Workflow
Taylor Devices(TAYD)
icon
Search documents
TAYLOR DEVICES ANNOUNCES FIRST QUARTER RESULTS
Prnewswire· 2024-09-27 12:00
Core Insights - Taylor Devices, Inc. reported first quarter sales of $11,617,856, a 17% increase from $9,923,628 in the same period last year [1][2] - Net earnings for the first quarter reached $2,666,655, representing a significant 44% increase from $1,847,863 in the previous year [1][2] - The company set new records for both sales and net earnings in this quarter, driven by strong performance in the Aerospace/Defense sector [2] Financial Performance - First quarter sales for fiscal 2024 were $9,923,628, while the current quarter sales are $11,617,856 [3] - Net earnings increased from $1,847,863 to $2,666,655 year-on-year [1][3] - Earnings per share for the previous year was $0.52, with shares outstanding at 3,520,910 [3] Market and Strategic Focus - The Aerospace/Defense market continues to show favorable momentum, helping to offset challenges in the Structural markets due to high interest rates and unfavorable foreign exchange rates [2] - The firm order backlog at the end of Q1 was $28.4 million, slightly up from $28.3 million in the previous year and significantly above the five-year average of $21.9 million [2] - The company remains committed to growth strategies through investments in team, technologies, and facilities [2]
Taylor Devices(TAYD) - 2025 Q1 - Quarterly Report
2024-09-27 11:42
Financial Performance - Net revenues for the three months ended August 31, 2024, increased by 17% to $11,618,000 compared to $9,924,000 for the same period in 2023[31]. - Gross profit for the same period was $5,504,000, representing a 26% increase from $4,385,000 in the prior year, with a gross margin of 47%[31][32]. - Operating income improved to $2,905,000 for the three months ended August 31, 2024, compared to $1,920,000 in the same period last year[35]. Expenses - Research and development costs decreased by 47% to $69,000, down from $129,000 in the previous year, accounting for 0.6% of net revenues[34]. - Selling, general, and administrative expenses rose by 8% to $2,530,000, representing 22% of net revenues, primarily due to increased employee compensation costs[34]. - Accrued expenses decreased by 49% from the prior year-end to $2,396,000 due to the payout of fiscal year 2024 incentive compensation[46]. Sales and Orders - The company had 118 open sales orders in backlog with a total sales value of $28.4 million as of August 31, 2024, compared to 131 orders valued at $28.3 million a year earlier[32]. - Total sales to Asia increased by 38% compared to the prior year, while sales to aerospace/defense customers rose by 20%[31]. - The company's backlog of sales orders decreased to $28.4 million from $33.1 million at the end of the prior year[45]. Accounts and Inventory - Accounts receivable increased by 30% to $6,780,000, with an average days sales outstanding (DSO) rising from 39 days to 53 days[41]. - Inventory as of August 31, 2024, was $8,154,000, an increase of 9% from $7,512,000 at the prior year-end[38]. - Accounts payable as of August 31, 2024, is $1,848,000, which is 28% higher than the prior year-end[46]. Capital and Projects - Capital expenditures for the three months ended August 31, 2024, were $247,000, down from $428,000 in the same period last year[36]. - The number of projects in progress increased from 14 to 15 between May 31, 2024, and August 31, 2024[42]. - The aggregate percent complete for projects in progress increased from 53% to 58% between May 31, 2024, and August 31, 2024[45]. - The average total sales value of projects in progress is $2,043,000 as of August 31, 2024[45]. Balances - The balance of CIEB as of August 31, 2024, is $4,333,000, which is 1% lower than the prior year-end balance[42]. - The balance of BIEC at August 31, 2024, is $2,984,000, down 47% from $5,601,000 at the end of the prior year[42]. - 34% of the CIEB balance was billed to customers in the quarter ended August 31, 2024[42]. - The percentage of total value invoiced to customers remained stable at 56%[45].
Taylor Devices: Record Fundamentals, Reduced Cyclicality, Undervalued Shares
Seeking Alpha· 2024-09-11 10:24
Investment Thesis - Taylor Devices designs and manufactures shock absorption, rate control, and energy storage products, with Aerospace & Defense (A&D) being the largest and fastest-growing revenue category, contributing 60% of revenues and growing 71% in the last two quarters of FY24 [3][5] - The company has achieved record revenues and backlog, with margins widening and cash position nearing 20% of market cap, while carrying zero debt and engaging in share buybacks [3][20] - Despite a 130% increase in stock price year-to-date, shares remain attractively priced for further upside due to strong free cash flow potential [3] Revenue Dynamics - A&D revenues have shown a significant shift, comprising over 70% of backlog in 2024, indicating strong demand and stability due to contract-based nature [5][6] - The U.S. market accounted for 86% of revenues in 2024, with total sales in the U.S. increasing by 18%, while sales to Asia decreased by 55% [7][8] - The cyclicality of Structural revenues is expected to improve with increased backlog and the introduction of new products, such as the Taylor Dampened Moment Frame [9] Market Trends - Increased global conflicts and defense spending, particularly in the U.S. and EU, are driving growth in the A&D sector, with the commercial and military space industry projected to reach nearly $1 trillion by 2030 [8] - The A&D segment's recurring revenue model is expected to reduce overall cyclicality for Taylor Devices, providing more stability during economic downturns [8] Competitive Positioning - Taylor Devices holds a strong market position with proprietary products and technology, supported by 10 patents expiring up to 2040, creating competitive barriers [10][11] - The company has established long-term customer relationships and benefits from government-funded product development, enhancing its competitive durability [10] Financial Performance - The company has achieved record highs in operating income, net income, and free cash flow in 2024, with operating leverage at its strongest in a decade [12] - Returns on capital and margins have significantly improved, effectively doubling the company's 5-year averages [12] Future Outlook - Revenue growth is expected to average 7.5% annually over the next decade, with gross margins projected to remain in the mid-40s [21] - Estimated free cash flow margins are anticipated to average 10% through the forecast period, with shares currently trading at a 34% discount to intrinsic value [22]
Taylor Devices (TAYD) Q4 EPS Up 36% Y/Y on Defense Segment Growth
ZACKS· 2024-08-16 15:45
Core Insights - Taylor Devices, Inc. reported a strong fourth quarter for fiscal 2024, with earnings per share (EPS) of 80 cents, up from 59 cents in the same quarter last year [1] - The company achieved quarterly revenues of $12.1 million, reflecting a 12.6% year-over-year increase from $10.7 million in Q4 2023 [2] - The Aerospace/Defense segment was a key growth driver, benefiting from sustained demand, while the Structural segment faced challenges due to macroeconomic factors [3] Financial Performance - The net income for Q4 2024 was $2.5 million, a 19.7% increase from $2.1 million in Q4 2023, driven by improved operational efficiency and strategic pricing [4] - The number of shares outstanding decreased to 3.1 million from 3.5 million in the prior-year quarter, positively impacting EPS [5] - For the full fiscal year 2024, sales reached $44.6 million, a 10.9% increase from $40.2 million in the previous year, with net income growing 43% to $9 million from $6.3 million [7] Order Backlog and Market Outlook - The company reported a record order backlog of $33.1 million entering fiscal year 2025, slightly surpassing the previous record of $32.5 million, indicating strong revenue visibility and demand stability in key markets [6]
Taylor Devices(TAYD) - 2024 Q4 - Annual Report
2024-08-15 11:27
Financial Performance - For the year ended May 31, 2024, net revenue increased by 11% to $44,583,000 compared to $40,199,000 in the previous year[46]. - Net income for the year ended May 31, 2024 rose by 43% to $2,711,000, up from the previous year's figure[44]. - The gross profit margin improved to 47% in the year ended May 31, 2024, compared to 42% in the prior year[48]. - Operating income improved significantly to $9,479,000 for the year ended May 31, 2024, compared to $6,809,000 in the prior year, attributed to reduced R&D costs and better gross margin performance[53]. - Other income rose by 104% due to increased interest income from higher short-term investments[53]. Revenue Sources - Revenue from long-term projects increased by 8% year-over-year, while revenue from non-projects rose by 15%[46]. - Sales to aerospace/defense customers surged by 71%, while sales to structural customers dropped by 30%[47]. - Total sales in the U.S. increased by 18% from the prior year, while sales to Asia decreased by 55%[48]. Expenses and Costs - Research and development costs decreased by 65% to $388,000 from $1,097,000 in the prior year, primarily due to the completion of the Taylor Damped Moment Frame™ project[52][53]. - Selling, general and administrative expenses increased by 21% to $10,971,000 from $9,043,000, mainly driven by higher personnel costs[52][53]. - The provision for potential inventory obsolescence was $386,000 for the year ended May 31, 2024, compared to $295,000 in the previous year[37]. Assets and Liabilities - The company had a total sales order backlog valued at $33.1 million as of May 31, 2024, compared to $32.5 million a year earlier[49]. - Inventory increased by 26% to $7,512,000, with 85% classified as work in process[59]. - Accounts receivable decreased by 6% to $5,212,000, while costs and estimated earnings in excess of billings increased by 6% to $4,357,000[63][65]. - Billings in excess of costs and estimated earnings surged by 181% to $5,601,000 from $1,992,000 in the prior year[68]. Tax and Deferred Assets - The deferred tax asset balance increased by 38% to $2,176,000 as of May 31, 2024, requiring approximately $10.4 million of taxable income to realize[42]. - The effective tax rate for the fiscal year ended May 31, 2024, was 18%, up from 16% in the prior year[53]. Capital Expenditures - Capital expenditures decreased to $1,149,000 from $3,359,000 in the prior year, with commitments for future capital expenditures of approximately $1,360,000[57]. Corporate Governance and Compliance - The Company has filed certifications from the Chief Executive Officer and Chief Financial Officer, ensuring compliance with regulatory requirements[81]. - The Company has a policy relating to the recovery of erroneously awarded compensation, reflecting governance and accountability measures[83]. - The Company has incorporated various stock option plans and agreements, indicating ongoing employee incentive strategies[79]. Future Outlook and Meetings - The company expects sufficient cash on hand, cash flows from operations, and borrowing capacity to fund ongoing operations and capital improvements for the next twelve months[60]. - The Company will hold its Annual Meeting of Shareholders on October 25, 2024, with proxy materials to be filed within 120 days after the fiscal year end[75]. Financial Reporting - Consolidated Balance Sheets as of May 31, 2024, and 2023 will be included in the financial statements[77]. - Consolidated Statements of Income for the years ended May 31, 2024, and 2023 will be presented, providing insights into revenue and profit trends[77]. - The financial statements will include Inline XBRL interactive data files, enhancing data accessibility and analysis[83]. - The financial reports will provide detailed notes to the consolidated financial statements, offering further insights into financial performance and position[77].
Zacks Initiates Coverage of Taylor Devices With Outperform Recommendation
ZACKS· 2024-06-12 09:35
Company Overview - Taylor Devices has a market capitalization of $138 2 million and is positioned as a promising investment opportunity in a niche market segment [1] - The company specializes in shock absorption, rate control, and energy storage devices, demonstrating strong operational efficiency and strategic alignment towards profitable markets [7] Financial Performance - Net income increased by 55% to $6 5 million for the nine months ended Feb 29, 2024, driven by a 10% rise in net revenues to $32 5 million [6] - Gross profit margins improved significantly, rising to 46% from 41% year over year, reflecting enhanced operational efficiency [6] - The company maintains a solid liquidity position with $3 1 million in cash and cash equivalents and a positive order backlog of $30 2 million as of Feb 29, 2024 [4] Market Segments and Growth - Sales in the aerospace/defense sector increased by 88%, offsetting declines in construction (down 35%) and industrial (down 18%) segments [3] - The aerospace/defense sector constituted 61% of sales for the nine months ending Feb 29, 2024, highlighting the company's strategic realignment towards this lucrative market [8] Competitive Landscape - Taylor Devices faces competition from both domestic and international firms but maintains a strong market position through a diversified product range and focus on innovation [9] - The company holds six patents expiring up to the year 2035, underscoring its commitment to technological advancement and intellectual property investment [9] Investor Appeal - The company's share price has shown robust growth over the past year, reflecting strong investor confidence in its financial health and market strategy [5] - The stock's attractive valuation relative to its peers makes it an appealing option for investors seeking value and growth potential [5]
Taylor Devices(TAYD) - 2024 Q3 - Quarterly Report
2024-03-28 12:07
Financial Performance - For the nine months ended February 29, 2024, net revenue increased by 10% to $32,518,000 compared to $29,480,000 for the same period in 2023[30]. - Net income for the nine months ended February 29, 2024, rose by 55% to $2,305,000, compared to $1,484,000 in the same period last year[30]. - For the three months ended February 29, 2024, net revenue increased by 24% to $12,254,000 compared to $9,891,000 in the same period last year[43]. Profitability - Gross profit for the nine months ended February 29, 2024, was $14,948,000, representing a 23% increase from $12,122,000 in the prior year, with a gross profit margin of 46%[30][31]. - The gross profit margin for the three months ended February 29, 2024, improved to 47%, up from 43% in the prior year[44]. Expenses - Research and development costs decreased by 64% to $321,000, down from $881,000, due to the completion of a major project[35]. - Selling, general and administrative expenses increased by 18% to $7,660,000, primarily due to higher employee compensation costs[36]. - Capital expenditures for the nine months ended February 29, 2024, were $755,000, a decrease from $2,383,000 in the same period of the prior year[56]. Sales and Orders - The company had 131 open sales orders in backlog valued at $30.2 million as of February 29, 2024, compared to 125 orders valued at $27.8 million a year earlier[33]. - Total sales within the U.S. increased by 21% year-over-year, while sales to Asia decreased by 53%[30]. - The company's backlog of sales orders decreased to $30.2 million from $32.5 million at the end of the prior year, with $16.1 million of the backlog on projects already in progress[67]. - The company expects to recognize revenue for the majority of its backlog during the 2024 and 2025 fiscal years[33]. Inventory and Receivables - Total inventory as of February 29, 2024, was $6,678,000, an increase of $737,000 (12%) compared to $5,941,000 at the prior year-end[60]. - Accounts receivable decreased by $667,000 (12%) to $4,887,000 as of February 29, 2024, while costs and estimated earnings in excess of billings increased by $410,000 (10%) to $4,534,000[62]. - The provision for potential inventory obsolescence increased to $369,000 for the nine months ended February 29, 2024, compared to $68,000 for the same period in the prior year[61]. Shareholder Actions - On January 4, 2024, the company entered into a Redemption Agreement to purchase 459,015 shares at $19.92 per share, representing approximately 13% of all issued shares[69]. Project Status - The number of projects in progress decreased from 12 to 7, while the aggregate percent complete increased from 33% to 43%[67]. - Accounts payable decreased by 44% to $956,000 as of February 29, 2024, compared to the prior year-end[68]. Stock Options - The estimated fair market value per stock option increased from $3.06 in February 2023 to $7.17 in February 2024, reflecting a significant rise in expected share price volatility from 30% to 36%[53]. - As of February 29, 2024, the total number of options outstanding and exercisable increased to 339,750 from 333,000 at May 31, 2023, with an average exercise price of $13.70[54].
Taylor Devices(TAYD) - 2024 Q2 - Quarterly Report
2024-01-10 12:51
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 November 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-3498 TAYLOR DEVICES INC (Exact name of registrant as specified in its charter) New York 16-0797789 (State or other jurisdiction ...
Taylor Devices(TAYD) - 2024 Q1 - Quarterly Report
2023-09-29 11:58
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OF 1934 For the quarterly period ended August 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-3498 TAYLOR DEVICES INC (Exact name of registrant as specified in its charter) New York 16-0797789 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 90 Taylor Drive, North Tonawanda, ...
Taylor Devices(TAYD) - 2023 Q4 - Annual Report
2023-08-15 10:46
PART I [Business](index=4&type=section&id=Item%201.%20Business.) Taylor Devices, Inc. designs, manufactures, and markets shock absorption, rate control, and energy storage devices for diverse sectors - The company's main business is the design, manufacture, and marketing of shock absorption, rate control, and energy storage devices for various industries[13](index=13&type=chunk) - Principal product categories include Seismic Dampers, Fluidicshoks®, Crane and Industrial Buffers, Self-Adjusting Shock Absorbers, Liquid Die Springs, Vibration Dampers, Machined Springs, and Custom Actuators[14](index=14&type=chunk)[15](index=15&type=chunk) - In fiscal year 2023, sales to **five customers** accounted for approximately **30% of net sales**[21](index=21&type=chunk) R&D Expense | R&D Expense | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Company-funded | $1,097,000 | $999,000 | | Defense-sponsored | $581,000 | $334,000 | [Risk Factors](index=6&type=section&id=Item%201A.%20Risk%20Factors.) As a smaller reporting company, Taylor Devices, Inc. is not required to provide this information - The company is not required to provide risk factor information as it qualifies as a smaller reporting company[30](index=30&type=chunk) [Unresolved Staff Comments](index=6&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) There are no unresolved staff comments - Not applicable[31](index=31&type=chunk) [Properties](index=6&type=section&id=Item%202.%20Properties.) The company's North Tonawanda facilities, over 100,000 sq ft, are pledged to M&T Bank, restricting sale or lease - The company owns production facilities totaling more than **54,000 square feet** on Tonawanda Island and two additional industrial buildings totaling **46,000 square feet** in North Tonawanda, New York[32](index=32&type=chunk) - The company's real properties are subject to a negative pledge agreement with its lender, M&T Bank, preventing their sale, lease, or mortgage as long as credit facilities are outstanding[33](index=33&type=chunk) [Legal Proceedings](index=6&type=section&id=Item%203.%20Legal%20Proceedings.) The company is a Third-Party Defendant in a lawsuit concerning 432 Park Condominium defects, which it disputes - The company has been named as a Third-Party Defendant in a lawsuit related to the 432 Park Condominium in New York City[34](index=34&type=chunk) - The lawsuit alleges over **1,500 construction and design defects**. The company supplied **16 Viscous Damping Devices (VDDs)** for the building's Tuned Mass Damper (TMD) system[35](index=35&type=chunk)[38](index=38&type=chunk) - Management disputes the allegations and believes the company met all contractual requirements. Due to limited discovery, it is not practical to quantify likely damages[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk) [Mine Safety Disclosures](index=7&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - Not applicable[45](index=45&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=8&type=section&id=Item%205.%20Market%20For%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities.) The company's common stock trades on NASDAQ under TAYD; no dividends were paid, and the share repurchase program is terminated - The company's common stock trades on the NASDAQ Capital Market under the symbol TAYD[48](index=48&type=chunk) - No cash or stock dividends have been declared during the last two fiscal years[51](index=51&type=chunk) - A shareholder rights plan was adopted in **2018** to deter coercive takeover tactics and will expire in **2028**[52](index=52&type=chunk)[53](index=53&type=chunk) - The company's share repurchase agreement has been terminated, with no shares purchased since August 2011[54](index=54&type=chunk) [Selected Financial Data](index=9&type=section&id=Item%206.%20Selected%20Financial%20Data.) As a smaller reporting company, Taylor Devices, Inc. is not required to provide this information - The company qualifies as a smaller reporting company and is not required to provide selected financial data[58](index=58&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=9&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) FY2023 net revenue rose 30% to $40.2M, net income 181%, with gross margin at 40% and backlog at $32.5M [Application of Critical Accounting Policies and Estimates](index=10&type=section&id=Application%20of%20Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant judgment in accounts receivable, inventory, revenue recognition, and deferred tax assets - For long-term contracts, revenue is recognized over time using costs incurred relative to total estimated costs. In FY2023, **61%** of revenue was recognized this way, compared to **60%** in FY2022[67](index=67&type=chunk) - The company recorded a provision for potential inventory obsolescence of **$295,000** in FY2023, compared to zero in FY2022. Inventory disposals were **$322,000** in FY2023[63](index=63&type=chunk) - Management believes it is more likely than not that the deferred tax assets of **$1,583,000** will be realized, which requires generating approximately **$7.5 million** of future taxable income[70](index=70&type=chunk) [Results of Operations](index=12&type=section&id=Results%20of%20Operations) FY2023 net revenue grew 30% to $40.2M, net income 181%, with gross margin at 40% and backlog reaching $32.5M Key Financial Metrics | Financial Metric | FY 2023 | FY 2022 | Change | Change % | | :--- | :--- | :--- | :--- | :--- | | Net Revenue | $40,199,000 | $30,867,000 | $9,332,000 | 30% | | Gross Profit | $16,066,000 | $9,627,000 | $6,439,000 | 67% | | Gross Margin | 40% | 31% | +9 pts | - | | Net Income | $6,287,358 | $2,239,423 | $4,048,000 | 181% | Sales by Customer Group | Sales by Customer Group (% of Total) | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Industrial | 10% | 7% | | Structural | 51% | 53% | | Aerospace / Defense | 39% | 40% | - The sales order backlog increased to **$32.5 million** at May 31, 2023, from **$23.7 million** at May 31, 2022. Aerospace/defense orders constitute **81% of the current backlog**, up from **41%** in the prior year[79](index=79&type=chunk) - Selling, general and administrative (SG&A) expenses increased **33%** to **$8.16 million**, primarily due to higher personnel costs[82](index=82&type=chunk) [Capital Resources, Line of Credit and Long-Term Debt](index=15&type=section&id=Capital%20Resources,%20Line%20of%20Credit%20and%20Long-Term%20Debt) Primary liquidity is cash from operations; FY2023 capital expenditures doubled to $3.36M, with a $10M credit line unused - Capital expenditures were **$3,359,000** in FY2023, a significant increase from **$1,392,000** in FY2022[91](index=91&type=chunk) - The company has a **$10,000,000 bank demand line of credit** with no outstanding balance at May 31, 2023. The interest rate benchmark will switch from LIBOR to SOFR effective July 1, 2023[92](index=92&type=chunk) Balance Sheet Metrics | Balance Sheet Metrics | May 31, 2023 | May 31, 2022 | Change % | | :--- | :--- | :--- | :--- | | Accounts receivable | $5,554,000 | $4,467,000 | 24% | | CIEB (Asset) | $4,124,000 | $3,336,000 | 24% | | BIEC (Liability) | $1,992,000 | $1,123,000 | 77% | | DSO (Days) | 47 | 42 | +5 days | [Quantitative and Qualitative Disclosures About Market Risk](index=18&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) As a smaller reporting company, Taylor Devices, Inc. is not required to provide this information - The company is not required to provide this information as it qualifies as a smaller reporting company[105](index=105&type=chunk) [Financial Statements and Supplementary Data](index=18&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section states that the required financial statements and supplementary data are included in the report, commencing on page 26 - The financial statements and supplementary data are included in the Form 10-K, starting on page 26[106](index=106&type=chunk) [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=18&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure.) The company reported no disagreements with its accountants on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure - There have been no disagreements with the company's accountants that require disclosure[107](index=107&type=chunk) [Controls and Procedures](index=18&type=section&id=Item%209A.%20Controls%20and%20Procedures.) Management concluded that disclosure controls and internal control over financial reporting were effective as of May 31, 2023, with no material changes - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of May 31, 2023[108](index=108&type=chunk) - Management assessed internal control over financial reporting using the **2013 COSO framework** and concluded it was effective as of May 31, 2023[109](index=109&type=chunk) - No changes in internal controls over financial reporting occurred during the fiscal year that materially affected, or are reasonably likely to materially affect, the company's control over financial reporting[110](index=110&type=chunk) [Other Information](index=18&type=section&id=Item%209B.%20Other%20Information.) There is no other information to report - None[111](index=111&type=chunk) PART III [Directors, Executive Officers, Corporate Governance, Compensation, Security Ownership, and Related Transactions](index=18&type=section&id=Items%2010-14) Information for Items 10-14 is incorporated by reference from the company's Proxy Statement for the Annual Meeting on October 20, 2023 - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the Company's Proxy Statement, which will be filed within **120 days** of the fiscal year end[113](index=113&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=19&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules.) This section lists all documents filed as part of the 10-K report, including financial statements and various exhibits - Lists the financial statements and various exhibits filed with the report, including corporate governance documents, material contracts, and officer certifications[116](index=116&type=chunk)[117](index=117&type=chunk)[119](index=119&type=chunk) [Form 10-K Summary](index=22&type=section&id=Item%2016.%20Form%2010-K%20Summary.) No summary is provided under this item - None[123](index=123&type=chunk) Consolidated Financial Statements [Report of Independent Registered Public Accounting Firm](index=26&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Lumsden & McCormick, LLP issued an unqualified opinion, highlighting critical audit matters in long-term contract revenue and inventory valuation - The auditors, Lumsden & McCormick, LLP, issued an unqualified opinion, stating the financial statements are presented fairly in all material respects[134](index=134&type=chunk) - A Critical Audit Matter was identified related to revenue recognition for long-term contracts due to the significant variability and judgment involved in estimating costs to completion[140](index=140&type=chunk) - A second Critical Audit Matter was identified related to the valuation of inventory, given the significant judgments required to estimate potential obsolescence[142](index=142&type=chunk)[143](index=143&type=chunk) [Consolidated Balance Sheets](index=29&type=section&id=Consolidated%20Balance%20Sheets) Total assets grew to $57.9M, driven by short-term investments; liabilities and equity also increased reflecting profitability Consolidated Balance Sheet Highlights (In thousands) | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $3,575 | $22,517 | | Short-term investments | $24,515 | $1,097 | | Total current assets | $44,378 | $37,977 | | Total assets | $57,881 | $49,219 | | **Liabilities & Equity** | | | | Total current liabilities | $7,788 | $5,964 | | Total stockholders' equity | $50,093 | $43,255 | [Consolidated Statements of Income](index=30&type=section&id=Consolidated%20Statements%20of%20Income) FY2023 net sales increased 30% to $40.2M, with net income surging 181% to $6.3M, or $1.79 per share Consolidated Income Statement Highlights (In thousands, except per share data) | :--- | :--- | :--- | | Sales, net | $40,199 | $30,867 | | Gross profit | $16,066 | $9,627 | | Operating income | $6,809 | $2,473 | | Net income | $6,287 | $2,239 | | Basic EPS | $1.79 | $0.64 | | Diluted EPS | $1.77 | $0.64 | [Consolidated Statements of Cash Flows](index=32&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) FY2023 operating cash flow was $7.7M, but investing activities, mainly short-term investments, reduced cash by $18.9M Consolidated Cash Flow Highlights (In thousands) | :--- | :--- | :--- | | Net cash from operating activities | $7,707 | $3,309 | | Net cash from investing activities | ($26,782) | ($1,389) | | Net cash from financing activities | $133 | $16 | | Net change in cash and cash equivalents | ($18,942) | $1,935 | | Cash and cash equivalents - ending | $3,575 | $22,517 | [Notes to Consolidated Financial Statements](index=33&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail operations, revenue streams, asset/liability composition, credit line terms, employee benefits, and legal proceedings - **81%** of FY2023 revenue was from customers in the United States, with **11%** from Asia[153](index=153&type=chunk) - At year-end, there were **22 projects** in progress with an aggregate remaining contract value of **$18.1 million**, which is expected to be recognized mostly in fiscal 2024[182](index=182&type=chunk) - The company has a **$10 million bank demand line of credit**, secured by a negative pledge on property, with no amount outstanding at year-end[187](index=187&type=chunk) - The company maintains a **401(k) retirement plan**, with expenses of **$371,881** in FY2023 and **$313,269** in FY2022[205](index=205&type=chunk)