The Eastern Company (EML) 10-Q 7 Nov 22 2023 Q3 Quarterly report Financial data

Cover

Cover	9 Months Ended
	Oct. 01, 2022 shares
Cover [Abstract]
Entity Registrant Name	THE EASTERN COMPANY
Entity Central Index Key	0000031107
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--01-01
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Oct. 01, 2022
Entity Filer Category	Accelerated Filer
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding	6,215,123
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-35383
Entity Incorporation State Country Code	CT
Entity Tax Identification Number	06-0330020
Entity Interactive Data Current	Yes
Entity Address Address Line 1	112 Bridge Street
Entity Address City Or Town	Naugatuck
Entity Address State Or Province	CT
Entity Address Postal Zip Code	06770
City Area Code	203
Local Phone Number	729-2255
Security 12b Title	Common Stock, No Par Value
Trading Symbol	EML
Security Exchange Name	NASDAQ

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Condensed Consolidated Statements of Operations (Unaudited)
Net sales	$ 71,636,746	$ 63,876,906	$ 210,191,448	$ 186,897,930
Cost of products sold	(55,056,160)	(48,661,374)	(163,047,360)	(142,196,527)
Gross margin	16,580,586	15,215,532	47,144,088	44,701,403
Product development expense	(1,011,961)	(962,924)	(3,168,333)	(3,068,866)
Selling general and administrative expenses	(10,121,683)	(9,440,583)	(30,129,112)	(27,760,514)
Operating profit	5,446,942	4,812,025	13,846,643	13,872,023
Interest expense	(645,773)	(427,222)	(1,583,894)	(1,388,512)
Other income	1,118,453	407,192	2,118,783	3,359,065
Income from continuing operations before income taxes	5,919,622	4,791,995	14,381,532	15,842,576
Income tax expense	(1,423,363)	(971,884)	(3,498,365)	(3,573,308)
Net income from continuing operations	4,496,259	3,820,111	10,883,167	12,269,268
Discontinued Operations (see note B)
Income from operations of discontinued operations	495,820	1,492,063	1,426,569	2,831,530
Gain (loss) on classification of assets as held for sale	0	1,308,639	0	(9,274,439)
Income tax (expense) benefit	(133,500)	(659,285)	(384,104)	(1,516,661)
Gain (loss) from discontinued operations	362,320	2,141,417	1,042,465	(4,926,248)
Net income (loss)	$ 4,858,579	$ 5,961,528	$ 11,925,632	$ 7,343,020
Earnings per share from continuing operations:
Basic	$ 0.72	$ 0.61	$ 1.75	$ 1.96
Diluted	0.72	0.61	1.74	1.96
Earnings (loss) per share from discontinued operations:
Basic1	0.06	0.34	0.17	(0.79)
Diluted1	0.06	0.34	0.17	(0.79)
Total earnings (loss) per share:
Basic2	0.78	0.95	1.92	1.17
Diluted2	0.78	0.95	1.91	1.17
Cash dividends per share:	$ 0.11	$ 0.11	$ 0.33	$ 0.33

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
Net income	$ 4,858,579	$ 5,961,528	$ 11,925,632	$ 7,343,020
Other comprehensive (loss) income:
Change in foreign currency translation	(1,387,274)	(523,632)	(2,358,170)	(238,837)
Change in fair value of interest rate swap, net of tax cost of: 2022 - $163,533 and $590,827 respectively; 2021 - $31,759 and $188,753 respectively	517,855	104,949	1,870,954	602,224
Change in pension and postretirement benefit costs, net of taxes of: 2022 - $92,235 and $276,705 respectively; 2021 - $107,962 and $308,117 respectively	313,408	346,328	940,225	988,401
Total other comprehensive (loss) income	(556,011)	(72,355)	453,009	1,351,788
Comprehensive income	$ 4,302,568	$ 5,889,173	$ 12,378,641	$ 8,694,808

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Other Comprehensive Income/(loss)
Change In Fair Value Of Interest Rate Swap, Taxes Benefit	$ 163,533	$ 31,759	$ 590,827	$ 188,753
Change In Pension And Postretirement Benefit Costs, Income Taxes (expense)/ Benefit	$ 92,235	$ 107,962	$ 276,705	$ 308,117

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Oct. 01, 2022	Jan. 01, 2022
Current Assets
Cash and cash equivalents	$ 5,275,472	$ 6,168,304
Accounts receivable, less allowances: 2022 - $577,820; 2021 - $515,000	50,854,523	43,151,500
Inventories	67,502,778	62,862,342
Current portion of notes receivable	1,006,421	1,027,125
Prepaid expenses and other assets	8,110,917	6,943,691
Current assets held for sale	5,071,203	3,521,899
Total Current Assets	137,821,314	123,674,861
Property, Plant and Equipment	55,079,978	56,935,080
Accumulated depreciation	(29,512,038)	(28,631,329)
Property, Plant and Equipment, Net	25,567,940	28,303,751
Goodwill	71,938,360	72,211,873
Trademarks	5,489,068	5,409,720
Patents and other intangibles net of accumulated amortization	19,748,225	22,863,497
Long term notes receivable, less current portion	2,499,254	2,726,698
Right of Use Assets	12,882,053	11,138,535
Total Other Assets	112,556,960	114,350,323
TOTAL ASSETS	275,946,214	266,328,935
Current Liabilities
Accounts payable	29,035,147	29,633,974
Accrued compensation	3,397,417	4,375,867
Other accrued expenses	3,126,494	4,808,000
Current portion of lease liability	2,993,652	2,664,895
Current portion of long-term debt	8,125,000	7,500,000
Current liabilities held for sale	577,118	580,990
Total Current Liabilities	47,254,828	49,563,726
Deferred income taxes	1,151,759	1,151,759
Other long-term liabilities	668,355	668,354
Lease liability	9,919,112	8,639,339
Long-term debt, less current portion	66,619,231	63,813,522
Accrued postretirement benefits	1,342,537	1,284,589
Accrued pension cost	25,001,982	26,605,382
Total Liabilities	151,957,804	151,726,671
Authorized and unissued: 1,000,000 shares1
Common Stock, no par value, Authorized: 50,000,000 shares Issued: 9,049,568 shares in 2022 and 9,029,852 shares in 2021 Outstanding: 6,215,123 shares in 2022 and 6,265,527 shares in 2021	33,319,461	32,620,008
Treasury Stock: 2,834,445 shares in 2022 and 2,764,325 shares in 2021	(22,544,685)	(20,907,613)
Retained earnings	139,293,381	129,422,625
Accumulated other comprehensive income (loss):
Foreign currency translation	(1,539,724)	818,446
Unrealized gain (loss) on interest rate swap, net of tax	1,514,966	(355,988)
Unrecognized net pension and postretirement benefit costs, net of tax	(26,054,989)	(26,995,214)
Accumulated other comprehensive loss	(26,079,747)	(26,532,756)
Total Shareholders' Equity	123,988,410	114,602,264
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 275,946,214	$ 266,328,935

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Oct. 01, 2022	Jan. 01, 2022
Accounts Receivable, Allowance For Doubtful Accounts	$ 577,820	$ 515,000
Common Stock, Par Value (in Dollars Per Share)	$ 0	$ 0
Common Stock, Shares Authorized (in Shares)	50,000,000	50,000,000
Common Stock, Shares Issued (in Shares)	9,049,568	9,029,852
Common Stock, Shares Outstanding (in Shares)	6,215,123	6,265,527
Treasury Stock, Shares (in Shares)	2,834,445	2,764,325
Voting Preferred Stock (Member)
Voting Preferred Stock, Par Value (in Dollars Per Share)	$ 0	$ 0
Voting Preferred Stock, Shares Authorized (in Shares)	1,000,000	1,000,000
Nonvoting Preferred Stock [Member]
Nonvoting Preferred Stock, Par Value (in Dollars Per Share)	$ 0	$ 0
Nonvoting Preferred Stock, Shares Authorized (in Shares)	1,000,000	1,000,000

Condensed Consolidated Statem_4

Condensed Consolidated Statements Of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021
Operating Activities
Net income	$ 11,925,632	$ 7,343,020
Less: gain (loss) from discontinued operations	1,042,465	(4,926,248)
Net income from continuing operations	10,883,167	12,269,268
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	5,389,394	5,188,863
Unrecognized pension and postretirement benefits	(477,560)	(3,056,642)
Gain on sale of equipment and other assets	(345,718)	(1,469,218)
Provision for doubtful accounts	35,000	73,097
Stock compensation expense	699,454	1,090,946
Changes in operating assets and liabilities:
Accounts receivable	(8,008,687)	(9,553,337)
Inventories	(5,217,395)	(13,686,268)
Prepaid expenses and other	(1,082,483)	(3,903,388)
Other assets	340,925	47,534
Accounts payable	(537,072)	11,156,105
Accrued compensation	(957,022)	697,735
Other accrued expenses	(1,046,094)	(2,173,142)
Net cash used in operating activities	(324,091)	(3,318,448)
Investing Activities
Marketable securities	0	28,951
Issuance of Notes Receivable	(400,000)	0
Payments received from notes receivable	748,148	694,962
Proceeds from sale of equipment	2,171,073	1,980,729
Purchases of property, plant and equipment	(1,734,553)	(2,112,990)
Net cash provided by investing activities	784,668	591,652
Financing Activities
Payments on short term borrowings (revolver)	(1,000,000)	0
Proceeds from short term borrowings (revolver)	10,000,000	0
Principal payments on long-term debt	(5,688,866)	(4,424,757)
Financing leases, net	(161,906)	132,221
Purchase common stock for treasury	(1,637,072)	0
Dividends paid	(2,054,875)	(2,062,492)
Net cash used in financing activities	(542,719)	(6,355,028)
Discontinued Operations
Cash (used in) provided by operating activities	(610,887)	3,546,530
Cash used in investing activities	0	(794,519)
Cash (used in) provided by discontinued operations	(610,887)	2,752,011
Effect of exchange rate changes on cash	(257,093)	239,561
Net change in cash and cash equivalents	(950,122)	(6,090,252)
Cash and cash equivalents at beginning of period	6,602,429	16,101,635
Cash and cash equivalents at end of period ?	5,652,307	10,011,384
Supplemental disclosure of cash flow information:
Interest	1,753,699	1,839,729
Income taxes	3,197,375	866,850
Non-cash investing and financing activities
Right of use asset	1,743,518	(820,561)
Lease liability	$ (1,608,530)	$ 688,341

Basis of Presentation

Basis of Presentation	9 Months Ended
	Oct. 01, 2022
Basis of Presentation
Note A - Basis Of Presentation	Note A – Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and do not include all the information and footnotes required by generally accepted accounting principles in the United States (“GAAP”) for complete financial statements. Refer to the consolidated financial statements of The Eastern Company (together with its consolidated subsidiaries, the “Company,” “we,” “us” or “our”) and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended January 1, 2022, filed with the Securities and Exchange Commission on March 17, 2022 (the “2021 Form 10-K”), for additional information. The accompanying condensed consolidated financial statements are unaudited. However, in the opinion of management, all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for interim periods have been reflected therein. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. All intercompany accounts and transactions are eliminated. The condensed consolidated balance sheet as of January 1, 2022 has been derived from the audited consolidated balance sheet at that date. The Company’s fiscal year is a 52-53-week fiscal year ending on the Saturday nearest to December 31. References to 2021 or the 2021 fiscal year mean the 52-week period ended on January 1, 2022, and references to 2022 or the 2022 fiscal year mean the 52-week period ending on December 31, 2022. In a 52-week fiscal year, each quarter has 13 weeks. References to the third quarter of 2021, the third fiscal quarter of 2021 or the three months ended October 2, 2021 mean the period from July 4, 2021 to October 2, 2021. References to the third quarter of 2022, the third fiscal quarter of 2022 or the three months ended October 1, 2022 mean the 13-week period from July 3, 2022 to October 1, 2022. Certain amounts in the financial statements have been reclassified to conform with the current presentation with no impact or change to previously reported net income or shareholder’s equity.

Discontinued Operations

Discontinued Operations	9 Months Ended
	Oct. 01, 2022
Discontinued Operations (see note B)
Note B - Discontinued Operations	Note B – Discontinued Operations In the second quarter of 2021, the Company determined that the companies included in our former Diversified Products segment no longer fit with our long-term strategy and the Company initiated the process of selling the companies within the Diversified Products segment. We believe that selling the companies within this segment will allow management to focus on our core capabilities and offerings. The former Diversified Products segment met the criteria to be held for sale and furthermore, we determined that the assets held for sale qualify for discontinued operations. As such, the financial results of the Diversified Products segment are reflected in our unaudited condensed consolidated statements of operations as discontinued operations for all periods presented. Additionally, current and non-current assets and liabilities of discontinued operations are reflected in the unaudited condensed consolidated balance sheets for both periods presented. On November 3, 2021, the Company sold its Greenwald Industries, Inc. division (“Greenwald”). Greenwald, located in Chester, CT, is an OEM manufacturer offering a range of payment solutions from coin-vending products to smart card systems and payment applications. On November 22, 2021, the Company sold its Frazer & Jones Company division (“Frazer & Jones”). Frazer & Jones is a ductile and malleable iron foundry located in Syracuse, NY. Eastern has exited the mining business to focus on our three core businesses. Summarized Financial Information of Discontinued Operations The following table represents income from discontinued operations, net of tax: Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 (unaudited) (unaudited) (unaudited) (unaudited) Net sales $ 2,516,064 $ 11,477,553 $ 7,356,491 $ 36,495,452 Cost of products sold (1,656,694 ) (8,749,365 ) (4,943,751 ) (29,793,971 ) Gross margin 859,370 2,728,188 2,412,740 6,701,481 Selling, general and administrative expenses (311,190 ) (1,093,716 ) (857,747 ) (3,407,113 ) Gain (loss) on classification of assets as held for sale 1,308,639 (9,274,439 ) Operating income (loss) 548,180 2,943,111 1,554,993 (5,980,071 ) Interest expense (52,360 ) (142,409 ) (128,424 ) (462,838 ) Gain (loss) from discontinued operations before income taxes 495,820 2,800,702 1,426,569 (6,442,909 ) Income tax (expense) benefit (133,500 ) (659,285 ) (384,104 ) 1,516,661 Income (loss) from discontinued operations, net of tax $ 362,320 $ 2,141,417 $ 1,042,465 $ (4,926,248 ) The following table represents the assets and liabilities from discontinued operations: October 1, 2022 January 1, 2022 (unaudited) Cash $ 376,835 $ 434,126 Accounts receivable 963,659 1,153,274 Inventory 2,905,947 1,258,032 Prepaid expenses 61,183 59,850 Property, plant and equipment, net 529,941 591,920 Right of use assets 233,638 24,697 Total assets of discontinued operations¹ $ 5,071,203 $ 3,521,899 Accounts payable $ 79,711 $ 167,794 Accrued compensation and other accrued expenses 263,769 388,499 Current portion of lease liability 93,455 24,697 Other long-term liabilities 140,183 - Total liabilities of discontinued operations¹ $ 577,118 $ 580,990 ¹ The total assets and liabilities of discontinued operations are presented as current in the October 1, 2022 and January 1, 2022 balance sheets as we sold the discontinued operations and collected proceeds within one year of the applicable balance sheet date.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Oct. 01, 2022
Earnings Per Share
Note C - Earnings Per Share	Note C – Earnings Per Share The denominators used to calculate earnings per share are as follows: Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Basic: Weighted average shares outstanding 6,209,014 6,270,147 6,226,493 6,259,380 Diluted: Weighted average shares outstanding 6,209,014 6,270,147 6,226,493 6,259,380 Dilutive stock appreciation rights 14,102 2,140 14,102 2,140 Denominator for diluted earnings per share 6,223,116 6,272,287 6,240,595 6,261,520

Inventories

Inventories	9 Months Ended
	Oct. 01, 2022
Inventories
Note D - Inventories	Note D – Inventories Inventories from continuing operations consist of the following components: October 1, 2022 January 1, 2022 Raw material and component parts $ 26,967,340 $ 25,113,487 Work in process 10,347,330 9,636,009 Finished goods 30,188,108 28,112,846 Total inventories $ 67,502,778 $ 62,862,342

Goodwill

Goodwill	9 Months Ended
	Oct. 01, 2022
Goodwill
Note E - Goodwill	Note E - Goodwill The aggregate carrying amount of goodwill from continuing operations is approximately $71.9 million as of October 1, 2022 and $72.2 million as of January 1, 2022. No impairment was recognized in the third quarter of 2022. The Company tests its reporting units for impairment annually in December, or more frequently if events or circumstances indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Such events and circumstances could include, among other things, increased competition or unexpected loss of market share, significant adverse changes in the markets in which the Company operates, or unexpected business disruptions. The Company tests reporting units for impairment by comparing the estimated fair value of each reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its estimated fair value, the Company records an impairment loss based on the difference between fair value and carrying amount not to exceed the associated carrying amount of goodwill. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. The values assigned to the key assumptions represent management’s assessment of future trends in the relevant industry and have been based on historical data from both external and internal sources.

Leases

Leases	9 Months Ended
	Oct. 01, 2022
Leases
Note F - Leases	Note F – Leases The Company presents right-of-use (ROU) assets and lease liabilities on the balance sheet for all leases with terms longer than 12 months, in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2016-02, Leases. The Company accounts for non-lease components as part of the lease component to which they relate. Lease accounting involves significant judgements, including making estimates related to the lease term, lease payments, and discount rate. The Company has operating leases for buildings, warehouses, and office equipment. The Company determines whether an arrangement is, or contains, a lease at contract inception. An arrangement contains a lease if the Company has the right to direct the use of and obtain substantially all the economic benefits of an identified asset. ROU assets and lease liabilities are recognized at lease commencement based on the present value of lease payments over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Most leases include one or more options to renew. The exercise of lease renewal options is at our sole discretion. All options to extend, when it is reasonably certain the option will be exercised, have been included in the calculation of the ROU asset and lease liability. Currently, the Company has 24 operating leases and two finance leases with a lease liability of $13.1 million as of October 1, 2022 and $11.3 million as of January 1, 2022. The finance lease arrangements are immaterial. The terms and conditions of the leases are determined by the individual agreements. The leases do not contain residual value guarantees, restrictions, or covenants that could cause the Company to incur additional financial obligations. There are no related party lease transactions. There are no leases that have not yet commenced that could create significant rights and obligations for the Company. Total lease expense for each of the next five fiscal years is estimated to be as follows: remainder of 2022 - $0.8 million; 2023 - $3.1 million; 2024 - $2.6 million; 2025 - $1.7 million; 2026 - $1.3 million; and $3.7 million thereafter. The weighted average remaining lease term is 6.2 years. The implicit interest rate used was 5.0%.

Debt

Debt	9 Months Ended
	Oct. 01, 2022
Debt
Note G - Debt	Note G - Debt On August 30, 2019, the Company entered into a credit agreement with Santander Bank, N.A., for itself, People’s United Bank, National Association and TD Bank, N.A. as lenders (the “Credit Agreement”), that included a $100 million term portion and a $20 million revolving commitment portion. Proceeds of the term loan were used to repay the Company’s remaining outstanding term loan (and to terminate its existing credit facility) with People’s United Bank, N.A. (approximately $19 million) and to acquire certain subsidiaries of Big 3 Holdings, LLC. The term portion of the loan required quarterly principal payments of $1,250,000 for an 18-month period beginning December 31, 2019. The repayment amount then increased to $1,875,000 per quarter beginning September 30, 2021 and continuing through June 30, 2023. The repayment amount then increases to $2,500,000 per quarter beginning September 30, 2023 and continuing through June 30, 2024. The term loan is a 5-year loan with the remaining balance due on August 30, 2024. The revolving commitment portion has an annual commitment fee of 0.25% based on the unused portion of the revolver. The revolving commitment portion has a maturity date of August 30, 2024. As of October 1, 2022, the Company has borrowed $9,000,000 on the revolving commitment portion of the facility at an interest rate of 4.51%. The term loan bears interest at a variable rate based on the LIBOR rate plus an applicable margin of 1.25% to 2.25%, depending on the Company’s senior net leverage ratio. Borrowings under the revolving portion bear interest at a variable rate based on, at the Company’s election, a base rate plus an applicable margin of 0.25% to 1.25% or the LIBOR rate plus an applicable margin of 1.25% to 2.25%, with such margins determined based on the Company’s senior net leverage ratio. The Company’s obligations under the Credit Agreement are secured by a lien on certain of the Company’s and its subsidiaries’ assets pursuant to a Pledge and Security Agreement, dated August 30, 2019, with Santander Bank, N.A., as administrative agent. The Company’s loan covenants under the Credit Agreement require the Company to maintain a senior net leverage ratio not to exceed 4.25 to 1. In addition, the Company is required to maintain a fixed charge coverage ratio to be not less than 1.25 to 1. The Company was in compliance with all of its covenants under the Credit Agreement on October 1, 2022, and through the date of filing this Form 10-Q. On August 30, 2019, the Company entered an interest rate swap contract with Santander Bank, N.A., with an original notional amount of $50,000,000, which was equal to 50% of the outstanding balance of the term loan on that date. The Company has a fixed interest rate of 1.44% on the swap contract and will pay the difference between the fixed rate and LIBOR when LIBOR is below 1.44% and will receive interest when the LIBOR rate exceeds 1.44%. On October 1, 2022, the interest rate for approximately half ($24.9 million) of the term portion was 4.28%, using a one-month LIBOR rate, and 3.19% on the remaining balance ($40.9 million) of the term loan based on a one-month LIBOR rate. The interest rates under the Credit Agreement and the interest rate swap contract are susceptible to changes to the method of determining LIBOR rates and to the phasing out of LIBOR. Information regarding the phasing out of LIBOR is provided below. On July 27, 2017, the Financial Conduct Authority (the “FCA”) (the authority that regulates LIBOR) announced that it would phase out LIBOR by the end of 2021. In December 2020, the ICE Benchmark Administration (the “IBA”) announced a market consultation regarding the extension of US dollar LIBOR tenors through June 30, 2023, which the FCA supports. On March 5, 2021, the IBA released its feedback statement reporting the results of the market consultation. Pursuant to its feedback statement, the IBA ceased publication of all settings of non-US dollar LIBOR and only the one-week and two-month U.S. dollar LIBOR settings on December 31, 2021, with the publication of the remaining U.S. dollar LIBOR settings scheduled to be discontinued after June 30, 2023. The Alternative Reference Rates Committee (ARRC), a financial industry group convened by the Federal Reserve Board, has recommended the use of a secured overnight financing rate (“SOFR”) to replace LIBOR. In addition, on March 15, 2022, the Adjustable Interest Rate Act (the “LIBOR Act”) was signed into law, which provided a replacement framework for outstanding financial contracts tied to LIBOR once LIBOR ceases to be published. The LIBOR Act provides a statutory mechanism and safe harbor that applies on a nationwide basis to replace LIBOR with a benchmark rate, selected by the Federal Reserve Board based on SOFR, for certain contracts that reference LIBOR and contain no or insufficient fallback provisions. The LIBOR Act preempts and supersedes any state or local law, statute, rule, regulation or standard relating to the selection or use of a benchmark replacement or related changes and allows parties that already have effective fallback provisions to opt out of the legislation. The difference between LIBOR and SOFR is that LIBOR is a forward-looking rate which means the interest rate is set at the beginning of the period with payment due at the end. SOFR is a backward-looking overnight rate which has implications for how interest and other payments are based. Although the Federal Reserve has proposed a regulation implementing the LIBOR Act, including the basis for calculation of the alternative benchmark rate thereunder, this regulation has not been finalized and changes in the method of calculating the alternative rate or benchmark are still in flux, and once an alternate rate is adopted, may adversely affect interest rates and result in higher borrowing costs. This could materially and adversely affect the Company’s results of operations, cash flows and liquidity. We cannot predict the effect of the potential changes to LIBOR or the establishment and use of alternative rates or benchmarks at this time.

Stock Options and Awards

Stock Options and Awards	9 Months Ended
	Oct. 01, 2022
Stock Options and Awards
Note H - Stock Options And Awards	Note H - Stock Options and Awards The Eastern Company 2010 Executive Stock Incentive Plan (the “2010 Plan”), for officers, other key employees, and non-employee directors expired in February 2020. On February 19, 2020, the Board of Directors of the Company (the “Board”) adopted the Eastern Company 2020 Stock Incentive Plan (the “2020 Plan”). On April 29, 2020, at the Company’s 2020 Annual Meeting of Shareholders, the shareholders of the Company approved and adopted the 2020 Plan. The 2020 Plan replaced the 2010 Plan. The Company has no other existing plan pursuant to which equity awards may be granted. Incentive stock options granted under the 2020 Plan must have exercise prices that are not less than 100% of the fair market value of the Company’s common stock on the dates the stock options are granted. Restricted stock awards may also be granted to participants under the 2020 Plan with restrictions determined by the Compensation Committee of the Board. Under the 2020 Plan, non-qualified stock options granted to participants will have exercise prices determined by the Compensation Committee of the Board. During the first nine months of fiscal 2022, the Company granted 43,300 stock awards that were subject to the meeting of performance measurements. The Company granted 27,300 stock awards in the first nine months of fiscal 2021 that were subject to the meeting of performance measurements. For the first nine months of fiscal 2022, the Company used assumptions which included an expected term of 4.0 years, volatility deviation between 47.15% to 47.70% and a risk-free rate between 2.04% to 2.66% for the purposes of measuring compensation under the Black Scholes Method. For the first nine months of fiscal 2021, the Company used several assumptions which included an expected term of 4.0 years, volatility deviation between 47.25% to 48.55% and a risk-free rate between 0.18% to 0.35% for the purposes of measuring compensation under the Black Scholes Method. The 2020 Plan also permits the issuance of Stock Appreciation Rights (“SARs”). The SARs are in the form of an option with a cashless exercise price equal to the difference between the fair value of the Company’s common stock at the date of grant and the fair value as of the exercise date resulting in the issuance of the Company’s common stock. During the first nine months of fiscal 2022 and 2021 the Company did not issue any SARs. Stock-based compensation expense in connection with SARs previously granted to employees was approximately $131,000 and $102,000 in the third quarter of 2022 and the third quarter of 2021, respectively and was approximately $381,000 and $316,000 in the first nine months of fiscal years 2022 and 2021, respectively. As of October 1, 2022, there were 812,954 shares of Company common stock reserved and available for future grant under the 2020 Plan. The following tables set forth the outstanding SARs for the period specified: Nine Months Ended Year Ended October 1, 2022 January 1, 2022 Units Weighted Average Exercise Price Units Weighted Average Exercise Price Outstanding at beginning of period 180,833 $ 22.88 244,001 $ 21.87 Issued - - - - Exercised (16,667 ) 21.20 (55,668 ) 19.31 Forfeited (16,000 ) 21.34 (7,500 ) 21.20 Outstanding at end of period 148,166 23.24 180,833 22.88 SARs Outstanding and Exercisable Range of Exercise Prices Outstanding as of October 1, 2022 Weighted Average Remaining Contractual Life Weighted Average Exercise Price Exercisable as of October 1, 2022 Weighted Average Remaining Contractual Life Weighted Average Exercise Price $20.20 - $26.30 148,166 1.3 $ 23.24 120,166 0.8 $ 23.52 The following tables set forth the outstanding stock awards for the period specified: Nine Months Ended Year Ended October 1, 2022 January 1, 2022 Units Units Outstanding at beginning of period 27,300 25,000 Issued 43,300 27,300 Exercised - - Forfeited (6,100 ) (25,000 ) Outstanding at end of period 64,500 27,300 As of October 1, 2022, outstanding SARs and stock awards had an intrinsic value of $1,119,000.

Share Repurchase Program

Share Repurchase Program	9 Months Ended
	Oct. 01, 2022
Share Repurchase Program
Note I - Share Repurchase Program	Note I – Share Repurchase Program On May 2, 2018, the Company announced that the Board of Directors of the Company had authorized a new program to repurchase up to 200,000 shares of the Company’s common stock. The Company’s share repurchase program does not obligate it to acquire the Company’s common stock at any specific price per share. Under this program, shares of common stock may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. Below is a summary of the Company’s share repurchases during the third quarter of 2022. Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that may yet be Purchased Under the Plans or Programs Balance as of July 2, 2022 129,596 $ 24.89 129,596 70,404 July 3, 2022 - October 1, 2022 10,120 21.12 10,120 (10,120 ) Balance as of October 1, 2022 139,716 $ 24.62 139,716 60,284

Revenue Recognition

Revenue Recognition	9 Months Ended
	Oct. 01, 2022
Revenue Recognition
Note J - Revenue Recognition	Note J – Revenue Recognition The Company’s revenues result from the sale of goods and services and reflect the consideration to which the Company expects to be entitled. The Company records revenues in accordance with FASB Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers.” The Company has defined purchase orders as contracts in accordance with ASC Topic 606. For its customer contracts, the Company identifies its performance obligations, which are delivering goods or services, determines the transaction price, allocates the contract transaction price to the performance obligations (when applicable), and recognizes the revenue when (or as) the performance obligation is transferred to the customer. A good or service is transferred when the customer obtains control of that good or service. The Company’s revenues are recorded at a point in time from the sale of tangible products. Revenues are recognized when products are shipped. Customer volume rebates, product returns, discount and allowance are variable consideration and are recorded as a reduction of revenue in the same period that the related sales are recorded. The Company has reviewed the overall sales transactions for variable consideration and has determined that these costs are not material. The Company has no future performance obligations and does not capitalize costs to obtain or fulfill contracts.

Income Taxes

Income Taxes	9 Months Ended
	Oct. 01, 2022
Income Taxes
Note K - Income Taxes	Note K - Income Taxes The Company files income tax returns in the U.S. federal jurisdiction, and in various states and foreign jurisdictions. With limited exceptions, the Company is no longer subject to U.S. federal, state, and local income tax examinations by tax authorities for years before 2017 and is no longer subject to non-U.S. income tax examinations by foreign tax authorities for years prior to 2015. The total amount of unrecognized tax benefits could increase or decrease within the next 12 months following October 1, 2022 for several reasons, including the closure of federal, state, and foreign tax years by expiration of the statute of limitations and the recognition and measurement considerations under FASB ASC Topic 740, “Income Taxes.” There have been no significant changes to the value of unrecognized tax benefits during the nine months ended October 1, 2022. The Company believes that it is reasonably possible that the total amount of unrecognized tax benefits will not increase or decrease significantly over the next twelve months following October 1, 2022.

Retirement Benefit Plans

Retirement Benefit Plans	9 Months Ended
	Oct. 01, 2022
Retirement Benefit Plans
Note L - Retirement Benefit Plans	Note L - Retirement Benefit Plans The Company has four non-contributory defined benefit pension plans covering most U.S. employees. Three of these pension plans are frozen and participants in these three plans have not accrued benefits since the date on which these plans were frozen. A fourth pension plan, The Eastern Company Pension Plan for Hourly-Rated Employees of the Eberhard Division, does not permit new participants but existing participants in this fourth pension plan continue to accrue benefits. Plan benefits are generally based upon age at retirement, years of service and, for the plan covering salaried employees, the level of compensation. On August 29, 2022, in agreement with the International Association of Machinist and Aerospace Workers Union AFL-CIO District #54, Local #439 the Company agreed to freeze The Eastern Company Pension Plan for Hourly-Rated Employees of the Eberhard Division effective December 31, 2022. As a result, no benefits will accrue under this plan after December 31, 2022. The Company also sponsors unfunded non-qualified supplemental retirement plans that provide certain former officers with benefits in excess of limits imposed by federal tax law. The Company also provides health care and life insurance for retired salaried employees in the United States who meet specific eligibility requirements. Significant disclosures relating to these benefit plans for the first three months and first nine months 2022 and 2021 are as follows: Pension Benefits Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Service cost $ 269,744 $ 271,832 $ 809,231 $ 815,500 Interest cost 608,188 504,252 1,824,568 1,512,761 Expected return on plan assets (1,460,658 ) (1,448,671 ) (4,381,980 ) (4,346,020 ) Amortization of prior service cost 16,563 24,845 49,689 74,535 Amortization of the net loss 390,075 432,539 1,170,225 1,297,614 Net periodic benefit $ (176,088 ) $ (215,203 ) $ (528,267 ) $ (645,610 ) Other Postretirement Benefits Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Service cost 13,323 13,626 39,969 40,878 Interest cost 10,988 9,842 32,964 29,526 Expected return on plan assets (4,400 ) (6,420 ) (13,200 ) (19,260 ) Amortization of prior service cost 1,060 — 3,180 — Amortization of the net loss (2,054 ) (3,094 ) (6,162 ) (9,282 ) Net periodic benefit cost $ 18,917 $ 13,954 $ 56,751 $ 41,862 The Company’s funding policy with respect to its qualified plans is to contribute at least the minimum amount required by applicable laws and regulations. In 2022, the Company expects to contribute $300,000 into its pension plans and $50,000 into its postretirement plan. As of October 1, 2022, the Company has contributed $15,000 into its pension plans, has contributed $18,000 to its postretirement plan, and expects to make the remaining contributions as required during the remainder of the fiscal year. The Company has a contributory savings plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) covering substantially all U.S. non-union employees. The 401(k) Plan allows participants to make voluntary contributions from their annual compensation on a pre-tax basis, subject to limitations under the Internal Revenue Code. The 401(k) Plan provides for contributions by the Company at its discretion. The Company made contributions to the plan as follows: Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Regular matching contribution $ 149,673 $ 135,664 $ 522,327 $ 433,061 Transitional credit contribution 28,144 32,468 107,886 108,337 Non-discretionary contribution 16,715 15,001 376,861 377,486 Total contributions for the period $ 194,532 $ 183,133 $ 1,007,074 $ 918,884 The non-discretionary contribution of $323,082 made in the nine months ended October 1, 2022, was accrued and expensed in the prior fiscal year.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	9 Months Ended
	Oct. 01, 2022
Recent Accounting Pronouncements
Note M - Recent Accounting Pronouncements	Note M - Recent Accounting Pronouncements Adopted In December 2019, FASB issued ASU 2019-12, Simplifying the Accounting for Income Tax. The changes implemented in ASU 2019-12 include removing exceptions to incremental intraperiod tax allocation of losses and gains from different financial statement components, exceptions to the method of recognizing income taxes on interim period losses and exceptions to deferred tax liability recognition related to foreign subsidiary investments. In addition, ASU 2019-12 requires that entities recognize franchise tax based on an incremental method, requires an entity to evaluate the accounting for step-ups in the tax basis of goodwill as inside or outside of a business combination, and removes the requirement to allocate the current and deferred tax provision among entities in standalone financial statement reporting. The ASU also now requires that an entity reflect enacted changes in tax laws in the annual effective rate, and other codification adjustments have been made to employee stock ownership plans. The Company adopted ASU 2019-12 as of January 3, 2021. The adoption of this guidance did not have a material impact on the consolidated financial statements of the Company. The Company has implemented all new accounting pronouncements that are in effect and that could impact its consolidated financial statements and does not believe that there are any other new accounting pronouncements that have been issued, but are not yet effective, that might have a material impact on the consolidated financial statements of the Company.

Concentration of Risk

Concentration of Risk	9 Months Ended
	Oct. 01, 2022
Concentration of Risk
Note N - Concentration Of Risk	Note N - Concentration of Risk Credit Risk Credit risk is the potential financial loss resulting from the failure of a customer or counterparty to settle its financial and contractual obligations to the Company, as and when they become due. The primary credit risk for the Company is its accounts receivable due from customers. The Company has established credit limits for customers and monitors their balances to mitigate the risk of loss. As of October 1, 2022, there was one significant concentration of credit risk with a customer, who has receivables representing 15% of our total accounts receivable. One single customer represented more than 11% of the Company’s net accounts receivable as of January 1, 2022. The maximum exposure to credit risk is primarily represented by the carrying amount of the Company’s accounts receivable. The Company has deposits that exceed amounts up to $250,000 that are insured by the Federal Deposit Insurance Corporation (FDIC), but the Company does not consider this a significant concentration of credit risk based on the strength of the financial institution. Interest Rate Risk The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt, which bears interest at variable rates based on the LIBOR rate plus a margin spread of 1.25% to 2.25%. The Company has an interest rate swap with a notional amount of $40.9 million on October 1, 2022, to convert a portion of the borrowing under the Credit Agreement from variable to fixed rates. The valuation of this swap is determined using the one-month LIBOR rate index and mitigates the Company’s exposure to interest rate risk. Additionally, interest rates on the Company’s debt are susceptible to changes to the method that LIBOR rates are determined and to the potential phasing out of LIBOR after 2021. The potential phasing out of LIBOR is discussed in greater detail in Note G — Debt hereof and under the heading “The phaseout of the London Interbank Offered Rate (LIBOR), or the replacement of LIBOR with a different reference rate, may adversely affect interest rates” in Part I, Item 1A of the 2021 Form 10-K. Currency Exchange Rate Risk The Company’s currency exposure is concentrated in the British pound, Canadian dollar, Mexican peso, New Taiwan dollar, Chinese RMB and the Hong Kong dollar. Because of the Company’s limited exposure to any single foreign market, any currency gains or losses have not been material and are not expected to be material in the future. As a result, the Company does not attempt to mitigate its foreign currency exposure through the acquisition of any speculative or leveraged financial instruments.

Subsequent Events

Subsequent Events	9 Months Ended
	Oct. 01, 2022
Subsequent Events
Note O - Subsequent Events	Note O – Subsequent Events Subsequent to the end of the third quarter of 2022, on October 14, 2022, the Company closed on the sale of the assets of Argo to CCK Automation, LLC. The proceeds will be used to pay down debt and fund the operations of the Company. The strategic decision to divest of the Argo business reflects our strategy of focusing on our core capabilities and offerings.

Discontinued Operations (Tables

Discontinued Operations (Tables)	9 Months Ended
	Oct. 01, 2022
Discontinued Operations (see note B)
Schedule Income From Discontinued Operations	Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 (unaudited) (unaudited) (unaudited) (unaudited) Net sales $ 2,516,064 $ 11,477,553 $ 7,356,491 $ 36,495,452 Cost of products sold (1,656,694 ) (8,749,365 ) (4,943,751 ) (29,793,971 ) Gross margin 859,370 2,728,188 2,412,740 6,701,481 Selling, general and administrative expenses (311,190 ) (1,093,716 ) (857,747 ) (3,407,113 ) Gain (loss) on classification of assets as held for sale 1,308,639 (9,274,439 ) Operating income (loss) 548,180 2,943,111 1,554,993 (5,980,071 ) Interest expense (52,360 ) (142,409 ) (128,424 ) (462,838 ) Gain (loss) from discontinued operations before income taxes 495,820 2,800,702 1,426,569 (6,442,909 ) Income tax (expense) benefit (133,500 ) (659,285 ) (384,104 ) 1,516,661 Income (loss) from discontinued operations, net of tax $ 362,320 $ 2,141,417 $ 1,042,465 $ (4,926,248 )
Schedule Of Assets And Liabilities From Discontinued Operations	October 1, 2022 January 1, 2022 (unaudited) Cash $ 376,835 $ 434,126 Accounts receivable 963,659 1,153,274 Inventory 2,905,947 1,258,032 Prepaid expenses 61,183 59,850 Property, plant and equipment, net 529,941 591,920 Right of use assets 233,638 24,697 Total assets of discontinued operations¹ $ 5,071,203 $ 3,521,899 Accounts payable $ 79,711 $ 167,794 Accrued compensation and other accrued expenses 263,769 388,499 Current portion of lease liability 93,455 24,697 Other long-term liabilities 140,183 - Total liabilities of discontinued operations¹ $ 577,118 $ 580,990

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Oct. 01, 2022
Earnings Per Share
Schedule Of Denominators Used In Earnings Per Share Computations	Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Basic: Weighted average shares outstanding 6,209,014 6,270,147 6,226,493 6,259,380 Diluted: Weighted average shares outstanding 6,209,014 6,270,147 6,226,493 6,259,380 Dilutive stock appreciation rights 14,102 2,140 14,102 2,140 Denominator for diluted earnings per share 6,223,116 6,272,287 6,240,595 6,261,520

Inventories (Tables)

Inventories (Tables)	9 Months Ended
	Oct. 01, 2022
Inventories
Schedule Of Inventory	October 1, 2022 January 1, 2022 Raw material and component parts $ 26,967,340 $ 25,113,487 Work in process 10,347,330 9,636,009 Finished goods 30,188,108 28,112,846 Total inventories $ 67,502,778 $ 62,862,342

Stock Options and Awards (Table

Stock Options and Awards (Tables)	9 Months Ended
	Oct. 01, 2022
Stock Options and Awards
Schedule Of Stock Appreciation Rights Activity	Nine Months Ended Year Ended October 1, 2022 January 1, 2022 Units Weighted Average Exercise Price Units Weighted Average Exercise Price Outstanding at beginning of period 180,833 $ 22.88 244,001 $ 21.87 Issued - - - - Exercised (16,667 ) 21.20 (55,668 ) 19.31 Forfeited (16,000 ) 21.34 (7,500 ) 21.20 Outstanding at end of period 148,166 23.24 180,833 22.88
Schedule Of Sars Outstanding And Exercisable	SARs Outstanding and Exercisable Range of Exercise Prices Outstanding as of October 1, 2022 Weighted Average Remaining Contractual Life Weighted Average Exercise Price Exercisable as of October 1, 2022 Weighted Average Remaining Contractual Life Weighted Average Exercise Price $20.20 - $26.30 148,166 1.3 $ 23.24 120,166 0.8 $ 23.52
Schedule Of Stock Option Activity	Nine Months Ended Year Ended October 1, 2022 January 1, 2022 Units Units Outstanding at beginning of period 27,300 25,000 Issued 43,300 27,300 Exercised - - Forfeited (6,100 ) (25,000 ) Outstanding at end of period 64,500 27,300

Share Repurchase Program (Table

Share Repurchase Program (Tables)	9 Months Ended
	Oct. 01, 2022
Share Repurchase Program
Schedule Of Share Repurchase Program	Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that may yet be Purchased Under the Plans or Programs Balance as of July 2, 2022 129,596 $ 24.89 129,596 70,404 July 3, 2022 - October 1, 2022 10,120 21.12 10,120 (10,120 ) Balance as of October 1, 2022 139,716 $ 24.62 139,716 60,284

Retirement Benefit Plans (Table

Retirement Benefit Plans (Tables)	9 Months Ended
	Oct. 01, 2022
Retirement Benefit Plans
Schedule Of Significant Disclosures Relating To Benefit Plans	Pension Benefits Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Service cost $ 269,744 $ 271,832 $ 809,231 $ 815,500 Interest cost 608,188 504,252 1,824,568 1,512,761 Expected return on plan assets (1,460,658 ) (1,448,671 ) (4,381,980 ) (4,346,020 ) Amortization of prior service cost 16,563 24,845 49,689 74,535 Amortization of the net loss 390,075 432,539 1,170,225 1,297,614 Net periodic benefit $ (176,088 ) $ (215,203 ) $ (528,267 ) $ (645,610 ) Other Postretirement Benefits Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Service cost 13,323 13,626 39,969 40,878 Interest cost 10,988 9,842 32,964 29,526 Expected return on plan assets (4,400 ) (6,420 ) (13,200 ) (19,260 ) Amortization of prior service cost 1,060 — 3,180 — Amortization of the net loss (2,054 ) (3,094 ) (6,162 ) (9,282 ) Net periodic benefit cost $ 18,917 $ 13,954 $ 56,751 $ 41,862
Schedule Of Defined Contribution Plan	Three Months Ended Nine Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Regular matching contribution $ 149,673 $ 135,664 $ 522,327 $ 433,061 Transitional credit contribution 28,144 32,468 107,886 108,337 Non-discretionary contribution 16,715 15,001 376,861 377,486 Total contributions for the period $ 194,532 $ 183,133 $ 1,007,074 $ 918,884

Discontinued Operations (Detail

Discontinued Operations (Details) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Cost of products sold	$ (55,056,160)	$ (48,661,374)	$ (163,047,360)	$ (142,196,527)
Gross margin	16,580,586	15,215,532	47,144,088	44,701,403
Selling, general and administrative expenses	10,121,683	9,440,583	30,129,112	27,760,514
Operating profit	5,446,942	4,812,025	13,846,643	13,872,023
Gain (loss) on classification of assets as held for sale	0	1,308,639	0	(9,274,439)
Interest expense	(645,773)	(427,222)	(1,583,894)	(1,388,512)
Income tax (expense) benefit	1,423,363	971,884	3,498,365	3,573,308
Discontinued Operations [Member]
Net Sales	2,516,064	11,477,553	7,356,491	36,495,452
Cost of products sold	(1,656,694)	(8,749,365)	(4,943,751)	(29,793,971)
Gross margin	859,370	2,728,188	2,412,740	6,701,481
Selling, general and administrative expenses	311,190	1,093,716	857,747	3,407,113
Operating profit	548,180	2,943,111	1,554,993	(5,980,071)
Gain (loss) on classification of assets as held for sale		1,308,639		(9,274,439)
Interest expense	(52,360)	(142,409)	(128,424)	(462,838)
Gain (Loss) from discontinued operations before income taxes	495,820	2,800,702	1,426,569	(6,442,909)
Income tax (expense) benefit	(133,500)	(659,285)	(384,104)	1,516,661
Income (loss) from discontinued operations, net of tax	$ 362,320	$ 2,141,417	$ 1,042,465	$ (4,926,248)

Discontinued Operations (Deta_2

Discontinued Operations (Details 1) - USD ($)	Oct. 01, 2022	Jan. 01, 2022
Right Of Use Assets	$ 12,882,053	$ 11,138,535
Accounts Payable	29,035,147	29,633,974
Accrued Compensation And Other Accrued Expenses	3,397,417	4,375,867
Current Portion Of Lease Liability	2,993,652	2,664,895
Discontinued Operations [Member]
Cash	376,835	434,126
Accounts Receivable	963,659	1,153,274
Inventory	2,905,947	1,258,032
Prepaid Expenses	61,183	59,850
Property Plant And Equipment, Net	529,941	591,920
Right Of Use Assets	233,638	24,697
Total Assets Of Discontinued Operations	5,071,203	3,521,899
Accounts Payable	79,711	167,794
Accrued Compensation And Other Accrued Expenses	263,769	388,499
Current Portion Of Lease Liability	93,455	24,697
Other Long-term Liabilities	140,183	0
Total Liabilities Of Discontinued Operations	$ 577,118	$ 580,990

Earnings Per Share (Details)

Earnings Per Share (Details) - shares	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Basic [abstract]
Weighted Average Shares Outstanding	6,209,014	6,270,147	6,226,493	6,259,380
Diluted [abstract]
Weighted Average Shares Outstanding	6,209,014	6,270,147	6,226,493	6,259,380
Dilutive Stock Appreciation Rights	14,102	2,140	14,102	2,140
Denominator For Diluted Earnings Per Share (in Shares)	6,223,116	6,272,287	6,240,595	6,261,520

Inventories (Details)

Inventories (Details) - USD ($)	Oct. 01, 2022	Jan. 01, 2022
Inventories
Raw Material And Component Parts	$ 26,967,340	$ 25,113,487
Work In Process	10,347,330	9,636,009
Finished Goods	30,188,108	28,112,846
Total Inventories	$ 67,502,778	$ 62,862,342

Goodwill (Details Narrative )

Goodwill (Details Narrative ) - USD ($) $ in Millions	Oct. 01, 2022	Jan. 01, 2022
Inventories
Goodwill, Net	$ 71.9	$ 72.2

Leases (Details Narrative)

Leases (Details Narrative) - USD ($) $ in Thousands	9 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Leases
Lease Liability	$ 1,310	$ 1,130
Total Operating Lease	$ 2,400
Interest Rate	5%
Lease weighted average remaining lease terms	6 years 2 months 12 days
2022	$ 800
2023	3,100
2024	2,600
2025	1,700
2026	1,300
Thereafter	$ 3,700

Debt (Details Narrative)

Debt (Details Narrative) - USD ($)	1 Months Ended	9 Months Ended
	Aug. 30, 2019	Oct. 01, 2022
Credit Agreement [Member]
Ratio Description		the Company to maintain a senior net leverage ratio not to exceed 4.25 to 1. In addition, the Company is required to maintain a fixed charge coverage ratio to be not less than 1.25 to 1
Revolving Credit Loan [Member]
Revolving Commitment Portion		$ 9,000,000
Interest Rate		4.51%
Interest amount		$ 24,900,000
Outstanding Balance		$ 40,900,000
Annual Commitment Fee Percentage		0.25%
LIBOR [Member] | Revolving Credit Loan [Member] | Minimum [Member]
Basis Spread On Variable Rate		1.25%
LIBOR [Member] | Revolving Credit Loan [Member] | Maximum [Member]
Basis Spread On Variable Rate		2.25%
Term Loan [Member]
Revolving Commitment Portion	$ 100,000,000
Repayment Of Debt	$ 19,000,000
Term Of Loan		5 years
Interest Rate		0.19%
Term Loan [Member] | December 31, 2019 through August 30, 2021 [Member]
Quarterly Principal Payment		$ 1,250,000
Term Loan [Member] | September 30, 2021 through June 30, 2023 [Member]
Quarterly Principal Payment		1,875,000
Term Loan [Member] | September 30, 2023 through June 30, 2024 [Member]
Quarterly Principal Payment		$ 2,500,000
Term Loan [Member] | Minimum [Member]
Variable Interest Rate Based On Senior Net Leverage Ratio		1.25%
Term Loan [Member] | Maximum [Member]
Variable Interest Rate Based On Senior Net Leverage Ratio		2.25%
Term Loan [Member] | LIBOR [Member]
Fixed Rate Of Interest	1.44%
Interest Rate Swap [Member] | Term Loan [Member]
Description Of Interest Rate Swap Contract		which was equal to 50% of the outstanding balance of the term loan on that date. The Company has a fixed interest rate of 1.44% on the swap contract and will pay the difference between the fixed rate and LIBOR when LIBOR is below 1.44% and will receive interest when the LIBOR rate exceeds 1.44%. On October 1, 2022, the interest rate for approximately half ($24.9 million) of the term portion was 4.28%, using a one-month LIBOR rate, and 3.19% on the remaining balance ($40.9 million) of the term loan based on a one-month
Interest Rate Swap, Notional Amount	$ 50,000,000
Fixed Rate Of Interest	1.44%
Revolving Commitment Portion	$ 20,000,000

Stock Options and Awards (Detai

Stock Options and Awards (Details) - $ / shares	9 Months Ended	12 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Number Of Units Outstanding At Beginning Of Period	27,300	25,000
Number Of Units, Issued	43,300	27,300
Number Of Units, Forfeited	(6,100)	(25,000)
Number Of Units Outstanding At End Of Period	64,500	27,300
Stock Options [Member]
Number Of Units Outstanding At Beginning Of Period	180,833	244,001
Number Of Units, Exercised	(16,667)	(55,668)
Number Of Units, Forfeited	(16,000)	(7,500)
Number Of Units Outstanding At End Of Period	148,166	180,833
Weighted Average Exercise Price, Beginning Balance	$ 22.88	$ 21.87
Weighted Average Exercise Price, Issued	0	0
Weighted Average Exercise Price, Exercised	21.20	19.31
Weighted Average Exercise Price, Forfeited	21.34	21.20
Weighted Average Exercise Price, Ending Balance	$ 23.24	$ 22.88

Stock Options and Awards (Det_2

Stock Options and Awards (Details 1) - SAR [Member]	9 Months Ended
	Oct. 01, 2022 $ / shares shares
Exercisable | shares	120,166
Weighted Average Exercise Price, Oustanding	$ 23.52
Outstanding | shares	148,166
Weighted- Average Remaining Contractual Life, Oustanding	1 year 3 months 18 days
Weighted- Average Remaining Contractual Life, Exercisable	9 months 18 days
Weighted Average Exercise Price, Exercisable	$ 23.24
Minimum [Member]
Range Of Exercise Prices	20.20
Maximum [Member]
Range Of Exercise Prices	$ 26.30

Stock Options and Awards (Det_3

Stock Options and Awards (Details 2) - shares	9 Months Ended	12 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Stock Options and Awards
Number Of Units Outstanding At Beginning Of Period	27,300	25,000
Number Of Units, Issued	43,300	27,300
Number Of Units, Forfeited	(6,100)	(25,000)
Number Of Units Outstanding At End Of Period	64,500	27,300

Stock Options and Awards (Det_4

Stock Options and Awards (Details Narrative) - USD ($)	9 Months Ended		12 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Jan. 01, 2022
Stock Compensation Expense	$ 381,000	$ 316,000
Stock Option Granted	43,300		27,300
Stock Compensation Expense	$ 699,454	$ 1,090,946
Minimum [Member]
Volatility Deviation		47.25%
Risk Free Rate		0.18%
Maximum [Member]
Volatility Deviation	47.70%	48.55%
Risk Free Rate	2.66%	0.35%
2020 Plan [Member]
Common Stock Shares Reserved For Future Issuance	812,954
Stock Option Granted	43,300	27,300
Volatility Deviation	47.15%
Risk Free Rate	2.04%
Expected Term	4 years	4 years
SAR [Member]
Intrinsic Value	$ 1,119,000
Stock Compensation Expense	$ 131,000	$ 102,000

Share Repurchase Program (Detai

Share Repurchase Program (Details)	9 Months Ended
	Oct. 01, 2022 $ / shares shares
Maximum Number of Shares That May Yet be Purchased Under the Plans or Programs [Member]
Maximum Number Of Shares That May Yet Be Purchased Under The Plans Or Programs, Beginning Balance	70,404
Maximum Number Of Shares That May Yet Be Purchased Under The Plans Or Programs During The Period	(10,120)
Maximum Number Of Shares That May Yet Be Purchased Under The Plans Or Programs, Ending Balance	60,284
Average Price Paid Per Share [Member]
Average Price Paid Per Share, Beginning Balance | $ / shares	$ 24.89
Average Price Paid Per Share During The Period | $ / shares	21.12
Average Price Paid Per Share, Ending Balance | $ / shares	$ 24.62
Total Number of Shares Purchased [Member]
Total Number Of Shares Purchased, Beginning Balance	129,596
Total Number Of Shares Purchased During The Period	10,120
Total Number Of Shares Purchased,ending Balance	139,716
Total Number of Shares Purchased As Part of Publicly Announced Plansor Programs [Member]
Total Number Of Shares Purchased As Part Of Publicly Announced Plansor Programs, Beginning Balance	129,596
Total Number Of Shares Purchased As Part Of Publicly Announced Plans Or Programs During The Period	10,120
Total Number Of Shares Purchased As Part Of Publicly Announced Plansor Programs, Ending Balance	139,716

Share Repurchase Program (Det_2

Share Repurchase Program (Details Narrative)	May 02, 2018 shares
Share Repurchase Program
Number Of Shares Authorized To Be Repurchased	200,000

Retirement Benefit Plans (Detai

Retirement Benefit Plans (Details) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Pension Benefit [Member]
Service Cost	$ 269,744	$ 271,832	$ 809,231	$ 815,500
Interest Cost	608,188	504,252	1,824,568	1,512,761
Expected Return On Plan Assets	1,460,658	1,448,671	4,381,980	4,346,020
Amortization Of Prior Service Cost	16,563	24,845	49,689	74,535
Amortization Of The Net Loss	390,075	432,539	1,170,225	1,297,614
Net Periodic Benefit Cost	(176,088)	(215,203)	(528,267)	(645,610)
Other Postretirement Benefit [Member]
Service Cost	13,323	13,626	39,969	40,878
Interest Cost	10,988	9,842	32,964	29,526
Expected Return On Plan Assets	4,400	6,420	13,200	19,260
Amortization Of Prior Service Cost	1,060	0	3,180	0
Amortization Of The Net Loss	(2,054)	(3,094)	(6,162)	(9,282)
Net Periodic Benefit Cost	$ (18,917)	$ (13,954)	$ (56,751)	$ (41,862)

Retirement Benefit Plans (Det_2

Retirement Benefit Plans (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Total Contributions For The Period	$ 194,532	$ 183,133	$ 1,007,074	$ 918,884
Regular Matching Contributions [Member]
Total Contributions For The Period	149,673	135,664	522,327	433,061
Transitional Credit Contributions [Member]
Total Contributions For The Period	28,144	32,468	107,886	108,337
Non-Discretionary Contributions [Member]
Total Contributions For The Period	$ 16,715	$ 15,001	$ 376,861	$ 377,486

Retirement Benefit Plans (Det_3

Retirement Benefit Plans (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Accrued Amount For Non Discretionary Safe Harbor Contribution	$ 323,082
Pension Benefit [Member]
Cash Contributions	15,000	$ 300,000
Other Postretirement Benefit [Member]
Cash Contributions	$ 18,000	$ 50,000

Concentration of Risk (Details

Concentration of Risk (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Federal Deposit Insurance Corporation	$ 250,000
Accounts Receivable [Member] | Customer Concentration Risk [Member]
Threshold Percentage Of Concentration Risk	11%	15%
Minimum [Member] | Revolving Credit Loan [Member] | LIBOR [Member]
Basis Spread On Variable Rate	1.25%
Maximum [Member] | Revolving Credit Loan [Member] | LIBOR [Member]
Basis Spread On Variable Rate	2.25%
Interest Rate Swap [Member] | Term Loan [Member]
Interest Rate Swap, Notional Amount	$ 40,900,000