TechPrecision .(US:TPCS)2021-08-13 01:34Financial Data and Key Metrics Changes - Gross profit increased by 20% to $833,000 compared to the same quarter one year ago, with gross margin improving to 24.4% [5][9] - Net sales were $3.4 million, a 4% increase from the same quarter a year ago [5][6] - Net income for the first quarter was $1.4 million, including a $1.3 million gain from the forgiveness of the PPP loan, compared to a net loss of $116,000 in the prior year [11] - Operating income increased to $100,000 from an operating loss of $96,000 in the same quarter a year ago [10] Business Line Data and Key Metrics Changes - Revenue in the precision industrial markets increased, offsetting slightly lower defense revenue [6] - The defense backlog remains strong, with four key defense customers accounting for about 80% of the $17.6 million net backlog [7] Market Data and Key Metrics Changes - The company generated $137,000 of cash from operating activities compared to a cash outflow of $369,000 in the prior year quarter [12] - Total debt was $2.5 million, down $1.3 million from March 31, 2021, due to the PPP loan forgiveness [13] Company Strategy and Development Direction - The company is focused on serving the United States defense industry, particularly in naval submarine manufacturing through its Ranor subsidiary, with meaningful opportunities expected in the nuclear submarine business [14] - The acquisition of STADCO is anticipated to close during the week of August 15, 2021, although no assurances can be given regarding the timing [16] Management's Comments on Operating Environment and Future Outlook - Management noted that the COVID pandemic has impacted the United States Navy Virginia class submarine shipbuilding, causing delays that have affected the supply chain [15] - The shipbuilders are getting back on track, which is expected to increase opportunities for the Ranor subsidiary [15] Other Important Information - The company expects to spend approximately $1.1 million to purchase new fixed assets during fiscal 2022 [12] Q&A Session Summary Question: Comments on COVID and bottlenecks - A participant expressed appreciation for the clarity regarding COVID-related bottlenecks and looks forward to updates on the acquisition deal [22] Response: Acknowledgment - Management thanked the participant for their comments [23]