Financial Data and Key Metrics Changes - Net sales for Q4 2024 totaled $28.6 million, a decrease of 20.6% from $36.1 million in Q4 2023 [22] - For the year ended December 31, 2024, net sales were $128.1 million, down 8% from $139.3 million in 2023 [22] - Gross profit for Q4 2024 was $2.8 million, or 9.9% of net sales, compared to $6.8 million, or 18.9% of net sales in Q4 2023 [25] - Adjusted EBITDA for Q4 2024 was a negative $585,000, compared to a positive $3.2 million in Q4 2023 [29] - Year-end 2024 adjusted EBITDA was $2.1 million, down from $8 million in 2023 [30] Business Line Data and Key Metrics Changes - Aerospace and defense net sales were negatively impacted by the closure of the Blue Earth facility and delays in customer approvals [7] - Revenue headwinds were noted in the industrial and medical sectors due to reduced inventory investments and delayed product launches [23] Market Data and Key Metrics Changes - The company experienced a reduction in customer backlog in Q4 2024 as customers requested shorter lead times with new orders [24] - The imposition of tariffs may significantly impact contract manufacturers, including Nortech, particularly regarding operations in China and Mexico [8][10] Company Strategy and Development Direction - The company is focused on consolidating its North American footprint and moving customer programs to better fit customer needs, which is expected to improve long-term EBITDA generation [16] - Nortech is investing in core infrastructure and leadership teams to drive long-term growth, including a fully staffed business development team [14] - The company is pivoting towards fiber optic technology to enhance product performance and align with sustainability goals [44] Management's Comments on Operating Environment and Future Outlook - Management expects the aerospace and defense business to normalize in the second half of 2025, despite ongoing headwinds in the first half [8] - The company remains vigilant in monitoring trade policies and geopolitical uncertainties that may impact operations [11] - Management is optimistic about future growth opportunities, particularly in fiber optic technology and AI capabilities [42][48] Other Important Information - The company completed a 30% reduction in lease space at its Maple Grove facility, resulting in annual savings of at least $1.6 million [12] - Cash and cash equivalents totaled $916,000 as of December 31, 2024, down from $1.7 million in 2023 [30] Q&A Session Summary Question: What are the expectations for the aerospace and defense market? - Management expects the aerospace and defense business to return to normal in the second half of 2025, despite current challenges [8] Question: How is the company addressing the impact of tariffs? - The company is closely monitoring tariff impacts and adjusting customer pricing and sourcing strategies as needed [10] Question: What are the company's priorities for 2025? - The company aims to strengthen its balance sheet, reduce inventory investments, and align operations with market demand for sustainable long-term EBITDA growth [34]

Financial Performance - Fourth quarter net sales were $28.6 million, a decrease of 20.6% compared to $36.1 million in Q4 2023[6] - The company reported a net loss of $1.5 million, or $0.54 per diluted share, compared to a net income of $4.4 million, or $1.59 per diluted share in Q4 2023[4][6] - Adjusted EBITDA for Q4 2024 was a loss of $585 thousand, down 118.4% from $3.2 million in Q4 2023[6] - Gross profit for Q4 2024 was $2.8 million, a decline of 58.7% from $6.8 million in Q4 2023[6] - Net loss for the year ended December 31, 2024, was $1,295 million, a significant decrease from a net income of $6,874 million in 2023[15] - EBITDA for the twelve months ended December 31, 2024, was $1,543 million, down from $8,003 million in 2023[16] - Adjusted EBITDA for the year ended December 31, 2024, was $2,114 million, compared to $8,003 million in 2023[16] - The company reported a gross profit margin of 16.1% for Q4 2024, down from 16.6% in Q4 2023[18] Cash Flow and Liquidity - Cash and cash equivalents at the end of 2024 were $916 million, down from $1,675 million at the end of 2023[15] - Net cash used in operating activities for the year was $2,250 million, compared to net cash provided of $1,769 million in 2023[15] - Total cash and restricted cash reported in the consolidated statements of cash flows was $916 million at the end of 2024, down from $1,675 million in 2023[15] - Proceeds from the line of credit for the year were $129,793 million, with payments totaling $126,944 million[15] Operational Changes and Strategy - The company anticipates clearing the majority of the approval backlog for defense customer transfers by Q2 2025, which is expected to improve sales[3] - Nortech has completed a significant restructuring of its operations to enhance efficiency and reduce costs, focusing on high-quality product delivery[3] - Investments in research and development, particularly in fiber optics technologies, are expected to position the company for long-term growth[3] - The company is actively monitoring regulatory changes and geopolitical uncertainties that may impact its global operations[3] Backlog and Accounts Receivable - The 90-day backlog as of December 31, 2024, was $26.5 million, indicating potential future revenue[4] - The company experienced a significant change in accounts receivable, with an increase of $4,405 million in 2024 compared to a decrease of $3,432 million in 2023[15] Other Expenses - The company incurred $571 thousand in retention bonuses and other expenses related to the closure of the Blue Earth, Minnesota facility[17] - Operating expenses decreased slightly by 2.4% to $4.0 million in Q4 2024 from $4.2 million in Q4 2023[6]

MINNEAPOLIS, March 31, 2025 (GLOBE NEWSWIRE) -- Nortech Systems Incorporated (Nasdaq: NSYS) ("Nortech" or the "Company"), a leading provider of engineering and manufacturing solutions for complex electromedical and electromechanical products serving the medical, industrial and defense markets, reported financial results for the fourth quarter ended December 31, 2024. "We have just completed a significant restructuring of our back office and plant operations to better serve our customers by delivering high-q ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-K ☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2024 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from __________ to __________ NORTECH SYSTEMS INCORPORATED (Exact name of registrant as specified in its charter) Commission file number 0-13257 State of Incorporation: Minnesota ...

MINNEAPOLIS, March 25, 2025 (GLOBE NEWSWIRE) -- Nortech Systems Incorporated (Nasdaq: NSYS) (the “Company”), a leading provider of engineering and manufacturing solutions for complex electromedical and electromechanical products serving the medical imaging, medical device, aerospace & defense and industrial markets, will hold a live conference call and webcast at 3:30 p.m. Central Time on Monday, March 31, 2025, to discuss the Company's fourth quarter and full year 2024 financial results. The call will be h ...

Financial Data and Key Metrics Changes - Net sales for Q3 2024 totaled $31.4 million, a 5.9% decrease from $33.4 million in Q3 2023 [21] - Year-to-date net sales were $99.5 million, down 3.6% from $103.3 million in the same prior year period [21] - Gross profit for Q3 2024 was $3.8 million, or 12.2% of net sales, compared to $5.3 million, or 15.9% of net sales in Q3 2023 [24] - Adjusted EBITDA for Q3 2024 was $143,000, down from $1.6 million in Q3 2023 [31] - Cash and equivalents as of September 30, 2024, totaled $1.2 million, down from $1.7 million as of December 31, 2023 [32] Business Line Data and Key Metrics Changes - Revenue growth was strong in the Aerospace and Defense category, contrasting with softness in the industrial and medical markets [22] - Customer purchasing patterns have shifted towards shorter lead times, resulting in a reduction in customer backlog by the end of Q3 2024 [23] Market Data and Key Metrics Changes - The company faced headwinds from industrial customers due to market softness and delayed product launches [22] - Medical customers are aggressively reducing inventory investments, impacting revenue [22] Company Strategy and Development Direction - The company is focusing on consolidating its North American footprint and moving production to better fit customer needs [9] - Investments are being made in business development and facility optimization, expected to yield at least $1.6 million in annual savings starting in 2025 [11] - The company is pursuing a 3-tier global manufacturing strategy across the U.S., Mexico, and China to enhance competitiveness [15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a difficult quarter but remains optimistic about long-term growth and investments [14] - The company is adapting to supply chain nearshoring trends and is committed to improving operational efficiencies [7][8] - Future technological developments, particularly in fiber optic technology, are expected to support sales momentum in 2024 [48] Other Important Information - The closure of the Blue Earth facility is on track for December 2024, with production moving to Bemidji [10] - The company has incurred restructuring costs related to the Blue Earth closure, estimated between $650,000 and $750,000 for 2024 [27] Q&A Session Summary - No specific questions or answers were documented in the provided content, indicating that the call concluded without a Q&A segment [49]

Core Insights - Nortech Systems Incorporated reported a net sales of $31.4 million for Q3 2024, a decrease of 5.9% compared to $33.4 million in Q3 2023 [2][4] - The company experienced a net loss of $739 thousand, or $0.27 per diluted share, compared to a net income of $1.2 million in the same quarter last year [2][4] - Adjusted EBITDA for Q3 2024 was $143 thousand, down 91.1% from $1.6 million in Q3 2023 [2][4] Financial Performance - Net sales for the nine months ended September 30, 2024, were $99.5 million, a decline of 3.6% from $103.3 million in the same period of 2023 [4] - Gross profit for Q3 2024 was $3.8 million, down 27.9% from $5.3 million in Q3 2023 [4] - Operating expenses increased by 4.5% to $4.5 million in Q3 2024 compared to $4.3 million in Q3 2023 [4] Management Commentary - The CEO noted that sales were impacted by customers delaying product purchases and reducing inventory, which has affected the contract manufacturing industry [2] - The company is consolidating facilities and moving programs to lower-cost locations to improve efficiency and reduce costs [2] - Management expressed optimism about the customer pipeline and the future of Nortech Systems despite current challenges [2] Backlog and Strategic Moves - As of September 30, 2024, the company reported a 90-day backlog of $29.6 million [2] - The restructuring of back office and plant operations aims to enhance service delivery and product quality [2] Cash Flow and Balance Sheet - Cash and cash equivalents at the end of Q3 2024 were $1.2 million, an increase from $1.1 million at the end of Q3 2023 [13] - Total assets as of September 30, 2024, were $77.0 million, compared to $75.1 million at the end of 2023 [11][12]

Financial Performance - Net sales for Q3 2024 were $31.4 million, a decrease of 5.9% compared to $33.4 million in Q3 2023[5] - The company reported a net loss of $739 thousand, or $0.27 per diluted share, compared to a net income of $1.2 million, or $0.44 per diluted share in Q3 2023[5] - Adjusted EBITDA for Q3 2024 was $143 thousand, down 91.1% from $1.6 million in Q3 2023[5] - Gross profit decreased by 27.9% to $3.8 million in Q3 2024 from $5.3 million in Q3 2023[5] - Net income for the three months ended September 30, 2024, was $183 thousand, a significant decrease from $2,522 thousand in the same period of 2023[12] - Adjusted EBITDA for the nine months ended September 30, 2024, was $2,699 thousand, down from $4,815 thousand in the same period of 2023, indicating a decline of 43.9%[13] - The company reported a gross profit margin of 14.9% for Q3 2024, down from 16.6% in Q4 2023[15] Operational Changes - The company is consolidating facilities and moving programs to lower-cost, higher-margin locations to improve efficiency and reduce costs[3] - The restructuring of back office and plant operations aims to enhance service delivery and product quality[3] - Management expressed optimism about the customer pipeline and the future growth of the company despite current headwinds[3] - The company is focused on strengthening customer relationships as a key strategy for achieving long-term objectives[3] Financial Position - Total current assets increased to $60,278 thousand as of September 30, 2024, compared to $58,793 thousand at December 31, 2023, reflecting a growth of 2.5%[11] - Total liabilities rose to $41,276 thousand as of September 30, 2024, compared to $39,783 thousand at December 31, 2023, marking an increase of 3.8%[11] - The current portion of finance lease obligations increased to $492 thousand from $356 thousand, reflecting a rise of 38.1%[11] Cash Flow - Cash and cash equivalents at the end of the period were $1,239 thousand, an increase from $1,121 thousand at the end of September 2023[12] - Net cash used in operating activities was $(3,043) thousand for the three months ended September 30, 2024, compared to $2,181 thousand provided in the same period of 2023[12] - Proceeds from the line of credit amounted to $99,888 thousand in Q3 2024, compared to $95,783 thousand in Q3 2023, showing an increase of 3.3%[12] Backlog and Demand - The 90-day backlog as of September 30, 2024, was $29.6 million, indicating ongoing demand despite current challenges[3] - Operating expenses increased by 4.5% to $4.5 million in Q3 2024 compared to $4.3 million in Q3 2023[5] - The company accrued $267 thousand in retention bonuses and other expenses related to the closure of its Blue Earth facility, impacting adjusted EBITDA[14]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, par value $.01 per share NSYS NASDAQ Capital Market 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 September 30, 2024 OR ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to NORTEC ...

MINNEAPOLIS, Oct. 24, 2024 (GLOBE NEWSWIRE) -- Nortech Systems Incorporated (Nasdaq: NSYS) (the “Company”), a leading provider of engineering and manufacturing solutions for complex electromedical and electromechanical products serving the medical, aerospace & defense and industrial markets, will hold a live conference call and webcast at 7:30 a.m. Central Time on Thursday, November 7, 2024, to discuss the Company's third quarter financial results. The call will be hosted by Jay D. Miller, Chief Executive O ...