Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 30, 2023 | Aug. 18, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2023 | |
Entity Registrant Name | TechPrecision Corporation | |
Entity File Number | 000-51378 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0539828 | |
Entity Address, Address Line One | 1 Bella Drive | |
Entity Address, City or Town | Westminster | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01473 | |
City Area Code | 978 | |
Local Phone Number | 874-0591 | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | TPCS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 8,737,432 | |
Entity Central Index Key | 0001328792 | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2023 | Mar. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 271,918 | $ 534,474 |
Accounts receivable, net | 2,965,696 | 2,336,481 |
Contract assets | 8,651,343 | 8,947,811 |
Raw materials | 1,635,748 | 1,692,852 |
Work-in-process | 816,702 | 719,736 |
Other current assets | 324,457 | 348,983 |
Total current assets | 14,665,864 | 14,580,337 |
Property, plant and equipment, net | 15,376,726 | 13,914,024 |
Right-of-use asset, net | 5,492,504 | 5,660,938 |
Deferred income taxes | 2,077,616 | 1,931,186 |
Other noncurrent assets, net | 121,256 | 121,256 |
Total assets | 37,733,966 | 36,207,741 |
Current liabilities: | ||
Accounts payable | 743,933 | 2,224,320 |
Accrued expenses | 2,552,449 | 2,533,185 |
Contract liabilities | 2,853,695 | 2,333,591 |
Current portion of long-term lease liability | 715,707 | 711,727 |
Current portion of long-term debt, net | 2,865,387 | 1,218,162 |
Total current liabilities | 9,731,171 | 9,020,985 |
Long-term debt, net | 4,603,255 | 4,749,139 |
Long-term lease liability | 4,963,082 | 5,143,974 |
Other noncurrent liability | 4,369,762 | 2,699,492 |
Total liabilities | 23,667,270 | 21,613,590 |
Commitments and contingent liabilities | ||
Stockholders' Equity: | ||
Common stock - par value $.0001 per share, shares authorized: 50,000,000; Shares issued and outstanding: June 30, 2023 and March 31, 2023 - 8,613,408 | 861 | 861 |
Additional paid in capital | 14,949,729 | 14,949,729 |
Accumulated deficit | (883,894) | (356,439) |
Total stockholders' equity | 14,066,696 | 14,594,151 |
Total liabilities and stockholders' equity | $ 37,733,966 | $ 36,207,741 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2023 | Mar. 31, 2023 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 8,613,408 | 8,613,408 |
Common stock, shares outstanding | 8,613,408 | 8,613,408 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Net sales | $ 7,371,240 | $ 7,076,357 |
Cost of sales | 6,677,091 | 6,259,139 |
Gross profit | 694,149 | 817,218 |
Selling, general and administrative | 1,273,949 | 1,375,227 |
Loss from operations | (579,800) | (558,009) |
Other income (expense), net | 1 | (33,225) |
Interest expense | (94,086) | (83,645) |
Total other income (expense), net | (94,085) | (116,870) |
Loss before income taxes | (673,885) | (674,879) |
Income tax benefit | (146,430) | (173,714) |
Net loss | $ (527,455) | $ (501,165) |
Net loss per share - basic | $ (0.06) | $ (0.06) |
Net loss per share - diluted | $ (0.06) | $ (0.06) |
Weighted average number of shares outstanding - basic | 8,613,408 | 8,576,863 |
Weighted average number of shares outstanding - diluted | 8,613,408 | 8,576,863 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Common Stock Outstanding | Additional Paid in Capital | Retained Earnings (Accumulated Deficit) | Total |
Balance at Mar. 31, 2022 | $ 858 | $ 14,640,343 | $ 622,567 | $ 15,263,768 |
Balance (in shares) at Mar. 31, 2022 | 8,576,863 | |||
Net loss | (501,165) | (501,165) | ||
Stock based compensation | 52,107 | 52,107 | ||
Balance at Jun. 30, 2022 | $ 858 | 14,692,450 | 121,402 | 14,814,710 |
Balance (in shares) at Jun. 30, 2022 | 8,576,863 | |||
Balance at Mar. 31, 2023 | $ 861 | 14,949,729 | (356,439) | 14,594,151 |
Balance (in shares) at Mar. 31, 2023 | 8,613,408 | |||
Net loss | (527,455) | (527,455) | ||
Balance at Jun. 30, 2023 | $ 861 | $ 14,949,729 | $ (883,894) | $ 14,066,696 |
Balance (in shares) at Jun. 30, 2023 | 8,613,408 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (527,455) | $ (501,165) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 559,735 | 585,361 |
Amortization of debt issue costs | 18,761 | 13,399 |
Stock based compensation expense | 52,107 | |
Change in contract loss provision | 16,170 | 18,402 |
Deferred income taxes | (146,430) | (173,714) |
Change in fair value for contingent consideration | (33,474) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (629,215) | 501,882 |
Contract assets | 296,468 | (452,411) |
Work-in-process and raw materials | (39,861) | (665,192) |
Other current assets | 24,526 | 693,394 |
Accounts payable | (1,480,387) | 481,208 |
Accrued expenses | (167,629) | (85,348) |
Contract liabilities | 520,104 | 21,083 |
Other noncurrent liabilities | 1,670,270 | 993,203 |
Net cash provided by operating activities | 115,057 | 1,448,735 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Fixed asset deposit | (559,000) | |
Purchases of property, plant, and equipment | (1,854,002) | (203,981) |
Net cash used in investing activities | (1,854,002) | (762,981) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Debt issue costs | (6,268) | |
Revolver loan payments and borrowings, net | 1,630,000 | (987,002) |
Payments of principal for leases | (6,191) | (16,860) |
Repayments of long-term debt | (147,420) | (154,125) |
Net cash provided by (used in) financing activities | 1,476,389 | (1,164,255) |
Net decrease in cash and cash equivalents | (262,556) | (478,501) |
Cash and cash equivalents, beginning of period | 534,474 | 1,052,139 |
Cash and cash equivalents, end of period | 271,918 | 573,638 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION: | ||
Cash paid for interest; net of amounts capitalized | $ 67,175 | $ 69,799 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 3 Months Ended |
Jun. 30, 2023 | |
DESCRIPTION OF BUSINESS | |
DESCRIPTION OF BUSINESS | NOTE 1 - DESCRIPTION OF BUSINESS TechPrecision Corporation, or “TechPrecision”, is a Delaware corporation organized in February 2005 under the name Lounsberry Holdings II, Inc. On February 24, 2006, we acquired all of the issued and outstanding capital stock of our wholly owned subsidiary Ranor, Inc., or “Ranor.” Ranor, together with its predecessors, has been in continuous operation since 1956. The company’s name was changed to TechPrecision Corporation on March 6, 2006. On August 25, 2021, the Company completed its previously announced acquisition of Stadco, pursuant to that certain stock purchase agreement with Stadco New Acquisition, LLC, or “Acquisition Sub”, Stadco Acquisition, LLC, Stadco and each equity holder of Stadco Acquisition, LLC. On the closing date, the Company, through Acquisition Sub, acquired all the issued and outstanding capital stock of Stadco from Stadco Acquisition, LLC in exchange for the issuance of shares of the Company’s common stock to Stadco Acquisition, LLC. As a result of the acquisition, Stadco is now our wholly owned indirect subsidiary. TechPrecision is the parent company of Ranor, Westminster Credit Holdings, LLC, or “WCH”, Acquisition Sub, and Stadco. TechPrecision, Ranor, WCH, Acquisition Sub and Stadco are collectively referred to as the “Company”, “we”, “us” or “our”. We manufacture large-scale metal fabricated and machined precision components and equipment. These products are used in a variety of markets including defense and aerospace, nuclear, medical, and precision industrial. All our operations and customers are in the United States, or “U.S.”. |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Consolidation - one These notes to the condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the “SEC”, for Quarterly Reports on Form 10-Q. Certain information and disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These unaudited financial statements and related notes should be read in conjunction with the consolidated financial statements included with our Annual Report on Form 10-K for the fiscal year ended March 31, 2023, filed with the SEC on June 15, 2023. Use of Estimates in the Preparation of Financial Statements - Liquidity and Going Concern - The Company is the borrower under the amended and restated loan agreement with Berkshire Bank, or the “Loan Agreement” (as defined below; see Note 11 – Debt). There was $7.6 million outstanding under the agreement on June 30, 2023. The Company has determined it is in compliance with the debt covenants as of June 30, 2023. However, it is probable that the Company will not be in compliance with the debt covenants at subsequent compliance dates, in which case the Company will request a waiver from the lender. Without such a waiver, the lender would have the right, but not the obligation, to demand repayment from the Company for noncompliance with the debt covenants. In addition, the bank retains the right to act on covenant violations that occur after the date of delivery of any waiver. If the lender were to decline to grant us a waiver and instead demand repayment, we would need to seek alternative financing to pay these obligations as the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations. We are subject to certain financial debt covenants and may not spend more than $1.5 million for new machinery and equipment during any single fiscal year, tested on an annual basis at the end of each fiscal year. On June 12, 2023, we executed a waiver with the lender under which the lender agreed to waive the Company’s noncompliance with this capital spending limit covenant, as it related to the period ended March 31, 2023. The waiver document also contains an agreement by the parties to exclude from the calculation of capital expenditures for purposes of the Loan Agreement during the year ending March 31, 2024, any such expenditures made by the Company to the extent they are made using funds provided by customers of the Company for the purpose of making such capital expenditures. We estimate our spending on new machinery and equipment in fiscal 2024, which we expect will include expenditures for the installation and construction of equipment for contract project work with a certain customer, will again exceed the spending limitation. However, as a result of the agreement to exclude certain expenditures from the limitation imposed by the covenant, the Company does not anticipate this will result in noncompliance with the capital spending limit covenant for the fiscal year ended March 31, 2024. In order for us to continue operations beyond the next twelve months and be able to discharge our liabilities and commitments in the normal course of business, we must mitigate our recurring operating losses at our Stadco subsidiary. We must efficiently increase utilization of our manufacturing capacity at our Stadco subsidiary and improve the manufacturing process, so our direct labor hours (inputs) allow us to recognize more revenue over time (outputs) and improve job performance. We plan to closely monitor our expenses and, if required, will reduce operating costs to enhance liquidity. The uncertainty associated with the recurring operating losses at Stadco and expected debt covenant violation at subsequent compliance dates raise substantial doubt about our ability to continue as a going concern. The condensed consolidated financial statements for the three months ended June 30, 2023, were prepared on the basis of a going concern which contemplates that we will be able to realize assets and discharge liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should we be required to liquidate assets. Our ability to satisfy our current liabilities and to continue as a going concern is dependent upon the Company’s compliance with the debt covenants and its ability to grow revenue and reduce costs at Stadco. The financial statements do not include any adjustments that might result from the outcome of these uncertainties. New Accounting Standards Recently Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
REVENUE
REVENUE | 3 Months Ended |
Jun. 30, 2023 | |
REVENUE | |
REVENUE | NOTE 3 – REVENUE The Company generates revenue primarily from performance obligations completed under contracts with customers in two main market sectors: defense and precision industrial. The period over which the Company performs its obligations can be between three thirty-six months Net Sales by market Defense Industrial Totals Three months ended June 30, 2023 $ 6,597,893 $ 773,347 $ 7,371,240 Three months ended June 30, 2022 $ 6,840,924 $ 235,433 $ 7,076,357 Net Sales by contract type Over-time Point-in-time Totals Three months ended June 30, 2023 $ 6,933,804 $ 437,436 $ 7,371,240 Three months ended June 30, 2022 $ 6,622,093 $ 454,264 $ 7,076,357 As of June 30, 2023, the Company had $46.3 million of remaining performance obligations, of which $39.9 million were less than 50% complete. The Company expects to recognize all of its remaining performance obligations as revenue within the next thirty-six months We are dependent each year on a small number of customers who generate a significant portion of our business, and these customers change from year to year. The following table sets forth revenues from customers who accounted for more than 10% of our net sales. Three months ended Three months ended June 30, 2023 June 30, 2022 Customer Amount Percent Amount Percent A $ 2,285,275 31 % $ 1,296,387 18 % B $ 866,171 12 % $ 1,763,591 25 % C $ 805,690 11 % $ 735,758 11 % D $ * * % $ 1,071,874 15 % E $ 800,512 11 % $ * * % F $ 743,237 10 % $ * * % * Less than 10% of total In our condensed consolidated balance sheet, contract assets and contract liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. For the three months ended June 30, 2023, we recognized revenue of approximately $0.9 million related to our contract liabilities at April 1, 2023. Contract assets consisted of the following at: Progress Unbilled payments Total June 30, 2023 $ 19,914,513 $ (11,263,170) $ 8,651,343 March 31, 2023 $ 19,485,914 $ (10,538,103) $ 8,947,811 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jun. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | NOTE 4 – INCOME TAXES The Company accounts for income taxes under ASC 740, Income Taxes The valuation allowance on deferred tax assets was approximately $2.1 million at June 30, 2023. We believe that it is more likely than not that the benefit from certain state net operating losses, or “NOLs”, carryforwards and other deferred tax assets will not be realized. In the event future taxable income is below management’s estimates or is generated in tax jurisdictions different than projected, the Company could be required to increase the valuation allowance for deferred tax assets. This would result in an increase in the Company’s effective tax rate. |
EARNINGS PER SHARE (EPS)
EARNINGS PER SHARE (EPS) | 3 Months Ended |
Jun. 30, 2023 | |
EARNINGS PER SHARE (EPS) | |
EARNINGS PER SHARE (EPS) | NOTE 5 – EARNINGS PER SHARE (EPS) Basic EPS is computed by dividing reported earnings available to stockholders by the weighted average number of shares outstanding. Diluted EPS also includes the effect of stock options that would be dilutive. The following table provides a reconciliation of the numerators and denominators reflected in the basic and diluted earnings per share computations for the periods ended: Three Months ended Three Months ended June 30, 2023 June 30, 2022 Basic EPS Net loss $ (527,455) $ (501,165) Weighted average shares 8,613,408 8,576,863 Net loss per share $ (0.06) $ (0.06) Diluted EPS Net loss $ (527,455) $ (501,165) Dilutive effect of stock options — — Weighted average shares 8,613,408 8,576,863 Net loss per share $ (0.06) $ (0.06) All potential common stock equivalents that have an anti-dilutive effect are excluded from the calculation of diluted EPS (i.e., those that increase income per share or decrease loss per share). For the three months ended June 30 2023 there were potential anti-dilutive stock options and warrants of 667,500 and 25,000. For the three months ended June 30, 2022 there were potential anti-dilutive stock options and warrants of 680,000 and 25,000, none of which were included in the earnings per share calculations above. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 6 – STOCK-BASED COMPENSATION The 2016 TechPrecision Equity Incentive Plan, or the “2016 Plan”, is designed to reflect our commitment to having best practices in both compensation and corporate governance. The 2016 Plan provides for a share reserve of 1,250,000 shares of common stock. The 2016 Plan authorizes the award of incentive and non-qualified stock options, restricted and unrestricted stock awards, restricted stock units, and performance awards to employees, directors, consultants, and other individuals who provide services to TechPrecision or its affiliates. The purpose of the 2016 Plan is to: (a) enable TechPrecision and its affiliated companies to recruit and retain highly qualified employees, directors and consultants; (b) provide those employees, directors and consultants with an incentive for productivity; and (c) provide those employees, directors and consultants with an opportunity to share in the growth and value of the Company. Subject to adjustment as provided in the 2016 Plan, the maximum number of shares of common stock that may be issued with respect to awards under the 2016 Plan is 1,250,000 shares (inclusive of awards issued under the 2006 Long-Term Incentive Plan, or the “2006 Plan”, that remained outstanding as of the effective date of the 2016 Plan). Shares of our common stock subject to awards that expire unexercised or are otherwise forfeited shall again be available for awards under the 2016 Plan. At June 30, 2023, there were 312,500 shares available for grant under the 2016 Plan. The following table summarizes information about options granted during the most recently completed periods: Weighted Average Weighted Aggregate Remaining Number Of Average Intrinsic Contractual Life Options Exercise Price Value (in years) Outstanding at March 31, 2023 667,500 $ 1.37 $ 3,804,625 3.70 Outstanding at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 Vested or expected to vest at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 Exercisable and vested at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the closing stock price on the last trading day of the first quarter of fiscal 2024 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on June 30, 2023. This amount changes based on the fair market value of the Company’s common stock. The maximum contractual term is ten years Weighted Average Remaining Weighted Weighted Options Contractual Average Options Average Range of Exercise Prices: Outstanding Term Exercise Price Exercisable Exercise Price $0.01-$0.99 317,500 2.36 $ 0.46 317,500 $ 0.46 $2.00-$2.99 350,000 3.91 $ 2.19 350,000 $ 2.19 Totals 667,500 667,500 |
CONCENTRATION OF CREDIT RISK
CONCENTRATION OF CREDIT RISK | 3 Months Ended |
Jun. 30, 2023 | |
CONCENTRATION OF CREDIT RISK | |
CONCENTRATION OF CREDIT RISK | NOTE 7 - CONCENTRATION OF CREDIT RISK We maintain bank account balances, which, at times, may exceed insured limits. We have not experienced any losses with these accounts and believe that we are not exposed to any significant credit risk on cash. On June 30, 2023, there were trade accounts receivable balances outstanding from two customers comprising 58% of the total trade receivables balance. The following table sets forth information as to trade accounts receivable from customers who accounted for more than 10% of our accounts receivable balance as of: June 30, 2023 March 31, 2023 Customer Dollars Percent Dollars Percent A $ 991,695 33 % $ 730,514 31 % B $ * * % $ 260,177 11 % C $ 728,548 25 % $ * * % D $ * * % $ 265,755 11 % * less than 10% of total |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 3 Months Ended |
Jun. 30, 2023 | |
OTHER CURRENT ASSETS | |
OTHER CURRENT ASSETS | NOTE 8 - OTHER CURRENT ASSETS Other current assets included the following as of: June 30, 2023 March 31, 2023 Prepaid taxes $ 35,505 $ 9,616 Prepaid insurance 148,592 162,075 Prepaid subscriptions 87,071 120,570 Deposits 21,706 21,706 Employee advances 12,683 4,561 Prepaid advisory fees, other 18,900 30,455 Total $ 324,457 $ 348,983 |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 3 Months Ended |
Jun. 30, 2023 | |
PROPERTY, PLANT AND EQUIPMENT, NET | |
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 9 - PROPERTY, PLANT AND EQUIPMENT, NET Property, plant and equipment, net consisted of the following as of: June 30, 2023 March 31, 2023 Land $ 110,113 $ 110,113 Building and improvements 3,293,986 3,293,986 Machinery equipment, furniture, and fixtures 24,846,351 23,018,713 Construction-in-progress 164,681 149,576 Total property, plant, and equipment 28,415,131 26,572,388 Less: accumulated depreciation (13,038,405) (12,658,364) Total property, plant and equipment, net $ 15,376,726 $ 13,914,024 We capitalize interest on borrowings during active construction period for major capital projects. Capitalized interest is added to the cost of the underlying assets and is amortized over the useful lives of the assets. Interest capitalized for the three months ended June 30, 2023 was $28,168. |
ACCRUED EXPENSES
ACCRUED EXPENSES | 3 Months Ended |
Jun. 30, 2023 | |
ACCRUED EXPENSES | |
ACCRUED EXPENSES | NOTE 10 - ACCRUED EXPENSES Accrued expenses included the following as of: June 30, 2023 March 31, 2023 Accrued compensation $ 1,182,453 $ 1,257,245 Provision for claims 234,472 256,227 Provision for contract losses 119,124 102,954 Accrued professional fees 234,176 241,195 Accrued project costs 615,213 440,550 Other 167,011 235,014 Total $ 2,552,449 $ 2,533,185 Accrued compensation includes amounts for executive bonuses, payroll and vacation and holiday pay. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in the provision are recorded in cost of sales. Accrued project costs are estimates for certain project expenses during the reporting period. |
DEBT
DEBT | 3 Months Ended |
Jun. 30, 2023 | |
DEBT | |
DEBT | NOTE 11 – DEBT Long-term debt included the following as of: June 30, 2023 March 31, 2023 Stadco Term Loan, at 3.79% interest, due August 2028 $ 3,053,758 $ 3,186,495 Ranor Term Loan, at 6.05% interest, due December 2027 2,261,835 2,276,518 Ranor Revolver Loan, at 7.31% interest, due December 2023 2,280,000 650,000 Total debt $ 7,595,593 $ 6,113,013 Less: debt issue costs unamortized $ 126,951 $ 145,712 Total debt, net $ 7,468,642 $ 5,967,301 Less: Current portion of long-term debt $ 2,865,387 $ 1,218,162 Total long-term debt, net $ 4,603,255 $ 4,749,139 Amended and Restated Loan Agreement On August 25, 2021, the Company entered into an amended and restated loan agreement with Berkshire Bank, or the “Loan Agreement”. Under the Loan Agreement, Berkshire Bank will continue to provide the Ranor Term Loan (as defined below) and the revolving line of credit, or the “Revolver Loan”. In addition, Berkshire Bank provided the Stadco Term Loan (as defined below) in the original amount of $4.0 million. The proceeds of the original Ranor Term Loan of $2.85 million were previously used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company. The proceeds of the Stadco Term Loan were to be used to support the acquisition of Stadco and refinance existing indebtedness of Stadco. Stadco Term Loan On August 25, 2021, Stadco borrowed $4.0 million from Berkshire Bank, or the “Stadco Term Loan”, under the Loan Agreement. Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021 at a fixed rate per annum equal to the 7 year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%. Since September 25, 2021 and on the 25th day of each month thereafter, Stadco had made and will make monthly payments of principal and interest in the amount of $54,390 each, with all remaining outstanding principal and accrued interest due and payable on August 25, 2028. Interest shall be calculated based on actual days elapsed and a 360-day year. Unamortized debt issue costs on June 30, 2023 and March 31, 2023 were $40,649 and $44,482, respectively. Ranor Term Loan and Revolver Loan A term loan was made to Ranor by Berkshire Bank in 2016 in the amount of $2.85 million, or the “Ranor Term Loan”. Payments began on January 20, 2017, and were made in monthly installments of $19,260 each, inclusive of interest at a fixed rate of 5.21% per annum, with all outstanding principal and accrued interest due and payable on the original maturity date, December 20, 2021, which was extended to December, 2022. On December 23, 2022, Ranor and certain affiliates of the Company entered into a Fifth Amendment to Amended and Restated Loan Agreement, Fifth Amendment to Promissory Note and First Amendment to Second Amended and Restated Promissory Note, or the “Amendment”. Effective as of December 20, 2022, the Amendment, among other things (i) extends the maturity date of the Ranor Term Loan to December 15, 2027, (ii) extends the maturity date of the Revolver Loan from December 20, 2022 to December 20, 2023, (iii) increases the interest rate on the Ranor Term Loan from 5.21% to 6.05% per annum, (iv) decreases the monthly payment on the Ranor Term Loan from $19,260 to $16,601, (v) replaces LIBOR as an option for the benchmark interest rate for the Revolver Loan with SOFR, (vi) replaces LIBOR-based interest pricing conventions with SOFR-based pricing conventions, including benchmark replacement provisions, and (vii) solely with respect to the fiscal quarter ending December 31, 2022, lowers the debt service coverage ratio from at least 1.2 to 1.0 to 1.1 to 1.0. Under the Loan Agreement, Berkshire Bank also makes available to Ranor the Revolver Loan, which has a maximum principal amount available of $5.0 million. Advances under the Revolver Loan are subject to a borrowing base equal to the lesser of (a) $5.0 million or (b) the sum of (i)80% of the net outstanding amount of Base Accounts, plus (ii) the lesser of (x) 25% of Eligible Raw Material Inventory, and (y) $250,000, plus (iii) 80% of the Appraised Value of the Eligible Equipment, as such terms are defined in the Loan Agreement. The Company agrees to pay to Berkshire Bank, as consideration for Berkshire Bank’s agreement to make the Revolver Loan available, a nonrefundable Revolver Loan fee equal to 0.25% per annum (computed based on a year of 360 days and actual days elapsed) on the difference between the amount of: (a) $5.0 million, and (b) the average daily outstanding balance of the Revolver Loan during the quarterly period then ended. All Revolver Loan fees are payable quarterly in arrears on the first day of each January, April, July and October and on the Revolver Maturity Date, or upon acceleration of the Revolver Loan, if earlier. Under the amended promissory note for the Revolver Loan, the Company can elect to pay interest at the Term SOFR-based rate or an Adjusted Prime Rate, each as defined in the agreement. Interest-only payments on advances made under the Revolver Loan will continue to be payable monthly in arrears. The prior LIBOR-based rate expired on December 20, 2022. There was approximately $2.3 million outstanding under the Revolver Loan at June 30, 2023. Interest payments made under the Revolver Loan were $29,678 for the three months ended June 30, 2023. The weighted average interest rate at June 30, 2023 and March 31, 2023 was 7.31% and 5.02%, respectively. Unused borrowing capacity at June 30, 2023 and March 31, 2023 was approximately $2.4 million and $4.2 million, respectively. Unamortized debt issue costs at June 30, 2023 and March 31, 2023 were $86,302 and $101,230, respectively. Berkshire Loan Covenants For purposes of this discussion, Ranor and Stadco are referred to together as the “Borrowers”. The Ranor Term Loan, the Stadco Term Loan and the Revolver Loan, or together, the “Berkshire Loans”, may be accelerated upon the occurrence of an event of default as defined in the Loan Agreement. Upon the occurrence and during the continuance of certain default events, at the option of Berkshire Bank, or automatically without notice or any other action upon the occurrence of certain other events specified in the Loan Agreement, the unpaid principal amount of the Berkshire Loans together with accrued interest and all other obligations owing by the Borrowers to Berkshire Bank would become immediately due and payable without presentment, demand, protest, or further notice of any kind. The Company agreed to maintain compliance with certain financial covenants under the Loan Agreement. Namely, the Borrowers agree to maintain the ratio of the Cash Flow of TechPrecision-to-the Total Debt Service of TechPrecision of not less than 1.20 to 1.00, (except for the fiscal quarter ended December 31, 2022, in which case such ratio of Cash Flow to Total Debt Service was to be not less than 1.10 to 1.00), measured quarterly on the last day of each fiscal quarter, or annual period of TechPrecision on a trailing 12-month basis, commencing with the fiscal quarter ending as of September 30, 2021. Calculations will be based on the audited (year-end) and unaudited (quarterly) consolidated financial statements of TechPrecision. Quarterly tests will be measured based on the financial statements included in the Company’s quarterly reports on Form 10-Q within 60 days of the end of each quarter, and annual tests will be measured based on the financial statements included in the Company’s annual reports on Form 10-K within 120 days after the end of each fiscal annual period. Cash Flow means an amount, without duplication, equal to the sum of net income of TechPrecision plus (i) interest expense, plus (ii) taxes, plus (iii) depreciation and amortization, plus (iv) stock based compensation expense taken by TechPrecision, plus (v) non-cash losses and charges and one time or non-recurring expenses at Berkshire Bank’s discretion, less (vi) the amount of cash distributions, if any, made to stockholders or owners of TechPrecision, less (vii) cash taxes paid by the TechPrecision, all as determined in accordance with U.S. GAAP. “Total Debt Service” means an amount, without duplication, equal to the sum of (i) all amounts of cash interest paid on liabilities, obligations, and reserves of TechPrecision paid by TechPrecision, (ii) all amounts paid by TechPrecision in connection with current maturities of long-term debt and preferred dividends, and (iii) all payments on account of capitalized leases, all as determined in accordance with U.S. GAAP. The Borrowers agree to cause their Balance Sheet Leverage to be less than or equal 2.50 to 1.00. For purposes of this covenant, “Balance Sheet Leverage” means, at any date of determination, the ratio of Borrowers’ (a) Total Liabilities, less Subordinated Debt, to (b) Net Worth, plus Subordinated Debt. The Borrowers agree that their combined annual capital expenditures shall not exceed $1.5 million, subject to certain agreed-upon exclusions. Compliance is tested annually. The Borrowers agree to maintain a Loan-to-Value Ratio of not greater than 0.75 to 1.00. “Loan-to-Value Ratio” means the ratio of (a) the sum of the outstanding balance of the Ranor Term Loan and the Stadco Term Loan to (b) the fair market value of the property pledged as collateral for the loan, as determined by an appraisal obtained from time to time by Berkshire Bank, but not more frequently than one time during each 365 day period (provided that Berkshire Bank may obtain an appraisal at any time after either the Ranor Term Loan or the Stadco Term Loan has been accelerated), which appraisals shall be at the expense of the Borrowers. On June 12, 2023, the Company and Berkshire Bank executed a waiver under which Berkshire Bank waived the Company’s noncompliance with the capital expenditure limit on March 31, 2023. The waiver document also contains an agreement by the parties to exclude from the calculation of capital expenditures for purposes of the Loan Agreement during the year ending March 31, 2024 any such expenditures made by the Company to the extent they are made using funds provided by customers of the Company for the purpose of making such capital expenditures. The Company was in compliance with all of the financial covenants at June 30, 2023. Collateral securing all the above obligations comprises all personal and real property of the Company, including cash, accounts receivable, inventories, equipment, and financial assets. The carrying value of short and long-term borrowings approximates their fair value. The Company’s short-term and long-term debt is all privately held with no public market for this debt and is considered to be Level 3 under the fair value hierarchy. The scheduled principal maturities for our total debt for the next five years and thereafter: 2024 $ 2,886,387 2025 632,251 2026 658,564 2027 686,007 2028 2,624,108 Thereafter 108,276 Total $ 7,595,593 |
OTHER NONCURRENT LIABILITIES
OTHER NONCURRENT LIABILITIES | 3 Months Ended |
Jun. 30, 2023 | |
OTHER NONCURRENT LIABILITIES | |
OTHER NONCURRENT LIABILITIES | NOTE 12 - OTHER NONCURRENT LIABILITIES The Company purchased new equipment in fiscal 2022 for contract project work with a certain customer. Under an addendum to the contract purchase orders, that customer agreed to reimburse the Company for the cost of the new equipment. We received the first payment in January 2022 and two additional payments in April 2022. In case of a contract breach, at the time of the breach, the customer may claw back the funds based on a prorated ten-year straight-line annual declining balance recovery period. Customer payments received of $1.7 million in fiscal 2024 are recorded as a noncurrent liability in the condensed consolidated balance sheets. Stadco entered into the Payment Agreement with the Department of Water and Power of the City of Los Angeles (the “LADWP”) to settle previously outstanding amounts for water, water service, electric energy and/or electric service in the aggregate amount of $1,770,201 that were delinquent and unpaid. Under the Payment Agreement, Stadco will make monthly installment payments on the unpaid balance beginning on December 15, 2022, in an aggregate amount of $18,439 per month until the earlier of November 15, 2030, or the amount due is paid in full. Late payments under the Payment Agreement accrue a late payment charge equal to an 18% annual rate on the unpaid balance. This liability amount was included in the Company’s balance sheet as a current and noncurrent liability as of June 30, 2023 and March 31, 2023 for $0.2 million and $1.4 million, and $0.2 million, and $1.5 million, respectively. |
LEASES
LEASES | 3 Months Ended |
Jun. 30, 2023 | |
LEASES | |
LEASES | NOTE 13 – LEASES On August 25, 2021, Stadco became party to an amended building and property operating lease and recorded a right of use asset and liability of $6.6 million. Monthly base rent for the property is $82,998 per month. The term of the lease will expire on June 30, 2030, and the lessee has no right of renewal beyond the expiration date. The lease contains customary default provisions allowing the landlord to terminate the lease if the lessee fails to remedy a breach of its obligations under the lease within the period specified in the lease, or upon certain events of bankruptcy or seizure or attachment of the lessee’s assets or interest in the lease. The lease also contains other customary provisions for real property leases of this type. The following table lists our right-of-use assets and liabilities on our condensed consolidated balance sheets at: June 30, 2023 March 31, 2023 Finance lease: Right of use asset – operating lease $ 6,629,396 $ 6,629,396 Right of use asset – finance leases 65,016 65,016 Amortization (1,201,908) (1,033,474) Right of use asset, net $ 5,492,504 $ 5,660,938 Lease liability – operating lease $ 5,648,643 $ 5,819,365 Lease liability – finance leases 30,146 36,336 Total lease liability $ 5,678,789 $ 5,855,701 Other supplemental information regarding our leases is contained in the following tables: Components of lease expense for the three months ended: June 30, 2023 June 30, 2022 Operating lease amortization $ 164,101 $ 158,071 Finance lease amortization $ 4,333 $ 6,300 Finance lease interest $ 281 $ 544 Weighted average lease term and discount rate at: June 30, 2023 June 30, 2022 Lease term (years) – operating lease 7.00 8.00 Lease term (years) – finance lease 2.40 2.70 Lease rate – operating lease 4.5 % 4.5 % Lease rate – finance lease 4.5 % 3.7 % Supplemental cash flow information related to leases for the three months ended: June 30, 2023 June 30, 2022 Cash used in operating activities $ 234,700 $ 193,393 Cash used in financing activities $ 6,191 $ 16,860 Maturities of lease liabilities at June 30, 2023 for the next five years and thereafter: 2024 $ 952,880 2025 948,701 2026 946,226 2027 938,802 2028 938,802 Thereafter 1,876,899 Total lease payments $ 6,602,310 Less: imputed interest 923,521 Total $ 5,678,789 |
COMMITMENTS
COMMITMENTS | 3 Months Ended |
Jun. 30, 2023 | |
COMMITMENTS | |
COMMITMENTS | NOTE 14 - COMMITMENTS Employment Agreements We have employment agreements with each of our executive officers. Such agreements provide for minimum salary levels, adjustable annually, and incentive bonuses that are payable if specified company goals are attained. The aggregate commitment at June 30, 2023 for future executive salaries and bonus was approximately $0.6 million. The aggregate commitment at June 30, 2023 for accrued payroll, vacation and holiday pay was approximately $1.0 million for the remainder of our employees. Retirement Benefits Ranor has a defined contribution and savings plan that covers substantially all Ranor employees who have completed 90 days of service. Ranor retains the option to match employee contributions. The Company contributed $21,543 and $22,123 for the three months ended June 30, 2023 and 2022, respectively. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Jun. 30, 2023 | |
SEGMENT INFORMATION. | |
SEGMENT INFORMATION | NOTE 15 – SEGMENT INFORMATION The Company has two wholly-owned subsidiaries, Ranor and Stadco that are reportable segments. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. All of the Company’s operations, assets, and customers are located in the U.S. Each reportable segment focuses on the manufacture and assembly of specific components, primarily for defense, aerospace and other industrial customers. However, both segments have separate operating, engineering, and sales teams. The Chief Operating Decision Maker, or “CODM”, evaluates the performance of our segments based upon, among other things, segment net sales and operating profit. Segment operating profit excludes general corporate costs. Corporate costs include executive and director compensation, stock-based compensation, and other corporate and administrative expenses not allocated to the segments. The segment operating profit metric is what the CODM uses in evaluating our results of operations and the financial measure that provides insight into our overall performance and financial position. The following table provides summarized financial information for our segments: Three Months Ended June 30, 2023 2022 Ranor $ 4,499,097 $ 4,725,931 Stadco 2,967,133 2,350,426 Eliminate intersegment revenue (94,990) — Net sales from external customers 7,371,240 7,076,357 Ranor operating income 875,465 1,435,674 Stadco operating loss (904,524) (1,458,791) Corporate and unallocated (1) (550,741) (534,892) Total operating loss (579,800) (558,009) Other (expense) income 1 (33,225) Interest expense (94,086) (83,645) Consolidated loss before income taxes $ (673,885) $ (674,879) Depreciation and amortization: Ranor $ 131,135 $ 131,600 Stadco 428,600 453,761 Totals $ 559,735 $ 585,361 Capital expenditures Ranor $ 1,854,002 $ 62,233 Stadco — 141,748 Totals $ 1,854,002 $ 203,981 (1) Corporate general costs include executive and director compensation, and other corporate administrative expenses not allocated to the segments. Prior period segment data is revised to reflect current period updates to unallocated corporate administrative expense. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Jun. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 16 – SUBSEQUENT EVENTS On July 13, 2023, Thomas Sammons, our previous CFO, exercised options to purchase 125,000 shares of the Company’s common stock, pursuant to option awards previously granted under the Company’s 2016 Long-Term Incentive Plan. The options were exercised as a cashless transaction and resulted in the delivery of 109,024 shares of common stock on July 13, 2023. On July 14, 2023, Thomas Sammons, retired from service as Chief Financial Officer of the Company. He is continuing to serve the Company as a non-executive employee, which he and the Company expect will continue for a limited period of time, to assist with transition efforts. Thereafter, the Company expects that it may enter into a consultancy agreement with Mr. Sammons under which he will agree to provide consulting services to the Company as an independent contractor, primarily to continue ensuring an orderly transition of his former duties to the new chief financial officer. On July 17, 2023, the Company entered into an Employment Agreement with Barbara M. Lilley, with an effective date as of July 14, 2023 which governs Ms. Lilley’s employment as Chief Financial Officer of the Company. Pursuant to the Employment Agreement, Ms. Lilley will: (i) receive an annual base salary of $200,000; and (ii) receive a grant of 15,000 restricted shares of the Company’s common stock pursuant to the 2016 Plan. On August 3, 2023 the Company issued 15,000 restricted shares of the Company’s common stock to Ms. Lilley, consistent with the terms of the employment agreement. Provided that she remains employed by the Company from the grant date through the applicable vesting dates, 5,000 shares of the restricted stock will vest on each of the first, second, and third anniversaries of the Effective Date. |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation - one These notes to the condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the “SEC”, for Quarterly Reports on Form 10-Q. Certain information and disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These unaudited financial statements and related notes should be read in conjunction with the consolidated financial statements included with our Annual Report on Form 10-K for the fiscal year ended March 31, 2023, filed with the SEC on June 15, 2023. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements - |
Liquidity and Going Concern | Liquidity and Going Concern - The Company is the borrower under the amended and restated loan agreement with Berkshire Bank, or the “Loan Agreement” (as defined below; see Note 11 – Debt). There was $7.6 million outstanding under the agreement on June 30, 2023. The Company has determined it is in compliance with the debt covenants as of June 30, 2023. However, it is probable that the Company will not be in compliance with the debt covenants at subsequent compliance dates, in which case the Company will request a waiver from the lender. Without such a waiver, the lender would have the right, but not the obligation, to demand repayment from the Company for noncompliance with the debt covenants. In addition, the bank retains the right to act on covenant violations that occur after the date of delivery of any waiver. If the lender were to decline to grant us a waiver and instead demand repayment, we would need to seek alternative financing to pay these obligations as the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations. We are subject to certain financial debt covenants and may not spend more than $1.5 million for new machinery and equipment during any single fiscal year, tested on an annual basis at the end of each fiscal year. On June 12, 2023, we executed a waiver with the lender under which the lender agreed to waive the Company’s noncompliance with this capital spending limit covenant, as it related to the period ended March 31, 2023. The waiver document also contains an agreement by the parties to exclude from the calculation of capital expenditures for purposes of the Loan Agreement during the year ending March 31, 2024, any such expenditures made by the Company to the extent they are made using funds provided by customers of the Company for the purpose of making such capital expenditures. We estimate our spending on new machinery and equipment in fiscal 2024, which we expect will include expenditures for the installation and construction of equipment for contract project work with a certain customer, will again exceed the spending limitation. However, as a result of the agreement to exclude certain expenditures from the limitation imposed by the covenant, the Company does not anticipate this will result in noncompliance with the capital spending limit covenant for the fiscal year ended March 31, 2024. In order for us to continue operations beyond the next twelve months and be able to discharge our liabilities and commitments in the normal course of business, we must mitigate our recurring operating losses at our Stadco subsidiary. We must efficiently increase utilization of our manufacturing capacity at our Stadco subsidiary and improve the manufacturing process, so our direct labor hours (inputs) allow us to recognize more revenue over time (outputs) and improve job performance. We plan to closely monitor our expenses and, if required, will reduce operating costs to enhance liquidity. The uncertainty associated with the recurring operating losses at Stadco and expected debt covenant violation at subsequent compliance dates raise substantial doubt about our ability to continue as a going concern. The condensed consolidated financial statements for the three months ended June 30, 2023, were prepared on the basis of a going concern which contemplates that we will be able to realize assets and discharge liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should we be required to liquidate assets. Our ability to satisfy our current liabilities and to continue as a going concern is dependent upon the Company’s compliance with the debt covenants and its ability to grow revenue and reduce costs at Stadco. The financial statements do not include any adjustments that might result from the outcome of these uncertainties. |
New Accounting Standards Recently Adopted | New Accounting Standards Recently Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Schedule of net sales on a disaggregated basis by market and contract type | Net Sales by market Defense Industrial Totals Three months ended June 30, 2023 $ 6,597,893 $ 773,347 $ 7,371,240 Three months ended June 30, 2022 $ 6,840,924 $ 235,433 $ 7,076,357 Net Sales by contract type Over-time Point-in-time Totals Three months ended June 30, 2023 $ 6,933,804 $ 437,436 $ 7,371,240 Three months ended June 30, 2022 $ 6,622,093 $ 454,264 $ 7,076,357 |
Schedule of contract assets | Progress Unbilled payments Total June 30, 2023 $ 19,914,513 $ (11,263,170) $ 8,651,343 March 31, 2023 $ 19,485,914 $ (10,538,103) $ 8,947,811 |
Sales | |
Schedule of accounts receivable from customers who accounted for more than 10% of our net sales | Three months ended Three months ended June 30, 2023 June 30, 2022 Customer Amount Percent Amount Percent A $ 2,285,275 31 % $ 1,296,387 18 % B $ 866,171 12 % $ 1,763,591 25 % C $ 805,690 11 % $ 735,758 11 % D $ * * % $ 1,071,874 15 % E $ 800,512 11 % $ * * % F $ 743,237 10 % $ * * % * Less than 10% of total |
EARNINGS PER SHARE (EPS) (Table
EARNINGS PER SHARE (EPS) (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
EARNINGS PER SHARE (EPS) | |
Schedule of reconciliation of the numerators and denominators reflected in the basic and diluted earnings per share computations | Three Months ended Three Months ended June 30, 2023 June 30, 2022 Basic EPS Net loss $ (527,455) $ (501,165) Weighted average shares 8,613,408 8,576,863 Net loss per share $ (0.06) $ (0.06) Diluted EPS Net loss $ (527,455) $ (501,165) Dilutive effect of stock options — — Weighted average shares 8,613,408 8,576,863 Net loss per share $ (0.06) $ (0.06) |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
Schedule of information about options granted | Weighted Average Weighted Aggregate Remaining Number Of Average Intrinsic Contractual Life Options Exercise Price Value (in years) Outstanding at March 31, 2023 667,500 $ 1.37 $ 3,804,625 3.70 Outstanding at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 Vested or expected to vest at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 Exercisable and vested at June 30, 2023 667,500 $ 1.37 $ 4,018,225 3.46 |
Schedule of information relating to stock options outstanding | Weighted Average Remaining Weighted Weighted Options Contractual Average Options Average Range of Exercise Prices: Outstanding Term Exercise Price Exercisable Exercise Price $0.01-$0.99 317,500 2.36 $ 0.46 317,500 $ 0.46 $2.00-$2.99 350,000 3.91 $ 2.19 350,000 $ 2.19 Totals 667,500 667,500 |
CONCENTRATION OF CREDIT RISK (T
CONCENTRATION OF CREDIT RISK (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Accounts Receivable | |
Concentration of credit risk and major customers | |
Schedule of accounts receivable from customers who accounted for more than 10% of our net sales | June 30, 2023 March 31, 2023 Customer Dollars Percent Dollars Percent A $ 991,695 33 % $ 730,514 31 % B $ * * % $ 260,177 11 % C $ 728,548 25 % $ * * % D $ * * % $ 265,755 11 % * less than 10% of total |
OTHER CURRENT ASSETS (Tables)
OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
OTHER CURRENT ASSETS | |
Schedule of other current assets | Other current assets included the following as of: June 30, 2023 March 31, 2023 Prepaid taxes $ 35,505 $ 9,616 Prepaid insurance 148,592 162,075 Prepaid subscriptions 87,071 120,570 Deposits 21,706 21,706 Employee advances 12,683 4,561 Prepaid advisory fees, other 18,900 30,455 Total $ 324,457 $ 348,983 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
PROPERTY, PLANT AND EQUIPMENT, NET | |
Schedule of components of property, plant and equipment, net | Property, plant and equipment, net consisted of the following as of: June 30, 2023 March 31, 2023 Land $ 110,113 $ 110,113 Building and improvements 3,293,986 3,293,986 Machinery equipment, furniture, and fixtures 24,846,351 23,018,713 Construction-in-progress 164,681 149,576 Total property, plant, and equipment 28,415,131 26,572,388 Less: accumulated depreciation (13,038,405) (12,658,364) Total property, plant and equipment, net $ 15,376,726 $ 13,914,024 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
ACCRUED EXPENSES | |
Schedule of accrued expenses | Accrued expenses included the following as of: June 30, 2023 March 31, 2023 Accrued compensation $ 1,182,453 $ 1,257,245 Provision for claims 234,472 256,227 Provision for contract losses 119,124 102,954 Accrued professional fees 234,176 241,195 Accrued project costs 615,213 440,550 Other 167,011 235,014 Total $ 2,552,449 $ 2,533,185 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
DEBT | |
Schedule of outstanding debt obligations | Long-term debt included the following as of: June 30, 2023 March 31, 2023 Stadco Term Loan, at 3.79% interest, due August 2028 $ 3,053,758 $ 3,186,495 Ranor Term Loan, at 6.05% interest, due December 2027 2,261,835 2,276,518 Ranor Revolver Loan, at 7.31% interest, due December 2023 2,280,000 650,000 Total debt $ 7,595,593 $ 6,113,013 Less: debt issue costs unamortized $ 126,951 $ 145,712 Total debt, net $ 7,468,642 $ 5,967,301 Less: Current portion of long-term debt $ 2,865,387 $ 1,218,162 Total long-term debt, net $ 4,603,255 $ 4,749,139 |
Scheduled principal maturities for our total debt | 2024 $ 2,886,387 2025 632,251 2026 658,564 2027 686,007 2028 2,624,108 Thereafter 108,276 Total $ 7,595,593 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
LEASES | |
Schedule of right-of-use assets and liabilities | June 30, 2023 March 31, 2023 Finance lease: Right of use asset – operating lease $ 6,629,396 $ 6,629,396 Right of use asset – finance leases 65,016 65,016 Amortization (1,201,908) (1,033,474) Right of use asset, net $ 5,492,504 $ 5,660,938 Lease liability – operating lease $ 5,648,643 $ 5,819,365 Lease liability – finance leases 30,146 36,336 Total lease liability $ 5,678,789 $ 5,855,701 |
Schedule of supplemental information of leases | Components of lease expense for the three months ended: June 30, 2023 June 30, 2022 Operating lease amortization $ 164,101 $ 158,071 Finance lease amortization $ 4,333 $ 6,300 Finance lease interest $ 281 $ 544 Weighted average lease term and discount rate at: June 30, 2023 June 30, 2022 Lease term (years) – operating lease 7.00 8.00 Lease term (years) – finance lease 2.40 2.70 Lease rate – operating lease 4.5 % 4.5 % Lease rate – finance lease 4.5 % 3.7 % |
Schedule of supplemental cash flow information | Supplemental cash flow information related to leases for the three months ended: June 30, 2023 June 30, 2022 Cash used in operating activities $ 234,700 $ 193,393 Cash used in financing activities $ 6,191 $ 16,860 |
Schedule of maturities of lease liabilities | 2024 $ 952,880 2025 948,701 2026 946,226 2027 938,802 2028 938,802 Thereafter 1,876,899 Total lease payments $ 6,602,310 Less: imputed interest 923,521 Total $ 5,678,789 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
SEGMENT INFORMATION. | |
Summary of financial information for segments | Three Months Ended June 30, 2023 2022 Ranor $ 4,499,097 $ 4,725,931 Stadco 2,967,133 2,350,426 Eliminate intersegment revenue (94,990) — Net sales from external customers 7,371,240 7,076,357 Ranor operating income 875,465 1,435,674 Stadco operating loss (904,524) (1,458,791) Corporate and unallocated (1) (550,741) (534,892) Total operating loss (579,800) (558,009) Other (expense) income 1 (33,225) Interest expense (94,086) (83,645) Consolidated loss before income taxes $ (673,885) $ (674,879) Depreciation and amortization: Ranor $ 131,135 $ 131,600 Stadco 428,600 453,761 Totals $ 559,735 $ 585,361 Capital expenditures Ranor $ 1,854,002 $ 62,233 Stadco — 141,748 Totals $ 1,854,002 $ 203,981 (1) Corporate general costs include executive and director compensation, and other corporate administrative expenses not allocated to the segments. Prior period segment data is revised to reflect current period updates to unallocated corporate administrative expense. |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Accounts receivable and allowance for doubtful accounts, Property, plant and equipment, net (Details) | 3 Months Ended | ||
Feb. 23, 2023 | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |||
Reverse stock split conversion ratio | 0.25 | ||
Net loss | $ 527,455 | $ 501,165 | |
Maximum spending limit on machinery and equipment | 1,500,000 | ||
Berkshire Loan | |||
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |||
Amount outstanding | $ 7,600,000 |
REVENUE - Disaggregated basis (
REVENUE - Disaggregated basis (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
REVENUE | ||
Net Sales | $ 7,371,240 | $ 7,076,357 |
Over-time | ||
REVENUE | ||
Net Sales | 6,933,804 | 6,622,093 |
Point-in-time | ||
REVENUE | ||
Net Sales | 437,436 | 454,264 |
Defense | ||
REVENUE | ||
Net Sales | 6,597,893 | 6,840,924 |
Industrial | ||
REVENUE | ||
Net Sales | $ 773,347 | $ 235,433 |
REVENUE - Net sales from custom
REVENUE - Net sales from customers (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
REVENUE | ||
Revenues | $ 7,371,240 | $ 7,076,357 |
Customer A | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 2,285,275 | $ 1,296,387 |
Concentration risk percentage | 31% | 18% |
Customer B | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 866,171 | $ 1,763,591 |
Concentration risk percentage | 12% | 25% |
Customer C | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 805,690 | $ 735,758 |
Concentration risk percentage | 11% | 11% |
Customer D | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 1,071,874 | |
Concentration risk percentage | 15% | |
Customer E | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 800,512 | |
Concentration risk percentage | 11% | |
Customer F | Customer concentration risk | Sales revenue, net | ||
REVENUE | ||
Revenues | $ 743,237 | |
Concentration risk percentage | 10% |
REVENUE - Contract assets and c
REVENUE - Contract assets and contract liabilities (Details) - USD ($) | Jun. 30, 2023 | Mar. 31, 2023 |
REVENUE | ||
Contract assets | $ 8,651,343 | $ 8,947,811 |
Unbilled | ||
REVENUE | ||
Contract assets | 19,914,513 | 19,485,914 |
Progress Payments | ||
REVENUE | ||
Contract assets | $ (11,263,170) | $ (10,538,103) |
REVENUE - Additional informatio
REVENUE - Additional information (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2023 USD ($) | |
REVENUE | |
Remaining performance obligation amount | $ 46.3 |
Revenue remaining performance obligation completed less than 50% | $ 39.9 |
Revenue, remaining performance obligation, percentage | 50% |
Revenue recognized by contract liabilities | $ 0.9 |
Minimum | |
REVENUE | |
Remaining performance obligation expected timing of satisfaction period | 3 months |
Maximum | |
REVENUE | |
Remaining performance obligation expected timing of satisfaction period | 36 months |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
INCOME TAXES | ||
Income tax benefit | $ (146,430) | $ (173,714) |
Effective tax rate | 21.70% | 25.70% |
Valuation allowance on deferred tax assets | $ 2,100,000 |
EARNINGS PER SHARE (EPS) (Detai
EARNINGS PER SHARE (EPS) (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Basic EPS | ||
Net loss | $ (527,455) | $ (501,165) |
Weighted average shares | 8,613,408 | 8,576,863 |
Net loss per share | $ (0.06) | $ (0.06) |
Diluted EPS | ||
Net loss | $ (527,455) | $ (501,165) |
Weighted average shares | 8,613,408 | 8,576,863 |
Net loss per share | $ (0.06) | $ (0.06) |
Options | ||
Diluted EPS | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 667,500 | 680,000 |
Warrants | ||
Diluted EPS | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 25,000 | 25,000 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock option activity (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Mar. 31, 2023 | |
Number Of Options | ||
Outstanding at the beginning of the period (in shares) | 667,500 | |
Outstanding at the end of the period (in shares) | 667,500 | 667,500 |
Vested or expected to vest at the end of the period (in shares) | 667,500 | |
Exercisable and vested at the end of the period (in shares) | 667,500 | |
Weighted Average Exercise Price | ||
Outstanding at the beginning of the period (in dollars per share) | $ 1.37 | |
Outstanding at the end of the period (in dollars per share) | 1.37 | $ 1.37 |
Vested or expected to vest at the end of the period (in dollars per share) | 1.37 | |
Exercisable and vested at the end of the period (in dollars per share) | $ 1.37 | |
Aggregate Intrinsic Value | ||
Outstanding Value at the beginning of the period | $ 3,804,625 | |
Outstanding Value at the end of the period | 4,018,225 | $ 3,804,625 |
Vested or expected to vest at the end of the period | 4,018,225 | |
Exercisable and vested at the end of the period | $ 4,018,225 | |
Weighted Average Remaining Contractual Life (in years) | ||
Outstanding at the end of the period | 3 years 5 months 15 days | 3 years 8 months 12 days |
Vested or expected to vest at the end of the period | 3 years 5 months 15 days | |
Exercisable and vested at the end of the period | 3 years 5 months 15 days |
STOCK-BASED COMPENSATION - St_2
STOCK-BASED COMPENSATION - Stock options outstanding by exercise price (Details) | 3 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Stock Based Compensation By Exercise Price Range | |
Options Outstanding | shares | 667,500 |
Options Exercisable | shares | 667,500 |
Range One | |
Stock Based Compensation By Exercise Price Range | |
Exercise Price, Lower Range | $ 0.01 |
Exercise Price, Upper Range | $ 0.99 |
Options Outstanding | shares | 317,500 |
Options Outstanding, Weighted Average Remaining Contractual Term | 2 years 4 months 9 days |
Options Outstanding, Weighted Average Exercise Price | $ 0.46 |
Options Exercisable | shares | 317,500 |
Options Exercisable, Weighted Average Exercise Price | $ 0.46 |
Range Two | |
Stock Based Compensation By Exercise Price Range | |
Exercise Price, Lower Range | 2 |
Exercise Price, Upper Range | $ 2.99 |
Options Outstanding | shares | 350,000 |
Options Outstanding, Weighted Average Remaining Contractual Term | 3 years 10 months 28 days |
Options Outstanding, Weighted Average Exercise Price | $ 2.19 |
Options Exercisable | shares | 350,000 |
Options Exercisable, Weighted Average Exercise Price | $ 2.19 |
STOCK-BASED COMPENSATION - Addi
STOCK-BASED COMPENSATION - Additional information (Details) - shares | 3 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Mar. 31, 2023 | |
STOCK-BASED COMPENSATION | ||
Maximum contractual term (in years) | 3 years 5 months 15 days | 3 years 8 months 12 days |
2016 Plan | ||
STOCK-BASED COMPENSATION | ||
Shares reserved | 1,250,000 | |
Shares available for grant | 312,500 | |
Maximum | ||
STOCK-BASED COMPENSATION | ||
Maximum contractual term (in years) | 10 years | |
Maximum | 2016 Plan | ||
STOCK-BASED COMPENSATION | ||
Number of shares of common stock | 1,250,000 |
CONCENTRATION OF CREDIT RISK (D
CONCENTRATION OF CREDIT RISK (Details) | 3 Months Ended | |
Jun. 30, 2023 USD ($) customer | Mar. 31, 2023 USD ($) | |
CONCENTRATION OF CREDIT RISK | ||
Accounts receivable | $ 2,965,696 | $ 2,336,481 |
Accounts Receivable | Customer concentration risk | Customer A | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 33% | 31% |
Accounts receivable | $ 991,695 | $ 730,514 |
Accounts Receivable | Customer concentration risk | Customer B | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 11% | |
Accounts receivable | $ 260,177 | |
Accounts Receivable | Customer concentration risk | Customer C | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 25% | |
Accounts receivable | $ 728,548 | |
Accounts Receivable | Customer concentration risk | Customer D | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 11% | |
Accounts receivable | $ 265,755 | |
Accounts Receivable | Customer concentration risk | Customers | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 10% | |
Trade Receivables | ||
CONCENTRATION OF CREDIT RISK | ||
Number of significant customers | customer | 2 | |
Trade Receivables | Customer concentration risk | Customers ACD | ||
CONCENTRATION OF CREDIT RISK | ||
Concentration risk percentage | 58% |
OTHER CURRENT ASSETS (Details)
OTHER CURRENT ASSETS (Details) - USD ($) | Jun. 30, 2023 | Mar. 31, 2023 |
OTHER CURRENT ASSETS | ||
Prepaid taxes | $ 35,505 | $ 9,616 |
Prepaid insurance | 148,592 | 162,075 |
Prepaid subscriptions | 87,071 | 120,570 |
Deposits | 21,706 | 21,706 |
Employee advances | 12,683 | 4,561 |
Prepaid advisory fees, other | 18,900 | 30,455 |
Total | $ 324,457 | $ 348,983 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Mar. 31, 2023 | |
PROPERTY, PLANT AND EQUIPMENT, NET | ||
Total property, plant, and equipment | $ 28,415,131 | $ 26,572,388 |
Less: accumulated depreciation | (13,038,405) | (12,658,364) |
Total property, plant and equipment, net | 15,376,726 | 13,914,024 |
Capitalized interest | 28,168 | |
Land | ||
PROPERTY, PLANT AND EQUIPMENT, NET | ||
Property, plant and equipment, Gross | 110,113 | 110,113 |
Building and improvements | ||
PROPERTY, PLANT AND EQUIPMENT, NET | ||
Property, plant and equipment, Gross | 3,293,986 | 3,293,986 |
Machinery equipment, furniture, and fixtures | ||
PROPERTY, PLANT AND EQUIPMENT, NET | ||
Property, plant and equipment, Gross | 24,846,351 | 23,018,713 |
Construction-in-progress | ||
PROPERTY, PLANT AND EQUIPMENT, NET | ||
Property, plant and equipment, Gross | $ 164,681 | $ 149,576 |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2023 | Mar. 31, 2023 |
ACCRUED EXPENSES | ||
Accrued compensation | $ 1,182,453 | $ 1,257,245 |
Provision for claims | 234,472 | 256,227 |
Provision for contract losses | 119,124 | 102,954 |
Accrued professional fees | 234,176 | 241,195 |
Accrued project costs | 615,213 | 440,550 |
Other | 167,011 | 235,014 |
Total | $ 2,552,449 | $ 2,533,185 |
DEBT - Long-term Debt (Details)
DEBT - Long-term Debt (Details) - USD ($) | Jun. 30, 2023 | Mar. 31, 2023 |
DEBT | ||
Total debt | $ 7,595,593 | $ 6,113,013 |
Less: debt issue costs unamortized | 126,951 | 145,712 |
Total debt, net | 7,468,642 | 5,967,301 |
Less: Current portion of long-term debt | 2,865,387 | 1,218,162 |
Total long-term debt, net | 4,603,255 | 4,749,139 |
Stadco Term Loan, at 3.79% interest, due August 2028 | ||
DEBT | ||
Total debt | $ 3,053,758 | 3,186,495 |
Interest rate (as a percent) | 3.79% | |
Ranor Term Loan, at 6.05% interest, due December 2027 | ||
DEBT | ||
Total debt | $ 2,261,835 | 2,276,518 |
Interest rate (as a percent) | 6.05% | |
Ranor Revolver Loan, at 6.93% interest, due December 2023 | ||
DEBT | ||
Total debt | $ 2,280,000 | $ 650,000 |
Interest rate (as a percent) | 7.31% |
DEBT - Additional Information (
DEBT - Additional Information (Details) | 3 Months Ended | |||||||||||
Dec. 30, 2022 | Dec. 23, 2022 USD ($) | Dec. 20, 2022 USD ($) | Dec. 19, 2022 USD ($) | Aug. 25, 2021 USD ($) | Jan. 20, 2017 USD ($) | Jun. 30, 2023 USD ($) | Dec. 31, 2022 | Mar. 31, 2023 USD ($) | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Mar. 31, 2016 USD ($) | |
Revolver loan | ||||||||||||
DEBT | ||||||||||||
Interest payments | $ 29,678 | |||||||||||
Ranor, Inc. | ||||||||||||
DEBT | ||||||||||||
Unamortized debt issuance expense | $ 86,302 | $ 101,230 | ||||||||||
Stadco Term Loan, at 3.79% interest, due August 2028 | ||||||||||||
DEBT | ||||||||||||
Maturity term | 7 years | |||||||||||
Monthly payments of principal and interest amount | $ 54,390 | |||||||||||
Interest rate (as a percent) | 3.79% | |||||||||||
Unamortized debt issuance expense | $ 40,649 | $ 44,482 | ||||||||||
Stadco Term Loan, at 3.79% interest, due August 2028 | FHLBBC advance rate | ||||||||||||
DEBT | ||||||||||||
Applicable interest rate | 2.25% | |||||||||||
Basis spread on variable rate (as a percent) | 2.25% | |||||||||||
Stadco Term Loan, at 3.79% interest, due August 2028 | Ranor, Inc. | Revolver loan | ||||||||||||
DEBT | ||||||||||||
Principal amount of debt | $ 4,000,000 | |||||||||||
Ranor Term Loan, 6.05% due December 2027 [Member] | ||||||||||||
DEBT | ||||||||||||
Proceeds from term loan | $ 2,850,000 | |||||||||||
Ranor term loan | ||||||||||||
DEBT | ||||||||||||
Monthly payments of principal and interest amount | $ 16,601 | $ 19,260 | ||||||||||
Required minimum debt service coverage ratio, solely with respect to the fiscal quarter ending December 31, 2022 | 1.2 | 1.1 | ||||||||||
Interest rate (as a percent) | 6.05% | 5.21% | ||||||||||
Weighted average interest rate (as a percent) | 7.31% | 5.02% | ||||||||||
Unused borrowing capacity | $ 2,400,000 | $ 4,200,000 | ||||||||||
Ranor term loan | Revolver loan | ||||||||||||
DEBT | ||||||||||||
Maximum principal amount available | $ 5,000,000 | |||||||||||
Berkshire Loan | ||||||||||||
DEBT | ||||||||||||
Amount outstanding | $ 7,600,000 | |||||||||||
Annual capital expenditure | 1,500,000 | |||||||||||
Berkshire Loan | Revolving Credit Facility | ||||||||||||
DEBT | ||||||||||||
Maximum amount of borrowing base required to grant loan advance | $ 5,000,000 | |||||||||||
Debt instrument percentage of accounts receivable used for determination of aggregate amount of advances | 80% | |||||||||||
Debt instrument percentage of eligible raw material used for determination of aggregate amount of advances | 25% | |||||||||||
Amount included in sum to calculate maximum borrowing base | $ 250,000 | |||||||||||
Berkshire Loan | Revolver loan | ||||||||||||
DEBT | ||||||||||||
Maximum amount of borrowing base required to grant loan advance | 5,000,000 | |||||||||||
Amount outstanding | $ 2,300,000 | |||||||||||
Nonrefundable commitment fee percentages | 0.25% | |||||||||||
Berkshire Loan | Secured Term Loan | ||||||||||||
DEBT | ||||||||||||
Monthly payments of principal and interest amount | $ 19,260 | |||||||||||
Interest rate (as a percent) | 5.21% | |||||||||||
Berkshire Loan | Notes payables | ||||||||||||
DEBT | ||||||||||||
Debt Instrument percentage of appraised value Of equipment for determination of aggregate amount of advances | 80% | |||||||||||
Berkshire Loan | Ranor, Inc. | ||||||||||||
DEBT | ||||||||||||
Debt instrument covenant trailing period for measurement of loan to value ratio | 365 days | |||||||||||
Berkshire Loan | Ranor, Inc. | Secured Term Loan | ||||||||||||
DEBT | ||||||||||||
Principal amount of debt | $ 2,850,000 | |||||||||||
Berkshire Loan | Minimum | ||||||||||||
DEBT | ||||||||||||
Cash flow to total debt service | 1.20 | 1.10 | ||||||||||
Debt instrument covenant leverage ratio year one | 2.50 | |||||||||||
Berkshire Loan | Maximum | ||||||||||||
DEBT | ||||||||||||
Loan-to-Value Ratio | 0.75 |
DEBT - Scheduled principal matu
DEBT - Scheduled principal maturities for our total debt (Details) | Jun. 30, 2023 USD ($) |
Scheduled principal maturities for our total debt | |
2024 | $ 2,886,387 |
2025 | 632,251 |
2026 | 658,564 |
2027 | 686,007 |
2028 | 2,624,108 |
Thereafter | 108,276 |
Total | $ 7,595,593 |
OTHER NONCURRENT LIABILITIES (D
OTHER NONCURRENT LIABILITIES (Details) | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) |
OTHER NONCURRENT LIABILITY | ||
Customer payments received recorded as noncurrent liability | $ 1,700,000 | |
Current liability | 200,000 | $ 1,400,000 |
Noncurrent liability | 200,000 | $ 1,500,000 |
Stadco's payment agreement with the LADWP | ||
OTHER NONCURRENT LIABILITY | ||
Aggregate delinquent and unpaid outstanding amounts for water, water service, electric energy and/or electric service | 1,770,201 | |
Monthly installment payments to be made | $ 18,439 | |
Late payment charge, annual rate | 18 |
LEASES (Details)
LEASES (Details) - USD ($) | 3 Months Ended | |||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Aug. 25, 2021 | |
LEASES | ||||
Right of use asset - finance leases | $ 5,492,504 | $ 5,660,938 | ||
Building and property lease | ||||
LEASES | ||||
Other lease assets and liabilities | $ 6,600,000 | |||
Monthly payments | 82,998 | |||
Right of use asset - operating lease | 6,629,396 | $ 6,629,396 | ||
Right of use asset - finance leases | 65,016 | 65,016 | ||
Amortization | (1,201,908) | (1,033,474) | ||
Right of use asset, net | 5,492,504 | 5,660,938 | ||
Lease liability - operating lease | 5,648,643 | 5,819,365 | ||
Lease liability - finance leases | 30,146 | 36,336 | ||
Total lease liability | $ 5,678,789 | $ 5,855,701 |
LEASES - Other supplemental inf
LEASES - Other supplemental information of Leases (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
LEASES | ||
Operating lease amortization | $ 164,101 | $ 158,071 |
Finance lease amortization | 4,333 | 6,300 |
Finance lease interest | $ 281 | $ 544 |
Lease term (years) - operating lease | 7 years | 8 years |
Lease term (years) - finance lease | 2 years 4 months 24 days | 2 years 8 months 12 days |
Lease rate - operating lease | 4.50% | 4.50% |
Lease rate - finance lease | 4.50% | 3.70% |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
LEASES | ||
Cash used in operating activities | $ 234,700 | $ 193,393 |
Cash used in financing activities | $ 6,191 | $ 16,860 |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) | Jun. 30, 2023 USD ($) |
Maturities of lease liabilities | |
2024 | $ 952,880 |
2025 | 948,701 |
2026 | 946,226 |
2027 | 938,802 |
2028 | 938,802 |
Thereafter | 1,876,899 |
Total lease payments | 6,602,310 |
Less: imputed interest | 923,521 |
Total | $ 5,678,789 |
COMMITMENTS (Details)
COMMITMENTS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
COMMITMENTS | ||
Aggregate commitment for future executive salaries and bonus | $ 600,000 | |
Aggregate commitment for accrued payroll, vacation and holiday | 1,000,000 | |
Retirement Benefits | $ 21,543 | $ 22,123 |
SEGMENT INFORMATION - Financial
SEGMENT INFORMATION - Financial information for segments (Details) | 3 Months Ended | |
Jun. 30, 2023 USD ($) item | Jun. 30, 2022 USD ($) | |
SEGMENT INFORMATION | ||
Number of reportable segment | item | 2 | |
Net sales from external customers | $ 7,371,240 | $ 7,076,357 |
Total operating loss | (579,800) | (558,009) |
Other income (expense), net | 1 | (33,225) |
Interest expense and other expense | (94,086) | (83,645) |
Consolidated loss before income taxes | (673,885) | (674,879) |
Depreciation and amortization | 559,735 | 585,361 |
Capital expenditures | 1,854,002 | 203,981 |
Eliminate intersegment revenue | ||
SEGMENT INFORMATION | ||
Net sales from external customers | (94,990) | |
Corporate and unallocated | ||
SEGMENT INFORMATION | ||
Total operating loss | (550,741) | (534,892) |
Ranor | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 131,135 | 131,600 |
Capital expenditures | 1,854,002 | 62,233 |
Ranor | Operating segments | ||
SEGMENT INFORMATION | ||
Net sales from external customers | 4,499,097 | 4,725,931 |
Total operating loss | 875,465 | 1,435,674 |
Stadco | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 428,600 | 453,761 |
Capital expenditures | 141,748 | |
Stadco | Operating segments | ||
SEGMENT INFORMATION | ||
Net sales from external customers | 2,967,133 | 2,350,426 |
Total operating loss | $ (904,524) | $ (1,458,791) |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Subsequent event - USD ($) | Aug. 03, 2023 | Jul. 17, 2023 | Jul. 13, 2023 |
Restricted Shares | |||
SUBSEQUENT EVENTS | |||
Number of shares granted | 15,000 | ||
Number of shares will vest on each of the first, second, and third anniversaries | 5,000 | ||
2016 Long-Term Incentive Plan | |||
SUBSEQUENT EVENTS | |||
Stock options exercised | 109,024 | ||
2016 Long-Term Incentive Plan | Restricted Shares | |||
SUBSEQUENT EVENTS | |||
Number of shares granted | 15,000 | ||
Chief Financial Officer | |||
SUBSEQUENT EVENTS | |||
Annual base salary | $ 200,000 | ||
Chief Financial Officer | 2016 Long-Term Incentive Plan | |||
SUBSEQUENT EVENTS | |||
Stock options exercised | 125,000 |