Delaware
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000-51378
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51-0539828
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(State or Other Jurisdiction
of Incorporation or Organization)
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(Commission File Number)
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(IRS Employer Identification No.)
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☐
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02
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Results of Operations and Financial Condition.
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Item 7.01
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Regulation FD Disclosure.
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Item 9.01
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Financial Statements and Exhibits.
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(d)
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Exhibits
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99.1
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Date: June 28, 2016
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By:
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/s/ Thomas Sammons
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Name:
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Thomas Sammons
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Title:
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Chief Financial Officer
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Exhibit
Number
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Exhibit
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99.1
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Company Contact:
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Investor Relations Contact:
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Mr. Thomas Sammons
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Hayden IR
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Chief Financial Officer
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Brett Maas
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TechPrecision Corporation
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Phone: 646-536-7331
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Phone: 978-883-5109
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Email: brett@haydenir.com
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Email: sammonst@ranor.com
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Website: www.haydenir.com
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Website: www.techprecision.com
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· | Net sales of $4.9 million were higher by $1.0 million when compared to $3.9 million in the year-ago quarter. |
· | Gross profit was $1.7 million compared to $880,000 in the same quarter last year. Gross margins improved in the fourth quarter of fiscal 2016 due to improved throughput, lower materials and labor costs, and the absence of contract losses. |
· | Selling, general and administrative expenses decreased by approximately 30% or $387,000 compared to the same quarter last year. The fourth quarter of fiscal 2016 was positively impacted by lower spending on compensation, outside advisory services and office expense. |
· | Net interest expense includes a reversal of deferred interest costs of approximately $241,000 which will not have to be paid in connection with the Utica Loan and Security Agreement. |
· | Net income of $885,000 increased significantly compared to a net loss of $719,000 in the prior year's fourth quarter. |
· | Net sales decreased 8% or $1.4 million to $16.8 million compared to $18.2 million in the year-ago period. Fiscal 2016 shipments to our defense, aerospace and nuclear customers increased by $3.4 million. This increase was more than offset by a decrease in shipments to our precision industrial customers. |
· | Cost of sales decreased 29% or $4.5 million to $11.4 million compared to $15.9 million in the year-ago period. The decrease was driven primarily by lower labor costs, lower overhead as a percentage of sales and fewer contract losses. |
· | Gross profit in the full year of fiscal 2016 was $5.5 million compared to $2.3 million in fiscal 2015. The improvement was driven by a better production mix compared to higher labor costs, under absorbed overhead and contract losses which dampened margins in fiscal 2015. |
· | Selling, general and administrative expenses decreased by approximately 25%, or $1.1 million, to $3.4 million in fiscal 2016, down from $4.5 million in the year-ago period. |
· | Interest expense decreased in fiscal 2016 due to lower amortization and interest rates, and lower average levels of debt. |
· | Net income was $1.4 million for fiscal 2016 compared to a net loss of $3.6 million in fiscal 2015. |
CONSOLIDATED BALANCE SHEETS
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March 31,
2016
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March 31,
2015
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||||||
ASSETS
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||||||||
Current assets:
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||||||||
Cash and cash equivalents
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$
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1,332,166
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$
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1,336,325
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||||
Accounts receivable, less allowance for doubtful accounts of $0 - 2016 and $24,693 - 2015
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2,022,480
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826,363
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||||||
Costs incurred on uncompleted contracts, in excess of progress billings
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2,395,642
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2,008,244
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||||||
Inventories- raw materials
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128,595
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134,812
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||||||
Deferred income taxes
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--
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826,697
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||||||
Other current assets
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530,808
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538,253
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||||||
Total current assets
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6,409,691
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5,670,694
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||||||
Property, plant and equipment, net
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4,814,184
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5,610,041
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||||||
Deferred income taxes
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684,270
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--
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||||||
Other noncurrent assets, net
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223,686
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45,490
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||||||
Total assets
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$
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12,131,831
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$
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11,326,225
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||||
LIABILITIES AND STOCKHOLDERS' EQUITY:
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||||||||
Current liabilities:
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||||||||
Accounts payable
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$
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996,065
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$
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1,526,123
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||||
Accrued expenses
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1,804,485
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1,665,658
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||||||
Trade notes payable
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--
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138,237
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||||||
Income taxes payable
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9,032
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--
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||||||
Advanced claims payment
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507,835
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--
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||||||
Billings on uncompleted contracts, in excess of related costs
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1,629,018
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1,211,506
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||||||
Short-term debt
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--
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2,250,000
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||||||
Current portion of long-term debt
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953,106
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933,651
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||||||
Total current liabilities
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5,899,541
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7,725,175
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||||||
Long-term debt, including capital leases
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3,782,752
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2,485,858
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||||||
Deferred income taxes
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684,270
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826,697
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||||||
Noncurrent accrued expenses
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37,097
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--
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||||||
Stockholders' Equity:
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||||||||
Preferred stock - par value $.0001 per share, 10,000,000 shares authorized,
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||||||||
of which 9,890,980 are designated as Series A Preferred Stock, with -0-
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||||||||
and 1,927,508 shares issued and outstanding at March 31, 2016 and 2015, respectively
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||||||||
(liquidation preference of $0 and $549,340 at March 31, 2016 and 2015, respectively)
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--
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524,210
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||||||
Common stock - par value $.0001 per share, 90,000,000 shares authorized,
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||||||||
27,324,593 shares issued and outstanding at March 31, 2016,
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||||||||
and 24,669,958 shares issued and outstanding at March 31, 2015
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2,732
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2,467
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||||||
Additional paid in capital
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7,094,749
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6,487,589
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||||||
Accumulated other comprehensive income
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21,568
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23,561
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||||||
Accumulated deficit
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(5,390,878
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)
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(6,749,332
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)
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Total stockholders' equity
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1,728,171
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288,495
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||||||
Total liabilities and stockholders' equity
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$
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12,131,831
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$
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11,326,225
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Three Months Ended
March 31,
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Twelve Months Ended
March 31,
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||||||||||||||
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2016
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2015
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2016
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2015
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||||||||||||
Net sales
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$
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4,868,530
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$
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3,921,319
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$
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16,853,952
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$
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18,233,214
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||||||||
Cost of sales
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3,136,857
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3,041,189
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11,360,206
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15,925,742
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||||||||||||
Gross profit
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1,731,673
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880,130
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5,493,746
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2,307,472
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||||||||||||
Selling, general and administrative
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902,544
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1,289,607
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3,385,009
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4,533,181
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||||||||||||
Income (loss) from operations
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829,129
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(409,477
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)
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2,108,737
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(2,225,709
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)
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||||||||||
Other income (expense)
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(332
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)
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(3,610
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)
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1,199
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(4,633
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)
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|||||||||
Interest expense, net
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55,929
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(313,669
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)
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(752,280
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)
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(1,514,465
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)
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|||||||||
Interest income
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--
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25
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30
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121
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||||||||||||
Total other income (expense)
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55,957
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(317,255
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)
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(751,051
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)
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(1,518,977
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)
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|||||||||
Income (loss) before income taxes
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884,726
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(726,731
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)
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1,357,686
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(3,744,686
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)
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||||||||||
Income tax benefit
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(768
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)
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(8,107
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)
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(768
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)
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(160,505
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)
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||||||||
Net income (loss)
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$
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885,494
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$
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(718,625
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)
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$
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1,358,454
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$
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(3,584,181
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)
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||||||
Other comprehensive income (loss), before tax:
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||||||||||||||||
Reclassification adjustments for cash flow hedges
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--
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--
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--
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248,464
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||||||||||||
Change in unrealized loss on cash flow hedges
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--
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--
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--
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(16,681
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)
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|||||||||||
Foreign currency translation adjustments
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(2,210
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)
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3,907
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(1,993
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)
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(334
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)
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|||||||||
Other comprehensive income (loss), before tax
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(2,210
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)
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3,907
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(1,993
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)
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231,449
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||||||||||
Tax expense from reclassification adjustment
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--
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--
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152,791
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|||||||||||||
Other comprehensive income (loss), net of tax
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(2,210
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)
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3,907
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(1,993
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)
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78,658
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||||||||||
Comprehensive income (loss)
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$
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883,284
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$
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(714,718
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)
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$
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1,356,461
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$
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(3,505,523
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)
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||||||
Net income (loss) per share (basic)
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$
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0.03
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$
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(0.03
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)
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$
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0.05
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$
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(0.15
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)
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||||||
Net income (loss) per share (diluted)
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$
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0.03
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$
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(0.03
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)
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$
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0.05
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$
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(0.15
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)
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||||||
Weighted average number of shares outstanding (basic)
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27,324,593
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24,447,736
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26,392,514
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24,120,402
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||||||||||||
Weighted average number of shares outstanding (diluted)
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27,684,009
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24,447,736
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26,572,737
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24,120,402
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CONSOLIDATED STATEMENTS OF CASH FLOWS
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Years Ended March 31,
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|||||||
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2016
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2015
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
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||||||||
Net income (loss)
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$
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1,358,454
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$
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(3,584,181
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)
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|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
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||||||||
Depreciation
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747,553
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839,508
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||||||
Amortization deferred loan costs
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240,081
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269,840
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||||||
Loss on sale of equipment
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--
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81,340
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||||||
Stock based compensation expense
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88,041
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262,550
|
||||||
Provision for contract losses
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(69,014
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)
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(790,790
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)
|
||||
Changes in operating assets and liabilities:
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||||||||
Accounts receivable
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(1,196,117
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)
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1,454,153
|
|||||
Costs incurred on uncompleted contracts, in excess of progress billings
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(387,398
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)
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3,249,758
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|||||
Inventories – raw materials
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6,217
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158,513
|
||||||
Other current assets
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7,411
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45,702
|
||||||
Taxes receivable
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--
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8,062
|
||||||
Other noncurrent assets
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(193,906
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)
|
61,354
|
|||||
Accounts payable
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(668,295
|
)
|
(1,224,025
|
)
|
||||
Accrued expenses
|
180,687
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(1,358,070
|
)
|
|||||
Accrued taxes payable
|
9,032
|
--
|
||||||
Billings on uncompleted contracts, in excess of related costs
|
417,512
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(250,183
|
)
|
|||||
Advanced claims payment
|
507,835
|
--
|
||||||
Net cash provided by (used in) operating activities
|
1,048,093
|
(776,469
|
)
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Proceeds from sale of fixed assets
|
--
|
12,500
|
||||||
Capital expenditures for lighting project
|
(204,064
|
)
|
--
|
|||||
Purchases of property, plant and equipment
|
(17,600
|
)
|
(54,099
|
)
|
||||
Net cash used in investing activities
|
(221,664
|
)
|
(41,599
|
)
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Deferred loan costs
|
(100,472
|
)
|
(393,998
|
)
|
||||
Proceeds from lighting project grant
|
204,064
|
--
|
||||||
Borrowings of short-term debt
|
--
|
6,400,000
|
||||||
Repayment of long-term debt
|
(933,651
|
)
|
(4,938,333
|
)
|
||||
Net cash (used in) provided by financing activities
|
(830,059
|
)
|
1,067,669
|
|||||
Effect of exchange rate on cash and cash equivalents
|
(529
|
)
|
23
|
|||||
Net (decrease) increase in cash and cash equivalents
|
(4,159
|
)
|
249,624
|
|||||
Cash and cash equivalents, beginning of period
|
1,336,325
|
1,086,701
|
||||||
Cash and cash equivalents, end of period
|
$
|
1,332,166
|
$
|
1,336,325
|