Nortech Systems(NSYS) - 2024 Q4 - Annual Results

Financial Performance - Fourth quarter net sales were $28.6 million, a decrease of 20.6$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$3.2 million in Q4 2023[6] - Gross profit for Q4 2024 was $2.8 million, a decline of 58.7$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]