adverse impact on our income and cash flows.
Any disputes with customers could also have an adverse impact on our income and cash flow.
Demand in our end-use markets can be cyclical, impacting the demand for the products we produce. Demand in our end-use markets, including companies in the defense, aerospace, precision industrial, and nuclear industries, can be cyclical in nature and sensitive to general economic conditions, competitive influences, and fluctuations in inventory levels throughout the supply chain.
Demand in our end-use markets can be cyclical, impacting on the demand for the products we produce. Demand in our end-use markets, including companies in the defense and precision industrial sectors, can be cyclical in nature and sensitive to general economic conditions, competitive influences, and fluctuations in inventory levels throughout the supply chain.
Our stock price may fluctuate significantly. The stock market can experience significant volatility, and the volatility of stocks often does not relate to the operating performance of the companies represented by the stock. The market price of our common stock could be subject to significant fluctuations because of general market conditions and because of factors specifically related to our businesses.
The stock market can experience significant volatility, and the volatility of stocks often does not relate to the operating performance of the companies represented by the stock. The market price of our common stock could be subject to significant fluctuations because of general market conditions and because of factors specifically related to our business.
Trading volume of our common stock has fluctuated from time to time and is typically low, which may make it difficult for investors to sell their shares at times and prices that investors feel are appropriate. To date, the trading volume of our common stock has fluctuated, and there is typically a low volume of trading in our common stock.
The trading volume of our common stock has fluctuated from time to time and is typically low, which may make it difficult for investors to sell their shares at times and prices that investors feel is appropriate.
Contract modifications - as well as other changes in estimates of sales, costs, and profits on a performance obligation - are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes in current and prior periods.
Contract modifications - as well as other changes in estimates of revenue, costs, and profits on performance obligations - are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes in current and prior periods.
While we have taken steps to enhance our internal control environment, we have addressed the underlying cause of the material weaknesses with the implementation of additional controls including those designed to raise the level of precision of management review controls to gain additional assurance regarding the timely completion of our quality control procedures.
While we have taken steps to enhance our internal control environment, we have addressed the underlying cause of the material weaknesses with a review of our internal controls, and may propose additional new controls, including those designed to raise the level of precision of management review controls to gain additional assurance regarding the timely completion of our quality control procedures.
Berkshire Bank is the lender under the Loan Agreement and has agreed to extend the maturity date of the revolver loan to January 15, 2025. The original maturity date of the revolver loan under the loan agreement was December 20, 2023.
Berkshire Bank is the lender under the Loan Agreement and has agreed to extend the maturity date of the revolver loan to August 29, 2025. The original maturity date of the revolver loan under the loan agreement was December 20, 2023.
The sale of additional shares of our common stock, or securities convertible into shares of our common stock, would also dilute all of our stockholders. There was $7.6 million outstanding under the Loan Agreement on March 31, 2024.
The sale of additional shares of our common stock, or securities convertible into shares of our common stock, would also dilute all of our stockholders. There was $7,387 outstanding under the Loan Agreement on March 31, 2025.
Increased regulation regarding cybersecurity may increase our costs of compliance, including fines and penalties, as well as costs of cybersecurity audits. Any of these actions could materially adversely impact our business, financial condition and results of operations. We are subject to regulations related to conflict minerals which could adversely impact our business.
Increased regulation regarding cybersecurity may increase our costs of compliance, including fines and penalties, as well as costs of cybersecurity audits. Any of these actions could have a material adverse impact on our business, financial condition and the results of operations. We are subject to regulations related to conflict minerals which could adversely impact our business.
We face strong competition in our markets. We face competition from both domestic and foreign manufacturers in each of the markets we serve. No one company dominates the industry in which we operate.
We face competition from both domestic and foreign manufacturers in each of the markets we serve. No single company dominates the industry in which we operate.
We have identified certain material weaknesses in our internal control over financial reporting, resulting from control deficiencies related to 1) an insufficient complement of Stadco accounting staff necessary to consistently perform management review controls over financial information and complete account reconciliations on a timely basis to ensure all transactions were accurately captured and recorded, 2) initial purchase accounting and fair value accounting associated with the Stadco acquisition, and 3) adjustments related to tax accounting for a deficient analysis of the valuation allowance.
In this event, the market price of our common stock would likely be adversely affected. 19 Table of Contents We have identified certain material weaknesses in our internal control over financial reporting, resulting from control deficiencies related to 1) an insufficient complement of Stadco accounting staff necessary to consistently perform management review controls over financial information and complete account reconciliations on a timely basis to ensure all transactions were accurately captured and recorded, 2) initial purchase accounting and fair value accounting associated with the Stadco acquisition, and 3) adjustments related to tax accounting for a deficient analysis of the valuation allowance.
The possible impact on takeover attempts could adversely affect the price of our common stock. 18 Table of Contents General Risk Factors If securities analysts do not publish research or reports about our business, if they issue unfavorable commentary or downgrade their rating on our common stock, or if we fail to meet projections and estimates of earnings developed by such analysts, the price of our common stock could decline.
General Risk Factors If securities analysts do not publish research or reports about our business, if they issue unfavorable commentary or downgrade their rating on our common stock, or if we fail to meet projections and estimates of earnings developed by such analysts, the price of our common stock could decline.
Furthermore, to the extent that any one customer accounts for a large percentage of our revenue, the loss of that customer could materially affect our ability to operate profitably. For example, our largest customer in the fiscal years ended March 31, 2024 and 2023 accounted for 28% and 20%, respectively, of our revenue for both years.
Furthermore, to the extent that any one customer accounts for a large percentage of our revenue, the loss of that customer could materially affect our ability to operate profitably. For example, our single largest customer for the fiscal years ended March 31, 2025 and 2024 accounted for 22% and 32%, respectively, of our revenue for both years.
We cannot assure that our operating results will not decline in future periods as a result of changes in customers’ orders. Negative economic conditions may adversely impact the demand for our services and the ability of our customers to meet their obligations to us on a timely basis.
We cannot assure you that our operating results will not decline in future periods because of changes in customers’ orders. 15 Table of Contents Negative economic conditions may impact the demand for our services and the ability of our customers to meet their obligations with us on a timely basis.
We have, in the past, been dependent in each year on a small number of customers who generate a significant portion of our business, and these customers change from year to year. For the year ended March 31, 2024, our four largest customers accounted for approximately 61% of our revenue.
We have, in the past, been dependent in each year on a small number of customers who generate a significant portion of our business, and these customers change from year to year. For the fiscal year ended March 31, 2025, our five largest customers accounted for 79% of our revenue.
We recognize revenue for our defense contracts and some commercial contracts based on percentage of completion that requires significant management judgement. Errors made to our estimates of revenue and costs could result in overstated or understated profits or losses, subject to adjustment.
We recognize revenue for our defense contracts and some commercial contracts based on percentage of completion that requires significant management judgement. Errors made to estimates of revenue and costs could result in overstated or understated profits or losses, subject to adjustment. For most of our defense industry contracts, we recognize revenue over time as we perform services or deliver goods.
Our systems and information technology infrastructure may be subject to security breaches and other cybersecurity incidents. We rely on the accuracy, capacity, and security of our information technology systems to obtain, process, analyze, and manage data, as well as to facilitate the manufacture and distribution of products to and from our facility.
We rely on the accuracy, capacity, and security of our information technology systems to obtain, process, analyze, and manage data, as well as to facilitate the manufacture and distribution of products to and from our facility.
In periods of high utilization, it may become more difficult to find and retain qualified individuals, and there can be no assurance that we will be successful in attracting and retaining qualified personnel to fulfill our current or future needs.
In periods of high utilization, it may become more difficult to find and retain qualified individuals, and there can be no assurance that we will be successful in attracting and retaining qualified personnel to fulfill our current or future needs. This could increase our costs or have other adverse effects on our results of operations.
We cannot assure you that we will not incur additional costs to maintain compliance with environmental laws and regulations or that we will not incur significant penalties for failure to be in compliance any of which could have a material adverse effect on our business, financial condition and results of operations.
We cannot assure you that we will not incur additional costs to maintain compliance with environmental laws and regulations or that we will not incur significant penalties for failure to be in compliance any of which could have a material adverse effect on our business, financial condition and results of operations. 14 Table of Contents Our systems and information technology infrastructure may be subject to security breaches and other cybersecurity incidents.
Preferred stock, which could be issued with the right to more than one vote per share, could be utilized as a method of discouraging, delaying, or preventing a change of control.
Preferred stock, which could be issued with the right to more than one vote per share, could be utilized as a method of discouraging, delaying, or preventing a change of control. The possible impact on takeover attempts could adversely affect the price of our common stock.
The U.S. also imposed a 10% tariff on all aluminum imports into the United States, with initial exemptions for aluminum imported from certain U.S. trading partners. Such actions could increase steel and aluminum costs and decrease supply availability.
The U.S. also imposed a 10% tariff on all aluminum imports into the United States, with initial exemptions for aluminum imported from certain U.S. trading partners. Recent proposed changes to tariffs announced by the U.S. in April 2025 could increase steel and aluminum costs and decrease supply availability.
As a result, we may be unable to shift manufacturing capabilities to alternate locations, accept materials from suppliers, meet customer shipment needs or address other severe consequences that may be encountered, and we may suffer damage to our reputation.
As a result, we may be unable to shift manufacturing capabilities to alternate locations, accept materials from suppliers, meet customer shipment needs or address other severe consequences that may be encountered, and we may suffer damage to our reputation. Our financial condition and results of our operations could be materially adversely affected were such events occurred.
In addition, costs of certain critical raw materials have been volatile due to factors beyond our control. Raw material costs are included in our contracts with customers, but in some cases, we are exposed to changes in raw material costs from the time purchase orders are placed to when we purchase the raw materials for production.
Raw material costs are included in our contracts with customers, but in some cases, we are exposed to changes in raw material costs from the time purchase orders are placed to when we purchase the raw materials for production.
Our failure to obtain new or additional financing, if required, could impair our ability to both serve our existing customer base and develop new customers and could result in our failure to continue to operate as a going concern.
Our liquidity is highly dependent on our available financing facilities and ability to improve our gross profit and operating income. Our failure to obtain new or additional financing, if required, could impair our ability to both serve our existing customer base and develop new customers and could result in our failure to continue to operate as a going concern.
Because a significant portion of our revenue is derived from services rendered for the defense, aerospace, nuclear, large medical device and precision industrial markets, our operating results may suffer from conditions affecting these industries, including any budgeting, economic or other trends that have the effect of reducing the requirements for our services.
Because a significant portion of our revenue is derived from services rendered for the defense industry, our operating results may suffer from conditions affecting this sector, including any budgeting, economic or other trends that have the effect of reducing the requirements for our services.
The nature of our manufacturing business subjects our operations to numerous and varied federal, state, local and international laws and regulations relating to pollution, protection of public health and the environment, natural resource damages and occupational safety and health.
The extensive environmental, health and safety regulatory regimes applicable to our manufacturing operations create potential exposure to significant liabilities. The nature of our manufacturing business subjects our operations to numerous and varied federal, state, local and international laws and regulations relating to pollution, protection of public health and the environment, natural resource damage and occupational safety and health.
Although we perform manufacturing services pursuant to orders placed by our customers, we have in the past experienced delays in scheduling and changes in the specification of our products.
Changes in delivery schedules and order specifications may affect our revenue stream. Although we provide manufacturing services pursuant to orders placed by our customers, we have in the past experienced delays in scheduling and changes in the specification of our products.
In addition, although we do not make projections relating to our future operating results, our operating results may fall below the expectations of securities analysts and investors. In this event, the market price of our common stock would likely be adversely affected.
In addition, although we do not make projections relating to our future operating results, our operating results may fall below the expectations of securities analysts and investors.
These restrictive covenants and provisions could limit our ability to obtain future financings, make needed capital expenditures, withstand a future downturn in our business, or the economy in general, or otherwise conduct necessary corporate activities, and may prevent us from taking advantage of business opportunities that arise in the future.
These restrictive covenants and provisions could limit our ability to obtain future financing, make needed capital expenditures, withstand a future downturn in our business, or the economy in general, or otherwise conduct necessary corporate activities, and may prevent us from taking advantage of business opportunities that arise in the future. 16 Table of Contents If we refinance our credit facilities, we cannot guarantee that any new credit facility will not contain similar covenants and restrictions.
If we do not book more orders with existing customers, or develop relationships with new customers, we may not be able to increase, or even maintain, our revenue, and our financial condition, results of operations, business and/or prospects may be materially adversely affected. 10 Table of Contents Our backlog figures may not accurately predict future sales or recognizable revenue.
If we do not book more orders with existing customers, or develop relationships with new customers, we may not be able to increase, or even maintain, our current level of revenue, which could have an adverse effect on our financial condition and results of operations. Our backlog figures may not accurately predict future revenue or recognizable revenue.
We may also encounter challenges to satisfy customers that may require all of the components of products purchased to be certified as DRC conflict-free because our supply chain is complex.
We may also encounter challenges satisfying customers that may require all of the components of products purchased to be certified as DRC conflict-free because our supply chain is complex. If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier.
A successful product liability claim or series of claims against us, or a significant warranty claim or series of claims against us could materially decrease our liquidity and impair our financial condition and also materially and adversely affect our results of operations.
We have been subject to product liability claims in the past, and we may be subject to claims in the future. A successful product liability claim or series of claims against us, or a significant warranty claim or series of claims against us could materially decrease our liquidity and adversely affect our financial condition and results of operations.
Nasdaq also has rules governing the timely filing of periodic reports we have received notices from the Listing Qualifications Department of Nasdaq that we were not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Timely Filing Requirement”) because we had not timely filed our Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2023 (the “Q3 2024 10-Q”), our Annual Report on Form 10-K for the fiscal year ended March 31, 2024 (the “FY 2024 10-K”) and our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024 (the “Q1 2025 10-Q”) with the SEC on or before the applicable period provided for each filing.
Nasdaq also has rules governing the timely filing of periodic reports and we have received a notice from the Listing Qualifications Department of Nasdaq that we are not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Timely Filing Requirement”) because we had not timely filed our Annual Report on Form 10-K for the fiscal year ended March 31, 2025 (the “10-K”) with the SEC before July 15, 2025, which was the end of the grace period for timely filing.
As a result of the cyclical nature of these markets, we have experienced, and in the future, we may experience, significant fluctuations in our sales and results of operations with respect to a substantial portion of our total product offering, and such fluctuations could be material and adverse to our overall financial condition, results of operations and liquidity.
Our revenue is sensitive to the market conditions present in the industries in which the ultimate consumers of our products operate, which in some cases have been highly cyclical and subject to substantial downturns. 13 Table of Contents As a result of the cyclical nature of these markets, we have experienced, and in the future, we may experience significant fluctuations in our revenue and results of operations with respect to a substantial portion of our total product offering, and such fluctuations could be material and adverse to our overall financial condition, results of operations and liquidity.
For most of our defense industry contracts, we recognize revenue over time as we perform services or deliver goods. In situations where control transfers or services are performed over time, revenue is recognized based on the extent of progress towards completion of the performance obligation.
In situations where control transfers or services are performed over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We recognize revenue over time based on the transfer of control of the promised goods or services to the customer, or at a point in time.
In order to satisfy the future financial covenants in the Loan Agreement, we must efficiently increase utilization of our manufacturing capacity at our Stadco subsidiary and improve the manufacturing process, such that our direct labor hours (inputs) allow us to recognize more revenue over time (outputs) and improve job performance.
If the lender were to demand repayment, the Company would not be able to pay the obligation because the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations. 8 Table of Contents In order to satisfy the future financial covenants in the Loan Agreement, we must efficiently increase utilization of our manufacturing capacity at our Stadco subsidiary and improve the manufacturing process, such that our direct labor hours (inputs) allow us to recognize more revenue over time (outputs) and improve job performance.
For the year ended March 31, 2023, our four largest customers accounted for approximately 64% of our revenue. In addition, our backlog on March 31, 2024 and 2023 was $50.0 million and $44.0 million, respectively, of which 76% and 83% was attributable to four customers.
For the fiscal year ended March 31, 2024, our five largest customers accounted for 68% of our revenue. In addition, our backlog on March 31, 2025 and 2024 was $48,625 and $49,500, respectively, of which 73% and 76% was attributable to four customers.
The exercise of these options and the sale of stock issued upon such exercise or pursuant to stock grants may have an adverse effect upon the price of our stock.
The exercise of these options and the sale of stock issued upon such exercise or pursuant to stock grants may have an adverse effect upon the price of our stock. 18 Table of Contents The number of shares of common stock we have registered for resale are significant in relation to the number of our outstanding shares of common stock.
If we are unable to obtain adequate and timely deliveries of required raw materials, we may be unable to complete our manufacturing projects and deliver finished products on a timely basis. This could cause us to lose sales, incur additional costs, delay new product introductions, or suffer harm to our reputation.
If we are unable to obtain adequate and timely deliveries of the required raw materials, we may be unable to complete our manufacturing projects and deliver finished products on a timely basis.
It is possible that we could experience prolonged periods of reduced production due to unplanned equipment failures, and we could incur significant repair or replacement costs in the event of those failures. We must make regular capital investments and changes to our manufacturing processes to lower production costs, improve productivity, manufacture new or improved products and remain competitive.
Our manufacturing processes are complex, must constantly be upgraded to remain competitive and depend upon critical, high-cost equipment that may require costly repair or replacement. It is possible that we could experience prolonged periods of reduced production due to unplanned equipment failures, and we could incur significant repair or replacement costs in the event of those failures.
Lingering impacts from the COVID-19 pandemic, labor shortages and/or supply chain disruptions in the broader economy may also reduce demand for our products and services because of delays or disruptions in our customers’ ability to continue their own production, which could have a material adverse effect on our business, financial condition, or results of operation. 9 Table of Contents Our business may be impacted by external factors that we may not be able to control, including health emergencies like epidemics or pandemics, and the war between Russia and Ukraine.
Labor shortages, government tariffs, and/or supply chain disruptions in the broader economy may also reduce demand for our products and services because of delays or disruptions in our customers’ ability to continue their own production, which could have a material adverse effect on our business, financial condition, or results of operation.
War, civil conflict, terrorism, natural disasters, and public health issues including domestic or international pandemics, have caused and could cause damage or disruption to domestic or international commerce by creating economic or political uncertainties.
War, civil conflict, terrorism, natural disasters, and public health issues including domestic or international pandemics, have caused and could cause damage or disruption to domestic or international commerce by creating economic or political uncertainties. Additionally, volatility in the financial markets, government tariffs, and disruptions or downturns in other areas of the global or U.S. economies could negatively impact our business.
In addition, if the counterparty backing our existing credit facilities were unable to perform on its commitments, our liquidity could be impacted, which could adversely affect funding of working capital requirements and other general corporate purposes. 16 Table of Contents In the event we need to access the capital markets or other sources of financing, there can be no assurance that we will be able to obtain financing on acceptable terms or within an acceptable time, if at all.
In addition, if the counterparty backing our existing credit facilities were unable to perform on its commitments, our liquidity could be impacted, which could adversely affect funding of working capital requirements and other general corporate purposes.
We filed a Registration Statement on January 7, 2022, which was declared effective on January 18, 2022, to register the resale of shares of our common stock into the public market by certain stockholders that acquired shares of our common stock in transactions not registered under the Securities Act.
We recently filed a Registration Statement with the SEC which was declared effective on January 31, 2025, to register the resale of shares of our common stock into the public market by certain stockholders that acquired shares of our common stock in transactions not registered under the Securities Act, and for the resale the Stock Termination Fee and the shares of common stock that could be sold by participants in the July 2024 Private Placement (as defined below), including shares underlying PIPE Warrants (as defined below).
Additionally, the economic and other consequences of the recent instability in the banking system, Russia’s invasion of Ukraine, high inflation and increasing interest rates have resulted in significant volatility in the equity capital markets as the economy begins to recover. 17 Table of Contents These and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors from readily selling their shares of common stock at a profit and may otherwise negatively affect the liquidity of our common stock.
These and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors from readily selling their shares of common stock at a profit and may otherwise negatively affect the liquidity of our common stock.
In the event we produce any products utilizing conflict minerals, we will be required to comply with the rules discussed above. Changes in delivery schedules and order specifications may affect our revenue stream.
We currently do not use any conflict minerals in the production of our products, but from time to time we may receive a customer order necessitating the use of conflict minerals. In the event we produce any products utilizing conflict minerals, we will be required to comply with the rules discussed above.
In addition, the lender retains the right to act on covenant violations that occur after the date of delivery of any waiver. If the lender were to demand repayment, the Company would not be able to pay the obligation because the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations.
In addition, the lender retains the right to act on covenant violations that occur after the date of delivery of any waiver.
Volatility in our stock price may also be enhanced by the fact that our common stock is often thinly traded.
Volatility in our stock price may also be enhanced by the fact that our common stock is often thinly traded. Additionally, the economic and other consequences of the past instability with regional banks, Russia’s invasion of Ukraine, current Middle East conflict, high inflation, government tariffs and increasing interest rates have resulted in significant volatility in the equity capital markets.
Removed
Additionally, volatility in the financial markets, instability in the banking sector and disruptions or downturns in other areas of the global or U.S. economies could negatively impact our business.
Added
Our business may be impacted by external factors that we may not be able to control, including health emergencies like epidemics or pandemics, government tariffs, current middle east conflict, and the war between Russia and Ukraine.
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However, because of our reliance on certain raw materials and energy supplies, an economic environment of rising costs and interest rates could have an unfavorable impact our operations and financial condition.
Added
This could cause us to lose revenue, incur additional costs, delay new product introductions, or suffer harm to our reputation. 11 Table of Contents In addition, costs of certain critical raw materials have been volatile due to factors beyond our control.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur IT staff and such third-party providers are tasked with notifying management of any material risks or cybersecurity concerns that they identify, which management then assesses and may bring to our board of directors to discuss if deemed necessary or appropriate.
Biggest changeOur IT staff and such third-party providers are tasked with notifying management of any material risks or cybersecurity concerns that they identify, which management then assesses and may bring to our board of directors to discuss if deemed necessary or appropriate. 20 Table of Contents We continue to work with outside counsel and third - party service providers to further develop our expertise, processes and procedures with respect to cybersecurity protection and our response plan.
Our IT staff at both Ranor and Stadco oversee their respective cybersecurity processes on a day-to-day basis, including those described under the heading “Cybersecurity Risk Management and Strategy” above, and escalate matters to our Chief Executive Officer as appropriate. 20 Table of Contents Our audit committee is tasked with general oversight of our risk management process, including risks from cybersecurity threats.
Our IT staff at both Ranor and Stadco oversee their respective cybersecurity processes on a day-to-day basis, including those described under the heading “Cybersecurity Risk Management and Strategy” above, and escalate matters to our Chief Executive Officer as appropriate. Our audit committee is tasked with general oversight of our risk management process, including risks from cybersecurity threats.
For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “ Risk Factors ,” in this Report. We maintain a cyber liability insurance policy.
To date, we have not (to our knowledge) encountered cybersecurity challenges that have materially impaired our operations or financial standing. For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “ Risk Factors ,” in this Report. We maintain a cyber liability insurance policy.
Removed
We continue to work with outside counsel and third - party service providers to further develop our expertise, processes and procedures with respect to cybersecurity protection and our response plan. To date, we have not (to our knowledge) encountered cybersecurity challenges that have materially impaired our operations or financial standing.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeOn October 30, 2023, the Company and one of its employees were named as defendants in an action alleging individual claims of discrimination and wage and hour violations, along with representative wage and hour claims brought pursuant to the California Private Attorneys General Act of 2004 (“PAGA”) [Cal. Lab.
Biggest changeLitigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention. 21 Table of Contents On October 30, 2023, the Company and one of its employees were named as defendants in an action alleging individual claims of discrimination and wage and hour violations, along with representative wage and hour claims brought pursuant to the California Private Attorneys General Act of 2004 (“PAGA”) [Cal.
Code, ss. 2698, et seq.] in California Superior Court for the County of Los Angeles. In the complaint, captioned Ibarra v.
Lab. Code, ss. 2698, et seq.] in California Superior Court for the County of Los Angeles. In the complaint, captioned Ibarra v.
Item 4. Mine Safety Disclosures Not applicable to the registrant. 21 Table of Contents
Item 4. Mine Safety Disclosures Not applicable to the registrant. ​
Removed
Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 21 ​ ​ Item 4A. Executive Officers of the Registrant 22 ​ ​ PART II ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 ​ ​
Biggest changeItem 4. Mine Safety Disclosures 22 ​ ​ Item 4A. Executive Officers of the Registrant 22 ​ ​ PART II ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 ​ ​

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. Our common stock is traded on the Nasdaq Capital Market under the symbol “TPCS”. As of June 30, 2024, there were 52 holders of record of our outstanding common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is traded on the Nasdaq Capital Market under the symbol “TPCS”. As of June 30, 2025, there were 46 holders of record of our outstanding common stock.

Item 7. Management's Discussion & Analysis

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

72 edited+35 added−54 removed51 unchanged
Biggest changeFiscal Years Ended March 31, 2024 and 2023 The following table presents net sales, gross profit, and gross margin, consolidated and by reportable segment: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Changes ​ ​ ​ ​ Percent of ​ ​ ​ Percent of ​ ​ ​ ​ ​ (dollars in thousands) ​ Amount Net sales ​ Amount Net sales ​ Amount Percent Net Sales ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 17,821 ​ 56 % $ 19,182 ​ 61 % $ (1,361) ​ (7) % Stadco ​ ​ 14,567 ​ 46 % ​ 12,250 ​ 39 % ​ 2,317 ​ 19 % Intersegment elimination ​ ​ (797) ​ (2) % ​ — ​ — % ​ (797) ​ nm % Consolidated Net sales ​ $ 31,591 ​ 100 % $ 31,432 ​ 100 % $ 159 ​ 1 % Cost of Sales ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 13,273 ​ 42 % $ 12,205 ​ 39 % $ 1,068 ​ 9 % Stadco ​ ​ 14,997 ​ 47 % ​ 14,323 ​ 45 % ​ 674 ​ 5 % Intersegment elimination ​ ​ (797) ​ (2) % ​ — ​ — % ​ (797) ​ nm % Consolidated Cost of sales ​ $ 27,473 ​ 87 % $ 26,528 ​ 84 % $ 945 ​ 4 % Gross Profit (Loss) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 4,548 ​ 14 % $ 6,977 ​ 22 % $ (2,429) ​ (35) % Stadco ​ ​ (430) ​ (1) % ​ (2,073) ​ (6) % ​ 1,643 ​ 79 % Consolidated Gross profit ​ $ 4,118 ​ 13 % $ 4,904 ​ 16 % $ (786) ​ (16) % nm - not meaningful Net Sales Consolidated - Period-to-period revenue reflects production performance under new and ongoing contracts with changes in net sales due to varying levels of throughput.
Biggest changeFiscal Years Ended March 31, 2025 and 2024 The following table presents revenue, gross profit, and gross margin, consolidated and by reportable segment: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2024 Changes ​ ​ ​ ​ Percent of ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ ​ Amount Revenue ​ Amount Revenue ​ Amount Percent Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 18,165 ​ 53 % $ 17,821 ​ 56 % $ 344 ​ 2 % Stadco ​ ​ 15,998 ​ 47 % ​ 14,567 ​ 46 % ​ 1,431 ​ 10 % Intersegment elimination ​ ​ (132) ​ — % ​ (797) ​ (2) % ​ 665 ​ 83 % Consolidated Revenue ​ $ 34,031 ​ 100 % $ 31,591 ​ 100 % $ 2,440 ​ 8 % Cost of Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 12,623 ​ 37 % $ 13,273 ​ 42 % $ (650) ​ (5) % Stadco ​ ​ 17,211 ​ 50 % ​ 14,997 ​ 47 % ​ 2,214 ​ 15 % Intersegment elimination ​ ​ (132) ​ — % ​ (797) ​ (2) % ​ 665 ​ 83 % Consolidated Cost of Revenue ​ $ 29,702 ​ 87 % $ 27,473 ​ 87 % $ 2,229 ​ 8 % Gross Profit (Loss) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ranor ​ $ 5,674 ​ 16 % $ 4,548 ​ 14 % $ 1,126 ​ 25 % Stadco ​ ​ (1,345) ​ (3) % ​ (430) ​ (1) % ​ (915) ​ (213) % Consolidated Gross profit ​ $ 4,329 ​ 13 % $ 4,118 ​ 13 % $ 211 ​ 5 % ​ Revenue Consolidated - Revenue was $34,031 for the fiscal year ended March 31, 2025, or 8% higher when compared to revenue of $31,591 for the fiscal year ended March 31, 2024.
Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024; (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024; (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
Effective May 24, 2024, the Eighth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amends the maximum principal amount of the Revolver Loan from $5,000,000 to $4,500,000; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Effective May 24, 2024, the Eighth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amends the maximum principal amount of the Revolver Loan from $5,000 to $4,500; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Factors that could cause such outcomes and results to differ include, but are not limited to, risks and uncertainties arising from: ● our reliance on individual purchase orders, rather than long-term contracts, to generate revenue; ● our ability to balance the composition of our revenues and effectively control operating expenses; ● external factors that may be outside of our control, including health emergencies, like epidemics or pandemics, the conflicts in Eastern Europe and the Middle East, price inflation, increasing interest rates, and supply-chain inefficiencies; ● the availability of appropriate financing facilities impacting our operations, financial condition and/or liquidity; ● our ability to receive contract awards through competitive bidding processes; ● our ability to maintain standards to enable us to manufacture products to exacting specifications; 23 Table of Contents ● our ability to enter new markets for our services; ● our reliance on a small number of customers for a significant percentage of our business; ● competitive pressures in the markets we serve; ● changes in the availability or cost of raw materials and energy for our production facilities; ● restrictions on our ability to operate our business due to our outstanding indebtedness; ● government regulations and requirements; ● pricing and business development difficulties; ● changes in government spending on national defense; ● our ability to make acquisitions and successfully integrate those acquisitions with our business; ● our failure to maintain effective internal controls over financial reporting; ● general industry and market conditions and growth rates; ● unexpected costs, charges or expenses resulting from the recently terminated Stock Purchase Agreement; and ● those risks discussed in “ Item 1A.
Factors that could cause such outcomes and results to differ include, but are not limited to, risks and uncertainties arising from: ● our reliance on individual purchase orders, rather than long-term contracts, to generate revenue; ● our ability to balance the composition of our revenues and effectively control operating expenses; ● external factors that may be outside of our control, including health emergencies, like epidemics or pandemics, California wildfires, the conflicts in Eastern Europe and the Middle East, price inflation, increasing interest rates, and supply-chain inefficiencies; ● the availability of appropriate financing facilities impacting our operations, financial condition and/or liquidity; ● our ability to receive contract awards through competitive bidding processes; 23 Table of Contents ● our ability to maintain standards to enable us to manufacture products to exacting specifications; ● our ability to enter new markets for our services; ● our reliance on a small number of customers for a significant percentage of our business; ● competitive pressures in the markets we serve; ● changes in the availability or cost of raw materials and energy for our production facilities; ● restrictions on our ability to operate our business due to our outstanding indebtedness; ● government tariffs, regulations and requirements; ● pricing and business development difficulties; ● changes in government spending on national defense; ● our ability to make acquisitions and successfully integrate those acquisitions with our business; ● our failure to maintain effective internal controls over financial reporting; ● general industry and market conditions and growth rates; ● unexpected costs, charges or expenses resulting from the recently terminated Stock Purchase Agreement; and ● those risks discussed in “ Item 1A.
July Private Placement On July 3, 2024, the Company entered into a Securities Purchase Agreement (the “PIPE Agreement”), with certain accredited investors (the “PIPE Purchasers”) pursuant to which we agreed to sell in a private placement (the “July Private Placement”) at an aggregate purchase price of $2,298,045, (i) 666,100 shares of our common stock (the “PIPE Shares”), and (ii) common stock purchase warrants to purchase up to 666,100 shares of our common stock (the “PIPE Warrants”).
July Private Placement On July 3, 2024, the Company entered into a Securities Purchase Agreement (the “PIPE Agreement”), with certain accredited investors (the “PIPE Purchasers”) pursuant to which we agreed to sell in a private placement (the “July Private Placement”) at an aggregate purchase price of $2,298, (i) 666,100 shares of our common stock (the “PIPE Shares”), and (ii) common stock purchase warrants to purchase up to 666,100 shares of our common stock (the “PIPE Warrants”).
The waiver document also contains an agreement by the parties to exclude from the calculation of capital expenditures for purposes of the Loan Agreement during the year ending March 31, 2024, any such expenditures made by the Company to the extent they are made using funds provided by customers of the Company for the purpose of making such capital expenditures.
The waiver document contains an agreement by the parties to exclude from the calculation of capital expenditures for purposes of the Loan Agreement during the year ending March 31, 2024, any such expenditures made by the Company to the extent they are made using funds provided by customers of the Company for the purpose of making such capital expenditures.
Regardless of entering into this Agreement or any discussions between Borrowers and Lender, the Lender expressly reserves any and all rights and remedies available to it under the Loan Documents, the Collateral Documents, and under applicable law, including, without limitation, its right to choose to accelerate and demand the outstanding indebtedness evidenced by the Loan Documents and seek immediate repayment in full, and institute the default rate of interest as of the date of the occurrence of the default or at any time thereafter, as a result of any default or event of default, including, without limitation, the Existing Default, that have arisen or may arise.
Regardless of entering into this Agreement or any discussions between Borrowers and Lender, the Lender expressly reserves any and all rights and remedies available to it under the Loan Documents, the Collateral Documents, and under applicable law, including, without limitation, its right to choose to accelerate and demand the outstanding indebtedness evidenced by the Loan Documents and seek immediate repayment in full, and institute the default rate of interest as of the date of the occurrence of the default or at any time thereafter, as a result of any default or event of default, including, without limitation, the Existing Default, that has arisen or may arise.
Advances under the Revolver Loan are subject to a borrowing base equal to the lesser of (a) $5.0 million or (b) the sum of (i) 80% of the net outstanding amount of Base Accounts, plus (ii) the lesser of (x) 25% of Eligible Raw Material Inventory, and (y) $250,000, plus (iii) 80% of the Appraised Value of the Eligible Equipment, as such terms are defined in the Loan Agreement.
Advances under the Revolver Loan are subject to a borrowing base equal to the lesser of (a) $5,000 or (b) the sum of (i) 80% of the net outstanding amount of Base Accounts, plus (ii) the lesser of (x) 25% of Eligible Raw Material Inventory, and (y) $250, plus (iii) 80% of the Appraised Value of the Eligible Equipment, as such terms are defined in the Loan Agreement.
Effective December 20, 2023, the Sixth Amendment, among other things (i) extended the maturity date of the Revolver Loan from December 20, 2023 to March 20, 2024; (ii) limits the use of proceeds from the Revolver Loan by the Company or its affiliates to $1,000,000 in the aggregate for due diligence and related professional costs incurred on or prior to March 20, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
The Sixth Amendment, among other things (i) extended the maturity date of the Revolver Loan from December 20, 2023 to March 20, 2024; (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $1,000 in the aggregate for due diligence and related professional costs incurred on or prior to March 20, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
The following table provides a reconciliation of EBITDA to net income (loss), the most directly comparable U.S.
The following table provides a reconciliation of EBITDA to net loss, the most directly comparable U.S.
Other income, net for the fiscal year ended March 31, 2024 includes a gain of $40,399 from the settlement of an insurance claim related to abandoned fixed assets following a theft at the Stadco plant.
Other income, net for the fiscal year ended March 31, 2024, includes a gain from the settlement of an insurance claim related to abandoned fixed assets following a theft at the Stadco plant.
Our results of operations are also affected by our success in booking new contracts, the timing of revenue recognition, delays in customer acceptances of our products, delays in deliveries of ordered products and our rate of progress fulfilling obligations under our contracts.
Our results of operations are also affected by our success in booking new contracts, the timing of revenue recognition, delays in customer acceptance of our products, delays in deliveries of ordered products and our rate of progress fulfilling obligations under our contracts.
Effective May 24, 2024, the Eighth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amends the maximum principal amount of the Revolver Loan from $5,000,000 to $4,500,000; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Effective May 24, 2024, the Eighth Amendment, among other things, (i) extended the maturity date of the Revolver Loan from May 24, 2024 to August 30, 2024; (ii) amended the maximum principal amount of the Revolver Loan from $5,000 to $4,500; and (iii) effective on June 1, 2024, increases the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum.
Under the Loan Agreement, Berkshire Bank will continue to provide the Ranor Term Loan (as defined below) and the revolving line of credit, or the “Revolver Loan”. In addition, Berkshire Bank provided the Stadco Term Loan (as defined below) in the original amount of $4.0 million.
Under the Loan Agreement, Berkshire Bank will continue to provide the Ranor Term Loan (as defined below) and the revolving line of credit, or the “Revolver Loan”. In addition, Berkshire Bank provided the Stadco Term Loan (as defined below) in the original amount of $4,000.
In order for us to continue operations beyond the next twelve months from the date of issuance of the financial statements and to be able to discharge our liabilities and commitments in the normal course of business, we must renew our revolver loan or seek alternative financing by January 15, 2025.
In order for us to continue operations beyond the next twelve months from the date of issuance of the financial statements and to be able to discharge our liabilities and commitments in the normal course of business, we must renew our revolver loan or seek alternative financing by August 29, 2025.
The proceeds of the original Ranor Term Loan of $2.85 million were previously used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company.
The proceeds of the original Ranor Term Loan of $2,850 were previously used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company.
Pursuant to Section 7.01(f) of the Purchase Agreement, in the event that the Closing had not occurred by March 31, 2024, either we or the Seller had the right to terminate the Purchase Agreement, subject to the party terminating having complied with the other required closing conditions.
Pursuant to Section 7.01(f) of the Purchase Agreement, since the Closing had not occurred by March 31, 2024, either we or the Seller had the right to terminate the Purchase Agreement, subject to the party terminating having complied with the other required closing conditions.
Through May 20, 2024, Ranor utilized a revolving line of credit with, following certain modifications, a maximum principal amount available of $5.0 million.
Through May 20, 2024, Ranor utilized a revolving line of credit with, following certain modifications, a maximum principal amount available of $5,000.
We are subject to certain financial debt covenants and may not spend more than $1.5 million for new machinery and equipment during any single fiscal year, tested on an annual basis at the end of each fiscal year.
We are subject to certain financial debt covenants and may not spend more than $1,500 for new machinery and equipment during any single fiscal year, excluding supplier development funding, tested on an annual basis at the end of each fiscal year.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Statement Regarding Forward Looking Disclosure The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the related notes, which appear elsewhere in this Annual Report on Form 10-K.
Management’s Discussion and Analysis of Financial Condition and Results of Operations (dollars in thousands, except per share data) Statement Regarding Forward Looking Disclosure The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the related notes, which appear elsewhere in this Annual Report on Form 10-K.
The combined purchase price for one PIPE Share and one PIPE Warrant was $3.45. The purpose of the July Private Placement was to raise working capital for use by the Company. The closing of the July Private Placement occurred on July 8, 2024 (the “PIPE Closing Date”). Placement agent fees totaled $126,014.
The combined purchase price for one PIPE Share and one PIPE Warrant was $3.45. The purpose of the July Private Placement was to raise working capital for use by the Company. The closing of the July Private Placement occurred on July 8, 2024 (the “PIPE Closing Date”). Placement fees in connection with the offering totaled $247.
Liquidity, Capital Resources and Going Concern Our liquidity is highly dependent on the availability of financing facilities and our ability to maintain gross profit and operating income. As of March 31, 2024, we had $2.3 million in total available liquidity, consisting of $0.1 million in cash and cash equivalents, and approximately $2.2 million in undrawn capacity under our Revolver Loan.
Liquidity, Capital Resources and Going Concern Our liquidity is highly dependent on the availability of financing facilities and our ability to maintain gross profit and operating income. As of March 31, 2025, we had $1,451 in total available liquidity, consisting of $195 in cash and cash equivalents and $1,256 in undrawn capacity under our Revolver Loan.
The defense backlog remains strong as new orders for components related to a variety of programs, including the U.S. Marine Corps heavy lift helicopter programs, continue to flow down from our existing customer base of prime defense contractors. Stadco’s backlog was $28.9 million as of March 31, 2024.
The backlog remains strong as new orders for components related to a variety of defense programs continue to flow down from our existing customer base of prime defense contractors, including the U.S. Marine Corps heavy lift helicopters. Stadco’s backlog was $27,557 and $28,900 as of March 31, 2025 and 2024, respectively.
Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021, at a fixed rate per annum equal to the 7-year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%.
The proceeds of the Stadco Term Loan were used to support the acquisition of Stadco and refinance existing indebtedness of Stadco. Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021, at a fixed rate per annum equal to the 7-year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%.
Since September 25, 2021, and on the 25th day of each month thereafter, Stadco has made and will continue to make monthly payments of principal and interest in the amount of $54,390 each, with all outstanding principal and accrued interest due and payable on August 25, 2028.
Since September 25, 2021, and on the 25th day of each month thereafter, Stadco has made and will continue to make monthly payments of principal and interest in the amount of $54 each, with all outstanding principal and accrued interest due and payable on August 25, 2028. On June 12, 2023, the Company and Berkshire Bank executed a waiver.
On July 3, 2024, the Company entered into the PIPE Agreement with certain accredited investors, pursuant to which the Company agreed to sell in a private placement at an aggregate purchase price of approximately $2.3 million, the PIPE Shares and the PIPE Warrants. The combined purchase price for one PIPE Share and one PIPE Warrant was $3.45.
On July 3, 2024, the Company entered into a Security Purchase Agreement with certain accredited investors, pursuant to which the Company sold common stock and warrants in a private placement at an aggregate purchase price of $2,299. The combined purchase price for one share of common stock and one warrant was $3.45.
EBITDA Non-GAAP Financial Measure To complement our consolidated statements of operations and consolidated statements of cash flows, we use EBITDA, a non-GAAP financial measure. Net income (loss) is the financial measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to EBITDA.
There were no off-balance sheet arrangements as of March 31, 2025. EBITDA Non-GAAP Financial Measure To complement our consolidated statements of operations and consolidated statements of cash flows, we use EBITDA, a non-GAAP financial measure. Net income (loss) is the financial measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to EBITDA.
Corporate general costs include executive and director compensation, and other corporate administrative expenses not allocated to the segments. Prior period segment data is restated to reflect changes in corporate and administrative expenses not allocated to the segments.
Corporate expenses include stock-based compensation, board of director compensation, and other corporate general expenses not allocated to the segments. Prior period segment data is restated to reflect changes in the allocation of corporate expenses to the segments.
As of March 31, 2023, we had $4.7 million in total available liquidity, consisting of $0.5 million in cash and cash equivalents, and $4.2 million in undrawn capacity under our Revolver Loan. There was $2.8 million and $0.7 million outstanding under the Revolver Loan at March 31, 2024 and 2023, respectively. The Company pays interest at an adjusted SOFR-based rate.
As of March 31, 2024, we had $600 in total available liquidity, consisting of $138 in cash and cash equivalents, and $462 in undrawn capacity under our Revolver Loan. There was $3,150 and $2,785 outstanding under the Revolver Loan on March 31, 2025 and 2024, respectively. The Company pays interest at an adjusted SOFR - based rate.
The Company was otherwise in compliance with all the financial covenants on March 31, 2023. There was $7.6 million outstanding under the Loan Agreement on March 31, 2024. Without a waiver, the lender has the right, but not the obligation, to demand repayment from the Company for noncompliance with the debt covenants.
There was $7,387 and $7,648 outstanding under the Loan Agreement on March 31, 2025 and 2024, respectively. Without a waiver, the lender has the right, but not the obligation, to demand repayment from the Company for noncompliance with the debt covenants.
Our provision for losses at March 31, 2024 and 2023 was $0.3 million and $0.1 million, respectively, with approximately 92% and 76% of the totals related to customer projects at our Stadco reportable segment, and the remaining amounts at our Ranor segment.
Our provision for losses at March 31, 2025 and 2024 was $463 and $293, respectively, with 88% and 92% of the totals related to customer projects at our Stadco reportable segment, and the remaining amounts at our Ranor segment.
The carrying amount of an asset or asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group.
The carrying amount of an asset or asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group. If impaired, the asset is written down to fair value based on either discounted cash flows or appraised values.
Interest-only payments on advances made under the Revolver Loan will continue to be payable monthly in arrears. Interest-only payments on advances made under the Revolver Loan during the fiscal years ended March 31, 2024 and 2023 totaled $171,073 and $33,156, respectively. The weighted average interest rate at March 31, 2024 and March 31, 2023 was 7.58% and 5.02%, respectively.
Interest - only payments on advances made under the Revolver Loan will continue to be payable monthly in arrears. Interest paid and accrued on advances made under the Revolver Loan during fiscal 2025 and 2024, totaled $197 and $171, respectively. The weighted average interest rate on March 31, 2025 and 2024 was 7.47% and 7.58%, respectively.
On December 23, 2022, Ranor and certain affiliates of the Company entered into a Fifth Amendment to Amended and Restated Loan Agreement, Fifth Amendment to Promissory Note and First Amendment to Second Amended and Restated Promissory Note, or the “Amendment”.
On December 20, 2023, Ranor and certain affiliates of the Company entered into a Sixth Amendment to Amended and Restated Loan Agreement and Second Amendment to Second Amended and Restated Promissory Note, or the “Sixth Amendment”.
Payments for the original Ranor Term Loan began on January 20, 2017, and until the facility was amended in December 2022, the Company paid monthly installments of $19,260 each, inclusive of interest at a fixed rate of 5.21% per annum. 32 Table of Contents In addition, Berkshire Bank provided to Stadco a term loan in the original amount of $4.0 million, or the “Stadco Term Loan”.
Payments for the original Ranor Term Loan began on January 20, 2017, and until the facility was amended in December 2022, the Company paid monthly installments of $19 each, inclusive of interest at a fixed rate of 5.21% per annum.
A delay in deliveries or cancellations of orders could have an unfavorable impact on liquidity, cause us to have inventories in excess of our short-term needs, and delay our ability to recognize, or prevent us from recognizing, revenue on contracts in our order backlog.
A delay in deliveries or cancellations of orders could have an unfavorable impact on liquidity, cause us to have inventories in excess of our short-term needs, and delay our ability to recognize, or prevent us from recognizing, revenue on contracts in our order backlog. 28 Table of Contents We evaluate the performance of our segments based upon, among other things, segment revenue and operating profit.
In fiscal 2023 we drew down $10.9 million of proceeds under the Revolver Loan and repaid $11.5 million during the same period. We also used $0.7 million of cash to pay down debt principal, make periodic lease payments and pay costs in connection with the Ranor Term Loan.
In fiscal 2024 we drew down $7,160 of proceeds under the Revolver Loan and repaid $5,025 during the same period. We also used $617 of cash to pay down debt principal and make periodic lease payments.
Net loss was $7.0 million for the fiscal year ended March 31, 2024, as compared to net loss of $1.0 million for the year ended March 31, 2023. EBITDA, a non-GAAP financial measure, was negative for the year ended March 31, 2024, compared to positive $1.8 million for the year ended March 31, 2023.
Net loss was $2,748 for the fiscal year ended March 31, 2025, as compared to net loss of $7,042 for the year ended March 31, 2024. EBITDA, a non-GAAP financial measure, was $587 for the year ended March 31, 2025, compared to negative $2,160 for the year ended March 31, 2024.
Commitments and Contractual Obligations The following contractual obligations associated with our normal business activities are expected to result in cash payments in future periods, and include the following material items on March 31, 2024: ● Our long-term debt obligations, including fixed and variable-rate debt, totaled $7.6 million, and, because of current and probable future debt covenant violations, are classified as current in the consolidated balance sheets. ● We enter into various commitments with suppliers for the purchase of raw materials and work supplies.
Collateral securing all the above obligations comprises all personal and real property of the Company, including cash, accounts receivable, inventories, equipment, and financial assets. 34 Table of Contents Commitments and Contractual Obligations The following contractual obligations associated with our normal business activities are expected to result in cash payments in future periods, and include the following material items on March 31, 2025: ● Our debt obligations under the Berkshire loan agreement, including fixed and variable-rate debt, totaled $7,387, and, because of debt covenant violations, are classified as current in the consolidated balance sheets. ● We enter into various commitments with suppliers for the purchase of raw materials and work supplies.
Pursuant to the PIPE Agreement, we have agreed to have a registration statement registering for resale the PIPE Shares and the shares underlying the PIPE Warrants declared effective with 60 days of the PIPE Closing Date.
In addition, the Company issued to the placement agent common stock purchase warrants to purchase up to 19,983 shares of common stock. Pursuant to the PIPE Agreement, we have agreed to have a registration statement registering for resale the PIPE Shares and the shares underlying the PIPE Warrants declared effective within 60 days of the PIPE Closing Date.
GAAP”, we also utilize and present certain financial measures that are not based on or included in U.S. GAAP. We refer to these as non-GAAP financial measures.
Key Performance Indicators While we prepare our financial statements in accordance with U.S. generally accepted accounting principles, or “U.S. GAAP”, we also utilize and present certain financial measures that are not based on or included in U.S. GAAP. We refer to these as non-GAAP financial measures.
GAAP measure reported in our consolidated financial statements for the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change (dollars in thousands) ​ 2024 ​ 2023 ​ Amount Net loss ​ $ (7,042) ​ $ (979) ​ $ (6,063) Income tax expense ​ 1,932 ​ ​ 196 ​ ​ 1,736 Interest expense (1) ​ 521 ​ 356 ​ 165 Depreciation and amortization ​ 2,429 ​ 2,217 ​ 212 EBITDA ​ $ (2,160) ​ $ 1,790 ​ $ (3,950) (1) Includes amortization of debt issue costs.
GAAP measure reported in our consolidated financial statements for the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change (dollars in thousands) ​ 2025 ​ 2024 ​ Amount Net loss ​ $ (2,748) ​ $ (7,042) ​ $ 4,294 Income tax (benefit) expense ​ (2) ​ ​ 1,932 ​ ​ (1,934) Interest expense (1) ​ 541 ​ 521 ​ 20 Depreciation and amortization ​ 2,796 ​ 2,429 ​ 367 EBITDA ​ $ 587 ​ $ (2,160) ​ $ 2,747 (1) Includes amortization of debt issue costs.
It has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries.
Stadco has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries. Stadco also manufactures tooling, molds, fixtures, jigs and dies used in the production of defense-centric aircraft components.
Cost of Sales and Gross Profit Consolidated – Cost of sales consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of sales for the fiscal year ended March 31, 2024, was $27.5 million, or 4% higher compared to the fiscal year ended March 31, 2023.
Cost of Revenue and Gross Profit Consolidated – Cost of revenue consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of revenue for the fiscal year ended March 31, 2025, was $29,702, an increase of 8% when compared to the fiscal year ended March 31, 2024.
Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024; (ii) limits the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions; and (iii) makes certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds.
Effective March 20, 2024, the Seventh Amendment, among other things (i) extended the maturity date of the Revolver Loan from March 20, 2024 to May 20, 2024, and (ii) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions. 33 Table of Contents On May 28, 2024, Ranor and the other Borrowers entered into an Eighth Amendment to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note with Berkshire Bank.
Since the Seller validly terminated the Purchase Agreement pursuant to Section 7.01(f), the Company was required to pay to the Seller the Stock Termination Fee.
The Seller validly terminated the Purchase Agreement pursuant to Section 7.01(f), the Company was required to pay to the Seller the Stock Termination Fee. On April 29, 2024, we issued 320,000 shares of our common stock as the Stock Termination Fee.
The defense backlog remains strong as new orders for components related to a variety of programs, including the U.S. Navy submarine programs continue to flow down from our existing base of prime defense contractors.
The backlog at Ranor remains strong as new orders continue to flow down from our existing customer base of prime defense contractors.
Effective August 30, 2024, the Ninth Amendment, among other things, (i) extends the maturity date of the Revolver Loan from August 30, 2024 to January 15, 2025. Read about the Berkshire Bank Loans under the “Liquidity and Capital Resources” section below, for a discussion of the amended debt agreement and its impact on the Company’s liquidity and on-going operations.
Read about the Berkshire Bank Loans under the “Liquidity and Capital Resources” section below, for a discussion of the amended debt agreement and its impact on the Company’s liquidity and on-going operations.
Backlog at Ranor on March 31, 2024 was $21.1 million. 29 Table of Contents Stadco - Net sales were $14.6 million for the fiscal year ended March 31, 2024 compared with net sales of $12.3 million for the fiscal year ended March 31, 2023, an increase of 19%.
Backlog at Ranor on March 31, 2025, and 2024 was $21,068 and $21,100, respectively. 29 Table of Contents Stadco - Revenue was $15,998 for the fiscal year ended March 31, 2025, compared with revenue of $14,567 for the fiscal year ended March 31, 2024, an increase of $1,431, or 10%.
Unused borrowing capacity at March 31, 2024 and March 31, 2023 was approximately $0.5 million and $4.2 million, respectively. At March 31, 2024 our working capital was negative $2.9 million because of the reclassification of our long-term debt from noncurrent to current in the consolidated balance sheet. Working capital was $5.6 million at March 31, 2023.
The weighted average amount outstanding during the fiscal year ended March 31, 2025 was $2,631. Undrawn borrowing capacity as of March 31, 2025 and 2024 was $1,256 and $539, respectively. At March 31, 2025 our working capital was negative $1,570 because of the reclassification of our long-term debt from noncurrent to current in the consolidated balance sheet.
Financing activities For the fiscal year ended March 31, 2024 we drew down $7.2 million of proceeds under the Revolver Loan and repaid $5.0 million during the same period. We also used $0.6 million of cash primarily to pay down debt principal and make periodic lease payments.
Financing activities We drew down $13,876 of proceeds under our Revolver Loan during fiscal 2025 and repaid $13,511 during the same period. We also used $663 of cash to pay down debt principal and make periodic lease payments and financed the purchase of certain equipment at Stadco for $65.
On April 29, 2024, we issued 320,000 shares of our common stock as the Stock Termination Fee. 24 Table of Contents Amendments to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note On March 20, 2024, Ranor and certain affiliates of the Company entered into a Seventh Amendment to Amended and Restated Loan Agreement and Third Amendment to Second Amended and Restated Promissory Note, or the “Seventh Amendment”.
Such registration was filed initially with the Securities and Exchange Commission on May 2, 2024, and was declared effective on January 31, 2025. 24 Table of Contents Amendments to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note On March 20, 2024, Ranor and certain affiliates of the Company entered into a Seventh Amendment to Amended and Restated Loan Agreement and Third Amendment to Second Amended and Restated Promissory Note, or the “Seventh Amendment”.
Net Loss As a result of the foregoing, for fiscal 2024, we recorded a net loss of $7.0 million, or $0.81 per share basic and fully diluted, compared with a net loss of $1.0 million, or $0.11 per share basic and fully diluted in fiscal 2023.
In recognition of this risk, we continue to provide a valuation allowance on these items. 31 Table of Contents Net Loss As a result of the foregoing, for fiscal 2025, we recorded a net loss of $2,748, or $0.29 per share basic and fully diluted, compared with a net loss of $7,042, or $0.81 per share basic and fully diluted in fiscal 2024.
On September 4, 2024, Ranor and the other Borrowers entered into a Ninth Amendment to Amended and Restated Loan Agreement and Fifth Amendment to Second Amended and Restated Promissory Note, or the “Ninth Amendment”, with Berkshire Bank.
On December 19, 2024, Ranor and the other Borrowers entered into a Tenth Amendment to Amended and Restated Loan Agreement and Sixth Amendment to Second Amended and Restated Promissory Note, or the “Tenth Amendment”, with Berkshire Bank. The Tenth Amendment, among other things, extended the maturity date of the Revolver Loan from January 15, 2025 to April 30, 2025.
Upon the occurrence and during the continuance of certain default events, at the option of Berkshire Bank, or automatically without notice or any other action upon the occurrence of certain other events specified in the Loan Agreement, the unpaid principal amount outstanding under the facility, together with accrued interest and all other obligations, would become immediately due and payable without presentment, demand, protest, or further notice of any kind. 33 Table of Contents As a result of Borrowers’ failure to satisfy the required minimum Debt Service Coverage Ratio for the twelve (12) month period ending March 31, 2024 as set forth in the Loan Agreement, or the “Existing Default”, the borrowers acknowledge that a certain Event of Default has occurred and is continuing under the Loan Agreement.
As a result of Borrowers’ failure to satisfy the required minimum Debt Service Coverage Ratio for the twelve (12) month period ending March 31, 2025, as set forth in the Loan Agreement, or the “Existing Default”, the borrowers acknowledge that a certain Event of Default has occurred and is continuing under the Loan Agreement.
The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels. In recognition of this risk, we continue to provide a valuation allowance on these items.
We believe that it is more likely than not that the benefit from certain state NOL carryforwards and other deferred tax assets will not be realized. The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels.
On May 28, 2024, Ranor and the other Borrowers entered into an Eighth Amendment to Amended and Restated Loan Agreement and Fourth Amendment to Second Amended and Restated Promissory Note with Berkshire Bank.
On April 28, 2024, Ranor and the other Borrowers entered into the Eleventh Amendment to Amended and Restated Loan Agreement and Seventh Amendment to Second Amended and Restated Promissory Note, or the “Eleventh Amendment”, with Berkshire Bank. The Eleventh Amendment, among other things, extended the maturity date of the Revolver Loan from April 30, 2025 to August 29, 2025.
Other Income (Expense), net The following table presents other income (expense) for the fiscal years ended March 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 $ Change % Change Other income (expense), net ​ $ 43,363 ​ $ 40,842 ​ $ 2,521 6 % Interest expense ​ $ (414,268) ​ $ (295,692) ​ $ (118,576) (40) % Amortization of debt issue costs ​ $ (106,840) ​ $ (59,916) ​ $ (46,925) (78) % ​ Interest expense increased under the Revolver Loan (as defined below) by $138,987 when compared with the fiscal year ended March 31, 2023, due to higher amounts borrowed and higher interest rates.
Other Income (Expense), net The following table presents other income (expense) for the fiscal years ended March 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2024 $ Change % Change Other income (expense), net ​ $ (51) ​ $ 43 ​ $ (94) (219) % Interest expense ​ $ (438) ​ $ (414) ​ $ (24) (6) % Amortization of debt issue costs ​ $ (103) ​ $ (107) ​ $ 4 4 % ​ Interest expense increased by $24 when compared with the fiscal year ended March 31, 2024, due primarily to higher average debt levels under the revolver loan.
We evaluate the performance of our segments based upon, among other things, segment net sales and operating profit. Segment operating profit excludes general corporate costs, which include executive and director compensation, stock-based compensation, certain pension and other retirement benefit costs, and other corporate facilities and administrative expenses not allocated to the segments.
Segment operating profit excludes general corporate costs, which include director compensation, stock-based compensation, certain pension and other retirement benefit costs, and other corporate administrative expenses not allocated to the segments. Also excluded are items that we consider not representative of ongoing operations, such as the unallocated PPP loan forgiveness and refundable employee retention tax credits.
The purpose of the sale of the PIPE Shares and the PIPE Warrants under the PIPE Agreement is to raise working capital for use by the Company. The closing of the offering occurred on July 8, 2024.
The purpose of the sale of the common stock and warrants was to raise working capital for use by the Company.
The fiscal 2024 provision is the sum of tax expense from an increase in the valuation allowance of $3.1 million, offset in part by a federal and state tax benefit due to higher pretax losses. 31 Table of Contents Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The valuation allowance on deferred tax assets at March 31, 2025 and 2024 was $5,722 and $5,312, respectively.
Selling, General and Administrative (SG&A) Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ Changes ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ (dollars in thousands) Amount Net Sales Amount Net Sales Amount Percent Ranor ​ $ 1,477 ​ 4 % $ 1,649 ​ 5 % $ (172) ​ (10) % Stadco ​ ​ 1,552 ​ 5 % ​ 1,832 ​ 6 % ​ (280) ​ (15) % Corporate and unallocated ​ ​ 5,721 ​ 18 % ​ 2,528 ​ 8 % ​ 3,193 ​ 126 % Consolidated SG&A ​ $ 8,750 ​ 27 % $ 6,009 ​ 19 % $ 2,741 ​ 46 % ​ March 31, 2023 SG&A segment data is revised to reflect current period updates to unallocated corporate administrative expense.
Selling, General and Administrative (SG&A) Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 ​ Changes ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ (dollars in thousands) Amount Revenue Amount Revenue Amount Percent Ranor ​ $ 2,545 ​ 7 % $ 2,260 ​ 7 % $ 285 ​ 13 % Stadco ​ ​ 3,298 ​ 10 % ​ 3,125 ​ 10 % ​ 173 ​ 6 % Corporate and unallocated ​ ​ 644 ​ 2 % ​ 3,365 ​ 10 % ​ (2,721) ​ (81) % Consolidated SG&A ​ $ 6,487 ​ 19 % $ 8,750 ​ 27 % $ (2,263) ​ (26) % ​ Fiscal 2025 and 2024: SG&A segment data was revised to reflect current period updates to allocated corporate expenses.
Amortization of debt issue costs for the fiscal year ended March 31, 2024 increased when compared to fiscal year ended March 31, 2023, as new amortization periods commenced for costs incurred to extend the Ranor Term Loan and renew the Revolver Loan.
Amortization of debt issue costs for the fiscal year ended March 31, 2025, was slightly lower when compared to fiscal year ended March 31, 2024, as we continue to amortize issue costs related to the Berkshire loan agreement and amendments thereto.
Long-lived assets In accordance with Accounting Standards Codification (ASC) 360, Property, Plant & Equipment , our property, plant and equipment is tested for impairment when triggering events occur and, if impaired, written-down to fair value based on either discounted cash flows or appraised values.
Long-lived assets In accordance with Accounting Standards Codification (ASC) 360, Property, Plant & Equipment , our property, plant and equipment is tested for impairment whenever events or circumstances indicate the carrying amount of an asset may be impaired.
If such registration statement is not declared effective in a timely manner, we will be subject to liquidated damages as described in the PIPE Agreement. Overview Through our two wholly-owned subsidiaries, Ranor and Stadco, each of which is a reportable segment, we offer a full range of services required to transform raw materials into precision finished products.
If such registration statement is not declared effective in a timely manner, we will be subject to liquidated damages as described in the PIPE Agreement. The registration statement was declared effective by the Securities and Exchange Commission on January 31, 2025.
Our cash flows can fluctuate significantly from period to period as we mark progress with customer projects and the composition of our receivables collections mix changes between advance payments and customer payments made after shipment of finished goods. Cash provided by operating activities for fiscal 2024 was $1.3 million.
Our cash flows can fluctuate from period to period as we mark progress with customer project milestones and the timing of progress payments. Cash used in operating activities during fiscal 2025 totaled $599. Net loss adjusted by our non - cash items provided $813 of cash during fiscal 2025, as compared to cash used of $1,022 in fiscal 2024.
The table below presents selected liquidity and capital measures at the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change (dollars in thousands) ​ 2024 ​ 2023 ​ Amount Cash and cash equivalents ​ $ 138 ​ $ 534 ​ $ (396) Working capital ​ $ (2,904) ​ $ 5,559 ​ $ (8,463) Total debt ​ $ 7,648 ​ $ 6,113 ​ $ 1,535 Total stockholders’ equity ​ $ 7,803 ​ $ 14,594 ​ $ (6,791) ​ The next table summarizes changes in cash by primary component in the cash flows statements for the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change (dollars in thousands) ​ 2024 ​ 2023 ​ Amount Operating activities ​ $ 1,305 ​ $ 3,138 ​ $ (1,833) Investing activities ​ (3,168) ​ (2,318) ​ (850) Financing activities ​ 1,467 ​ (1,337) ​ 2,804 Net decrease in cash ​ $ (396) ​ $ (517) ​ $ 121 ​ Berkshire Bank Loans On August 25, 2021, the Company entered into an amended and restated loan agreement with Berkshire Bank (as amended to date, the “Loan Agreement”).
The table below presents selected liquidity and capital measures at the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change ​ ​ 2025 ​ 2024 ​ Amount Cash and cash equivalents ​ $ 195 ​ $ 138 ​ $ 57 Working capital ​ $ (1,570) ​ $ (2,904) ​ $ 1,334 Total debt ​ $ 7,424 ​ $ 7,648 ​ $ (224) Total stockholders’ equity ​ $ 8,740 ​ $ 7,803 ​ $ 937 ​ The next table summarizes changes in cash by primary component in the cash flows statements for the fiscal years ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, March 31, Change (dollars in thousands) ​ 2025 ​ 2024 ​ Amount Operating activities ​ $ (599) ​ $ 728 ​ $ (1,327) Investing activities ​ (1,081) ​ (2,591) ​ 1,510 Financing activities ​ 1,737 ​ 1,467 ​ 270 Net increase (decrease) in cash ​ $ 57 ​ $ (396) ​ $ 453 ​ Operating activities Apart from our loan facilities, our primary sources of cash are provided by customer revenue, customer contract advances, and associated accounts receivable collections.
Corporate and unallocated - SG&A increased by $3.2 million, due primarily to one-time outside advisory and pre-acquisition advisory and legal expenses ($1.9 million) plus a breakup fee ($1.1 million) in connection with the terminated Votaw acquisition. 30 Table of Contents Operating (loss) income ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Changes ​ ​ ​ ​ ​ Percent of ​ ​ Percent of ​ ​ ​ ​ ​ (dollars in thousands) ​ Amount ​ net sales ​ Amount ​ net sales ​ Amount ​ Percent ​ Ranor ​ $ 3,070 ​ 10 % $ 5,328 ​ 18 % $ (2,258) ​ (42) % Stadco ​ (1,981) ​ (6) % ​ (3,905) ​ (12) % ​ 1,924 ​ 49 % Corporate and unallocated ​ (5,721) ​ (18) % ​ (2,528) ​ (8) % ​ (3,193) ​ (126) % Operating loss ​ $ (4,632) ​ (14) % $ (1,105) ​ (4) % $ (3,527) ​ (319) % ​ Consolidated - As a result of the foregoing, for the fiscal year ended March 31, 2024, we reported an operating loss of $4.6 million, which was $3.5 million higher than the operating loss for the fiscal year ended March 31, 2023.
For the fiscal year ended March 31, 2025, corporate expenses in connection with the terminated Votaw acquisition decreased by $2,556, stock-based compensation expenses decreased by $181 and other corporate expenses increased by $16 when compared with the fiscal year ended March 31, 2024. 30 Table of Contents Operating (loss) income ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2024 Changes ​ ​ ​ ​ ​ Percent of ​ ​ Percent of ​ ​ ​ ​ ​ (dollars in thousands) ​ Amount ​ Revenue ​ Amount ​ Revenue ​ Amount ​ Percent ​ Ranor ​ $ 3,129 ​ 9 % $ 2,287 ​ 7 % $ 842 ​ 37 % Stadco ​ (4,643) ​ (13) % ​ (3,554) ​ (11) % ​ (1,089) ​ (31) % Corporate and unallocated ​ (644) ​ (2) % ​ (3,365) ​ (11) % ​ 2,721 ​ 81 % Operating loss ​ $ (2,158) ​ (6) % $ (4,632) ​ (15) % $ 2,474 ​ 53 % ​ Consolidated – For the fiscal year ended March 31, 2025, we reported an operating loss of $2,158, compared with an operating loss of $4,632 for the fiscal year ended March 31, 2024.
Consolidated - Total selling, general and administrative expenses for the fiscal year ended March 31, 2024 increased by $2.7 million or 46% due primarily to outside advisory costs of $1.9 million, a break-up fee for $1.1 million in connection with the terminated Votaw acquisition, and $0.3 million for a claims settlement, partially offset by a $0.6 reduction in compensation at Stadco.
Consolidated - Total selling, general and administrative expenses decreased by $2,263, or 26%, due primarily to the absence of due diligence work on the terminated Votaw acquisition. Corporate expenses incurred in connection with due diligence acquisition activity and breakup fees decreased year-over-year and more than offset increased expenses at Ranor and Stadco.
Our business is dependent in part on the continuation of governmental programs that require our services and products. Our contracts are generated both through negotiation with the customer and from bids made pursuant to a request for proposal.
We primarily serve customers in defense and aerospace, secondarily in the precision industrial sectors. Within these sectors, we have manufactured custom components for US Navy submarines and aircraft carriers, USMC military helicopters, US defense and civilian aerospace programs. Our contracts are generated both through negotiation with the customer and from bids made pursuant to a request for proposal.
Our outstanding unconditional contractual commitments, including for the purchase of raw materials and supplies goods, totaled $5.8 million, all of it due to be paid within the next twelve months.
Our outstanding unconditional contractual commitments, including the purchase of raw materials and supplies goods, totaled $4,690, all of it due to be incurred and paid within the next twelve months. ● We also have $10,475 in purchase obligations outstanding for the purchase of machinery and equipment under an arrangement with a certain customer where the Company is reimbursed in full for all purchases. ● Our operating lease obligations, including imputed interest, totaled $4,860 for buildings through 2030, with $939 due annually for each of the next five years and $156 in year six.
We estimate our spending on new machinery and equipment in fiscal 2025, which we expect will include expenditures for the installation and construction of equipment for contract project work with a certain customer, will again exceed the spending limitation.
We estimate that our spending on new machinery and equipment in fiscal 2026 will not exceed that spending limitation. 32 Table of Contents In fiscal 2024, we invested $3,230 in new factory machinery and equipment and were reimbursed for $577 of certain purchases under a supplier development fund.
Removed
Under the Purchase Agreement, the Stock Termination Fee can increase by 48,000 additional shares of the Company’s common stock under certain conditions, including if the Company fails use commercially reasonable efforts to cause a registration statement to effect the resale of the shares of common stock composing the Stock Termination Fee to be declared effective by the Securities and Exchange Commission as soon as practicable.
Added
Also, under the Purchase Agreement, a registration statement was filed to effect the resale of the shares of common stock.
Removed
Such registration was filed with the Securities and Exchange Commission on May 2, 2024, but cannot be declared effective until we have filed all of the required financial statements with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024.
Added
Since the registration statement was not declared effective in a timely manner, the Company was obligated to pay $108 as liquidated damages and interest under the agreement. 25 Table of Contents Overview TechPrecision, through our wholly owned subsidiaries, is a manufacturer of large-scale metal fabricated and machined precision components and equipment.
Removed
Our manufacturing capabilities include fabrication operations (cutting, press and roll forming, assembly, welding, heat treating, blasting, and painting) and machining operations including CNC (computer numerical controlled) horizontal and vertical milling centers.
Added
These components are used in a variety of markets, primarily defense and aerospace, and secondarily precision industrial. All our operations and customers are in the United States. We work with our customers to manufacture components in accordance with the customers’ drawings and specifications.
Removed
We also provide support services to our manufacturing capabilities: manufacturing engineering (planning, fixture and tooling development, manufacturing), quality control (inspection and testing), materials procurement, production control (scheduling, project management and expediting) and final assembly. All manufacturing is done in accordance with our written quality assurance program, which meets specific national and international codes, standards, and specifications.
Added
Our work complies with specific military specifications and standards as well as national and international codes and standards required by our customers. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service.

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