[Executive Summary](index=1&type=section&id=Executive%20Summary) [Announcement and Overview](index=1&type=section&id=Announcement%20and%20Overview) Argan, Inc. announced its financial results for the second quarter of fiscal year 2025, ended July 31, 2024, reporting significant increases in consolidated revenues, net income, and EBITDA, reflecting strong business momentum - Argan, Inc. reported second quarter fiscal year 2025 results on September 5, 2024[1](index=1&type=chunk) [Consolidated Financial Highlights](index=1&type=section&id=Consolidated%20Financial%20Highlights) The company experienced substantial growth in Q2 FY2025, with revenues increasing by 60.6% and net income by 42.5% year-over-year. For the six months ended July 31, 2024, revenues grew by 57.0% and net income by 75.3%. Project backlog also saw a significant increase Consolidated Financial Highlights (Q2 FY2025 vs. Q2 FY2024) | Metric | Q2 FY2025 ($ in thousands) | Q2 FY2024 ($ in thousands) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues | $227,015 | $141,349 | $85,666 | 60.6% | | Gross profit | $31,105 | $23,742 | $7,363 | 31.0% | | Gross margin % | 13.7 % | 16.8 % | (3.1)% | -18.5% | | Net income | $18,198 | $12,767 | $5,431 | 42.5% | | Diluted income per share | $1.31 | $0.94 | $0.37 | 39.4% | | EBITDA | $24,842 | $17,945 | $6,897 | 38.4% | | Cash dividends per share | $0.30 | $0.25 | $0.05 | 20.0% | Consolidated Financial Highlights (Six Months FY2025 vs. Six Months FY2024) | Metric | Six Months FY2025 ($ in thousands) | Six Months FY2024 ($ in thousands) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues | $384,697 | $245,024 | $139,673 | 57.0% | | Gross profit | $49,049 | $37,966 | $11,083 | 29.2% | | Gross margin % | 12.8 % | 15.5 % | (2.7)% | -17.4% | | Net income | $26,080 | $14,876 | $11,204 | 75.3% | | Diluted per share | $1.90 | $1.10 | $0.80 | 72.7% | | EBITDA | $36,732 | $21,594 | $15,138 | 70.1% | | Cash dividends per share | $0.60 | $0.50 | $0.10 | 20.0% | Key Balance Sheet and Operational Metrics (As of July 31, 2024 vs. January 31, 2024) | Metric | July 31, 2024 ($ in thousands) | January 31, 2024 ($ in thousands) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Cash, cash equivalents and investments | $484,682 | $412,405 | $72,277 | 17.5% | | Net liquidity | $259,827 | $244,919 | $14,908 | 6.1% | | Project backlog | $1,035,000 | $757,000 | $278,000 | 36.7% | [CEO Commentary and Business Outlook](index=1&type=section&id=CEO%20Commentary%20and%20Business%20Outlook) The CEO highlighted continued business momentum in fiscal 2025, with Q2 revenues up 61% and the highest quarterly EBITDA since 2017. Strong performance was noted from Gemma Power Systems in renewables and The Roberts Company with record quarterly revenues. The company's backlog reached $1.0 billion, driven by increasing electrical power demands from data centers, manufacturing onshoring, and EV expansion, positioning Argan well for future growth in energy facility construction - **Consolidated revenues** increased by **61%** to **$227 million** in Q2, with **net income** of **$18.2 million** and **EBITDA** of approximately **$25 million**, marking the **highest quarterly EBITDA** since 2017[3](index=3&type=chunk) - Gemma Power Systems showed strong performance and sustained growth in the renewable market, while The Roberts Company achieved **record quarterly revenues** of almost **$50 million**[3](index=3&type=chunk) - **Project backlog** closed at **$1.0 billion**, an increase of approximately **$210 million** from the previous quarter, including **$570 million** in renewable projects[4](index=4&type=chunk) - Key drivers for increasing electrical power demands and new business opportunities include high energy demand data centers, onshoring of manufacturing operations, and expansion of electric vehicle use[4](index=4&type=chunk) [Second Quarter Fiscal 2025 Performance](index=3&type=section&id=Second%20Quarter%20Fiscal%202025%20Performance) [Revenues](index=3&type=section&id=Revenues) Consolidated revenues for Q2 FY2025 significantly increased by 60.6% year-over-year, driven by progress on projects like Trumbull Energy Center, Midwest Solar and Battery Projects, and Louisiana LNG Facility, partially offset by the completion or near-completion of other projects - **Consolidated revenues** for Q2 FY2025 were **$227.0 million**, an increase of **$85.7 million** (**60.6%**) from **$141.3 million** in the comparable prior year quarter[5](index=5&type=chunk) - Increased revenues were attributed to projects such as the Trumbull Energy Center, Midwest Solar and Battery Projects, 405 MW Midwest Solar Project, and the Louisiana LNG Facility[5](index=5&type=chunk) - Revenue growth was partially offset by decreased construction revenues from projects nearing completion, including Guernsey Power Station, Shannonbridge Power Project, ESB FlexGen Peaker Plants, and Kilroot power facility[5](index=5&type=chunk) [Gross Profit and Margin](index=3&type=section&id=Gross%20Profit%20and%20Margin) Consolidated gross profit for Q2 FY2025 increased to $31.1 million, but the gross margin percentage declined to 13.7% from 16.8% in the prior year, reflecting a changing mix of projects and contract types - **Consolidated gross profit** for Q2 FY2025 was approximately **$31.1 million**, or **13.7%** of consolidated revenues[6](index=6&type=chunk) - This compares to a **gross profit** of **$23.7 million**, or **16.8%** of consolidated revenues, in Q2 FY2024[6](index=6&type=chunk) - The decline in **gross profit** percentage reflects the changing mix of projects and contract types[6](index=6&type=chunk) [Operating Expenses (SG&A)](index=3&type=section&id=Operating%20Expenses%20(SG%26A)) Selling, general and administrative (SG&A) expenses increased in absolute terms but decreased as a percentage of revenues in Q2 FY2025, indicating improved operational leverage - **SG&A expenses** increased by **$1.9 million** to **$12.4 million** in Q2 FY2025 from **$10.5 million** in Q2 FY2024[7](index=7&type=chunk) - As a percentage of revenues, **SG&A expenses** declined to **5.5%** in Q2 FY2025 from **7.4%** in Q2 FY2024[7](index=7&type=chunk) [Other Income and Income Tax Expense](index=3&type=section&id=Other%20Income%20and%20Income%20Tax%20Expense) Other income, net, for Q2 FY2025 was $5.6 million, primarily from invested funds. Income tax expense increased due to higher pre-tax book income - **Other income, net**, for Q2 FY2025 was **$5.6 million**, including approximately **$4.8 million** from invested funds[8](index=8&type=chunk) - **Income tax expense** for Q2 FY2025 was **$6.1 million** on consolidated pre-tax book income of **$24.3 million**, compared to **$4.6 million** on **$17.4 million** in Q2 FY2024[8](index=8&type=chunk) [Net Income and EBITDA](index=3&type=section&id=Net%20Income%20and%20EBITDA) Argan achieved significant increases in net income and EBITDA for Q2 FY2025, reflecting enhanced profitability - **Net income** for Q2 FY2025 was **$18.2 million**, or **$1.31 per diluted share**, up from **$12.8 million**, or **$0.94 per diluted share**, in Q2 FY2024[9](index=9&type=chunk) - **EBITDA** for Q2 FY2025 increased to **$24.8 million**, compared to **$17.9 million** in Q2 FY2024[9](index=9&type=chunk) [Financial Position and Liquidity](index=3&type=section&id=Financial%20Position%20and%20Liquidity) Argan maintained a strong financial position with substantial cash, cash equivalents, and investments, along with healthy net liquidity and no debt as of July 31, 2024 - **Total cash, cash equivalents, and investments** were **$484.7 million** as of July 31, 2024, up from **$412.4 million** as of January 31, 2024[10](index=10&type=chunk) - **Net liquidity** stood at **$259.8 million** at July 31, 2024, compared to **$244.9 million** at January 31, 2024[10](index=10&type=chunk) - The Company reported no debt[10](index=10&type=chunk) [First Six Months Fiscal 2025 Performance](index=4&type=section&id=First%20Six%20Months%20Fiscal%202025%20Performance) [Revenues](index=4&type=section&id=Revenues) Consolidated revenues for the first six months of FY2025 increased significantly by 57.0% compared to the prior year period - **Consolidated revenues** for the six months ended July 31, 2024, were **$384.7 million**, an increase of **$139.7 million** (**57.0%**) from **$245.0 million** in the comparable prior year period[11](index=11&type=chunk) [Gross Profit and Margin](index=4&type=section&id=Gross%20Profit%20and%20Margin) For the first six months of FY2025, consolidated gross profit increased, but the gross margin percentage declined due to a changing project mix and losses related to the Kilroot project - **Consolidated gross profit** for the six months ended July 31, 2024, increased to approximately **$49.0 million**, with a **consolidated gross margin** of **12.8%**[12](index=12&type=chunk) - This compares to a **gross profit** of **$38.0 million**, or **15.5% gross margin**, for the six months ended July 31, 2023[12](index=12&type=chunk) - The **gross margin** was adversely impacted by losses related to the Kilroot project and the changing mix of projects and contract types[12](index=12&type=chunk) [Operating Expenses (SG&A)](index=4&type=section&id=Operating%20Expenses%20(SG%26A)) SG&A expenses increased in absolute terms for the first six months of FY2025 but decreased as a percentage of revenues, demonstrating improved efficiency - **SG&A expenses** increased by **$2.8 million** to **$23.9 million** for the six months ended July 31, 2024, from **$21.1 million** in the comparable prior year period[13](index=13&type=chunk) - As a percentage of revenues, these expenses declined to **6.2%** from **8.6%** between the periods[13](index=13&type=chunk) [Other Income and Income Tax Expense](index=4&type=section&id=Other%20Income%20and%20Income%20Tax%20Expense) Other income, net, for the first six months of FY2025 was $10.4 million, primarily from invested funds. Income tax expense increased due to higher pre-tax book income - **Other income, net**, for the six months ended July 31, 2024, was **$10.4 million**, primarily from invested funds[14](index=14&type=chunk) - **Income tax expense** for the six months ended July 31, 2024, was **$9.5 million** on consolidated pre-tax book income of **$35.6 million**, compared to **$5.5 million** on **$20.4 million** in the prior year[14](index=14&type=chunk) [Net Income and EBITDA](index=4&type=section&id=Net%20Income%20and%20EBITDA) Argan reported substantial growth in net income and EBITDA for the first six months of FY2025, reflecting strong overall performance - **Net income** for the six months ended July 31, 2024, was **$26.1 million**, or **$1.90 per diluted share**, up from **$14.9 million**, or **$1.10 per diluted share**, in the comparable prior year period[15](index=15&type=chunk) - **EBITDA** for the six months ended July 31, 2024, was **$36.7 million**, compared to **$21.6 million** in the same period last year[15](index=15&type=chunk) [Company Information and Disclosures](index=4&type=section&id=Company%20Information%20and%20Disclosures) [About Argan (Business Description)](index=4&type=section&id=About%20Argan%20(Business%20Description)) Argan's core business involves providing construction and related services to the power industry, specializing in natural gas-fired and renewable energy facilities through its subsidiaries Gemma Power Systems and Atlantic Projects Company. It also includes The Roberts Company for industrial construction and SMC Infrastructure Solutions for telecommunications - Argan's primary business is providing a full range of construction and related services to the power industry[18](index=18&type=chunk) - Service offerings include engineering, procurement, and construction of natural gas-fired power plants and renewable energy facilities, along with commissioning, maintenance, project development, and technical consulting services[18](index=18&type=chunk) - Key operating subsidiaries are Gemma Power Systems, Atlantic Projects Company, The Roberts Company (industrial construction, fabrication, plant services), and SMC Infrastructure Solutions (telecommunications infrastructure services)[18](index=18&type=chunk)[19](index=19&type=chunk) [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) The company uses EBITDA as a non-GAAP financial measure to supplement understanding of its ongoing operating results, excluding the effects of capital structure, depreciation, amortization, and tax rates, and provides a reconciliation to comparable GAAP measures - **EBITDA** is presented as a non-GAAP financial measure to supplement the understanding of Argan's ongoing operating results[20](index=20&type=chunk) - This measure excludes the effects of capital structure, depreciation, amortization, and tax rates[20](index=20&type=chunk) - Reconciliation of non-GAAP financial measures to comparable GAAP measures is provided in the financial tables[20](index=20&type=chunk) [Safe Harbor Statement](index=5&type=section&id=Safe%20Harbor%20Statement) The report contains forward-looking statements subject to risks and uncertainties, including the successful addition of new contracts, project completion, and mitigation of losses, as detailed in the company's SEC filings - The press release contains forward-looking statements subject to federal securities laws[21](index=21&type=chunk) - Future financial performance is subject to risks and uncertainties, including successful contract additions, receipt of notices to proceed, ability to complete projects, and mitigating losses from the Kilroot contract[21](index=21&type=chunk) - Actual results may differ materially from projections due to risk factors described in the Company's SEC filings (Form 10-K, 10-Q)[21](index=21&type=chunk) [Conference Call and Investor Contacts](index=4&type=section&id=Conference%20Call%20and%20Investor%20Contacts) Argan hosted an investor conference call and webcast on September 5, 2024, with replay options available, and provided contact information for company and investor relations inquiries - Argan hosted a conference call and webcast for investors on September 5, 2024, at 5:00 p.m. ET[16](index=16&type=chunk) - A replay of the teleconference is available until September 19, 2024, and a webcast replay until September 5, 2025[17](index=17&type=chunk) - Contact information for David Watson (Company Contact) and IMS Investor Relations (John Nesbett/Jennifer Belodeau) is provided[22](index=22&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Statements of Earnings](index=6&type=section&id=Statements%20of%20Earnings) The Condensed Consolidated Statements of Earnings provide detailed financial performance for the three and six months ended July 31, 2024, and 2023, showing revenues, cost of revenues, gross profit, operating expenses, other income, income tax expense, and net income Condensed Consolidated Statements of Earnings (Three Months Ended July 31) | Metric (In thousands, except per share data) | 2024 | 2023 | | :--- | :--- | :--- | | REVENUES | $227,015 | $141,349 | | Cost of revenues | 195,910 | 117,607 | | GROSS PROFIT | 31,105 | 23,742 | | Selling, general and administrative expenses | 12,428 | 10,501 | | INCOME FROM OPERATIONS | 18,677 | 13,241 | | Other income, net | 5,604 | 4,118 | | INCOME BEFORE INCOME TAXES | 24,281 | 17,359 | | Income tax expense | 6,083 | 4,592 | | NET INCOME | 18,198 | 12,767 | | Basic Net Income Per Share | $1.36 | $0.95 | | Diluted Net Income Per Share | $1.31 | $0.94 | | Cash Dividends Per Share | $0.30 | $0.25 | Condensed Consolidated Statements of Earnings (Six Months Ended July 31) | Metric (In thousands, except per share data) | 2024 | 2023 | | :--- | :--- | :--- | | REVENUES | $384,697 | $245,024 | | Cost of revenues | 335,648 | 207,058 | | GROSS PROFIT | 49,049 | 37,966 | | Selling, general and administrative expenses | 23,853 | 21,092 | | INCOME FROM OPERATIONS | 25,196 | 16,874 | | Other income, net | 10,398 | 3,489 | | INCOME BEFORE INCOME TAXES | 35,594 | 20,363 | | Income tax expense | 9,514 | 5,487 | | NET INCOME | 26,080 | 14,876 | | Basic Net Income Per Share | $1.96 | $1.11 | | Diluted Net Income Per Share | $1.90 | $1.10 | | Cash Dividends Per Share | $0.60 | $0.50 | [Balance Sheets](index=7&type=section&id=Balance%20Sheets) The Condensed Consolidated Balance Sheets present the company's financial position as of July 31, 2024, and January 31, 2024, detailing assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (As of July 31, 2024 vs. January 31, 2024) | Metric (Dollars in thousands) | July 31, 2024 | January 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $232,685 | $197,032 | | Investments | 251,997 | 215,373 | | Accounts receivable, net | 95,315 | 47,326 | | Contract assets | 46,086 | 48,189 | | Other current assets | 48,871 | 39,259 | | TOTAL CURRENT ASSETS | 674,954 | 547,179 | | Property, plant and equipment, net | 12,098 | 11,021 | | Goodwill | 28,033 | 28,033 | | Intangible assets, net | 2,022 | 2,217 | | Deferred taxes, net | 1,637 | 2,259 | | Right-of-use and other assets | 7,830 | 7,520 | | **TOTAL ASSETS** | **$726,574** | **$598,229** | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Accounts payable | $99,693 | $39,485 | | Accrued expenses | 61,698 | 81,721 | | Contract liabilities | 253,736 | 181,054 | | TOTAL CURRENT LIABILITIES | 415,127 | 302,260 | | Noncurrent liabilities | 3,379 | 5,030 | | **TOTAL LIABILITIES** | **418,506** | **307,290** | | Common stock | 2,374 | 2,374 | | Additional paid-in capital | 165,902 | 164,183 | | Retained earnings | 243,519 | 225,507 | | Less treasury stock, at cost | (99,644) | (97,528) | | Accumulated other comprehensive loss | (4,083) | (3,597) | | **TOTAL STOCKHOLDERS' EQUITY** | **308,068** | **290,939** | | **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | **$726,574** | **$598,229** | [Reconciliation to EBITDA](index=8&type=section&id=Reconciliation%20to%20EBITDA) The reconciliation table provides a breakdown of how EBITDA, a non-GAAP measure, is derived from net income for both the three and six months ended July 31, 2024, and 2023, by adding back income tax expense, depreciation, and amortization Reconciliation to EBITDA (Three Months Ended July 31) | Metric (In thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Net income, as reported | $18,198 | $12,767 | | Income tax expense | 6,083 | 4,592 | | Depreciation | 463 | 488 | | Amortization of intangible assets | 98 | 98 | | **EBITDA** | **$24,842** | **$17,945** | Reconciliation to EBITDA (Six Months Ended July 31) | Metric (In thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Net income, as reported | $26,080 | $14,876 | | Income tax expense | 9,514 | 5,487 | | Depreciation | 943 | 1,035 | | Amortization of intangible assets | 195 | 196 | | **EBITDA** | **$36,732** | **$21,594** |

Core Viewpoint - Argan, Inc. (AGX) is well-positioned to benefit from increasing electricity demand driven by generative AI, electric vehicle (EV) adoption, and the need for enhanced energy infrastructure, leading to a positive growth outlook and a recommendation for a buy rating [3][19]. Company Overview - AGX operates through subsidiaries including Gemma Power Systems, The Roberts Company, Atlantic Projects Company, and Southern Maryland Cable, providing services to the power generation, industrial, and telecommunications markets [3]. - The power industry services segment is the largest, accounting for approximately 70% of total revenue, followed by industrial construction services at 28% and telecommunications infrastructure services at 2% [10]. Demand Drivers - The demand for electricity is expected to rise due to the growth of AI and data centers, EVs, and renewable energy projects, necessitating upgrades to the global energy infrastructure [11]. - Generative AI is projected to increase data center power consumption by 160% by 2030, with data centers expected to account for 3-4% of overall power usage by the end of the decade [12]. - EV sales reached nearly 14 million in 2023, with expectations for continued growth, potentially reaching 17 million in 2024, which will significantly increase power demand [15]. Financial Performance - AGX's revenue was approximately $509.37 million in 2021, decreased to $455.04 million in 2022, and rebounded to $573.33 million in 2023, with notable growth in power industry services (20.3%) and industrial construction services (53.9%) [6][8]. - In Q1 2025, AGX reported a 52.1% year-over-year increase in consolidated revenue to $157.7 million, driven by projects like the Trumbull Energy Center and Midwest Solar and Battery Projects [8]. Profitability Metrics - AGX's gross profit margin contracted from 19% to 14.1% in 2024, primarily due to a $13.6 million loss related to the Kilroot project, impacting net income margin which fell from 7.3% to 5.6% [7]. - Despite the gross margin contraction, EBITDA margin improved from 3.5% to 7.5% in Q1 2025, supported by lower SG&A expenses [8]. Growth Outlook - AGX's forward revenue growth rate is 24.42%, significantly higher than the peers' median of 11.46%, indicating strong growth potential [18]. - The company has a robust project backlog, including the Trumbull Energy Center and a utility-scale solar field in Illinois, which is expected to generate 405 MW of electricity [18]. Market Positioning - AGX's forward P/E ratio is 19.48x, higher than the peers' median of 16.47x, reflecting its strong growth outlook and profitability margins [18]. - The anticipated market revenue for AGX in 2026 is approximately $876 million, with an EPS estimate of $4.94 per share [18].

Financial Data and Key Metrics Changes - Consolidated revenues increased by 52% to $157.7 million for Q1 2025 compared to the same quarter last year [6][18] - EBITDA improved to $11.9 million from $3.6 million year-over-year [21] - Net income rose to $7.9 million or $0.58 per diluted share, compared to $2.1 million or $0.16 per diluted share in the prior year [21] Business Line Data and Key Metrics Changes - Power Industry Services segment revenues increased by 57% to $110.3 million, representing 70% of total revenues [9][19] - Industrial Construction Services segment (TRC) achieved revenue growth of 44% to $43.7 million, contributing 28% of total revenues [10][19] - Telecommunications Infrastructure Services contributed 2% of total revenues, reflecting the smallest segment [11] Market Data and Key Metrics Changes - Project backlog at the end of Q1 2025 was $824 million, up from $757 million at the end of Q4 2024 and $806 million year-over-year [7][22] - Approximately $318 million or 39% of the backlog consists of renewable projects, with 86% of the backlog supporting zero or low carbon emissions [14][22] Company Strategy and Development Direction - The company aims to expand its leadership role in energy infrastructure, focusing on both traditional and renewable energy projects [13][26] - There is a strong emphasis on leveraging capabilities to meet increasing energy demands driven by data centers and electric vehicle adoption [12][27] - The company is committed to disciplined risk management and exploring acquisition opportunities to enhance growth [27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growing urgency to reinforce energy infrastructure to meet anticipated consumption levels [16][28] - The company is well-positioned to benefit from the transition to cleaner energy alternatives while maintaining grid reliability [27] - Management highlighted the robust pipeline of opportunities and the effectiveness of their growth and diversity plan [14][26] Other Important Information - The company reported a strong balance sheet with $416 million in cash and investments, net liquidity of $247 million, and no debt [7][24] - A total of approximately $101.2 million has been returned to shareholders through stock repurchases since November 2021 [25] Q&A Session Summary Question: Are there likely or possible additional charges coming from the Kilroot project? - Management indicated that while there is a possibility of additional losses, there is also potential for recovery, with claims exceeding $25 million being pursued [31][32] Question: Can you talk about the cadence of the Trumbull project? - Management confirmed that the project is on schedule and expects peak activity throughout the year [33][34] Question: What needs to happen to begin construction on the 405 megawatt solar project? - Management stated that a full notice to proceed is required, which is expected to be received this summer [35][36] Question: How does the Louisiana gas project compare to traditional gas plant projects? - Management explained that the Louisiana project is a subcontract and will have a quicker revenue flow compared to traditional projects [44] Question: How is the pipeline of activity looking? - Management expressed satisfaction with the pipeline, noting recent full notices to proceed on renewable jobs totaling 565 megawatts [41][42]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended April 30, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT For the Transition Period from to Commission File Number 001-31756 (Exact Name of Registrant as Specified in Its Charter) (State or Other Jurisdiction of Incorporation) (I.R.S. Employer Identificatio ...

Financial Performance - Argan reported consolidated revenues of $157.7 million for Q1 FY2025, a 52.1% increase from $103.7 million in Q1 FY2024[2] - The company achieved a net income of $7.9 million, or $0.58 per diluted share, compared to $2.1 million, or $0.16 per diluted share, in the prior year[9] - EBITDA for the quarter increased to $11.9 million, representing a 225.8% increase from $3.6 million in the same quarter last year[3] - Gross profit was approximately $17.9 million, with a gross margin of 11.4%, down from 13.7% in the previous year[6] - Other income for the quarter was $4.8 million, primarily from invested funds[8] Project Backlog and Growth - The project backlog at the end of the quarter was $824 million, including over $300 million in renewable projects[4] - Argan's revenue growth was driven by projects such as the Trumbull Energy Center and the Midwest Solar and Battery Projects[5] Expenses and Liquidity - Selling, general and administrative expenses increased to $11.4 million, but as a percentage of revenues, they decreased to 7.2% from 10.2% year-over-year[7] - Cash, cash equivalents, and investments totaled $416.4 million as of April 30, 2024, up from $412.4 million at the end of January 2024[10] - The company maintained net liquidity of $246.7 million, with no debt reported[10]

Group 1: Coupang (CPNG) - Coupang operates retail businesses through mobile applications and websites, offering a wide range of products in South Korea [2] - CPNG stock has returned over 43% year-to-date, with a relative strength indicator (RSI) of over 84, indicating it may be overbought [2] - The stock trades at 1.66X trailing-year revenue, above the sector median of 0.67X, with projected revenue of $29.17 billion for the current fiscal year, up 19.6% from $24.38 billion in 2023 [3] Group 2: Argan (AGX) - Argan specializes in engineering and construction services for the power generation market, benefiting from momentum in the green energy sector [5] - AGX stock has gained almost 30% since the beginning of the year, with a recent surge of 22% in the last five sessions, and an RSI of 80.75, indicating it may be overbought [5] - The stock trades at a sales multiple of 1.44X, compared to the sector median of 0.76X, with anticipated sales of $724.35 million for the current fiscal year, up 26.3% from $573.33 million last year [6] Group 3: Janux Therapeutics (JANX) - Janux Therapeutics focuses on developing immunotherapies for cancer, with a core product in Phase 1 trials for metastatic castration-resistant prostate cancer [7] - JANX stock has increased nearly 359% year-to-date, with a recent gain of almost 28% in the past five sessions, and an RSI of 72.59, suggesting it may be overbought [7][8] - The stock trades at nearly 278X trailing-year revenue, with a projected revenue target of $5 million for fiscal 2024, which is below the previous year's revenue of $8.08 million [8]

Argan just surprised investors. Can it do it again in 2024?Investors in Rockville, Maryland-based engineering firm Argan (AGX 22.43%) are having a good day Friday, as the energy plant builder closes out the week with a powerful earnings report for the fiscal fourth quarter of 2024, ended Jan. 31.Analysts had forecast Argan would earn just $0.75 per share for the quarter, but Argan reported last night that Q4 earnings were a better-than-expected $0.89. Quarterly sales of $164.6 million also seem to have topp ...

Financial Data and Key Metrics Changes - Consolidated revenue increased by 26% to $573.3 million for fiscal 2024 compared to $455 million for fiscal 2023 [7][22] - Full year EBITDA was $51.3 million, up from $48.1 million in fiscal 2023 [22][24] - Net income for fiscal 2024 was $32.4 million or $2.39 per diluted share, compared to $33.1 million or $2.33 per diluted share for the prior year [22][24] - Cash and investments exceeded $400 million, with net liquidity of $245 million and no debt [7][28] Business Segment Data and Key Metrics Changes - Power industry services revenue increased by 20.3% to $416.3 million for fiscal 2024, driven by projects like the Trumbull Energy Center and Shannonbridge Power Project [22][23] - Industrial Construction Services revenue grew by 64% to $41.3 million in Q4, with pre-tax net income increasing by 155% [9][20] - Telecommunications infrastructure services contributed 2% of Q4 revenues, remaining the smallest segment [10] Market Data and Key Metrics Changes - The project backlog grew to $757 million sequentially from $730 million at the end of Q3 [7] - 83% of the project backlog supports low carbon emissions, indicating a focus on cleaner energy resources [13] - The demand for power is increasing due to factors like AI data centers and electric vehicle charging infrastructure [11][30] Company Strategy and Development Direction - The company aims to leverage its capabilities to capitalize on the growing demand for reliable energy sources, focusing on both traditional and renewable energy projects [18][30] - There is a commitment to driving long-term value creation for shareholders through disciplined risk management and potential acquisition opportunities [29][31] - The company is positioned to benefit from the transition to cleaner energy alternatives while maintaining grid reliability [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the project pipeline, expecting additional large projects in the coming months [34][35] - The company acknowledged challenges faced in the Kilroot project but emphasized its commitment to project success and efficiency [16][17] - The management believes that natural gas will continue to play a crucial role in meeting future energy demands alongside renewable sources [42][43] Other Important Information - The company repurchased approximately 300,000 shares for about $12.5 million during fiscal 2024 [8] - A quarterly cash dividend was increased by 20% to $0.30 per share, reflecting the company's strong financial position [8][29] Q&A Session Summary Question: Can you provide more details on the project pipeline? - Management highlighted excitement about the project pipeline, with expectations for additional large projects in gas and renewables [34] Question: Is there a growing demand for gas plants? - Management confirmed that there is a significant demand for natural gas plants due to increased power needs driven by AI and electric vehicles [38] Question: What is the expected percentage of natural gas in power generation? - Management believes that natural gas needs to remain in the 30% to 40% range to meet growing demand while supporting renewable energy [42] Question: Can the growth rate of the Industrial Construction Services segment be sustained? - Management indicated confidence in sustaining growth, supported by a strong backlog and ongoing project opportunities [49]

Financial Performance - Consolidated revenues increased by 38.5% in Q4 and 26.0% for Fiscal Year 2024[4] - Power Industry Services Q4 revenues increased 32.6%; FY revenues grew 20.3%[4] - Industrial Construction Services Q4 revenues increased 64.5%; FY revenues grew 53.9%[4] - Earnings per diluted share were $0.89 for Q4 and $2.39 for FY[4] - The company repurchased 303,160 shares of common stock at a cost of $12.5 million during FY 2024[4] - Quarterly dividend increased 20% during the year to $0.30 per common share, totaling $1.10 per share for FY 2024[4] Backlog and Projects - The company has a healthy backlog of $0.8 billion, including new gas & renewable project agreements awarded subsequent to year end[4] - Gemma Power Services is executing an EPC services contract for a 950 MW natural gas-fired power plant in Lordstown, Ohio[14] - Solar and battery plants in Illinois will represent 160 MW of electrical power and 22 MW of energy storage[15] Market and Strategy - AI power demand is projected to grow at an annual average of 70% through 2027[12] - Argan is positioned to support the growth in electricity demand, with recent forecasts indicating a 4.7% rise in US electricity demand over the next five years[37] - Since November 2021, Argan has returned a total of $101.2 million to shareholders through share repurchases and dividends[32]

Part I This section provides an overview of the company's business operations, risk factors, property details, and legal proceedings [Business](index=3&type=section&id=ITEM%201.%20BUSINESS) Argan, Inc. is a holding company operating through four primary subsidiaries: Gemma Power Systems (GPS), Atlantic Projects Company (APC), The Roberts Company (TRC), and Southern Maryland Cable (SMC), structured into three reportable segments - Argan operates as a holding company with four main subsidiaries: GPS, APC, TRC, and SMC, organized into three reportable business segments[12](index=12&type=chunk) Segment Revenue Contribution (as % of Consolidated Revenues) | Segment | Fiscal 2024 | Fiscal 2023 | Fiscal 2022 | | :--- | :--- | :--- | :--- | | Power Industry Services | 73% | 76% | 78% | | Industrial Construction Services | 25% | 20% | 19% | | Telecommunications Infrastructure Services | 2% | 4% | 3% | [Power Industry Services (GPS and APC)](index=3&type=section&id=Power%20Industry%20Services) This segment, comprising GPS in the U.S. and APC in Ireland and the U.K., is Argan's primary revenue driver, contributing 73% of consolidated revenues in Fiscal 2024 Power Industry Services Financials | Metric | Fiscal 2024 (Millions) | Fiscal 2023 (Millions) | Fiscal 2022 (Millions) | | :--- | :--- | :--- | :--- | | Revenues | $416.3 | $346.0 | $398.1 | | % of Consolidated Revenues | 73% | 76% | 78% | - Project backlog for the power industry services segment was approximately **$0.6 billion** at January 31, 2024, a decrease from **$0.7 billion** at January 31, 2023[18](index=18&type=chunk) - For Fiscal 2024, three power industry services customers accounted for **19%**, **16%**, and **15%** of consolidated revenues, respectively[35](index=35&type=chunk) - The company is targeting growth in renewable energy projects, including utility-scale solar, wind, battery storage, and hydrogen plants, to complement its natural gas-fired power plant business[22](index=22&type=chunk) [Industrial Construction Services (TRC)](index=7&type=section&id=Industrial%20Construction%20Services) The Industrial Construction Services segment, operated by The Roberts Company (TRC), provides industrial construction and field services, primarily in the Southeast U.S Industrial Construction Services Financials | Metric | Fiscal 2024 (Millions) | Fiscal 2023 (Millions) | Fiscal 2022 (Millions) | | :--- | :--- | :--- | :--- | | Revenues | $142.8 | $92.8 | $97.9 | | % of Consolidated Revenues | 25% | 20% | 19% | - TRC's project backlog grew over **175%** from January 31, 2022, to **$127.5 million** as of January 31, 2024, reflecting a strategic shift towards larger field service projects[45](index=45&type=chunk) [Telecommunications Infrastructure Services (SMC)](index=8&type=section&id=Telecommunications%20Infrastructure%20Services) This segment, operating as SMC Infrastructure Solutions, provides utility construction and technology wiring solutions, primarily in the Mid-Atlantic U.S Telecommunications Infrastructure Services Revenues | Fiscal Year | Revenues (Millions) | | :--- | :--- | | 2024 | $14.3 | | 2023 | $16.2 | | 2022 | $13.4 | - In Fiscal 2022, SMC acquired Lee Telecommunications, Inc. (LTI) for **$0.6 million** in cash, expanding its services into the Tidewater area of Virginia[52](index=52&type=chunk) [Corporate and Other Information](index=8&type=section&id=Corporate%20and%20Other%20Information) As of January 31, 2024, Argan employed 1,214 people and maintained a $50.0 million credit facility, with a strong commitment to safety and sustainability - The company had **1,214 employees** as of January 31, 2024[54](index=54&type=chunk) - Argan has a **$50.0 million** credit agreement with Bank of America, secured by a majority of its assets, which it expects to renew before its May 31, 2024 expiration. As of January 31, 2024, there were no borrowings, but **$9.3 million** in letters of credit were outstanding[55](index=55&type=chunk)[56](index=56&type=chunk) - The company's OSHA reportable incident rate for calendar year 2023 was **0.43**, significantly better than the national industry average[58](index=58&type=chunk) - Unsatisfied bonded performance obligations for all subsidiaries totaled approximately **$0.5 billion** as of January 31, 2024[62](index=62&type=chunk) [Risk Factors](index=11&type=page&id=ITEM%201A.%20RISK%20FACTORS) The company identifies several categories of risks that could materially affect its business, including project dependency, market competition, regulatory changes, and operational challenges - A majority of consolidated revenues are derived from a small number of large, long-term EPC services contracts, making financial results potentially uneven and dependent on winning new projects[78](index=78&type=chunk)[82](index=82&type=chunk) - The company primarily uses fixed-price contracts, which expose it to risks of cost overruns due to inaccurate estimates, inflation, supply chain delays, or labor productivity issues, potentially leading to reduced profits or losses[118](index=118&type=chunk)[119](index=119&type=chunk) - Regulatory hurdles, including the Biden Administration's goal for a carbon-free electricity sector by 2035 and proposed EPA rules, pose significant risks to the future development of fossil-fuel energy facilities[110](index=110&type=chunk)[111](index=111&type=chunk)[112](index=112&type=chunk) - The company is exposed to cybersecurity risks, including a complex criminal scheme in March 2023 that resulted in fraudulently-induced wire transfers and a net loss of **$2.7 million**[139](index=139&type=chunk) - Project backlog of **$0.8 billion** as of January 31, 2024, is not a guaranteed indicator of future revenue, as projects can be delayed, modified, or cancelled by customers[87](index=87&type=chunk)[88](index=88&type=chunk) [Unresolved Staff Comments](index=26&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company reports that it has no unresolved staff comments from the Securities and Exchange Commission - None[154](index=154&type=chunk) [Cybersecurity](index=26&type=section&id=ITEM%201C.%20CYBERSECURITY) Argan manages cybersecurity risk through a decentralized program with corporate oversight, technical measures, employee training, and incident response plans - Cybersecurity risk is managed at the subsidiary level with corporate oversight, integrating into the broader enterprise risk management framework. The audit committee of the board of directors oversees this area[155](index=155&type=chunk)[156](index=156&type=chunk) - The company's strategy includes technical defenses, regular employee training on threats like phishing, security screening for third-party vendors, and maintaining cybersecurity insurance[157](index=157&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk) - In March 2023, the company was the target of a criminal scheme that resulted in fraudulently-induced wire transfers, leading to a recognized loss of **$2.7 million** after recovery efforts and professional fees[167](index=167&type=chunk) [Properties](index=27&type=section&id=ITEM%202.%20PROPERTIES) The company and its subsidiaries own and lease various properties for their operations, which are considered sufficient for current and foreseeable needs - GPS owns its **23,380 sq. ft.** headquarters in Glastonbury, Connecticut[168](index=168&type=chunk) - TRC owns its **90,000 sq. ft.** industrial fabrication and warehouse facility in Winterville, North Carolina[169](index=169&type=chunk) - APC owns office and warehouse space in Ireland and leases additional space in Ireland and England[170](index=170&type=chunk) - SMC leases its primary office and maintenance facilities in Maryland and Virginia[171](index=171&type=chunk) [Legal Proceedings](index=29&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company states that no current legal proceedings are expected to have a material adverse effect on its consolidated financial statements - The company is not currently involved in any legal proceedings that are expected to have a material effect on its financial statements[173](index=173&type=chunk) [Mine Safety Disclosures](index=29&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company's operations - Not applicable[174](index=174&type=chunk) Part II This section details the company's common equity market, stock repurchase programs, management's financial discussion, market risks, and financial statements [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=30&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) Argan's common stock trades on the NYSE under the symbol AGX, with a history of paying dividends and an active share repurchase program - In September 2023, the board of directors increased the regular quarterly cash dividend by **20%** from **$0.25** to **$0.30 per share**[177](index=177&type=chunk) - The company has a share repurchase program authorized up to **$125 million**. Repurchases may occur in the open market or through other transactions[179](index=179&type=chunk) Share Repurchases for Q4 Fiscal 2024 | Period | Total Shares Repurchased | Average Price per Share Paid | | :--- | :--- | :--- | | Nov 2023 | 4,881 | $44.40 | | Dec 2023 | 7,721 | $43.60 | | Jan 2024 | 80,125 | $43.67 | | **Total** | **92,727** | | [[Reserved]](index=32&type=section&id=ITEM%206.%20%5BRESERVED%5D) This item is reserved and contains no information - None [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) For Fiscal 2024, consolidated revenues increased 26.0% to $573.3 million, despite a gross profit decline due to a significant project loss, while maintaining a strong financial position and project backlog Fiscal 2024 vs. Fiscal 2023 Key Financials | Metric | Fiscal 2024 (Millions) | Fiscal 2023 (Millions) | % Change | | :--- | :--- | :--- | :--- | | Consolidated Revenues | $573.3 | $455.0 | 26.0% | | Consolidated Gross Profit | $80.8 | $86.4 | (6.4)% | | Net Income Attributable to Stockholders | $32.4 | $33.1 | (2.2)% | | Diluted EPS | $2.39 | $2.33 | 2.6% | - The primary driver for the decrease in gross profit was a **$13.6 million** loss recognized on the Kilroot Power Station project in Northern Ireland[192](index=192&type=chunk)[213](index=213&type=chunk) - Consolidated project backlog was **$0.8 billion** as of January 31, 2024, primarily composed of projects in the power industry services segment[196](index=196&type=chunk) [Results of Operations (Fiscal 2024 vs. 2023)](index=42&type=section&id=Results%20of%20Operations) Fiscal 2024 revenues increased by 26.0% to $573.3 million, driven by growth in power and industrial services, though consolidated gross margin decreased due to a project loss Segment Revenue Performance (Fiscal 2024 vs 2023) | Segment | FY24 Revenue (Millions) | FY23 Revenue (Millions) | % Change | | :--- | :--- | :--- | :--- | | Power Industry Services | $416.3 | $346.0 | +20.3% | | Industrial Construction Services | $142.8 | $92.8 | +53.9% | | Telecommunications Infrastructure | $14.3 | $16.2 | -12.2% | - Consolidated gross profit was adversely impacted by a **$13.6 million** loss recorded for the Kilroot Power Station project[263](index=263&type=chunk) - Other income increased by **188.0%** to **$12.5 million**, primarily due to a **$14.1 million** gain on invested funds, partially offset by a **$3.0 million** wire-transfer fraud loss[267](index=267&type=chunk) - The effective income tax rate for Fiscal 2024 was **33.9%**, higher than the statutory rate primarily because the net operating loss of the U.K. subsidiary, where the Kilroot loss was recorded, was not tax effected with a benefit[268](index=268&type=chunk) [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) As of January 31, 2024, the company had $197.0 million in cash and cash equivalents, strong operating cash flow, no debt, and increased net liquidity Cash and Cash Equivalents | Date | Balance (Millions) | | :--- | :--- | | Jan 31, 2024 | $197.0 | | Jan 31, 2023 | $173.9 | Cash Flow Summary - Fiscal 2024 | Activity | Cash Flow (Millions) | | :--- | :--- | | Operating Activities | $116.9 provided | | Investing Activities | ($67.6) used | | Financing Activities | ($26.1) used | - The company has no outstanding borrowings under its **$50.0 million** credit facility, but had **$9.3 million** in letters of credit issued as of January 31, 2024[281](index=281&type=chunk) - Unsatisfied bonded performance obligations were approximately **$0.5 billion** as of January 31, 2024, down from **$0.6 billion** the prior year[285](index=285&type=chunk) [Critical Accounting Policies](index=49&type=section&id=Critical%20Accounting%20Policies) The company identifies revenue recognition on long-term construction contracts and income tax reporting as critical accounting policies requiring significant management judgment - Revenue on fixed-price contracts is recognized over time using the cost-to-cost method, which depends on management's ongoing estimates of total costs to complete each project. Inaccuracies can lead to material changes in recognized revenue and profit[304](index=304&type=chunk)[307](index=307&type=chunk) - The company includes variable consideration (e.g., unapproved change orders, claims) in the transaction price when it is probable a significant revenue reversal will not occur. As of Jan 31, 2024, **$8.4 million** of such variations were included in transaction prices pending customer approval[311](index=311&type=chunk)[313](index=313&type=chunk) - Accounting for uncertain tax positions is critical, as demonstrated by the settlement with the IRS over prior-year R&D credits, which resulted in a **$6.2 million** unfavorable adjustment to income tax expense in Fiscal 2023[320](index=320&type=chunk) - The company must assess the realizability of deferred tax assets, such as the **$13.8 million** related to foreign NOLs. A valuation allowance of **$17.8 million** exists, which was increased by **$2.1 million** in Fiscal 2024 due to revised future earnings estimates for the U.K. subsidiary[498](index=498&type=chunk)[323](index=323&type=chunk)[501](index=501&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risks include interest rate fluctuations, foreign currency risk, and commodity price volatility, managed without extensive hedging - The company is exposed to interest rate risk on its substantial cash and investment balances. As of January 31, 2024, the company had no outstanding debt[327](index=327&type=chunk) Hypothetical Annual Pre-Tax Income Impact of Interest Rate Changes | Basis Point Change | Net Increase (Decrease) in Income | | :--- | :--- | | Up 100 basis points | $3,522,000 | | Down 100 basis points | ($3,522,000) | - The company is subject to foreign currency translation risk from its subsidiary APC, whose functional currency is the Euro. Translation effects are recognized in accumulated other comprehensive loss[330](index=330&type=chunk) - Commodity price risk on fixed-price contracts is mitigated by securing firm quotes and procuring materials early in a project's lifecycle, rather than through hedging instruments[332](index=332&type=chunk) [Financial Statements and Supplementary Data](index=56&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section contains the company's consolidated financial statements for the fiscal years ended January 31, 2024, 2023, and 2022, along with accompanying notes and auditor reports [Report of Independent Registered Public Accounting Firm](index=63&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Grant Thornton LLP issued an unqualified opinion on Argan, Inc.'s consolidated financial statements and internal control over financial reporting, identifying revenue recognition as a critical audit matter - The auditor, Grant Thornton LLP, issued an unqualified opinion on both the consolidated financial statements and the effectiveness of internal control over financial reporting[370](index=370&type=chunk)[380](index=380&type=chunk) - A critical audit matter was identified concerning revenue recognition for fixed-price contracts, highlighting the challenging, subjective, and complex judgments required by management to estimate total costs and transaction prices[374](index=374&type=chunk)[375](index=375&type=chunk)[376](index=376&type=chunk) [Consolidated Financial Statements](index=67&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements detail the company's performance and financial position, showing revenues of $573.3 million and net income of $32.4 million for Fiscal 2024 Consolidated Statement of Earnings (in thousands) | Metric | FY 2024 (Thousands) | FY 2023 (Thousands) | FY 2022 (Thousands) | | :--- | :--- | :--- | :--- | | Revenues | $573,333 | $455,040 | $509,370 | | Gross Profit | $80,834 | $86,361 | $99,732 | | Income from Operations | $36,458 | $41,669 | $44,510 | | Net Income Attributable to Stockholders | $32,358 | $33,098 | $38,244 | Consolidated Balance Sheet (in thousands) | Metric | Jan 31, 2024 (Thousands) | Jan 31, 2023 (Thousands) | | :--- | :--- | | Total Current Assets | $547,179 | $438,702 | | Total Assets | $598,229 | $489,487 | | Total Current Liabilities | $302,260 | $202,503 | | Total Liabilities | $307,290 | $208,590 | | Total Stockholders' Equity | $290,939 | $280,897 | Consolidated Statement of Cash Flows (in thousands) | Metric | FY 2024 (Thousands) | FY 2023 (Thousands) | | :--- | :--- | | Net cash provided by (used in) operating activities | $116,858 | ($30,061) | | Net cash used in investing activities | ($67,607) | ($63,122) | | Net cash used in financing activities | ($26,050) | ($82,803) | | Net increase (decrease) in cash | $23,085 | ($176,525) | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=56&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) The company reports that there have been no changes in or disagreements with its accountants on any matter of accounting principles or practices, or financial statement disclosure - None[335](index=335&type=chunk) [Controls and Procedures](index=56&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures and internal control over financial reporting were effective as of January 31, 2024, a conclusion affirmed by the independent auditor - Based on their evaluation, the CEO and CFO concluded that the company's disclosure controls and procedures were effective as of January 31, 2024[338](index=338&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of January 31, 2024. This assessment was audited by Grant Thornton LLP, which issued an unqualified opinion[341](index=341&type=chunk)[342](index=342&type=chunk) [Other Information](index=57&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) During the fourth quarter ended January 31, 2024, no director or officer adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the fourth quarter of Fiscal 2024[346](index=346&type=chunk) [Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=57&type=section&id=ITEM%209C.%20DISCLOSURE%20REGARDING%20FOREIGN%20JURISDICTIONS%20THAT%20PREVENT%20INSPECTIONS) This item is not applicable to the company - Not applicable[347](index=347&type=chunk) Part III Part III of this Annual Report, covering directors, executive officers, corporate governance, executive compensation, security ownership, and certain relationships and transactions, incorporates information by reference from the company's definitive Proxy Statement for the 2024 Annual Meeting of Stockholders, which is to be filed with the SEC within 120 days of the fiscal year-end [Directors, Executive Officers and Corporate Governance](index=58&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information required for this item is incorporated by reference from the company's 2024 Proxy Statement - Information required by this item will be incorporated by reference to the 2024 Proxy Statement[349](index=349&type=chunk) [Executive Compensation](index=58&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Information required for this item is incorporated by reference from the company's 2024 Proxy Statement - Information required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference[350](index=350&type=chunk) [Security Ownership of Certain Beneficial Owners and Management, and Related Stockholder Matters](index=58&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%2C%20AND%20RELATED%20STOCKHOLDER%20MATTERS) This item provides information on equity compensation plans and incorporates other security ownership details by reference from the 2024 Proxy Statement Equity Compensation Plan Information as of January 31, 2024 | Plan Category | Securities Issuable under Outstanding Options | Weighted Avg. Exercise Price | Securities Remaining for Future Awards | | :--- | :--- | :--- | :--- | | Approved by Stockholders | 1,364,668 | $44.95 | 543,087 | - Other information required by this item will be included in the 2024 Proxy Statement and is incorporated by reference[351](index=351&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=58&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information required for this item is incorporated by reference from the company's 2024 Proxy Statement - Information required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference[353](index=353&type=chunk) [Principal Accountant Fees and Services](index=58&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Information required for this item is incorporated by reference from the company's 2024 Proxy Statement - Information required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference[354](index=354&type=chunk) Part IV Part IV contains the list of exhibits filed with the Form 10-K and the financial statement schedules, noting that a Form 10-K summary is not applicable [Exhibits and Financial Statements](index=59&type=section&id=ITEM%2015.%20EXHIBITS%20AND%20FINANCIAL%20STATEMENTS) This item lists the financial statements, financial statement schedules, and all exhibits filed as part of the Annual Report on Form 10-K - This section lists all financial statements and exhibits filed with the Form 10-K, including the consent of the independent auditor, CEO/CFO certifications, and various corporate agreements[357](index=357&type=chunk)[358](index=358&type=chunk)[359](index=359&type=chunk) [Form 10-K Summary](index=60&type=section&id=ITEM%2016.%20FORM%2010-K%20SUMMARY) The company has not provided a summary for its Form 10-K - None[361](index=361&type=chunk)