Core Insights - Sypris Solutions, Inc. reported a net loss of 4 cents per share for Q1 2025, an improvement from a loss of 10 cents per share a year earlier, despite a revenue decline of 17% year-over-year to $29.5 million [2][3] - The company’s stock has underperformed, declining 0.6% since the earnings report, compared to a 1.4% increase in the S&P 500 and a 15.4% rise in the broader market over the past month [1] Financial Performance - Revenue for Sypris Technologies fell to $13.6 million from $18.4 million, while Sypris Electronics saw a decline to $15.9 million from $17.2 million, attributed to cyclical and operational factors [5] - Gross profit increased by 16.7% year-over-year to $3.4 million, with a consolidated gross margin improvement of 330 basis points [3] - The Electronics segment experienced a significant gross profit increase of 51.1% to $1.3 million, driven by a favorable program mix and cost efficiencies [3] Management Strategy - CEO Jeffrey T. Gill highlighted a backlog exceeding $80 million in Sypris Electronics, which is more than a year’s worth of sales, allowing for proactive inventory management [4] - The company has withdrawn its full-year 2025 guidance due to macroeconomic uncertainties, particularly regarding new tariffs, and will suspend future guidance until more visibility is achieved [6]

HIGHLIGHTS Exhibit 99 For more information, contact: Rebecca R. Eckert Chief Accounting Officer (502) 329-2000 SYPRIS REPORTS FIRST QUARTER RESULTS GROSS PROFIT UP 17%; MARGINS IMPROVE; OPERATING INCOME AND EPS RISE LOUISVILLE, KY (May 14, 2025) – Sypris Solutions, Inc. (Nasdaq/GM: SYPR) today reported financial results for its first quarter ended March 30, 2025. "The past few months have been insightful as we evaluate how tariffs might affect the economy and our customers, which may, in turn, affect our ov ...

Core Viewpoint - Sypris Solutions, Inc. reported mixed financial results for the fourth quarter of 2024, with a return to profitability despite a decline in revenues, driven by contrasting performances in its business segments [2][10]. Financial Performance - For Q4 2024, Sypris Solutions reported net earnings per share of $0.01, compared to a net loss of $0.05 per share in Q4 2023 [2]. - Revenues for the quarter were $33.4 million, down 3.7% from $34.7 million in the same period a year earlier [2]. - Gross profit increased by 23.1% year over year to $5.4 million, with gross margin improving by 350 basis points [3]. Segment Performance - Sypris Technologies achieved quarterly revenue of $19.5 million, a 2.7% increase from $19 million a year ago, with gross profit rising 41.6% to $4.4 million and gross margin improving to 22.5% from 16.3% [4]. - In contrast, Sypris Electronics reported revenues of $13.9 million, down 11.5% from $15.7 million in the year-ago quarter, with gross profit dropping to $1 million, or 7.1% of revenues [5]. Management Commentary - The CEO highlighted positive momentum in Sypris Technologies, driven by increased energy product sales and a growing order book, supported by global demand for LNG and power infrastructure [6]. - For Sypris Electronics, the CEO noted strong demand in key markets despite temporary shipment delays, with a backlog exceeding $90 million expected to support operations into 2025 [7]. Operational Efficiency - Inventory management improved, with inventory balances decreasing from $77.3 million at the end of 2023 to $66.7 million at the close of 2024, enhancing working capital efficiency [9]. - Net cash provided by operating activities turned positive at $2 million, compared to negative $11.1 million in the prior year, indicating better operational control [9]. Full Year and Future Outlook - For the full year 2024, revenues rose 2.9% to $140.2 million, with a net loss of $1.7 million, slightly wider than the previous year's loss [10]. - The company issued 2025 guidance projecting revenues between $125 million and $135 million, with expectations for gross margin expansion of 150 to 175 basis points and gross profit growth of 10% to 15% [11]. - The company acknowledged potential cyclical headwinds in the commercial vehicle market but expressed confidence in offsetting these with strength in energy and defense-related programs [12]. Capital Expenditures - Sypris reduced capital expenditures year over year, investing $1.1 million in 2024 compared to $2.1 million in 2023, while ending the year with a higher cash balance of $9.7 million [13].

Revenue and Market Performance - Sypris Technologies' revenue is primarily generated from the sale of forged, machined, welded, and heat-treated steel components, with a focus on the heavy commercial vehicle and high-pressure energy pipeline applications [155]. - In 2024, production of Class 8 trucks in North America decreased by 2% compared to 2023, with a projected further decline of 5% in 2025 due to lower freight volumes and rates [158]. - Total net revenue increased by $3.96 million, or 2.9%, to $140.18 million in 2024 compared to 2023 [184]. - Sypris Technologies' net revenue decreased by $2.7 million, or 3.5%, to $75.2 million, primarily due to decreased sales volumes in the commercial vehicle market [185]. - Sypris Electronics' net revenue increased by $6.67 million, or 11.4%, to $65.0 million, driven by ramping production and new program shipments [188]. - Revenue for Sypris Technologies is expected to decrease slightly in 2025 due to anticipated declines in the commercial vehicle market, partially offset by higher energy component sales [187]. Cost and Profitability - Gross profit for Sypris Technologies increased by $3.6 million, or 39.3%, to $12.8 million, attributed to favorable foreign exchange rates and improved product mix [189]. - Gross profit for Sypris Electronics decreased by $0.9 million, or 12.1%, to $7.1 million, due to an unfavorable mix of programs and high unusable inventory [190]. - Selling, general and administrative expenses increased by $0.7 million, or 4.2%, to $17.0 million, primarily due to higher employee medical insurance claims and increased headcount [191]. - Interest expense increased by $0.9 million, or 116.7%, to $1.68 million, due to higher average debt and interest rates [192]. - The Company reported a net loss of $1.7 million for the year ended December 31, 2024, compared to a net loss of $1.6 million for 2023 [197]. Supply Chain and Operational Challenges - The company anticipates continued supply chain pressures and inflationary cost increases throughout 2025, which may negatively impact operational results [157]. - Sypris Electronics has encountered extended lead times for certain components, with waiting times approaching a year or more, affecting delivery schedules [161]. - The Company experienced a significant increase in net inventory in 2023, primarily due to delayed shipments related to contracts with Sypris Electronics' aerospace and defense customers [197]. Financial Position and Cash Flow - Cash used in operating activities was $11.1 million for the year ended December 31, 2023, while net cash provided by operating activities improved to $2.0 million in 2024 [197][205]. - As of December 31, 2024, the Company had approximately $9.7 million in cash and cash equivalents, with $4.0 million held outside the U.S. [200]. - The Company had purchase commitments totaling approximately $29.7 million as of December 31, 2024, primarily for inventory due through 2026 [204]. - Net cash provided by financing activities was $0.8 million in 2024, compared to net cash used of $0.6 million in 2023 [207]. - The decrease in inventory in 2024 resulted in a source of cash of $9.1 million, reflecting strategic inventory management efforts [205]. Strategic Initiatives and Future Outlook - Sypris Technologies aims to pursue new business opportunities across various markets, including light automotive and new pressure vessel applications, to achieve a more balanced portfolio [160]. - The ongoing geopolitical factors and macroeconomic variables, including high interest rates and rising material costs, are shaping the oil and gas markets served by Sypris [159]. - The company is positioned to compete for follow-on business opportunities as a subcontractor on future builds of several existing government programs, despite uncertainties surrounding the federal budget and debt ceiling [168]. - The Company is prepared to implement contingency plans, including cost reduction initiatives, if forecasted revenues are not achieved [199]. - The President's FY 2025 budget request includes $895 billion for national defense, with $850 billion allocated for the DoD base budget, reflecting a commitment to defense spending despite budgetary constraints [164].

Financial Performance - The company's gross profit for Q4 2024 increased by 23.1% year-over-year, with gross margin expanding by 350 basis points[5] - For the full year 2024, the company's gross profit rose by 15.3%, and gross margin increased by 150 basis points[5] - Sypris Technologies' gross profit surged by 41.6% in Q4 2024, reflecting an 8.6% increase in orders for energy products year-to-date[5] - The company reported Q4 2024 revenue of $33.4 million, a decrease from $34.7 million in the prior year, but net income improved to $0.1 million from a net loss of $1.1 million[6] - For the full year 2024, revenue was $140.2 million, compared to $136.2 million in 2023, with a net loss of $1.7 million[7] - Sypris Technologies generated $19.5 million in revenue for Q4 2024, up from $19.0 million in the prior year, while Sypris Electronics revenue was $13.9 million, down from $15.7 million[8][9] Future Projections - The company projects 2025 revenue between $125 million and $135 million, with gross profit expected to increase by 10-15%[5] - The company expects gross margin expansion of 150 to 175 basis points in 2025[11] Backlog and Demand - The backlog at Sypris Electronics exceeds $90 million, supporting growth through 2025 and beyond[6] - Demand for products in electronic warfare, aircraft avionics, and energy markets remains robust, despite anticipated declines in the commercial vehicle market[10][11] Assets and Liabilities - Total current assets decreased from $103,867 million in 2023 to $98,018 million in 2024, a decline of approximately 5.6%[21] - Cash and cash equivalents increased from $7,881 million in 2023 to $9,675 million in 2024, representing a growth of about 22.7%[21] - Total liabilities decreased from $106,875 million in 2023 to $99,795 million in 2024, a decline of about 6.4%[21] - Total stockholders' equity decreased from $22,467 million in 2023 to $19,581 million in 2024, a drop of approximately 12.9%[21] Cash Flow and Inventory - Net loss for 2024 was $1,680 million, compared to a net loss of $1,596 million in 2023, indicating a slight increase in losses[23] - Net cash provided by operating activities improved to $2,004 million in 2024 from a net cash used of $11,089 million in 2023[23] - Inventory decreased significantly from $77,314 million in 2023 to $66,680 million in 2024, a reduction of approximately 13.7%[21] - Capital expenditures for 2024 were $1,083 million, down from $2,139 million in 2023, reflecting a decrease of about 49.3%[23] - The cash flow from financing activities showed a net cash provided of $820 million in 2024, compared to a net cash used of $614 million in 2023[23]

Core Insights - Sypris Solutions, Inc. reported a net income of $0.4 million for Q3 2024, a turnaround from a net loss of $0.6 million in the same quarter last year, resulting in an EPS of 2 cents compared to a loss of 3 cents per share previously [2] - The company achieved revenues of $35.7 million, reflecting a 6.2% increase from $33.6 million in the prior-year quarter, driven by a 13.6% rise in the Sypris Electronics segment [3] Financial Performance - Gross profit increased by 48% year over year, with a 480-basis-point improvement in gross margin, attributed to a favorable product mix and currency exchange rates [5] - Sypris Technologies experienced a significant gross profit surge of 150.9% year over year, achieving an 18.8% gross margin compared to 7.5% a year ago, while Sypris Electronics saw a slight decline in gross margin to 14.3% from 18.1% due to increased labor and overhead costs [5] Management Commentary - The CEO expressed optimism regarding Sypris Electronics, highlighting a backlog exceeding $100 million and secured funding for key customer programs, which mitigates future supply chain risks [6] - Demand in Sypris Technologies remains stable across various markets, with new product lines expected to offset cyclical downturns in commercial vehicles, alongside an increase in energy-related product orders driven by global LNG demand [6] Revenue Growth Factors - Revenue growth was primarily attributed to increased shipments in the Sypris Electronics division, although temporary production delays hindered the ability to fully capitalize on demand [7] - In Sypris Technologies, a favorable sales mix and exchange rates supported profitability, despite challenges from anticipated declines in commercial vehicle demand [7] Guidance Update - For 2024, Sypris updated its revenue growth expectation to 10%, aligning with the lower end of prior guidance, and forecasted a 100-125 basis point increase in gross margin for the year [8] - The outlook reflects confidence in operational efficiency and continued strength in electronic warfare and energy markets, with orders expected to support revenue into 2025 [8] Strategic Developments - Sypris Technologies signed an exclusive contract extension with a leading commercial vehicle manufacturer to supply Ultra Axle Shafts, enhancing its market presence in the commercial vehicle sector [9]

Revenue and Growth - Revenue for the third quarter of 2024 increased by 6.2% year-over-year to $35.7 million, compared to $33.6 million in the prior-year period[8] - Sypris Electronics revenue rose 13.6% to $16.2 million, driven by contracts in electronic warfare and avionics markets[11] - Sypris Technologies revenue was $19.5 million, reflecting strong energy shipments, with gross profit margin increasing to 18.8%[10] - Orders increased by 6.5% for the quarter and 13.4% year-to-date, indicating positive growth across both business segments[2] - The company updated its full-year 2024 revenue outlook to a 10% increase year-over-year, at the lower end of prior guidance[6] - Orders for energy products increased by 11.8% year-to-date, with potential growth opportunities in LNG demand[4] - The backlog at Sypris Electronics exceeds $100 million, expected to support growth through 2024 and beyond[6] Profitability - Gross profit surged 48.0% year-over-year, with a gross margin expansion of 480 basis points[2] - Earnings per share (EPS) improved to $0.02 per diluted share, up from a loss of $0.03 per diluted share in the prior-year quarter[3] - Gross profit for Q3 2024 was $5,979,000, compared to $4,040,000 in Q3 2023, reflecting a gross margin improvement[17] - Operating income for the quarter was $1,729,000, a turnaround from an operating loss of $130,000 in Q3 2023[17] - Net income for Q3 2024 was $390,000, compared to a net loss of $555,000 in the same quarter last year[17] Financial Position - Cash and cash equivalents increased to $8,215,000 from $7,881,000 at the end of Q4 2023[18] - Total assets decreased to $121,613,000 from $129,342,000 at the end of Q4 2023[18] - Total liabilities decreased to $103,441,000 from $106,875,000 at the end of Q4 2023[18] - Net cash used in operating activities was $308,000, a significant improvement from $8,169,000 in Q3 2023[19] Strategic Initiatives - The company is actively pursuing applications in adjacent markets, including CO2 capture, to diversify its portfolio[8]

Core Insights - Sypris Solutions, Inc. reported breakeven net income per share for Q2 2024, down from 1 cent in the prior-year quarter, with revenues of $35.5 million, largely unchanged from $35.6 million in Q2 2023 [1][2] Business Segment Performance - Sypris Technologies experienced an 11% decline in revenue year over year to $17.8 million in Q2 2024, impacted by timing delays in energy shipments and a downturn in the commercial vehicle market [5] - Despite the revenue decline, gross profit for Sypris Technologies surged 35.5% year over year to $2.7 million, with gross margin improving by 520 basis points to 15.2% [6] - Sypris Electronics posted a 13.6% increase in revenues to $17.7 million in Q2 2024, driven by increased shipments related to defense programs [7] - Gross profit for Sypris Electronics increased by 9.7% year over year to $2.9 million, although gross margin slightly declined to 16.5% [8] Financial Update - As of June 30, 2024, Sypris Solutions reported cash and cash equivalents of $13.8 million, up from $7.9 million at the end of 2023, while total assets decreased to $124.2 million from $129.3 million [9] - Stockholders' equity decreased to $19 million from $22.5 million at the end of 2023, with operating cash flows improving to $4.5 million in the first half of 2024 from $3.7 million in the same period in 2023 [10] Management Guidance - The company reaffirmed its full-year 2024 outlook, expecting revenue growth of 10-15% year over year and gross profit increase of 20-25%, with gross margins anticipated to expand by 100-125 basis points [11] - Management highlighted a strong backlog in Sypris Electronics exceeding $100 million, expected to support growth through the remainder of 2024 and beyond [11] Other Developments - Sypris Electronics received releases for an additional four systems under a multi-year production contract for the U.S. Navy's electronic warfare improvement program, providing a steady revenue stream [12] - Sypris Technologies secured a long-term sole-source extension to its supply agreement with a leading commercial vehicle manufacturer, ensuring continued production of Ultra Axle Shafts [13]

Revenue Performance - The company's consolidated revenue for Q2 2024 was $35.5 million, consistent with the prior year, while year-to-date orders increased by 15.8%[2] - Revenue for Sypris Electronics increased by 13.6% year-over-year, driven by new contracts in electronic warfare and avionics markets[2] - Revenue for Sypris Technologies was $17.8 million in Q2 2024, down from $20.1 million in the prior year due to timing delays in energy shipments[7] - Total net revenue for Q2 2024 was $35,521, a slight decrease of 0.3% compared to $35,615 in Q2 2023[15] - Sypris Technologies reported net revenue of $17,841, down 11% from $20,058 in the same quarter last year[15] - Sypris Electronics achieved net revenue of $17,680, an increase of 13.6% from $15,557 in Q2 2023[15] Profitability - Gross profit rose by 20.8% year-over-year and 95.6% sequentially, with gross margin expanding by 280 basis points year-over-year[2] - Sypris Technologies reported a 35.5% increase in gross profit year-over-year, with orders for energy products up 13.6% year-to-date[3] - Sypris Electronics achieved a gross profit of $2.9 million in Q2 2024, representing 16.5% of revenue, compared to 17.1% in the prior year[8] - Gross profit for Q2 2024 was $5,641, up 20.8% from $4,670 in Q2 2023[15] - Operating income for Q2 2024 was $1,273, compared to $966 in Q2 2023, reflecting a 32% increase[15] - Net income for Q2 2024 was $16, a decrease from $213 in Q2 2023, resulting in a basic and diluted loss per share of $0.00[15] Financial Outlook - The company reaffirmed its full-year 2024 revenue growth outlook of 10-15% and gross profit increase of 20-25%[4] - Sypris Electronics' backlog exceeds $100 million, expected to support growth through 2024 and beyond[4] Cash Flow and Assets - Cash and cash equivalents increased to $13,760 as of June 30, 2024, up from $7,881 at the end of 2023[16] - Total current assets decreased to $100,304 from $103,867 at the end of 2023[16] - Total liabilities decreased slightly to $105,225 from $106,875 at the end of 2023[16] - Net cash provided by operating activities for Q2 2024 was $4,455, compared to $3,688 in Q2 2023[17] Strategic Initiatives - The company is actively pursuing new global projects to support increasing LNG demand and diversify its customer portfolio[5]

Core Viewpoint - Zacks Investment Research has initiated coverage of Sypris Solutions, Inc. with a Neutral recommendation, highlighting both contract expansions and financial challenges faced by the company [1] Group 1: Contractual Developments - Sypris Technologies has secured a long-term, sole-source contract extension with a major commercial vehicle manufacturer for Ultra Axle Shafts, ensuring stable revenue and reinforcing its reputation in the sector [2] - Sypris Electronics is expanding its presence in the electronic warfare market through additional contracts with the U.S. Navy, enhancing defense capabilities against missile threats [3] - The company holds a strong position in the aerospace and defense electronics markets, focusing on high-reliability manufacturing and systems integration, with key clients including Northrop Grumman, Lockheed Martin, and Raytheon Technologies [4] Group 2: Financial Performance - As of March 31, 2024, Sypris improved its cash balance to $8.1 million from $7.9 million at the end of 2023, with a significant backlog of over $110 million providing revenue visibility [5] - The company incurred a net loss of $2.2 million in Q1 2024, a significant increase from the $0.2 million loss in Q1 2023, with gross profit declining from $4.2 million to $2.9 million year over year [6] Group 3: Market Environment - Sypris operates in a highly competitive environment, facing competition from both domestic and international firms in industrial manufacturing and aerospace and defense segments [7] - Market risks include fluctuations in government defense spending and supply chain disruptions, which can affect project timelines and costs [7] Group 4: Stock Performance and Valuation - Sypris Solutions' shares have experienced notable growth over the past year, with the stock's valuation appearing relatively low compared to industry peers, indicating market caution regarding its near-term prospects [8] - The company has a modest market capitalization of $37.4 million, suggesting potential long-term growth driven by strategic contracts and strong market positions [9]