10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2020

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to ___________.

Commission File Number 1-8462

GRAHAM CORPORATION

(Exact name of Registrant as specified in its charter)

Delaware	16-1194720
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

20 Florence Avenue, Batavia, New York	14020
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code 585-343-2216

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.10 Per Share	GHM	NYSE

Securities registered pursuant to Section 12(g) of the Act: Preferred Stock Purchase Rights

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ NO ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES ☐ NO ☒

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☒ NO ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). YES ☒ NO ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by checkmark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.  ☐

Indicate by checkmark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐   No ☒

The aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on the NYSE Stock Market on September 30, 2019, was $189,547,236.

As of June 1, 2020, the Registrant’s Common Stock outstanding was 9,855,963 shares, $0.10 par value.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's definitive Proxy Statement, to be filed in connection with the Registrant's 2020 Annual Meeting of Stockholders to be held on August 11, 2020, are incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this filing.

Table of Contents

GRAHAM CORPORATION

Annual Report on Form 10-K

Year Ended March 31, 2020

PART I		PAGE
Item 1	Business	3
Item 1A	Risk Factors	8
Item 1B	Unresolved Staff Comments	17
Item 2	Properties	18
Item 3	Legal Proceedings	18
Item 4	Mine Safety Disclosures	18
PART II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	19
Item 6	Selected Financial Data	20
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 7A	Quantitative and Qualitative Disclosures About Market Risk	30
Item 8	Financial Statements and Supplementary Data	31
Item 9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	62
Item 9A	Controls and Procedures	62
Item 9B	Other Information	62
PART III
Item 10	Directors, Executive Officers and Corporate Governance	63
Item 11	Executive Compensation	63
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	63
Item 13	Certain Relationships and Related Transactions, and Director Independence	63
Item 14	Principal Accounting Fees and Services	63
PART IV
Item 15	Exhibits, Financial Statement Schedules	64

Note: Portions of the Registrant's definitive Proxy Statement, to be issued in connection with the Registrant's 2020 Annual Meeting of Stockholders to be held on August 11, 2020, are incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K.

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PART I

(Dollar amounts in thousands except per share data)

Item 1. Business

Graham Corporation ("we," "us," "our") is a global business that designs, manufactures and sells critical equipment for the energy, defense and chemical/petrochemical industries.  Our energy markets include oil refining, cogeneration, and alternative power.  For the defense industry, our equipment is used in nuclear propulsion power systems for the U.S. Navy.  For the chemical and petrochemical industries, our equipment is used in fertilizer, ethylene, methanol and downstream chemical facilities.  Graham’s global brand is built upon our world-renowned engineering expertise in vacuum and heat transfer technology, responsive and flexible customer service and high quality standards.  We design and manufacture custom-engineered ejectors, vacuum pumping systems, surface condensers and vacuum systems.  Our equipment can also be found in other diverse applications such as metal refining, pulp and paper processing, water heating, refrigeration, desalination, food processing, pharmaceutical, heating, ventilating and air conditioning.

Our corporate headquarters are located in Batavia, New York.  We have production facilities located with our headquarters in Batavia.  We also have two wholly-owned foreign subsidiaries, Graham Vacuum and Heat Transfer Technology (Suzhou) Co., Ltd. ("GVHTT"), located in Suzhou, China, and Graham India Private Limited ("GIPL"), located in Ahmedabad, India.  GVHTT provides sales and engineering support for us in the People’s Republic of China and management oversight throughout Southeast Asia.  GIPL serves as a sales and market development office focusing on the refining, petrochemical and fertilizer markets.

On June 24, 2019, we sold our wholly-owned subsidiary, Energy Steel & Supply Co. ("Energy Steel"), located in Lapeer, Michigan, which served the commercial nuclear utility industry.

We were incorporated in Delaware in 1983 and are the successor to Graham Manufacturing Co., Inc., which was incorporated in New York in 1936.  Our stock is traded on the NYSE under the ticker symbol "GHM".  

Unless indicated otherwise, dollar figures in this Annual Report on Form 10-K are reported in thousands.

Our Products, Customers and Markets

Our products are used in a wide range of industrial process applications, primarily in energy markets, including:

• Petroleum Refining

— conventional oil refining

— oil sands extraction and upgrading

• Defense

— propulsion systems for nuclear-powered aircraft carriers and submarines

• Chemical and Petrochemical Processing

— ethylene, methanol and nitrogen producing plants

— fertilizer plants

— plastics, resins and fibers plants

— downstream petrochemical plants

— coal-to-chemicals plants

— gas-to-liquids plants

•Power Generation /Alternative Energy

— biomass plants

— cogeneration power plants

— geothermal power plants

— ethanol plants

— fossil fuel plants

•Other

— oleo chemical plants

— air conditioning and water heating systems

— food processing plants

— pharmaceutical plants

— liquefied natural gas production facilities

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Our principal customers include end users of our products in their manufacturing, refining and power generation processes, large engineering companies that build installations for companies in such industries, and the original equipment manufacturers who combine our products with their equipment prior to its sale to end users.  

Our products are sold by a team of sales engineers we employ directly as well as by independent sales representatives located worldwide.  There may be short periods of time, a fiscal year for example, where one customer may make up greater than 10% of our business.  However, if this occurs in multiple years, it is usually not the same customer or project over such a multi-year period.  One customer accounted for more than 10% of our revenue in the fiscal year ended March 31, 2020, which we refer to as fiscal 2020, while a different customer accounted for more than 10% of our revenue in the fiscal year ended March 31, 2019, which we refer to as fiscal 2019.

As a result of our diversification efforts to more extensively support the U.S. Navy, we have increased our domestic sales in 2020.  Over a business cycle, our domestic sales will generally range between 50% and 75% of total sales.  The mix of domestic and international sales can vary from year to year.  

Our backlog at March 31, 2020 was $112,389 compared with $132,127 at March 31, 2019.  Included in the March 31, 2019 backlog was $8,039 for the commercial nuclear utility business, which was sold in June 2019.

Our Strengths

Our core strengths include:

• We have a value-enhancing sales and development platform. We believe our customer-facing platform of sales, project estimating and application engineering are competitive advantages.  We have tools and capabilities that we believe allow us to move quickly and comprehensively as customers evaluate how best to integrate our equipment into their facilities.  We believe that our early and deep involvement adds significant value to the process and is an important competitive differentiator in the long sales cycle industries we serve.  We believe customers need our engineering and fabrication expertise early in the project life cycle to understand how best to specify our equipment.  

• We are renowned for our strong capabilities to handle complex, custom orders.  The orders we receive are extremely complex and we believe that our order management platforms provide another competitive differentiator for our company.  In our markets, we believe that order administration, risk management, cost containment, quality and engineering documentation are as important as the equipment itself.  We have developed strong order management capabilities to enable us to deliver high quality, engineered-to-order and build-to-spec process-critical equipment in a timely manner.  For our customers’ complex, custom orders we typically manage very rigorous interaction between our project management teams and the end user or its engineering firm, as product design and quality requirements are finalized once an order is received.  Customers’ supplier selection process begins by assessing these order management capabilities.

• We maintain a responsive, flexible production environment.  We believe our operations platform is adept at handling low volume, high mix orders that are highly customized fabrications.  We also believe that our production environment is much different from a highly engineered standard products business.  While certain equipment in a product group may look similar, there are often subtle differences which are required to deliver the desired specification.  Also, during production it is not uncommon for customer-driven engineering changes to occur that alter the configuration of what had been initially released into production.  The markets that we serve demand this flexible operating model.

• We have the capability to manage outsourced production.  Effectively accessing the global fabrication supply chain expands our market reach, increases execution capacity and can improve competitiveness.  We use this capability for three primary reasons: 1. Delivering a lower cost manufacturing option; 2. Expanding capacity to execute an order to meet customer timing requirements and 3. Addressing localized content requirements.  We have proven capability to deliver our specialized product designs with outsourced fabrication that is on-time, within budget and that meets our high quality standards.

• We provide robust after-the-sale technical support.  Our engineering and performance improvement personnel go to customer sites to audit the performance of our equipment, provide operator training and troubleshoot performance issues.  Technical service after a sale is important to our customers as we believe their focus is always on leveraging our equipment to maximize their facilities’ productivity.

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• We have a highly trained workforce.We maintain a long-tenured, highly skilled and extremely flexible workforce.

• We have a strong balance sheet. We maintain significant cash and investments on hand, and no bank debt, which we believe provides us with the financial flexibility to pursue our business strategy, including growth by acquisition.

• We have a high-quality credit facility.  Our credit facilities provide us with a $35,000 borrowing capacity that is expandable at our option to provide us with up to a total of $60,000 in borrowing capacity.

Our Strategy

We intend to strategically leverage and deploy our assets, including but not limited to, financial, technical, manufacturing and industry know-how, in order to capture expanded market share within the geographies and industries we serve, expand revenue opportunities in adjacent and countercyclical markets and continually improve our results of operations in order to:

•Generate sustainable earnings growth;

•Reduce earnings volatility;

•Improve our operating performance;

•Generate strong cash flow from operations to reinvest in our business or return to shareholders in the form of ordinary

dividends; and

•Provide an acceptable return to our shareholders.

To accomplish our objectives and maintain strategic focus, we believe that we must:

• Successfully deploy our corporate assets to expand our market share in the industries we currently serve, access and develop a stronger presence in industries where we do not have a historically strong presence, and pursue acquisitions, partnerships and/or other business combinations in order to enter new geographic or industrial markets, new product lines or expand our coverage in existing markets.  

• Identify organic growth opportunities and consummate acquisitions where we believe the strength of the Graham brand will provide us with the ability to expand and complement our core businesses.  We intend to extend our existing product lines, move into complementary product lines and expand our global sales presence in order to further broaden our existing markets and reach additional markets.

• Expand our market presence in the U.S. Navy's Nuclear Propulsion Program.  We will continue to demonstrate our proficiency by successfully executing the complex Nuclear Propulsion Program orders that are currently in our backlog by controlling both cost and risk, providing high-quality custom fabrication to exacting military quality control requirements and through disciplined project management. We intend to continue to be a preferred supplier of equipment to the U.S. Navy’s Nuclear Propulsion Program for both surface and submarine vessels.

• Continue to invest in people and capital equipment to meet the long-term demand for our products in the oil refining, petrochemical processing and defense industries, especially in emerging geographic markets.  

• Continue to deliver the highest quality products and solutions that enable our customers to achieve their operating objectives.  We believe that our high quality and technical expertise differentiates us from our competitors and allows us to win new orders based on value.

In order to effectively implement our strategy, we also believe that we must continue to invest in and leverage our unique value enhancing differentiators, including:

• Invest in engineering resources and technology in order to advance our vacuum and heat transfer technology market penetration.

• Enhance our engineering capacity and capability, especially in connection with product design, in order to more quickly respond to existing and future customer demands and opportunities.  

• Invest in our manufacturing operations to improve productivity where needed and identify out-sourced capacity to complement our growth strategies.

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• Accelerate our ability to quickly and efficiently bid on available projects through our ongoing implementation of front-end bid automation and design processes.

• Invest in resources to further serve the U.S. Navy in our core competency areas of engineering and manufacturing, where our commercial capabilities meet U.S. Navy requirements.

• Implement and expand upon our operational efficiencies through ongoing refinement of our flexible manufacturing flow model as well as achievement of other cost efficiencies.  

• Focus on improving quality to eliminate errors and rework, thereby reducing lead time and enhancing productivity.

• Further develop a cross-trained, flexible workforce able to adjust to variable product demands by our customers.

COVID-19 Pandemic Impact

               In March 2020, the outbreak of COVID-19 was declared a global pandemic.  The COVID-19 pandemic began affecting our business, our customers’ businesses, and the markets we serve in the fourth quarter of our fiscal 2020.  Additionally, the COVID-19 pandemic has impacted the already volatile oil industry and markets.  The pandemic has impacted both our capital equipment sales as well as our short cycle business.

             Our proactive measures in response to the COVID-19 pandemic included approximately three weeks of limited production at our facility in Batavia, New York beginning in late March 2020.  As of June 2020, we are nearing our pre-COVID-19 pandemic headcount in our factory, subject to numerous new health and safety protocols as recommended by our federal and local authorities, including requiring appropriate personal protective equipment to be worn by everyone onsite, social distancing markers, staggered employee breaks and meetings to reduce group gatherings, expanded hygiene practices, and barriers as appropriate to separate workers based on our plant layout configuration.  We have deployed numerous laptop computers to our sales, engineering, quality, supply chain, finance, and administrative personnel to facilitate remote work.  We are limiting external visitors to our Batavia facility and those few that are being allowed must be pre-approved.  As we have and continue to implement pandemic response measures, workforce safety and employee well-being continue to be top priorities and we remain committed to the service of our customers and suppliers.  For further information on the risks posed to our business from the COVID-19 pandemic, see Item 1A - Risk Factors below, and our discussion of COVID-19 throughout this report.

Competition

Our business is highly competitive.  The principal bases on which we compete include technology, price, performance, reputation, delivery, and quality.  Our competitors listed in alphabetical order by market include:

North America
Market	Principal Competitors
Refining vacuum distillation	Croll Reynolds Company, Inc.; Gardner Denver, Inc.; GEA Wiegand GmbH
Chemicals/petrochemicals	Croll Reynolds Company, Inc.; Gardner Denver, Inc.; Schutte Koerting
Turbomachinery Original Equipment Manufacturer ("OEM") – refining, petrochemical	Donghwa Entec Co., Ltd.; KEMCO; Oeltechnik GmbH
Turbomachinery OEM – power and power producer	Holtec; KEMCO; Maarky Thermal Systems; Thermal Engineering International (USA), Inc.
Navy Nuclear Propulsion Program / Defense	DC Fabricators; Joseph Oat; PCC; Triumph Aerospace; Xylem

international
Market	Principal Competitors
Refining vacuum distillation	Edwards, Ltd.; Gardner Denver, Inc.; GEA Wiegand GmbH; Korting Hannover AG
Chemicals/petrochemicals	Croll Reynolds Company, Inc.; Edwards, Ltd.; Gardner Denver, Inc.; GEA Wiegand GmbH; Korting Hannover AG; Schutte Koerting

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Turbomachinery OEM – refining, petrochemical	Chem Process Systems; Donghwa Entec Co., Ltd.; Hangzhou Turbine Equipment Co., Ltd.; KEMCO; Mazda (India);  Oeltechnik GmbH
Turbomachinery OEM – power and power producer	Chem Process Systems; Holtec; KEMCO; Mazda (India); SPX Heat Transfer; Thermal Engineering International

Intellectual Property

Our success depends in part on our ability to protect our proprietary technologies.  We rely on a combination of patent, copyright, trademark, trade secret laws and contractual confidentiality provisions to establish and protect our proprietary rights.  We also depend heavily on the brand recognition of the Graham name in the marketplace.

Availability of Raw Materials

Historically, we have not been materially adversely impacted by the availability of raw materials.

Working Capital Practices

Our business does not require us to carry significant amounts of inventory or materials beyond what is needed for work in process.  We negotiate progress payments from our customers on our large projects to finance costs incurred.  We do not provide rights to return goods, or payment terms to customers that we consider to be extended in the context of the industries we serve.  We do provide for warranty claims.

Environmental Matters

We believe that we are in material compliance with applicable existing environmental laws and regulations.  We do not anticipate that our compliance with federal, state and local laws regulating the discharge of material in the environment or otherwise pertaining to the protection of the environment will have a material adverse effect upon our capital expenditures, earnings or competitive position.

Seasonality

No material part of our business is seasonal in nature.  However, our business is highly cyclical in nature as it depends on the willingness of our customers to invest in major capital projects.

Research and Development Activities

During fiscal 2020, fiscal 2019 and the fiscal year ended March 31, 2018, we spent $3,353, $3,538 and $3,211, respectively, on research and development (R&D) activities.  The majority of our R&D is application specific to help solve our customers’ problems in order to improve efficiencies, address challenging environments or caustic materials, or redesign for form and function.  We may be engineering new products and services for our customers.  We also continually look to improve existing products and services.

Employees

As of March 31, 2020, we had 337 employees.  We believe that our relationship with our employees is good.

Available Information

We maintain a website located at www.graham-mfg.com. On our website, we provide a link to the Securities and Exchange Commission’s (the "SEC") website that contains the reports, proxy statements and other information we file electronically.  We do not provide this information on our website because it is more cost effective for us to provide a link to the SEC's website.  Printed copies of all documents we file with the SEC are available free of charge for any stockholder who makes a request.  Such requests should be made to our Corporate Secretary at our corporate headquarters.  The other information found on our website is not part of this or any other report we file with, or furnish to, the SEC.

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Item 1A.       Risk Factors

Our business and operations are subject to numerous risks, many of which are described below and elsewhere in this Annual Report on Form 10-K.  If any of the events described below or elsewhere in this Annual Report on Form 10-K occur, our business and results of operations could be harmed.  Additional risks and uncertainties that are not presently known to us, or which we currently deem to be immaterial, could also harm our business and results of operations.

Risks related to the impact of the COVID-19 pandemic:

Our business, financial condition and results of operations have been and may continue to be adversely affected by global public health pandemics, including the recent COVID-19 pandemic.

Our business, financial condition and results of operations have been and may continue to be adversely affected if the COVID-19 pandemic, or another global health crisis, impacts our employees, suppliers, customers, financing sources or others’ ability to conduct business or negatively affects consumer and business confidence or the global economy. The COVID-19 health crisis has affected large segments of the global economy, including the markets we operate in. The COVID-19 pandemic began affecting our business in the fourth quarter of fiscal 2020.  In response to the COVID-19 pandemic, beginning in late March 2020, we had limited production at our facility in Batavia, New York, with only a small staff present, which significantly reduced our production capabilities for approximately three weeks.  As of June 2020, we are now nearing the pre-COVID-19 headcount of our production workforce and have applied numerous new health and safety protocols for those working onsite.

The pandemic and any additional preventative or protective actions that governments or we may take in response to the COVID-19 pandemic may have a material adverse effect on our business or our suppliers, distribution channels, and customers, including business shutdowns or disruptions for an indefinite period of time, reduced operations, restrictions on shipping, fabricating or installing products, reduced consumer demand or customers’ ability to make payments.  We have and may continue to experience additional operating costs due to increased challenges with our workforce (including as a result of illness, absenteeism or government orders), implementing further precautionary measures to protect the health of our workforce, increased project cancellations or projects put on hold, access to supplies, capital, and fundamental support services (such as shipping and transportation).  Any resulting financial impact cannot be fully estimated at this time, but may materially affect our business, financial condition or results of operations.  The extent to which the COVID-19 pandemic affects our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain the pandemic or treat its impact, among others.

The impact of the COVID-19 pandemic may also exacerbate other risks discussed in this Item 1A - Risk Factors, any of which could have a material adverse effect on us.  The situation surrounding the COVID-19 pandemic and its impact is changing rapidly and additional impacts may arise that we are presently unaware of.

The COVID-19 pandemic may disrupt and cause delays in our supply chains, and such disruptions could adversely affect our results of operations and financial performance.

The raw materials that we source come from a wide variety of domestic and international suppliers. Global sourcing of many of the products we sell is an important factor in our financial results.  It is possible that the ongoing COVID-19 pandemic could cause a disruption in our supply chain.  If that supply chain is disrupted for an extended period of time, including due to the COVID-19 pandemic or another global health crisis, our ability to meet customer requirements and achieve our financial performance may be affected.  We cannot at this time predict the impact of the COVID-19 pandemic on our supply chain, but we are maintaining ongoing communications with our suppliers to monitor their status.  Any disruption to our supply chain could negatively impact our operations and financial performance.

Disruption to the global oil markets and resulting substantial price decline, including from the impact of the COVID-19 pandemic, could adversely affect our customers’ and our own results of operations and financial performance.

Our business, consolidated results of operations and financial condition, or that of our customers, may be adversely affected by significant decreases in demand for oil resulting from global restrictions on travel, work from home practices, and the significant reduction in industrial and commercial activity, or an increase in operating costs as a result of the global business disruption resulting from the COVID-19 pandemic or that may result from a future global health crisis.  Global oil markets have recently experienced significant volatility and dramatic decreases in prices due to decreased demand during the COVID-19 pandemic resulting from government-led “stay-at-home” orders and social distancing initiatives and a geopolitical imbalance of supply.  Demand for some of our products is dependent on the level of expenditures by our customers in the oil and gas industry.  Accordingly, continued volatility or downturns in the oil markets, and potential project cancellations, could materially and adversely impact our financial condition or results of operations.

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The COVID-19 pandemic may impact businesses differently across various regions.

We operate and compete globally. The response to the COVID-19 pandemic by domestic and foreign governments has been and may continue to be varied and those differences may impact our competitiveness.  Our operating subsidiaries are located in China and India, and those countries’ responses to the COVID-19 pandemic have varied from the United States’ response.  There are uncertain political climates in the regions where our subsidiaries operate, and governmental action in those regions may result in the temporary closure or limited operations of our subsidiaries.  Government assistance during a pandemic may also differ between private and public companies, which may provide an advantage to one compared with another.  This may affect our competitive position and could disrupt the market access and success of our business compared with other current or new competitors.  This impact could have a material adverse impact on our financial condition or results of operation.

COVID-19 disruption could impact our management team due to illness from the pandemic.

Our business has specialized management, technical and sales personnel who may become unavailable for an extended period or lost due to the effect of COVID-19 or another pandemic.  The COVID-19 pandemic may significantly disrupt our workforce if a significant percentage of our employees are unable to work due to illness or quarantines.  In addition, COVID-19-related illness could impact members of our Board of Directors, resulting in absenteeism from meetings of the directors or committees of directors, making it more difficult to convene the quorums of the full Board of Directors or its committees needed to conduct meetings for the management of our affairs.  Any of the loss of personnel or disruption in management as described above could have a material adverse impact on our business and results of operations.

Risks related to our business:

The markets we serve include the petroleum refining and petrochemical industries. These industries are both highly cyclical in nature and dependent on the prices of crude oil and natural gas as well as on the differential between the two prices.  As a result, volatility in the prices of oil and natural gas may negatively impact our operating results.

A substantial portion of our revenue is derived from the sale of our products to companies in the chemical, petrochemical, and petroleum refining industries, or to firms that design and construct facilities for these industries.  These industries are highly cyclical and have historically experienced severe downturns.  The prices of crude oil and natural gas have historically been very volatile, as evidenced by the extreme volatility in oil prices over the past few years and, in particular, the recent volatility related to the COVID-19 pandemic.  During times of significant volatility in the market for crude oil or natural gas, our customers often refrain from placing orders until the market stabilizes and future demand projections are clearer. If our customers refrain from placing orders with us, our revenue would decline and there could be a material adverse effect on our business and results of operations.  We believe that over the long-term, demand for our products will expand in the petrochemical, petroleum refining and power generating industries.  A sustained deterioration in any of the industries we serve would materially harm our business and operating results because our customers would not likely have the resources necessary to purchase our products, nor would they likely have the need to build additional facilities or improve existing facilities.  As we have seen in the recent past, a cyclical downturn can occur suddenly and result in extremely different financial performance sequentially from quarter to quarter or on an annual comparative basis due to an inability to rapidly adjust costs.

The relative costs of oil, natural gas, nuclear power, hydropower and numerous forms of alternative energy production may have a material adverse impact on our business and operating results.

Global and regional energy supply comes from many sources, including oil, natural gas, coal, hydro, nuclear, solar, wind, geothermal and biomass, among others.  A cost or supply shift among these sources could negatively impact our business opportunities going forward and the profitability of those opportunities.  A demand shift, where technological advances favor the utilization of one or a few sources of energy may also impact the demand for our products.  If demand shifts in a manner that increases energy utilization outside of our traditional customer base or expertise, our business and financial results could be materially adversely affected.  In addition, governmental policy can affect the relative importance of various forms of energy sources.  For example, non-fossil based sources may require and often receive government tax incentives to foster investment.  If these incentives become more prominent, our business and results of operations could suffer.

A transition toward different types of energy may have a material adverse impact on our business and operating results.

Changes in consumer demand, including some driven by governmental and political preferences, toward electric, compressed natural gas, hydrogen vehicles and other alternative energy may impact our business.  We have products which can support certain technologies, while other technologies will not require our equipment.  A significant change in demand for oil based products may have a material adverse impact on our business.

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Our business is highly competitive.  If we are unable to successfully implement our business strategy and compete against entities with greater resources than us or against competitors who have a relative cost advantage, we risk losing market share to current and future competitors.

We encounter intense competition in all of our markets.  Some of our present and potential competitors may have substantially greater financial, marketing, technical or manufacturing resources.  Our competitors may also be able to respond more quickly to new technologies or processes and changes in customer demands and they may be able to devote greater resources towards the development, promotion and sale of their products.  Certain competitors may also have a cost advantage compared to us due to their geography or changes in relative currency values and may compete against us based on price.  This may affect our ability to secure new business and maintain our level of profitability.  In addition, our current and potential competitors may make strategic acquisitions or establish cooperative relationships among themselves or with third parties that increase their ability to address the needs of our customers.  Moreover, customer buying patterns can change if customers become more price sensitive and accepting of lower cost suppliers.  If we cannot compete successfully against current or future competitors, our business will be materially adversely affected.

A change in our end use customers, our markets, or a change in the engineering procurement and construction companies serving our markets could harm our business and negatively impact our financial results.

Although we have long-term relationships with many of our end use customers and with many engineering, procurement and construction companies, the project management requirements, pricing levels and costs to support each customer and customer type are often different.  Our customers have historically focused on the quality of the engineering and product solutions which we have provided to them.  As our markets continue to grow, and new market opportunities expand, we could see a shift in pricing as a result of facing competitors with lower production costs, which may have a material adverse impact on our results of operations and financial results.  Because our customers are unable to predict the length of the time period for the economic viability of their plants, there has been more of a focus on relative importance of cost versus quality which looks at short-term costs instead of total long-term cost of operations.

A change in the structure of our markets; the relationships between engineering and procurement companies, original equipment suppliers, others in the supply chain and any of their relationships with the end users could harm our business and negatively impact our financial results.

There are strong and long-standing relationships throughout the supply chain between the many parties involved in serving the end user of our products.  A change in the landscape between engineering and procurement companies, original equipment suppliers, others in the supply chain, including disruptions in the supply chain due to the COVID-19 pandemic, and/or with the end users could have a material adverse effect on our business and results of operations.  These changes might occur through acquisitions or other business partnerships and could have a material impact on our business and negatively impact our financial results.

The loss of, or significant reduction or delay in, purchases by our largest customers could reduce our revenue and adversely affect our results of operations.

While we may have only one customer represent over 10% of revenue in any one year, a small number of customers have accounted for a substantial portion of our historical net sales. For example, sales to our top ten customers, who can vary each year, accounted for 48%, 41% and 41% of consolidated net sales in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. We expect that a limited number of customers will continue to represent a substantial portion of our sales for the foreseeable future. The loss of any of our major customers, a decrease or delay in orders or anticipated spending by such customers, or a delay in the production of existing orders could materially adversely affect our revenues and results of operations.

We may experience customer concentration risk related to strategic growth for U.S. Navy projects.

We believe our strategy to increase the penetration of U.S. Navy related opportunities may lead to U.S. Navy related projects consistently being greater than 10% of our total revenue.  While these projects are spread across multiple contractors for the U.S. Navy, the end customer for these projects is the same.  This concentration of business could add additional risk to us should there be a disruption, short or long term, in the funding for these projects or our participation in the U.S. Navy Nuclear Propulsion program.

The size of our contracts with the U.S. Navy may produce volatility over the short term financial results.

We believe our strategy to increase the penetration of U.S. Navy related opportunities, which are often much larger contracts than our commercial contracts, may impact our ability to effectively provide accurate investor guidance for our near term financial results.  These contracts can, on occasion, be delayed before or during the revenue recognition cycle.  If we are unable to reallocate the resources to other projects, we may see an increase in unpredictable (greater) volatility in our near term financial results.

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A large percentage of our sales occur outside of the U.S. As a result, we are subject to the economic, political, regulatory and other risks of international operations.

For fiscal 2020, 36% of our revenue was from customers located outside of the U.S.  Moreover, through our subsidiaries, we maintain a sales office in China and a sales and market development office in India.  We believe that revenue from the sale of our products outside the U.S. will continue to account for a significant portion of our total revenue for the foreseeable future.  We intend to continue to expand our international operations to the extent that suitable opportunities become available.  Our foreign operations and sales could be adversely affected as a result of:

• nationalization of private enterprises and assets;

• political or economic instability in certain countries and regions, such as the ongoing instability throughout the Middle East and/or portions of the former Soviet Union;

• the global economic impact as a result of the COVID-19 pandemic

• political relationships between the U.S. and certain countries and regions;

• differences in foreign laws, including difficulties in protecting intellectual property and uncertainty in enforcement of contract rights;

• the possibility that foreign governments may adopt regulations or take other actions that could directly or indirectly harm our business and growth strategy;

• credit risks;

• currency fluctuations;

• tariff and tax increases;

• export and import restrictions and restrictive regulations of foreign governments;

• shipping products during times of crisis or war;

• our failure to comply with U.S. laws regarding doing business in foreign jurisdictions, such as the Foreign Corrupt Practices Act; or

• other factors inherent in maintaining foreign operations.

The impact of potential changes in customs and trade policies and tariffs imposed by the U.S. and those imposed in response by other countries, including China, as well as rapidly changing trade relations, could materially and adversely affect our business and results of operations.

The U.S. government has made proposals that are intended to address trade imbalances, which include encouraging increased production in the United States. These proposals could result in increased customs duties and the renegotiation of some U.S. trade agreements.  Changes in U.S. and foreign governments’ trade policies have resulted and may continue to result in tariffs on imports into, and exports from, the U.S.  Over the past few years, the U.S. imposed tariffs on imports from several countries, including China, Canada, the European Union and Mexico. In response, China, Canada and the European Union have proposed or implemented their own tariffs on certain exports from the U.S. into those countries. Tariffs affecting our products and product components, including raw materials we use, particularly high-end steel and steel related products, may add significant costs to us and make our products more expensive. As a result, our products could become less attractive to customers outside the U.S. due to U.S. import tariffs on our raw materials and our profit margins would be negatively impacted.  Accordingly, continued tariffs may weaken relationships with certain trading partners and may adversely affect our financial performance and results of operations.  When beneficial to us, we may consider alternate sourcing options, including off shore subcontracting, in order to minimize the impact of the tariffs.  Because we conduct aspects of our business in China through our subsidiary, potential reductions in trade with China and diminished relationships between China and the U.S., including as a result of the recent COVID-19 pandemic, as well as the continued escalation of tariffs, could have a material adverse effect on our business and results of operations.

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Global demand growth could be led by emerging markets, which could result in lower profit margins and increased competition.

The increase in global demand could be led by emerging markets.  If this is the case, we may face increased competition from lower cost suppliers, which in turn could lead to lower profit margins on our products. Customers in emerging markets may also place less emphasis on our high quality and brand name than do customers in the U.S. and certain other industrialized countries where we compete. If we are forced to compete for business with customers that place less emphasis on quality and brand recognition than our current customers, our results of operations could be materially adversely affected.

Climate change and greenhouse gas regulations may affect our customers’ investment decisions.

Due to concern over the risk of climate change, a number of countries have adopted, or are considering the adoption of, regulatory frameworks to reduce greenhouse gas emissions.  These restrictions may affect our customers' abilities and willingness to invest in new facilities or to re-invest in current operations.  These requirements could impact the cost of our customers’ products, lengthen project implementation times, and reduce demand for hydrocarbons, as well as shift hydrocarbon demand toward lower-carbon sources.  Any of the foregoing could adversely impact the demand for our products, which in turn could have an adverse effect on our business and results of operations.  

The operations of our Chinese subsidiary may be adversely affected by China’s evolving economic, political and social conditions.

We conduct our business in China primarily through our wholly-owned Chinese subsidiary.  The results of operations and future prospects of our Chinese subsidiary may be adversely affected by, among other things, changes in China's political, economic and social conditions, including as a result of the COVID-19 pandemic, changes in the relationship between China and its western trade partners, changes in policies of the Chinese government, changes in laws and regulations or in the interpretation of existing laws and regulations, changes in foreign exchange regulations, measures that may be introduced to control inflation, such as interest rate increases and changes in the rates or methods of taxation.  In addition, changes in demand could result from increased competition from local Chinese manufacturers who have cost advantages or who may be preferred suppliers for Chinese end users.  Also, Chinese commercial laws, regulations and interpretations applicable to non-Chinese owned market participants, such as us, are continually changing. These laws, regulations and interpretations could impose restrictions on our ownership or the operation of our interests in China and have a material adverse effect on our business and results of operations.  

Intellectual property rights are difficult to enforce in China and India, which could harm our business.

Chinese commercial law is relatively undeveloped compared with the commercial law in many of our other major markets and limited protection of intellectual property is available in China as a practical matter.  Similarly, proprietary information may not be afforded the same protection in India as it is in our other major markets with more comprehensive intellectual property laws.  Although we take precautions in the operations of our subsidiaries to protect our intellectual property, any local design or manufacture of products that we undertake could subject us to an increased risk that unauthorized parties will be able to copy or otherwise obtain or use our intellectual property, which could harm our business.  We may also have limited legal recourse in the event we encounter patent or trademark infringers, which could have a material adverse effect on our business and results of operations.

Uncertainties with respect to the Chinese legal system may adversely affect the operations of our Chinese subsidiary.

Our Chinese subsidiary is subject to laws and regulations applicable to foreign investment in China.  There are uncertainties regarding the interpretation and enforcement of laws, rules and policies in China.  The Chinese legal system is based on written statutes, and prior court decisions have limited precedential value.  Because many laws and regulations are relatively new and the Chinese legal system is still evolving, the interpretations of many laws, regulations and rules are not always uniform.  Moreover, the relative inexperience of China's judiciary in many cases creates additional uncertainty as to the outcome of any litigation, and the interpretation of statutes and regulations may be subject to government policies reflecting domestic political agendas.  Finally, enforcement of existing laws or contracts based on existing law may be uncertain and sporadic.  For the preceding reasons, it may be difficult for us to obtain timely or equitable enforcement of laws ostensibly designed to protect companies like ours, which could have a material adverse effect on our business and results of operations.  

Regulation of foreign investment in India may adversely affect the operations of our Indian subsidiary.

Our subsidiary in India is subject to laws and regulations applicable to foreign investment in India.  India regulates ownership of Indian companies by foreign entities.  These regulations may apply to our funding of our Indian operating subsidiary.  For example, the government of India has set out criteria for foreign investments in India, including requirements with respect to downstream investments by Indian companies owned or controlled by foreign entities and the transfer of ownership or control of Indian companies in certain industries.  These requirements may adversely affect our ability to operate our Indian subsidiary. There can be no assurance that we will be able to obtain any required approvals for future acquisitions, investments or operations in India, or that we will be able to obtain such approvals on satisfactory terms.

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Changes in U.S. and foreign energy policy regulations could adversely affect our business.

Energy policy in the U.S. and in the other countries where we sell our products is evolving rapidly and we anticipate that energy policy will continue to be an important legislative priority in the jurisdictions where we sell our products. It is difficult, if not impossible, to predict the changes in energy policy that could occur, as they may be related to changes in political administration, public policy or other factors. The elimination of, or a change in, any of the current rules and regulations in any of our markets could create a regulatory environment that makes our end users less likely to purchase our products, which could have a material adverse effect on our business.  Government subsidies or taxes, which favor or disfavor certain energy sources compared with others, could have a material adverse effect on our business and operating results.

Efforts to reduce large U.S. federal budget deficits could result in government cutbacks or shifts in focus in defense spending or in reduced incentives to pursue alternative energy projects, resulting in reduced demand for our products, which could harm our business and results of operations.

Our business strategy calls for us to continue to pursue defense-related projects as well as projects for end users in the alternative energy markets in the U.S.  In recent years, the U.S. federal government has incurred large budget deficits. In the event that U.S. federal government defense spending is reduced or alternative energy related incentives are reduced or eliminated in an effort to reduce federal budget deficits, projects related to defense or alternative energy may become less plentiful. The impact of such reductions could have a material adverse effect on our business and results of operations, as well as our growth opportunities.

U.S. Navy orders are subject to annual government funding.  A disruption in funding could adversely impact our business.

One of our growth strategies is to increase our penetration of U.S. Navy-related opportunities.  Projects for the U.S. Navy and its contractors generally have a much longer order-to-shipment time period than our commercial orders.  The time between the awarding of an order to the completion of shipment can take three to seven years.  Annual government funding is required to continue the production of this equipment.  Disruption of government funding, short or long term, could impact the ability for us to continue our production activity on these orders.  For example, the recent emergency spending bills related to the COVID-19 pandemic could compound the uncertainty already present in government funded programs.  Since this business is expected to increase as a percentage of our overall business, such a disruption, should it occur, could adversely impact the sales and profitability of our business.

Changes in the competitive environment for U.S. Navy procurement could adversely impact our ability to grow this portion of our business.

Over the past few years, we have expanded our business and the opportunities where we bid related to U.S. Navy projects.  This has increased our market share and caused an adverse share position for some of our competitors for these products.  Competitor response to our market penetration is possible.  Our customers may also raise concerns about their supplier concentration issues and the risk exposure related to this concentration.  As the U.S. Navy is looking to expand its fleet, there is also a risk that their facilities, their supply chain or our supply chain for raw materials, may not be able to support this expansion.  This could adversely impact our ability to grow this portion of our business.  

Contract liabilities for large U.S. Navy contracts may be beyond our normal insurance coverage and a claim could have an adverse impact on our financial results.

We are diligent at managing ongoing risks related to projects and the requirements of our customers.  Our history at managing risk provides significant evidence that our exposure and risk are minimal.  In addition, we secure business insurance coverage to minimize the impact of a major failure or liability related to our customers.  Due to certain U.S. government procurement policies, we may take on the risk of a liability for large U.S. Navy projects in excess of our insurance coverage and at a level which is higher than our commercial projects.  A claim related to one of these projects could have an adverse impact on our financial results.

New technology used by the ships for the U.S. Navy may delay projects and may impact our ability to grow this portion of our business.

Certain U.S. Navy vessels are implementing new technologies, unrelated to any of the equipment that we provide.  If there is a complication or delay to any ship caused by this new technology, it may delay the procurement and fabrication of future vessels, which could have a negative impact on our business.

Lapses in U.S. government appropriations have, and any future lapses could disrupt U.S. export processing and related procedures and, as a result, may materially and adversely affect our revenue, results of operations and business.

Recently, the U.S. experienced lapses in federal appropriations, which have had, in the past, a short-term effect on our business.  Any such future lapse (each, a "Government Shutdown") could negatively affect our ability to ship finished products to customers. We rely on federal government personnel, who are not able to perform their duties during a Government Shutdown, to conduct routine business processes related to the inspection and delivery of our products, process export licenses for us and perform other services for us that, when disrupted, may prevent us from timely shipping products outside the U.S. If we are unable to timely

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ship our products outside the U.S., there could be a material adverse impact on our results of operations and business. Moreover, our inability to ship products, or the perception by customers that we might not be able to timely ship our products in the future, may cause such customers to look to foreign competitors to fulfill their demand. If our customers look to foreign competitors to source equipment of the type we manufacture, there could be a material adverse impact on our results of operations and business.

Near-term income statement impact from competitive contracts could adversely affect our operating results.

During weaker market periods, we may choose to be more aggressive in pricing certain competitive projects to protect or gain market share or to increase the utilization of our facilities.  In these situations, it is possible that an incrementally profitable order, while increasing contribution, may be unprofitable from an accounting perspective when including fixed manufacturing costs.  In these situations, we are required to recognize the financial loss at the time of order acceptance, or as soon as our cost estimates are updated, whichever occurs first.  It is possible we may accumulate losses either on a large project or more than one project such that, in a short time period, for example, a reporting quarter, these losses may have a meaningful impact on the earnings of the period.

Our operating results could be adversely affected by customer contract cancellations and delays.

The value of our backlog as of March 31, 2020 was $112,389.  Our backlog can be significantly affected by the timing of large orders.  The amount of our backlog at March 31, 2020 is not necessarily indicative of future backlog levels or the rate at which our backlog will be recognized as sales. Although historically the amount of modifications and terminations of our orders has not been material compared with our total contract volume, customers can, and sometimes do, terminate or modify their orders.  This generally occurs more often in times of end market or capital market turmoil.  As evidence of this, we had orders totaling $24,361 cancelled during the downturn between fiscal 2015 through fiscal 2017, but had no cancellations in fiscal years 2018 and 2019.  In fiscal year 2020, we had two cancellations totaling $3,165 and two projects on hold, totaling $562.  We cannot predict whether cancellations will occur or accelerate in the future, and the ongoing COVID-19 pandemic may increase the risk of such cancellations.  Although certain of our contracts in backlog may contain provisions allowing for us to assess cancellation charges to our customers to compensate us for costs incurred on cancelled contracts, cancellations of purchase orders or modifications made to existing contracts could substantially and materially reduce our backlog and, consequently, our future sales and results of operations. Moreover, delay of contract execution by our customers can result in volatility in our operating results.

Our current backlog contains a number of large orders from the U.S. Navy.  In addition, we are continuing to pursue business in this end market which offers large multi-year projects which have an added risk profile beyond that of our historic customer base.  A delay, long-term extension or cancellation of any of these projects could have a material adverse effect on our business and results of operations.

An extended downturn could adversely impact the financial stability of our customers and increase the risk of uncollectable accounts receivables.

Our customers participate in cyclical markets, such as petroleum refining, petrochemical and alternate energy.  The financial strength of our customers can be impacted by a severe or lengthy downturn in these markets, including any downturn related to the COVID-19 pandemic.  This could lead to additional risk in our ability to collect outstanding accounts receivables.  We attempt to mitigate this risk with the utilization of progress payments for many projects, but certain industries, end markets and geographies are not as willing to make progress payments.  Certain projects require a small portion of the total payments to be held until the customer's facility is fully operational, which can be in excess of one year beyond our delivery of equipment to them.  This additional time may add risk to our ability to collect on the outstanding accounts receivables.

Our exposure to fixed-price contracts and the timely completion of such contracts could negatively impact our results of operations.

A substantial portion of our sales is derived from fixed-price contracts, which may involve long-term fixed price commitments by us to our customers. While we believe our contract management processes are strong, we nevertheless could experience difficulties in executing large contracts, including but not limited to, estimating errors, cost overruns, supplier failures and customer disputes.  To the extent that any of our fixed-price contracts are delayed, our subcontractors fail to perform, contract counterparties successfully assert claims against us, the original cost estimates in these or other contracts prove to be inaccurate or the contracts do not permit us to pass increased costs on to our customers, our profitability may decrease or losses may be incurred which, in turn, could have a material adverse effect on our business and results of operations.  For our U.S. Navy projects, these fixed priced contracts have order to shipment periods which can exceed five years.  This additional time-based risk, which we believe is manageable, nevertheless increases the likelihood of cost fluctuation, which could have a material adverse effect on our business and results of operation.

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Given our size and specialization of our business, if we lose any member of our management team and we experience difficulty in finding a qualified replacement, our business could be harmed.

Competition for qualified management and key technical and sales personnel in our industry is intense.  Moreover, our technology is highly specialized, and it may be difficult to replace the loss of any of our key technical and sales personnel. Many of the companies with which we compete for management and key technical and sales personnel have greater financial and other resources than we do or are located in geographic areas which may be considered by some to be more desirable places to live.  If we are not able to retain any of our key management, technical or sales personnel, it could have a material adverse effect on our business and results of operations.  

During certain high demand periods, there can be a shortage of skilled production workers, especially those with high-end welding capabilities.  We could experience difficulty hiring or replacing those individuals, which could adversely affect our business.

Our fabrication processes require highly skilled production workers, especially welders.  Welding has not been an educational field that has been popular over the past few decades as manufacturing has moved overseas.  While we have an in-house weld training program, if we are unable to retain, hire or train an adequate number of individuals with high-end welding capability, this could adversely impact our ability to achieve our financial objectives.  In addition, if demand for highly skilled production workers were to significantly outstrip supply, wages for these skilled workers could dramatically increase in our and related industries and that could affect our financial performance.  Furthermore, should we not be able to expand our production workforce, we would expect to increase the amount of outsourced fabrication which is likely to result in higher costs and lower margins.  

Our acquisition strategy may not be successful or may increase business risk.

The success of our acquisition strategy will depend, in part, on our ability to identify suitable companies or businesses to purchase and then successfully negotiate and close acquisition transactions.  In addition, our success depends in part on our ability to integrate acquisitions and realize the anticipated benefits from combining the acquisition with our historical business, operations and management.  We cannot provide any assurances that we will be able to complete any acquisitions and then successfully integrate the business and operations of those acquisitions without encountering difficulties, including unanticipated costs, issues or liabilities, difficulty in retaining customers and supplier or other relationships, failure to retain key employees, diversion of our management’s attention, failure to integrate information and accounting systems or establish and maintain proper internal control over financial reporting.  Moreover, as part of the integration process, we must incorporate an acquisition’s existing business culture and compensation structure with our existing business.  We also need to utilize key personnel who may be distracted from the core business.  If we are not able to efficiently integrate an acquisition’s business and operations into our organization in a timely and efficient manner, or at all, the anticipated benefits of the acquisition may not be realized, or it may take longer to realize these benefits than we currently expect, either of which could have a material adverse effect on our business or results of operations.

If we become subject to product liability, warranty or other claims, our results of operations and financial condition could be adversely affected.

The manufacture and sale of our products exposes us to potential product liability claims, including those that may arise from failure to meet product specifications, misuse or malfunction of our products, design flaws in our products, or use of our products with systems not manufactured or sold by us.  For example, our equipment is installed in facilities that operate dangerous processes and the misapplication, improper installation or failure of our equipment may result in exposure to potentially hazardous substances, personal injury or property damage.

Provisions contained in our contracts with customers that attempt to limit our damages may not be enforceable or may fail to protect us from liability for damages and we may not negotiate such contractual limitations of liability in certain circumstances.  Our insurance may not cover all liabilities and our historical experience may not reflect liabilities we may face in the future.  Our risk of liability may increase as we manufacture more complex or larger projects.  We also may not be able to continue to maintain such insurance at a reasonable cost or on reasonable terms, or at all.  Any material liability not covered by provisions in our contracts or by insurance could have a material adverse effect on our business and financial condition.

Furthermore, if a customer suffers damage as a result of an event related to one of our products, even if we are not at fault, they may reduce their business with us. We may also incur significant warranty claims which are not covered by insurance. In the event a customer ceases doing business with us as a result of a product malfunction or defect, perceived or actual, or if we incur significant warranty costs in the future, there could be a material adverse effect on our business and results of operations.  

If third parties infringe upon our intellectual property or if we were to infringe upon the intellectual property of third parties, we may expend significant resources enforcing or defending our rights or suffer competitive injury.

Our success depends in part on our proprietary technology.  We rely on a combination of patent, copyright, trademark, trade secret laws and confidentiality provisions to establish and protect our proprietary rights.  If we fail to successfully enforce our intellectual property rights, our competitive position could suffer.  We may also be required to spend significant resources to monitor

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and police our intellectual property rights.  Similarly, if we were found to have infringed upon the intellectual property rights of others, our competitive position could suffer.  Furthermore, other companies may develop technologies that are similar or superior to our technologies, duplicate or reverse engineer our technologies or design around our proprietary technologies. Any of the foregoing could have a material adverse effect on our business and results of operations.

In some instances, litigation may be necessary to enforce our intellectual property rights and protect our proprietary information, or to defend against claims by third parties that our products infringe upon their intellectual property rights.  Any litigation or claims brought by or against us, whether with or without merit, could result in substantial costs to us and divert the attention of our management, which could materially harm our business and results of operations.  In addition, any intellectual property litigation or claims against us could result in the loss or compromise of our intellectual property and proprietary rights, subject us to significant liabilities, require us to seek licenses on unfavorable terms, prevent us from manufacturing or selling certain products or require us to redesign certain products, any of which could have a material adverse effect on our business and results of operations.  

We are subject to foreign currency fluctuations which may adversely affect our operating results.

We are exposed to the risk of currency fluctuations between the U.S. dollar and the currencies of the countries in which we sell our products to the extent that such sales are not based on U.S. dollars, and volatility in foreign currency exchange rates has generally increased in connection with the COVID-19 pandemic.  Currency movements can affect sales in several ways, the foremost being our ability to compete for orders against foreign competitors that base their prices on relatively weaker currencies.  Strength of the U.S. dollar compared with the Euro or Asian currencies may put us in a less competitive position.  At the outset of the COVID-19 pandemic, the U.S. dollar saw relative strengthening in relation to the Euro and Asian currencies, however, as the pandemic has continued, the relative strength of the U.S. dollar has increased in volatility.  Business lost due to competition for orders against competitors using a relatively weaker currency cannot be quantified.  In addition, cash can be adversely impacted by the conversion of sales made by us in a foreign currency to U.S. dollars.  While we may enter into currency exchange rate hedges from time to time to mitigate these types of fluctuations, we cannot remove all fluctuations or hedge all exposures and our earnings are impacted by changes in currency exchange rates.  In addition, if the counter-parties to such exchange contracts do not fulfill their obligations to deliver the contractual foreign currencies, we could be at risk for fluctuations, if any, required to settle the obligation.  Any of the foregoing could adversely affect our business and results of operations.  At March 31, 2020, we held no forward foreign currency exchange contracts.

Security threats and other sophisticated computer intrusions could harm our information systems, which in turn could harm our business and financial results.

We utilize information systems and computer technology throughout our business.  We store sensitive data, proprietary information and perform engineering designs and calculations on these systems.  Threats to these systems, and the laws and regulations governing security of data, including personal data, on information systems and otherwise held by companies is evolving and adding layers of complexity in the form of new requirements and increasing costs of attempting to protect information systems and data and complying with new cybersecurity regulations. Information systems are subject to numerous and evolving cybersecurity threats and sophisticated computer crimes, which pose a risk to the stability and security of our information systems, computer technology, and business.  Global cybersecurity threats can range from uncoordinated individual attempts to gain unauthorized access to our information systems and computer technology to sophisticated and targeted measures known as advanced persistent threats. The techniques used in these attacks change frequently and may be difficult to detect for periods of time and we may face difficulties in anticipating and implementing adequate preventative measures. A failure or breach in security could expose our company as well as our customers and suppliers to risks of misuse of information, compromising confidential information and technology, destruction of data, production disruptions and other business risks which could damage our reputation, competitive position and financial results of our operations.  Further, our technology resources may be strained due to the increase in the number of remote users in response to the COVID-19 pandemic.  In addition, defending ourselves against these threats may increase costs or slow operational efficiencies of our business.  If any of the foregoing were to occur, it could have a material adverse effect on our business and results of operations.

We face potential liability from asbestos exposure and similar claims that could result in substantial costs to us as well as divert attention of our management, which could have a material adverse effect on our business and results of operations.

We are a defendant in a number of lawsuits alleging illnesses from exposure to asbestos or asbestos-containing products and seeking unspecified compensatory and punitive damages. We cannot predict with certainty the outcome of these lawsuits or whether we could become subject to any similar, related or additional lawsuits in the future.  In addition, because some of our products are used in systems that handle toxic or hazardous substances, any failure or alleged failure of our products in the future could result in litigation against us.  For example, a claim could be made under various regulations for the adverse consequences of environmental contamination. Any litigation brought against us, whether with or without merit, could result in substantial costs to us as well as divert the attention of our management, which could have a material adverse effect on our business and results of operations.

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Many of our large international customers are nationalized or state-owned businesses.  Any failure to comply with the United States Foreign Corrupt Practices Act could adversely impact our competitive position and subject us to penalties and other adverse consequences, which could harm our business and results of operations.

We are subject to the United States Foreign Corrupt Practices Act, which generally prohibits U.S. companies from engaging in bribery or making other prohibited payments to foreign officials for the purpose of obtaining or retaining business.  Many foreign companies, including some of our competitors, are not subject to these prohibitions.  Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices occur from time-to-time in certain of the jurisdictions in which we may operate or sell our products.  While we strictly prohibit our employees and agents from engaging in such conduct and have established procedures, controls and training to prevent such conduct from occurring, it is possible that our employees or agents will engage in such conduct and that we might be held responsible. If our employees or other agents are alleged or are found to have engaged in such practices, we could incur significant costs and suffer severe penalties or other consequences that may have a material adverse effect on our business, financial condition and results of operations.

Provisions contained in our certificate of incorporation and bylaws could impair or delay stockholders' ability to change our management and could discourage takeover transactions that some stockholders might consider to be in their best interests.

Provisions of our certificate of incorporation and bylaws could impede attempts by our stockholders to remove or replace our management and could discourage others from initiating a potential merger, takeover or other change of control transaction, including a potential transaction at a premium over the market price of our common stock, that our stockholders might consider to be in their best interests.  Such provisions include:

• We could issue shares of preferred stock with terms averse to our common stock.  Under our certificate of incorporation, our Board of Directors is authorized to issue shares of preferred stock and to determine the rights, preferences and privileges of such shares without obtaining any further approval from the holders of our common stock.  We could issue shares of preferred stock with voting and conversion rights that adversely affect the voting power of the holders of our common stock, or that have the effect of delaying or preventing a change in control of our company.

• Only a minority of our directors may be elected in a given year.  Our bylaws provide for a classified Board of Directors, with only approximately one-third of our Board elected each year.  This provision makes it more difficult to effect a change of control because at least two annual stockholder meetings are necessary to replace a majority of our directors.

• Our bylaws contain advance notice requirements.  Our bylaws also provide that any stockholder who wishes to bring business before an annual meeting of our stockholders or to nominate candidates for election as directors at an annual meeting of our stockholders must deliver advance notice of their proposals to us before the meeting.  Such advance notice provisions may have the effect of making it more difficult to introduce business at stockholder meetings or nominate candidates for election as director.  

• Our certificate of incorporation requires supermajority voting to approve a change of control transaction.  Seventy-five percent of our outstanding shares entitled to vote are required to approve any merger, consolidation, sale of all or substantially all of our assets and similar transactions if the other party to such transaction owns 5% or more of our shares entitled to vote.  In addition, a majority of the shares entitled to vote not owned by such 5% or greater stockholder are also required to approve any such transaction.

• Amendments to our certificate of incorporation require supermajority voting.  Our certificate of incorporation contains provisions that make its amendment require the affirmative vote of both 75% of our outstanding shares entitled to vote and a majority of the shares entitled to vote not owned by any person who may hold 50% or more of our shares unless the proposed amendment was previously recommended to our stockholders by an affirmative vote of 75% of our Board.  This provision makes it more difficult to implement a change to our certificate of incorporation that stockholders might otherwise consider to be in their best interests without approval of our Board.  

• Amendments to our bylaws require supermajority voting.  Although our Board of Directors is permitted to amend our bylaws at any time, our stockholders may only amend our bylaws upon the affirmative vote of both 75% of our outstanding shares entitled to vote and a majority of the shares entitled to vote not owned by any person who owns 50% or more of our shares.  This provision makes it more difficult for our stockholders to implement a change they may consider to be in their best interests without approval of our Board.

Item 1B. Unresolved Staff Comments

Not applicable.

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Item 2. Properties

Our corporate headquarters, located at 20 Florence Avenue, Batavia, New York, consists of a 45,000 square foot building.  Our manufacturing facilities, also located in Batavia, consist of approximately 33 acres and contain about 260,000 square feet in several buildings, including 206,000 square feet in manufacturing facilities, 48,000 square feet for warehousing and a 6,000 square-foot building for product research and development.  Additionally, we lease an approximately 1,500 square foot U.S. sales office in Houston, Texas and GVHTT leases an approximately 4,900 square foot sales and engineering office in Suzhou, China.  In fiscal 2019, the Company established Graham India Private Limited ("GIPL") as a wholly-owned subsidiary.  GIPL, located in Ahmedabad, India, serves as a sales and market development office focusing on the refining, petrochemical and fertilizer markets.  We lease a sales and marketing office of approximately 777 square feet in Ahmedabad, India.

We believe that our properties are generally in good condition, are well maintained, and are suitable and adequate to carry on our business.

Item 3.Legal Proceedings

The information required by this Item 3 is contained in Note 18 to our consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K and is incorporated herein by reference.

Item 4.    Mine Safety Disclosures

Not applicable.  

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PART II

(Amounts in thousands, except per share data)

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our common stock is traded on the NYSE exchange under the symbol "GHM".  As of June 1, 2020, there were 9,855,963shares of our common stock outstanding that were held by approximately 134 stockholders of record.

Subject to the rights of any preferred stock we may then have outstanding, the holders of our common stock are entitled to receive dividends as may be declared from time to time by our Board of Directors out of funds legally available for the payment of dividends.  Our Board of Directors declared dividends per share of $0.10 for the first quarter of fiscal 2020and $0.11 in each of the second, third and fourth quarters of fiscal 2020.  While we anticipate that we will continue to pay quarterly cash dividends in the future, there can be no assurance that we will pay such dividends in any future period or that the level of cash dividends paid by us will remain constant.

Our senior credit facility contains provisions pertaining to the maintenance of a maximum funded debt to earnings before interest expense, income taxes, depreciation and amortization, or EBITDA, ratio and a minimum level of earnings before interest expense and income taxes to interest ratio as well as restrictions on the payment of dividends to stockholders.  The facility limits the payment of dividends to stockholders to 25% of net income if our funded debt to EBITDA ratio is greater than 2.0 to 1.  As of March 31, 2020 and May 31, 2020 we did not have any funded debt outstanding.  More information regarding our senior credit facility can be found in Note 9 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K.

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Item 6. Selected Financial Data

GRAHAM CORPORATION – FIVE YEAR SUMMARY OF SELECTED FINANCIAL DATA

(Amounts in thousands, except per share data)

(for fiscal years ended March 31)

	2020			2019			2018			2017			2016
Operations:
Net sales	$	90,604		$	91,831		$	77,534		$	91,769		$	90,039
Gross profit		18,148			21,909			16,975			22,157			23,255
Gross profit percentage		20.0	%		23.9	%		21.9	%		24.1	%		25.8	%
Net income (loss)(1)		1,872			(308	)		(9,844	)		5,023			6,131
Cash dividends		4,250			3,834			3,517			3,492			3,296
Common stock:
Basic earnings (loss) from continuing operations per share	$	0.19		$	(0.03	)	$	(1.01	)	$	0.52		$	0.61
Diluted earnings (loss) from continuing operations per share		0.19			(0.03	)		(1.01	)		0.52			0.61
Stockholders' equity per share		9.79			10.05			10.58			11.72			11.34
Dividends declared per share		0.43			0.39			0.36			0.36			0.33
Market price range of common stock
High		23.77			28.98			24.03			24.99			25.25
Low		11.07			19.00			17.97			17.11			14.39
Average common shares outstanding – diluted		9,879			9,823			9,764			9,728			9,983
Financial data at March 31:
Cash and cash equivalents and investments	$	73,003		$	77,753		$	76,479		$	73,474		$	65,072
Working capital		77,443			79,896			78,105			78,688			74,807
Capital expenditures		2,417			2,138			2,051			325			1,153
Depreciation		1,957			1,968			1,986			2,092			2,201
Total assets		148,120			156,270			143,333			151,570			143,131
Long-term debt, including capital lease obligations		55			95			55			143			157
Stockholders' equity		96,724			98,966			103,349			114,110			109,380

⁽¹⁾  Net (loss) income in fiscal 2019 includes a loss from goodwill and other impairments of $5,320, which is net of an income tax benefit of $1,129.  Net (loss) income in fiscal 2018 includes a loss from impairment of goodwill and intangible assets of $12,014, which is net of an income tax benefit of $2,802.

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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

                                                         (Amounts in thousands, except per share data)

Overview

We are a global business that designs, manufactures and sells critical equipment for the energy, defense and chemical/petrochemical industries.  Our energy markets include oil refining, cogeneration, and alternative power.  For the defense industry, our equipment is used in nuclear propulsion power systems for the U.S. Navy.  For the chemical and petrochemical industries, our equipment is used in fertilizer, ethylene, methanol and downstream chemical facilities.

Graham's global brand is built upon our world-renowned engineering expertise in vacuum and heat transfer technology, responsive and flexible service and high quality standards.  We design and manufacture custom-engineered ejectors, vacuum pumping systems, surface condensers and vacuum systems.  Our equipment can also be found in other diverse applications such as metal refining, pulp and paper processing, water heating, refrigeration, desalination, food processing, pharmaceutical, and heating, ventilating and air conditioning.

Our corporate headquarters are located in Batavia, New York.  We have production facilities co-located with our headquarters in Batavia.  We also have wholly-owned foreign subsidiaries, Graham Vacuum and Heat Transfer Technology (Suzhou) Co., Ltd. ("GVHTT"), located in Suzhou, China and Graham India Private Limited ("GIPL"), located in Ahmedabad, India.  GVHTT provides sales and engineering support for us in the People's Republic of China and management oversight throughout Southeast Asia.  GIPL serves as a sales and market development office focusing on the refining, petrochemical and fertilizer markets.

On June 24, 2019, we sold our wholly-owned subsidiary, Energy Steel & Supply Co. ("Energy Steel"), located in Lapeer, Michigan, which served the commercial nuclear utility industry.  

This management's discussion and analysis of financial condition and results of operations for the fiscal year ended March 31, 2020 omits a comparative discussion regarding the fiscal year ended March 31, 2018.  Such information is located in Item 7 – Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the fiscal year ended March 31, 2019.  

Key Results

Key results for our fiscal year ended March 31, 2020, which we refer to as "fiscal 2020" include:

• Net sales for fiscal 2020 were $90,604, down 1% compared with $91,831 for the fiscal year ended March 31, 2019, which we refer to as "fiscal 2019."  Included in our fiscal 2020 and 2019 sales were $1,276 and $8,336, respectively, for the aforementioned commercial nuclear utility business which was sold in June 2019.

• Net income and income per diluted share for fiscal 2020, were $1,872 and $0.19, respectively, compared with net (loss) and (loss) per diluted share of ($308) and ($0.03), respectively, for fiscal 2019.  Included in net income and income per diluted share for fiscal 2020 was a loss of ($893) for our commercial nuclear utility business.  For fiscal 2019, included in net income and income per diluted share were $5,320 and $0.54, respectively, for an impairment charge.  In addition, for fiscal 2019, excluding the impairment charge, there was an after tax operating loss of ($1,459) for our commercial nuclear utility business.

• Operating cash flow for fiscal 2020 was $1,239, down from $7,917 in fiscal 2019.

• Net orders received in fiscal 2020 were $80,034 compared with fiscal 2019, when net orders received were $101,241.  Included in the fiscal 2020 and 2019 orders were $2,996 and $11,019, respectively, for the divested commercial nuclear utility business.

• Backlog on March 31, 2020 was $112,389 compared with backlog of $132,127 on March 31, 2019.  Included in the fiscal 2019 backlog was $8,039 from the commercial nuclear utility business.

• Gross profit and operating margins for fiscal 2020 were 20.0% and 0.7%, respectively, compared with 23.9% and (2.6%), respectively, for fiscal 2019.  

• In fiscal 2020, $4,250 was returned to shareholders as dividends compared with $3,834 in fiscal 2019.

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• Cash and cash equivalents and short-term investments at March 31, 2020 were $73,003 compared with $77,753 as of March 31, 2019, a decrease of $4,750.

• At March 31, 2020, we had a solid balance sheet that was free of bank debt and which we believe provides us with the financial flexibility to pursue our business and acquisition strategies.

Forward-Looking Statements

This report and other documents we file with the Securities and Exchange Commission ("SEC") include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results implied by the forward-looking statements.  Such factors include, but are not limited to, the risks and uncertainties identified by us under the heading "Risk Factors" in Item 1A of Part I and elsewhere in this Annual Report on Form 10-K.  

Forward-looking statements may also include, but are not limited to, statements about:

• the impacts of, and risks caused by, the COVID-19 pandemic on our business operations, our customers and our markets;

• the current and future economic environments, including the volatility associated with the COVID-19 pandemic, affecting us and the markets we serve;

• expectations regarding investments in new projects by our customers;

• sources of revenue and anticipated revenue, including the contribution from anticipated growth;

• expectations regarding achievement of revenue and profitability;

• plans for future products and services and for enhancements to existing products and services;

• our operations in foreign countries;

• political instability in regions in which our customers are located;

• tariffs and trade relations between the United States and its trading partners;

• our ability to affect our growth and acquisition strategy;

• our ability to maintain or expand work for the U.S. Navy;

• our ability to successfully execute our existing contracts;

• estimates regarding our liquidity and capital requirements;

• timing of conversion of backlog to sales;

• our ability to attract or retain customers;

• the outcome of any existing or future litigation; and

• our ability to increase our productivity and capacity.

Forward-looking statements are usually accompanied by words such as "anticipate," "believe," "contemplate," "continue," "could," "estimate," "may," "might," "intend," "interest," "appear," "expect," "suggest," "plan," "predict," "project," "encourage," "potential," "should," "view," "will," and similar expressions.  Actual results could differ materially from historical results or those implied by the forward-looking statements contained in this report.

Undue reliance should not be placed on our forward-looking statements.  All forward-looking statements included in this Form 10-K are made only as of the date indicated or as of the date of this Form 10-K. Except as required by law, we undertake no obligation to update or announce any revisions to forward-looking statements contained in this report, whether as a result of new information, future events or otherwise. New risks and uncertainties arise from time to time and we cannot predict these events or how they may affect us and cause actual results to differ materially from those expressed or implied by our forward-looking statements. Therefore, you should not rely on our forward-looking statements as predictions of future events. When considering these risks, uncertainties and assumptions, you should keep in mind the cautionary statements contained in this report and any documents incorporated herein by reference. You should read this document and the documents that we reference in this Form 10-K completely and with the understanding that our actual future results may be materially different from what we expect. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.

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Current Market Conditions

Our global energy and petrochemical markets turned downward during the latter part of fiscal 2020.  These markets were adversely impacted by a dramatic reduction in oil prices, partly due to the COVID-19 pandemic, but importantly, also due to geopolitical imbalance of supply compared with demand, which began to appear before COVID-19 was prevalent.  Accordingly, volatility in pricing began prior to the COVID-19 pandemic and has increased because of it.  As noted above, customers have significantly reduced their capital budgets to invest in upgrading and turnaround maintenance for existing facilities.  This has impacted and will continue to impact both our capital equipment sales as well as our short cycle business.

The COVID-19 pandemic has further impacted our customers, the markets which they serve and the operation of our business.  The near term impact on global energy and petrochemical demand was immediate and significant.  Our customers’ plans for capital spending and operational upgrades have been significantly reduced and their outlook for this calendar year, and likely beyond, has turned negative.

Over the long-term, our view for the global energy and petrochemical markets is that general economic fundamentals will drive increasing demand and result in continued capital investment to satisfy increasing global demand for energy and chemicals. These fundamentals include rising populations, strong emerging market economic growth, and overall global economic expansion.  We believe the long-term outlook in our key markets supports our growth plans. However, until there is greater clarity regarding the impact of COVID-19 on the global economy, energy demand and customer financial strength, new order levels may be challenged due to the resulting weak energy and petrochemical markets.

Our naval nuclear propulsion market has demand tied to aircraft carrier and submarine vessel construction schedules of the primary shipyards who service the U.S. Navy.  We expect growth in our naval nuclear propulsion business to result from our strategic actions to increase our market share, our successful performance, and expected increases in demand.

The chart below shows the impact of our successful diversification strategy into multiple U.S. Navy defense platforms.  The diversification began with our entry into the nuclear carrier program and expanded into both the Virginia and Columbia class nuclear submarine programs.  Our U.S. Navy defense business makes up 52% of our total backlog.  Each vessel platform has made up at least 10% of our total backlog for the past three years.  On March 31, 2020, the nuclear carriers, Virginia class submarines and Columbia class submarines make up 16%, 12% and 24% of our backlog, respectively.  We believe this diversification will be especially beneficial during periods where our commercial markets are weak.

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Results of Operations

For an understanding of the significant factors that influenced our performance, the following discussion should be read in conjunction with our consolidated financial statements and the notes to our consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K.  

The following table summarizes our results of operations for the periods indicated:

	Year Ended March 31,
	2020			2019			2018
Net sales	$	90,604		$	91,831		$	77,534
Gross profit	$	18,148		$	21,909		$	16,975
Gross profit margin		20.0	%		23.9	%		21.9	%
SG&A expense (1)	$	16,879		$	17,878		$	15,769
SG&A as a percent of sales		18.6	%		19.5	%		20.3	%
Net income (loss)	$	1,872		$	(308	)	$	(9,844	)
Diluted income (loss) per share	$	0.19		$	(0.03	)	$	(1.01	)
Total assets	$	148,120		$	156,270		$	143,333
Total assets excluding cash, cash equivalents and investments	$	75,117		$	78,517		$	66,854

⁽¹⁾ Selling, general and administrative expense is referred to as "SG&A."

Fiscal 2020 Compared with Fiscal 2019

Sales for fiscal 2020 were $90,604, down 1% as compared with sales of $91,831 for fiscal 2019.  Included in our fiscal 2020 and 2019 sales were $1,276 and $8,336, respectively, for the Energy Steel business which was sold in June 2019.  Domestic sales were $58,042 or 64% of total sales, down from $59,441 or 65% of total sales in fiscal 2019.  Domestic sales decreased $1,399, or 2%, compared with fiscal year 2019.  International sales accounted for $32,562, or 36% of total sales, for fiscal 2020, up from $32,390, or 35% of total sales in fiscal 2019.  International sales increased $172, compared with fiscal 2019.  By market, sales for fiscal 2020 were 37% to the refining industry (down from 50% in fiscal 2019), 34% to the chemical and petrochemical industries (up from 18% in fiscal 2019), 3% to the power markets (down from 11% in fiscal 2019), and 26% to defense and other industrial applications (up from 21% in fiscal 2019).  

The COVID-19 pandemic impacted our financial results in the fourth quarter of fiscal 2020.  We estimated that revenue was adversely impacted by COVID-19 by approximately $7 million, of which $5 million was related to a project being fabricated in China and $2 million was related to lower production capacity at our Batavia, New York facility.  In late March 2020, we limited production at our production facility in Batavia, New York, with only a very small staff.  This temporary reduction in workforce substantially reduced our production capacity during this time period. We continued to pay our employees, despite lacking revenue to cover those costs.  Beginning in mid-April and subsequent to fiscal 2020 year-end, we began ramping up our production personnel and as of June 2020 are nearing our pre-COVID-19 headcount in our factory.  We are committed to diligently protecting our workforce while endeavoring to minimize any unfavorable impact to our business and our customers.

Our gross margin for fiscal 2020 was 20.0% compared with 23.9% for fiscal 2019.  The decrease in gross margin was primarily due to increased production costs, as our business was structured for expected strong growth in fiscal 2021, which now appears unlikely.  These additional costs adversely impacted current period results.  Gross profit for fiscal 2020 decreased $3,761, or 17%, compared with fiscal 2019 on similar volume and lower gross margin as noted above, compared with fiscal 2019.

SG&A expense for fiscal 2020 was $16,879, down 6%, or $999, compared with $17,878 in fiscal 2019.  SG&A as a percentage of sales in fiscal 2020 was 18.6% of sales compared with 19.5% of sales in fiscal 2019.  Included in SG&A in fiscal 2020 and fiscal 2019 was $621 and $1,980, respectively, for SG&A for the commercial nuclear utility business.

During the first quarter of fiscal 2020, we completed the sale of our commercial nuclear utility business. We recorded a loss on the sale of the business of $617, before and after tax, in fiscal 2020.  In fiscal 2019, we reviewed the market value of the business at such time and determined the assets to be impaired based on such market value.  We also estimated the fair value of the commercial nuclear utility business related to the carrying value of Energy Steel.  The impairment review indicated that the fair value of the intangible assets, goodwill and other long-lived assets of the business were negligible, due to erosion of the Energy Steel business and commercial nuclear utility industry.  As a result, we recorded impairment losses of $1,700, $2,000, $1,208, $1,222, and $319 for permits, tradename, customer relationships, goodwill, and other long-lived assets, respectively.  The total impairment charge was $6,449 before taxes and $5,320 after taxes.

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Interest income for fiscal 2020 was $1,324, down from $1,462 in fiscal 2019.  Interest expense in each of fiscal 2020 and fiscal 2019 was $12.

Our effective tax rate in fiscal 2020 was 19%.  Our effective tax rate was not meaningful in fiscal 2019, as we had a tax expense despite a pre-tax loss, due to non-deductibility of the goodwill portion of the write down for our commercial nuclear utility business.  The effective tax rate in fiscal 2019 included the tax benefit of $1,129 related to the impairment charge.

Net income and income per diluted share for fiscal 2020, were $1,872 and $0.19, respectively, compared with net (loss) and (loss) per diluted share of ($308) and ($0.03), respectively, for fiscal 2019.  Included in net income and income per diluted share for fiscal 2020 was a loss of ($893) for the operation and sale of our commercial nuclear utility business.  For fiscal 2019, included in net income and income per diluted share were $5,320 and $0.54, respectively, for an impairment charge.  In addition, for fiscal 2019, excluding the impairment charge, there was an after tax operating loss of ($1,459) for our commercial nuclear utility business.

Liquidity and Capital Resources

The following discussion should be read in conjunction with our consolidated statements of cash flows and consolidated balance sheets appearing in Item 8 of Part II of this Annual Report on Form 10-K:

	March 31,
	2020			2019
Cash and investments	$	73,003		$	77,753
Working capital(1)		77,443			79,896
Working capital ratio(2)		2.6			2.5
Working capital excluding cash and investments		4,440			2,143
Working capital excluding cash and investments as a     percent of net sales		4.9	%		2.3	%

⁽¹⁾  Working capital equals current assets minus current liabilities.  

⁽²⁾  Working capital ratio equals current assets divided by current liabilities.

We use the above ratios to assess our liquidity and overall financial strength.

Net cash generated by operating activities for fiscal 2020 was $1,239, compared with $7,917 for fiscal 2019.  The $6,678 decrease in cash generated was due to cash usage from customer deposits and unbilled revenue.  These were mostly offset by cash generations for earnings, inventory and accounts receivable.  In fiscal 2019, customer deposits were a cash generator.

Capital spending in fiscal 2020 was $2,417, compared with $2,138 in fiscal 2019.  Capital expenditures in each of fiscal 2020 and fiscal 2019 were approximately 85% for facilities along with machinery and equipment and the remaining 15% for all other items.

Dividend payments were $4,250 in fiscal 2020, compared with $3,834 in fiscal 2019.  

Cash and investments were $73,003 at March 31, 2020, compared with $77,753 at March 31, 2019, down $4,750 or 6%.

We invest net cash generated from operations in excess of cash held for near-term needs in short-term, less than 365 days, certificates of deposit, money market accounts or U.S. government instruments, generally with maturity periods of up to 180 days.  Our certificates of deposit are used to securitize our outstanding letters of credit, which reduces our cost on those letters of credit.  Approximately 95% of our cash and investments are held in the U.S.  The remaining 5% is invested in our China operations.

Capital expenditures for the fiscal year ending March 31, 2021, which we refer to as "fiscal 2021," are expected to be between approximately $2,000 and $2,500.  Approximately 80% to 85% of our fiscal 2021 capital expenditures are expected to be for machinery and equipment, with the remaining amounts expected to be used for other items.

Our revolving credit facility with JP Morgan Chase, N.A. ("JP Morgan Chase") provides us with a line of credit of $25,000, including letters of credit and bank guarantees.  In addition, our JP Morgan Chase agreement allows us to increase the line of credit, at our discretion, up to another $25,000, for total availability of $50,000.  Borrowings under this credit facility are secured by all of our assets.  We also had a $10,000 unsecured line of credit with HSBC, N.A. ("HSBC") at March 31, 2020.  Subsequent to the fiscal 2020 year end, this line of credit was increased to $14,000.  See Note 19 to the consolidated financial statements contained in Item 8 of Part II of this Annual Report on Form 10-K for a discussion of the increase to our line of credit with HSBC.  Letters of credit outstanding on March 31, 2020 and March 31, 2019 were $13,328 and $8,503, respectively.  The outstanding letters of credit as of March 31, 2020

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were issued by JP Morgan Chase and HSBC.  There were no other amounts outstanding on our credit facilities at March 31, 2020 and March 31, 2019.  The borrowing rate under our JP Morgan Chase facility as of March 31, 2020 was the bank’s prime rate, or 3.25%.  Availability under the JP Morgan Chase and HSBC lines of credit was $21,672 and $22,505 at March 31, 2020 and March 31, 2019, respectively.  

We believe that cash generated from operations, combined with the liquidity provided by our investments and available financing capacity under our credit facility, will be adequate both to meet our cash needs for the immediate future and to support our growth strategies.

Stockholders' Equity

The following discussion should be read in conjunction with our consolidated statements of changes in stockholders' equity that can be found in Item 8 of Part II of this Annual Report on Form 10-K.  The following table shows the balance of stockholders' equity on the dates indicated:

March 31, 2020		March 31, 2019
$	96,724	$	98,966

Fiscal 2020 Compared with Fiscal 2019

Stockholders' equity decreased $2,242 or 2%, at March 31, 2020 compared with March 31, 2019.  

On March 31, 2020, our net book value per share was $9.79, down from $10.05 at March 31, 2019.

Contractual Obligations

As of March 31, 2020, our contractual and commercial obligations for the next five fiscal years ending March 31 and thereafter were as follows:

			Payments Due by Period
	Total		Less Than 1 Year		1 – 3 Years		3 – 5 Years		Thereafter
Capital lease obligations(1)	$	110	$	48	$	52	$	10	$	—
Operating leases(1)		249		162		79		8		—
Pension and postretirement benefits(2)		77		77		—		—		—
Accrued pension liability		747		—		—		—		747
Total	$	1,183	$	287	$	131	$	18	$	747

⁽¹⁾ For additional information, see Note 8 to the consolidated financial statements in Item 8 of Part II of this Annual Report on Form 10-K.

⁽²⁾ Amounts represent anticipated contributions during fiscal 2020 to our postretirement medical benefit plan, which provides healthcare benefits for eligible retirees and eligible survivors of retirees.  On February 4, 2003, we terminated postretirement healthcare benefits for our U.S. employees.  Benefits payable to retirees of record on April 1, 2003 remained unchanged.  We expect to be required to make cash contributions in connection with these plans beyond one year, but such amounts cannot be estimated.  No contributions are expected to be made to our defined benefit pension plan for fiscal 2021.

Orders and Backlog

Orders in fiscal 2020 decreased 21% to $80,034 from $101,241 in fiscal 2019.  Orders in fiscal 2020 and 2019 included $2,996 and $11,019, respectively, for the divested commercial nuclear utility business.  Orders represent communications received from customers requesting us to supply products and services.  Revenue is recognized on orders received in accordance with our revenue recognition policy described in Notes 1 and 2 to the consolidated financial statements contained in Item 8 of Part II of this Annual Report on Form 10-K.

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Domestic orders were 54%, or $43,045, and international orders were 46%, or $36,989, of our total net orders in fiscal 2020.  This compared with net domestic orders of $62,205, or 61%, of total net orders, and international orders of $39,036, or 39%, of our total orders in fiscal 2019.  Domestic orders decreased by $19,160, or 31%.  Net international orders decreased by $2,047, or 5% in fiscal 2020.

Backlog was $112,389 at March 31, 2020, down 15% compared with $132,127 at March 31, 2019.  Included in the fiscal 2019 backlog was $8,039 from the commercial nuclear utility business.  Backlog is defined by us as the total dollar value of orders received for which revenue has not yet been recognized.  All orders in backlog represent orders from our traditional markets in established product lines.  We had two projects totaling $3,165 cancelled in fiscal 2020.  Approximately 70% to 75% of orders currently in our backlog are expected to be converted to sales within one year.  At March 31, 2020, approximately 27% of our backlog was attributed to equipment for refinery project work, 17% for chemical and petrochemical projects, 52% for U.S. Navy projects and 4% for power and other industrial or commercial applications.  At March 31, 2019, approximately 22% of our backlog was attributed to equipment for refinery project work, 19% for chemical and petrochemical projects, 49% for U.S. Navy projects and 10% for power, including commercial nuclear energy, other industrial or commercial applications.  At March 31, 2020, we had two projects totaling $562 on hold.  At March 31, 2019, we had no projects on hold.

Outlook

Capital spending in the energy markets we serve began to decrease during the second half of fiscal 2020 and the pace of activity materially contracted as COVID-19 became a global health issue in the fourth quarter of fiscal 2020. Net orders from customers in the fourth quarter of fiscal 2020 fell to their lowest levels in nearly three years, driven by very low refining orders.  Our bidding activity also slowed in the second half of fiscal 2020, with international opportunities in emerging markets stronger than domestic markets.  At March 31, 2020, 52% of our backlog was for the U.S. Navy.  Our pipeline for the U.S. Navy continues to be robust, but quarterly fluctuations in order levels will occur due to the size and timing of release of the U.S. Navy projects.  Navy programs in backlog are planned to deliver $20 to $25 million per year of revenue in fiscal 2021 and beyond.

While the near term opportunities in the global energy and petrochemical markets have slowed significantly due to the combined impact of the COVID-19 pandemic and the geopolitical imbalance of supply, and this may continue for the foreseeable future, we continue to believe in the long-term strength of the energy and petrochemical markets.  Coupled with our diversification strategy with the U.S. Navy, we believe that the long-term strength of our markets will support our goal to significantly grow our business.  We have invested in capacity to serve our commercial customers as well as to expand the work we do for the U.S. Navy.  We intend to continue to look for organic growth opportunities as well as acquisitions or other business combinations that we believe will allow us to expand our presence in both our existing and ancillary markets.

Our expectations for sales and profitability assume that we are able to operate our production facility in Batavia, New York at or near normal capacity for the last three quarters of fiscal 2021.  In our first quarter of fiscal 2021, our production capability was significantly reduced due to the COVID-19 pandemic.  Our production was at approximately one-third of its capacity in the first two months of the first quarter of fiscal 2021 and we are expecting to be at approximately 50% of normal production for the first quarter of fiscal 2021.

We expect a weak first quarter of fiscal 2021, for the reasons previously noted.  For the remaining nine months of fiscal 2021, we expect to operate at normal capacity.  We project that approximately 70% to 75% of our $112,389 March 31, 2020 backlog will convert to sales in fiscal 2021.  We expect the remaining backlog will convert beyond fiscal 2021, which includes a combination of U.S. Navy orders that have a long conversion cycle (up to five years) as well as certain commercial orders, the conversion of which has been extended by our customers.  We had two projects totaling $3,165 canceled in fiscal 2020.  At March 31, 2020, we had two projects totaling $562 put on hold by our customers.  Furthermore, as of June 2020, we have three projects which have been delayed by our customers due to COVID-19 and related energy market dynamics, causing revenue of $4,118 to be delayed beyond fiscal 2021.  Given extreme market uncertainty resulting from the COVID-19 pandemic and the volatility in the oil markets, at this time we are not providing any quantitative revenue guidance.

We expect that cash flow in fiscal 2021 will be challenged in the first quarter of the fiscal year, primarily due to our reduced production in the first quarter, but will improve in the remaining part of the fiscal year.

Contingencies and Commitments

We have been named as a defendant in lawsuits alleging personal injury from exposure to asbestos allegedly contained in, or accompanying, our products.  We are a co-defendant with numerous other defendants in these lawsuits and intend to vigorously defend ourselves against these claims.  The claims are similar to previous asbestos lawsuits that named us as a defendant.  Such previous lawsuits either were dismissed when it was shown that we had not supplied products to the plaintiffs’ places of work or were

27

settled by us for immaterial amounts.  We cannot provide any assurances that any pending or future matters will be resolved in the same manner as previous lawsuits.

As of March 31, 2020, we are subject to the claims noted above, as well as other legal proceedings and potential claims that have arisen in the ordinary course of business.  Although the outcome of the lawsuits to which we are, or may become, a party to cannot be determined and an estimate of the reasonably possible loss or range of loss cannot be made for the majority of claims, we do not believe that the outcomes, either individually or in the aggregate, will have a material effect on our results of operations, financial position or cash flows.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations are based upon the consolidated financial statements and the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K, which have been prepared in accordance with accounting principles generally accepted in the U.S.

Critical accounting policies are defined as those that reflect significant judgments and uncertainties and could potentially result in materially different results under different assumptions and conditions.

Revenue Recognition.  The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.

We recognize revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, we have rights to payment, and rewards of ownership pass to the customer.  Customer acceptance may also be a factor in determining whether control of the product has transferred.  Although revenue on the majority of our contracts, as measured by number of contracts, is recognized upon shipment to the customer, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria in ASC 606.  Revenue from contracts that is recognized upon shipment accounted for approximately 30% of revenue in fiscal 2020.  Revenue from contracts that is recognized over time accounted for approximately 70% of revenue in fiscal 2020.  We recognize revenue over time when contract performance results in the creation of a product for which we do not have an alternative use and the contract includes an enforceable right to payment in an amount that corresponds directly with the value of the performance completed.  To measure progress towards completion on performance obligations for which revenue is recognized over time we utilize an input method based upon a ratio of direct labor hours incurred to date to management’s estimate of the total labor hours to be incurred on each contract or an output method based upon completion of operational milestones, depending upon the nature of the contract.

Pension and Postretirement Benefits.  Defined benefit pension and other postretirement benefit costs and obligations are dependent on actuarial assumptions used in calculating such amounts.  These assumptions are reviewed annually and include the discount rate, long-term expected rate of return on plan assets, salary growth, healthcare cost trend rate and other economic and demographic factors.  We base the discount rate assumption for our plans on the FTSE Pension Liability Above-Median AA-Index.  The long-term expected rate of return on plan assets is based on the plan’s asset allocation, historical returns and expectations as to future returns that are expected to be realized over the estimated remaining life of the plan liabilities that will be funded with the plan assets.  The salary growth assumptions are determined based on long-term actual experience and future and near-term outlook.  The healthcare cost trend rate assumptions are based on historical cost and payment data, the near-term outlook, and an assessment of likely long-term trends.

Income Taxes.  We use the liability method to account for income taxes.  Under this method, deferred tax liabilities and assets are recognized for the tax effects of temporary differences between the financial reporting and tax bases of liabilities and assets measured using the enacted tax rate.

Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using current tax rates.  We evaluate available information about future taxable income and other possible sources of realization of deferred income tax assets and record valuation allowances to reduce deferred income tax assets to an amount that represents our best estimates of the amounts of such deferred income tax assets that more likely than not will be realized.

The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations. Significant judgment is required in evaluating our tax positions and determining our provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. We establish reserves for uncertain tax positions when we believe that certain tax positions do not meet the more likely than not threshold. We adjust these reserves in light of changing facts and circumstances, such as the outcome of a tax audit or the lapse of the statute of

28

limitations. The provision for income taxes includes the impact of reserve provisions and changes to the reserves that are considered appropriate.

Critical Accounting Estimates and Judgments

We have evaluated the accounting policies used in the preparation of the consolidated financial statements and the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K and believe those policies to be reasonable and appropriate.

We believe that the most critical accounting estimates used in the preparation of our consolidated financial statements relate to labor hour estimates and establishment of operational milestones which are used to recognize revenue over time, accounting for contingencies, under which we accrue a loss when it is probable that a liability has been incurred and the amount can be reasonably estimated, and accounting for pensions and other postretirement benefits.

As discussed above under the heading "Critical Accounting Policies," we recognize a majority of our revenue using an over-time recognition method.  The key estimate for the over-time recognition model is total labor to be incurred on each contract and to the extent that this estimate changes, it may significantly impact revenue recognized in each period.

As a result of the adoption of ASC 606, we anticipate certain large international contracts will not qualify for over-time revenue recognition which may cause inordinate quarter-to-quarter and year-to-year financial performance volatility.

Contingencies, by their nature, relate to uncertainties that require us to exercise judgment both in assessing the likelihood that a liability has been incurred as well as in estimating the amount of potential loss.  For more information on these matters, see the notes to consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K.

Accounting for pensions and other postretirement benefits involves estimating the cost of benefits to be provided well into the future and attributing that cost over the time period each employee works.  To accomplish this, extensive use is made of assumptions about inflation, investment returns, mortality, turnover, medical costs and discount rates.  These assumptions are reviewed annually.

The discount rate used in accounting for pensions and other postretirement benefits expense (income) is determined in conjunction with our actuary by reference to a current yield curve and by considering the timing and amount of projected future benefit payments.  The discount rate assumption for fiscal 2020 was 3.83% for our defined benefit pension plan and 3.37% for our other postretirement benefit plan.  A reduction in the discount rate of 50 basis points, with all other assumptions held constant, would have increased fiscal 2020 net periodic benefit expense for our defined benefit pension plan and other postretirement benefit plan by approximately $311 and $0, respectively.

The expected return on plan assets assumption of 7.0% used in accounting for our pension plan is determined by evaluating the mix of investments that comprise plan assets and external forecasts of future long-term investment returns.  A reduction in the rate of return of 50 basis points, with other assumptions held constant, would have increased fiscal 2020 net periodic pension expense by approximately $190.

During fiscal 2020 and fiscal 2019, the pension plan released liabilities for vested benefits of certain participants through the purchase of nonparticipating annuity contracts with a third-party insurance company.  As a result of these transactions, in fiscal 2020 and fiscal 2019, the projected benefit obligation decreased $1,420 and $1,589, respectively, and plan assets decreased $1,420 and $1,718, respectively.  

As part of our ongoing financial reporting process, a collaborative effort is undertaken involving our managers with functional responsibilities for financial, credit, tax, engineering, manufacturing and benefit matters, and outside advisors such as lawyers, consultants and actuaries.  We believe that the results of this effort provide management with the necessary information on which to base their judgments and to develop the estimates and assumptions used to prepare the financial statements.

We believe that the amounts recorded in the consolidated financial statements included in Item 8 of Part II of this Annual Report on Form 10-K related to revenue, contingencies, pensions, other postretirement benefits and other matters requiring the use of estimates and judgments are reasonable, although actual outcomes could differ materially from our estimates.

New Accounting Pronouncements

In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board, the SEC, the Emerging Issues Task Force, the American Institute of Certified Public Accountants or any

29

other authoritative accounting body to determine the potential impact they may have on our consolidated financial statements.  For discussion of the newly issued accounting pronouncements see ''Accounting and reporting changes'' in Note 1 to the Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of March 31, 2020, other than letters of credit incurred in the ordinary course of business and operating leases and letters of credit as of March 31, 2019.  

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk

The principal market risks (i.e., the risk of loss arising from market changes) to which we are exposed are foreign currency exchange rates, price risk and project cancellation risk.

The assumptions applied in preparing the following qualitative and quantitative disclosures regarding foreign currency exchange rate, price risk and project cancellation risk are based upon volatility ranges experienced by us in relevant historical periods, our current knowledge of the marketplace, and our judgment of the probability of future volatility based upon the historical trends and economic conditions of the markets in which we operate.

Foreign Currency

International consolidated sales for fiscal 2020 were 36% of total sales, up from 35% of sales in fiscal 2019.  Operating in markets throughout the world exposes us to movements in currency exchange rates, including the recent increased volatility in foreign currency exchange rates resulting from the COVID-19 pandemic.  Currency movements can affect sales in several ways, the foremost being our ability to compete for orders against foreign competitors that base their prices on relatively weaker currencies.  Business lost due to competition for orders against competitors using a relatively weaker currency cannot be quantified.  In addition, cash can be adversely impacted by the conversion of sales made by us in a foreign currency to U.S. dollars.  In fiscal 2020, substantially all sales by us and our wholly owned subsidiaries, for which we were paid, were denominated in the local currency of the respective subsidiary (U.S. dollars or Chinese RMB).

We have limited exposure to foreign currency purchases.  In fiscal 2020, our purchases in foreign currencies represented 1% of the cost of products sold.  At certain times, we may enter into forward foreign currency exchange agreements to hedge our exposure against potential unfavorable changes in foreign currency values on significant sales and purchase contracts negotiated in foreign currencies.  Forward foreign currency exchange contracts were not used in fiscal 2020 and as of March 31, 2020, we held no forward foreign currency contracts.

Price Risk

Operating in a global marketplace requires us to compete with other global manufacturers which, in some instances, benefit from lower production costs and more favorable economic conditions.  Although we believe that our customers differentiate our products on the basis of our manufacturing quality and engineering experience and excellence, among other things, such lower production costs and more favorable economic conditions mean that our competitors are able to offer products similar to ours at lower prices.  In extreme market downturns, such as we recently experienced, we typically see depressed price levels.  Moreover, the cost of metals and other materials used in our products have experienced significant volatility.  Such factors, in addition to the global effects of the recent volatility and disruption of the capital and credit markets, have resulted in downward demand and pricing pressure on our products.

Project Cancellation and Project Continuation Risk

Adverse economic or specific project conditions can lead to a project being placed on hold or cancelled by our customers.  In fiscal 2020, we had two projects totaling $3,165 cancelled.  In fiscal 2019, we had no projects cancelled.  At March 31, 2020, we had two projects totaling $562 on hold.  At March 31, 2019, we had no projects on hold.  We attempt to mitigate the risk of cancellation by structuring contracts with our customers to maximize the likelihood that progress payments made to us for individual projects cover the costs we have incurred.  As a result, we do not believe we have a significant cash exposure to projects which may be cancelled.

Open orders are reviewed continuously through communications with customers.  If it becomes evident to us that a project is delayed well beyond its original shipment date, management will move the project into "placed on hold" (i.e., suspended) category.  Furthermore, if a project is cancelled by our customer, it is removed from our backlog.

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Item 8. Financial Statements and Supplementary Data

INDEX TO FINANCIAL STATEMENTS

Consolidated Financial Statements:	Page
Consolidated Statements of Operations for the years ended March 31, 2020, 2019 and 2018	32
Consolidated Statements of Comprehensive Income (Loss) for the years ended March 31, 2020, 2019 and 2018	33
Consolidated Balance Sheets as of March 31, 2020 and 2019	34
Consolidated Statements of Cash Flows for the years ended March 31, 2020, 2019 and 2018	35
Consolidated Statements of Changes in Stockholders' Equity for the years ended March 31, 2020, 2019 and 2018	36
Notes to Consolidated Financial Statements	37

31

CONSOLIDATED STATEMENTS OF OPERATIONS

	Year Ended March 31,
	2020			2019			2018
	(Amounts in thousands, except per share data)
Net sales	$	90,604		$	91,831		$	77,534
Cost of products sold		72,456			69,922			60,559
Gross profit		18,148			21,909			16,975
Other expenses and income:
Selling, general and administrative		16,868			17,641			15,533
Selling, general and administrative - amortization		11			237			236
Goodwill and other impairments		—			6,449			14,816
Restructuring charge		—			—			316
Other expense		617			—			—
Other income		(348	)		(823	)		(478	)
Interest income		(1,324	)		(1,462	)		(606	)
Interest expense		12			12			12
Total other expenses and income		15,836			22,054			29,829
Income (loss) before provision (benefit) for income taxes		2,312			(145	)		(12,854	)
Provision (benefit) for income taxes		440			163			(3,010	)
Net income (loss)	$	1,872		$	(308	)	$	(9,844	)
Per share data:
Basic:
Net income (loss)	$	0.19		$	(0.03	)	$	(1.01	)
Diluted:
Net income (loss)	$	0.19		$	(0.03	)	$	(1.01	)
Average common shares outstanding:
Basic		9,876			9,823			9,764
Diluted		9,879			9,823			9,764
Dividends declared per share	$	0.43		$	0.39		$	0.36

See Notes to Consolidated Financial Statements.

32

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Year Ended March 31,
	2020			2019			2018
	(Amounts in thousands)
Net income (loss)	$	1,872		$	(308	)	$	(9,844	)
Other comprehensive (loss) income:
Foreign currency translation adjustment		(198	)		(235	)		344
Defined benefit pension and other postretirement plans, net of income tax    (benefit) provision of $(153), $(63), and $476, for the years ended    March 31, 2020, 2019 and 2018, respectively		(525	)		(348	)		1,668
Total other comprehensive (loss) income		(723	)		(583	)		2,012
Total comprehensive income (loss)	$	1,149		$	(891	)	$	(7,832	)

See Notes to Consolidated Financial Statements.

33

CONSOLIDATED BALANCE SHEETS

	March 31,
	2020			2019
	(Amounts in thousands, except per share data)
Assets
Current assets:
Cash and cash equivalents	$	32,955		$	15,021
Investments		40,048			62,732
Trade accounts receivable, net of allowances ($33 at each of March 31, 2020 and    2019)		15,400			17,582
Unbilled revenue		14,592			7,522
Inventories		22,291			24,670
Prepaid expenses and other current assets		906			1,333
Income taxes receivable		485			1,073
Assets held for sale		—			4,850
Total current assets		126,677			134,783
Property, plant and equipment, net		17,587			17,071
Prepaid pension asset		3,460			4,267
Operating lease assets		243			—
Other assets		153			149
Total assets	$	148,120		$	156,270
Liabilities and stockholders’ equity
Current liabilities:
Current portion of finance lease obligations	$	40		$	51
Accounts payable		14,253			12,405
Accrued compensation		4,453			5,126
Accrued expenses and other current liabilities		3,352			2,933
Customer deposits		26,983			30,847
Operating lease liabilities		153			—
Liabilities held for sale		—			3,525
Total current liabilities		49,234			54,887
Finance lease obligations		55			95
Operating lease liabilities		82			—
Deferred income tax liability		721			1,056
Accrued pension liability		747			662
Accrued postretirement benefits		557			604
Total liabilities		51,396			57,304
Commitments and contingencies (Notes 8 and 17)
Stockholders’ equity:
Preferred stock, $1.00 par value, 500 shares authorized
Common stock, $.10 par value, 25,500 shares authorized; 10,689 and 10,650 shares    issued and 9,881 and 9,843 shares outstanding at March 31, 2020 and 2019,    respectively		1,069			1,065
Capital in excess of par value		26,361			25,277
Retained earnings		91,389			93,847
Accumulated other comprehensive loss		(9,556	)		(8,833	)
Treasury stock (808 and 807 shares at March 31, 2020 and 2019, respectively)		(12,539	)		(12,390	)
Total stockholders’ equity		96,724			98,966
Total liabilities and stockholders’ equity	$	148,120		$	156,270

See Notes to Consolidated Financial Statements.

34

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year Ended March 31,
	2020			2019			2018
	(Dollar amounts in thousands)
Operating activities:
Net income (loss)	$	1,872		$	(308	)	$	(9,844	)
Adjustments to reconcile net income  (loss) to net cash provided by    operating activities:
Depreciation		1,957			1,968			1,986
Amortization		11			237			236
Amortization of unrecognized prior service cost and actuarial losses		997			875			1,050
Goodwill and other impairments		—			6,449			14,816
Equity-based compensation expense		975			1,069			577
(Gain) loss on disposal or sale of property, plant and equipment		(1	)		30			26
Loss on sale of Energy Steel & Supply Co.		181			—			—
Deferred income taxes		(287	)		(159	)		(3,088	)
(Increase) decrease in operating assets:
Accounts receivable		2,044			(1,227	)		(5,472	)
Unbilled revenue		(7,070	)		(2,519	)		7,866
Inventories		2,279			(2,068	)		(2,311	)
Income taxes receivable		588			396			(1,794	)
Prepaid expenses and other current and non-current assets		358			(576	)		(176	)
Operating lease assets		214			—			—
Prepaid pension asset		(871	)		(1,181	)		(1,009	)
Increase (decrease) in operating liabilities:
Accounts payable		1,826			(2,572	)		5,757
Accrued compensation, accrued expenses and other current and    non-current liabilities		(52	)		1,118			(954	)
Customer deposits		(3,683	)		6,328			792
Operating lease liabilities		(140	)		—			—
Long-term portion of accrued compensation, accrued pension    liability and accrued postretirement benefits		41			57			53
Net cash provided by operating activities		1,239			7,917			8,511
Investing activities:
Purchase of property, plant and equipment		(2,417	)		(2,138	)		(2,051	)
Proceeds from disposal of property, plant and equipment		12			—			6
Proceeds from the sale of Energy Steel & Supply Co.		602			—			—
Purchase of investments		(181,462	)		(115,342	)		(54,023	)
Redemption of investments at maturity		204,146			88,633			52,000
Net cash provided (used) by investing activities		20,881			(28,847	)		(4,068	)
Financing activities:
Principal repayments on finance lease obligations		(51	)		(97	)		(107	)
Issuance of common stock		24			307			—
Dividends paid		(4,250	)		(3,834	)		(3,517	)
Purchase of treasury stock		(230	)		(146	)		(119	)
Net cash used by financing activities		(4,507	)		(3,770	)		(3,743	)
Effect of exchange rate changes on cash		(231	)		(183	)		282
Net increase (decrease) in cash and cash equivalents, including cash    classified within current assets held for sale		17,382			(24,883	)		982
Net decrease (increase) in cash classified within current assets   held for sale		552			(552	)		—
Net increase (decrease) in cash and cash equivalents		17,934			(25,435	)		982
Cash and cash equivalents at beginning of year		15,021			40,456			39,474
Cash and cash equivalents at end of year	$	32,955		$	15,021		$	40,456

See Notes to Consolidated Financial Statements.

35

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

Years Ended March 31, 2020, 2019 and 2018

(Dollar and share amounts in thousands)

	Common Stock						Capital in						Accumulated Other						Total
				Par			Excess of			Retained			Comprehensive			Treasury			Stockholders'
	Shares			Value			Par Value			Earnings			Loss			Stock			Equity
Balance at April 1, 2017		10,548		$	1,055		$	23,176		$	110,544		$	(8,434	)	$	(12,231	)	$	114,110
Comprehensive (loss) income											(9,844	)		2,012						(7,832	)
Reclassification of stranded tax effects (See Note 1)											1,828			(1,828	)					—
Issuance of shares		59			6			(6	)											—
Forfeiture of shares		(28	)		(3	)		3												—
Dividends											(3,517	)								(3,517	)
Recognition of equity-based compensation expense								577												577
Purchase of treasury stock																	(119	)		(119	)
Issuance of treasury stock								76									54			130
Balance at March 31, 2018		10,579			1,058			23,826			99,011			(8,250	)		(12,296	)		103,349
Cumulative effect of change in accounting principle											(1,022	)								(1,022	)
Comprehensive loss											(308	)		(583	)					(891	)
Issuance of shares		72		7				300												307
Forfeiture of shares		(1	)		—			—												—
Dividends											(3,834	)								(3,834	)
Recognition of equity-based compensation expense								1,069												1,069
Purchase of treasury stock																	(146	)		(146	)
Issuance of treasury stock								82									52			134
Balance at March 31, 2019		10,650			1,065			25,277			93,847			(8,833	)		(12,390	)		98,966
Cumulative effect of change in accounting principle											(80	)								(80	)
Comprehensive loss											1,872			(723	)					1,149
Issuance of shares		84		8				16												24
Forfeiture of shares		(45	)		(4	)		4												—
Dividends											(4,250	)								(4,250	)
Recognition of equity-based compensation expense								975												975
Purchase of treasury stock																	(230	)		(230	)
Issuance of treasury stock								89									81			170
Balance at March 31, 2020		10,689		$	1,069		$	26,361		$	91,389		$	(9,556	)	$	(12,539	)	$	96,724

See Notes to Consolidated Financial Statements.

36

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended March 31, 2020, 2019 and 2018

(Amounts in thousands, except per share data)

Note 1 - The Company and Its Accounting Policies:

Graham Corporation, and its operating subsidiaries, (together, the "Company"), is a global designer, manufacturer and supplier of vacuum and heat transfer equipment used in the chemical, petrochemical, petroleum refining, and electric power generating industries.  During the fiscal year ended March 31, 2019, the Company decided to divest of its wholly-owned subsidiary, Energy Steel & Supply Co. ("Energy Steel"), located in Lapeer, Michigan.  The sale of Energy Steel was completed in June 2019 and the accompanying Consolidated Financial Statements include the results of operation of Energy Steel for the period April 1, 2017 through June 23, 2019.  During the fiscal year ended March 31, 2019, the Company established Graham India Private Limited ("GIPL") as a wholly-owned subsidiary.  GIPL, located in Ahmedabad, India, serves as a sales and market development office focusing on the refining, petrochemical and fertilizer markets.  The Company's significant accounting policies are set forth below.

The Company's fiscal years ended March 31, 2020, 2019 and 2018 are referred to as "fiscal 2020," "fiscal 2019" and "fiscal 2018," respectively.

Principles of consolidation and use of estimates in the preparation of consolidated financial statements

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Energy Steel, located in Lapeer, Michigan, Graham Vacuum and Heat Transfer Technology (Suzhou) Co., Ltd., located in China, and GIPL, located in India.  All intercompany balances, transactions and profits are eliminated in consolidation.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the related revenues and expenses during the reporting period.  Actual amounts could differ from those estimated.

Translation of foreign currencies

Assets and liabilities of the Company's foreign subsidiary are translated into U.S. dollars at currency exchange rates in effect at year-end and revenues and expenses are translated at average exchange rates in effect for the year.  Gains and losses resulting from foreign currency transactions are included in results of operations. The Company's sales and purchases in foreign currencies are minimal.  Therefore, foreign currency transaction gains and losses are not significant.  Gains and losses resulting from translation of foreign subsidiary balance sheets are included in a separate component of stockholders' equity.  Translation adjustments are not adjusted for income taxes since they relate to an investment, which is permanent in nature.

Revenue recognition

The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.  

The Company recognizes revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, the Company has rights to payment, and rewards of ownership pass to the customer.  Customer acceptance may also be a factor in determining whether control of the product has transferred.  Although revenue on the majority of the Company’s contracts, as measured by number of contracts, is recognized upon shipment to the customer, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria in ASC 606.

Cash and cash equivalents

Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities at the time of purchase of three months or less.

Shipping and handling fees and costs

Shipping and handling fees billed to the customer are recorded in net sales and the related costs incurred for shipping and handling are included in cost of products sold.

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Investments

Investments consist of certificates of deposits with financial institutions.  All investments have original maturities of greater than three months and less than one year and are classified as held-to-maturity, as the Company believes it has the intent and ability to hold the securities to maturity.  The investments are stated at amortized cost which approximates fair value.  All investments held by the Company at March 31, 2020 are scheduled to mature on or before June 25, 2020.

Inventories

Inventories are stated at the lower of cost or net realizable value, using the average cost method.  Unbilled revenue (contract assets) in the Consolidated Balance Sheets represents revenue recognized that has not been billed to customers on contracts in which revenue is recognized over time.  All progress payments exceeding unbilled revenue are presented as customer deposits (contract liabilities) in the Consolidated Balance Sheets.

Property, plant, equipment, depreciation and amortization

Property, plant and equipment are stated at cost net of accumulated depreciation and amortization.  Major additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred.  Depreciation and amortization are provided based upon the estimated useful lives, or lease term if shorter, under the straight-line method.  Estimated useful lives range from approximately five to eight years for office equipment, eight to 25 years for manufacturing equipment and 40 years for buildings and improvements.  Upon sale or retirement of assets, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations.

Business combinations

The Company records its business combinations under the acquisition method of accounting.  Under the acquisition method of accounting, the Company allocates the purchase price of each acquisition to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition.  The fair value of identifiable intangible assets is based upon detailed valuations that use various assumptions made by management.  Any excess of the purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill.  Direct acquisition-related costs are expensed as incurred.

Impairment of long-lived assets

The Company assesses the impairment of definite-lived long-lived assets or asset groups when events or changes in circumstances indicate that the carrying value may not be recoverable.  Factors that are considered in deciding when to perform an impairment review include: a significant decrease in the market price of the asset or asset group; a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; or a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life.  The term more likely than not refers to a level of likelihood that is more than 50%.

Recoverability potential is measured by comparing the carrying amount of the asset or asset group to its related total future undiscounted cash flows.  If the carrying value is not recoverable through related cash flows, the asset or asset group is considered to be impaired.  Impairment is measured by comparing the asset or asset group's carrying amount to its fair value.  When it is determined that useful lives of assets are shorter than originally estimated, and no impairment is present, the rate of depreciation is accelerated in order to fully depreciate the assets over their new shorter useful lives.

Goodwill and intangible assets with indefinite lives are tested annually for impairment as of December 31.  The Company assesses goodwill for impairment by comparing the fair value of its reporting units to their carrying amounts.  If the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the implied fair value of the goodwill within the reporting unit is less than its carrying value.  Fair values for reporting units are determined based on a weighted combination of the market approach and the income approach using discounted cash flows.  Indefinite lived intangible assets are assessed for impairment by comparing the fair value of the asset to its carrying value.

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Assets and liabilities held for sale

The Company classifies long-lived assets (disposal group) to be sold as held for sale in accordance with Accounting Standards Update ("ASU") 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360):  Reporting Discontinued Operation And Disclosures of Disposals Of Components Of An Entity," in the period in which all of the following criteria are met:

1. Management, having the authority to approve the action, commits to a plan to sell the asset (disposal group);

2. The asset (disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (disposal group);

3. An active program to locate a buyer and other actions required to complete the plan to sell the asset (disposal group) have been initiated;

4. The sale of the asset (disposal group) is probable, and transfer of the asset (disposal group) is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond the Company's control extend the period of time required to sell the asset (disposal group) beyond one year;

5. The asset (disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and

6. Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

A long-lived asset (disposal group) that is classified as held for sale is initially measured at the lower of its carrying value or fair value less any costs to sell.  Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met.  Gains are not recognized on the sale of a long-lived asset (disposal group) until the date of sale.

The fair value of a long-lived asset (disposal group) less any costs to sell is assessed at each reporting period it remains classified as held for sale and any subsequent changes are reported as an adjustment to the carrying value of the asset (disposal group), as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale.  Upon determining that a long-lived asset (disposal group) met the criteria to be classified as held for sale, the Company reported the assets and liabilities of the disposal group for all periods presented in the line items "Assets held for sale" and "Liabilities held for sale," respectively, in the Consolidated Balance Sheet as of March 31, 2019.  See Note 3.

Product warranties

The Company estimates the costs that may be incurred under its product warranties and records a liability in the amount of such costs at the time revenue is recognized.  The reserve for product warranties is based upon past claims experience and ongoing evaluations of any specific probable claims from customers.  A reconciliation of the changes in the product warranty liability is presented in Note 7.

Research and development

Research and development costs are expensed as incurred.  The Company incurred research and development costs of $3,353, $3,538 and $3,211 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.  Research and development costs are included in the line item “Cost of products sold” in the Consolidated Statements of Operations.

Income taxes

The Company recognizes deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns.  Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using currently enacted tax rates.  The Company evaluates the available evidence about future taxable income and other possible sources of realization of deferred income tax assets and records a valuation allowance to reduce deferred income tax assets to an amount that represents the Company's best estimate of the amount of such deferred income tax assets that more likely than not will be realized.

The Company accounts for uncertain tax positions using a "more likely than not" recognition threshold.  The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective resolution of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position.  These tax positions are evaluated on a quarterly basis.  It is the Company's policy to recognize any interest related to uncertain tax positions in interest expense and any penalties related to uncertain tax positions in selling, general and administrative expense.

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The Company files federal and state income tax returns in several U.S. and non-U.S. domestic and foreign jurisdictions.  In most tax jurisdictions, returns are subject to examination by the relevant tax authorities for a number of years after the returns have been filed.

Equity-based compensation

The Company records compensation costs related to equity-based awards based on the estimated fair value of the award on the grant date.  Compensation cost is recognized in the Company's Consolidated Statements of Operations over the applicable vesting period.  The Company uses the Black-Scholes valuation model as the method for determining the fair value of its stock option awards.  For service and performance based restricted stock awards, the fair market value of the award is determined based upon the closing value of the Company's stock price on the grant date.  The fair market value of market-based performance restricted stock awards is determined using the Monte Carlo valuation model.  The amount of equity-based compensation expense recognized during a period is based on the portion of the awards that are ultimately expected to vest.  The Company estimates the forfeiture rate at the grant date by analyzing historical data and revises the estimates in subsequent periods if the actual forfeiture rate differs from the estimates.

Income (loss) per share data

Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period.  Diluted income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding and, when applicable, potential common shares outstanding during the period.  

A reconciliation of the numerators and denominators of basic and diluted (loss) income per share is presented below:

	Year ended March 31,
	2020		2019			2018
Basic income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted common shares outstanding		9,876		9,823			9,764
Basic income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)
Diluted income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted average common shares and SEUs    outstanding		9,876		9,823			9,764
Stock options outstanding		3		—			—
Weighted average common and potential common    shares outstanding		9,879		9,823			9,764
Diluted income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)

None of the options to purchase shares of common stock which totaled 39 and 69 in fiscal 2019 and fiscal 2018, respectively, were included in the computation of diluted loss per share as the affect would be anti-dilutive due to the net losses in the fiscal years.

Cash flow statement

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Interest paid was $12 in each of fiscal 2020, fiscal 2019, and fiscal 2018.  In addition, income taxes paid (refunded) were $139 in fiscal 2020, $(73) in fiscal 2019 and $1,916 in fiscal 2018.

In fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included pension and other postretirement benefit adjustments, net of income tax, of $525, $348 and $(1,668), respectively.  In fiscal 2018, non-cash activities included the reclassification of $1,828 from accumulated other comprehensive loss to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of

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2017 (the "Tax Act").  Also, in fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included the issuance of treasury stock valued at $170, $134 and $130, respectively, to the Company's Employee Stock Purchase Plan (See Note 13).

At March 31, 2020, 2019 and 2018, there were $162, $85, and $0, respectively, of capital purchases that were recorded in accounts payable and are not included in the caption "Purchase of property, plant and equipment" in the Consolidated Statements of Cash Flows.  In fiscal 2020, fiscal 2019 and fiscal 2018, capital expenditures totaling $0, $100 and $0, respectively, were financed through the issuance of capital leases.

Accumulated other comprehensive loss

Comprehensive income is comprised of net income and other comprehensive income or loss items, which are accumulated as a separate component of stockholders' equity.  For the Company, other comprehensive income or loss items include a foreign currency translation adjustment and pension and other postretirement benefit adjustments.

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the "exit price") in an orderly transaction between market participants at the measurement date.  The accounting standard for fair value establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.  Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company.  Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.  The hierarchy is broken down into three levels based on the reliability of inputs as follows:

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.  Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.

Level 2 – Valuations determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market.

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.  The degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

The availability of observable inputs can vary and is affected by a wide variety of factors, including, the type of asset/liability, whether the asset/liability is established in the marketplace, and other characteristics particular to the transaction.  To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment.  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure.  Therefore, even when market assumptions are not readily available, assumptions are required to reflect those that market participants would use in pricing the asset or liability at the measurement date.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of sales and expenses during the reporting period.  Actual results could differ materially from those estimates.

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Accounting and reporting changes

In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board ("FASB"), the Securities and Exchange Commission ("SEC"), the Emerging Issues Task Force, the American Institute of Certified Public Accountants or any other authoritative accounting body to determine the potential impact they may have on the Company's consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)," which requires companies to recognize all leases as assets and liabilities on the consolidated balance sheet.  Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  This ASU retains a distinction between finance leases and operating leases, and the classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous accounting guidance.  The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.  Earlier application is permitted.

The Company adopted the new standard using the modified retrospective approach on April 1, 2019.  The Company elected the available transition method that uses the effective date of the amended guidance as the date of initial application.  The guidance provided for several practical expedients.  The Company elected the package of practical expedients permitted under the transition guidance which allows entities to carry forward historical lease classification.  The Company made an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  The Company recognizes those lease payments in the Condensed Consolidated Statements of Income on a straight-line basis over the lease term.  On April 1, 2019, the Company recognized the cumulative effect of initially applying the amended guidance which resulted in the recognition of operating lease ROU assets of $677, lease liabilities of $732 and a decrease to the opening balance of retained earnings of $80.  Other current assets and the deferred income tax liability were reduced by $47 and $22, respectively.  Approximately $500 of ROU assets and lease liabilities were related to the business held for sale at March 31, 2019 and subsequently sold on June 24, 2019.  See Note 8 to the Consolidated Financial Statements for additional information on the Company’s leases.

 In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326)," which replaces the current incurred loss impairment methodology for most financial assets with the current expected credit loss ("CECL") methodology.  Under the CECL method, the Company will be required to immediately recognize an estimate of credit losses expected to occur over the life of the financial asset at the time the financial asset is originated or acquired.  Estimated credit losses are determined by taking into consideration historical loss conditions, current conditions and reasonable and supportable forecasts.  Changes to the expected lifetime credit losses are required to be recognized each period.  The standard is effective for the Company on April 1, 2023.  The Company does not expect the adoption of this ASU will have a material effect on its Consolidated Financial Statements.

In August 2018, the FASB issued ASU No. 2018-14, "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20)," which removes disclosures that no longer are considered cost beneficial, clarifies specific disclosure requirements and adds disclosure requirements identified as relevant for defined benefit pension and other postretirement benefit plans.  This amendment is effective for fiscal years ending after December 15, 2020.  Early adoption is permitted. The amendment requires application on a retrospective basis to all periods presented.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

In December 2019, the FASB issue ASU No. 2019-12, “Simplifying the Accounting for Income Taxes.”.  The amended guidance simplifies the accounting for income taxes, eliminating certain exceptions to the general income tax principles, in an effort to reduce the cost and complexity of application.  The amended guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.  Earlier application is permitted.  The guidance requires application on either a prospective, retrospective or modified retrospective basis, contingent on the income tax exception being applied.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

Management does not expect any other recently issued accounting pronouncements, which have not already been adopted, to have a material impact on the Company's consolidated financial statements.

Note 2 – Revenue Recognition:

The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.

The Company recognizes revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, the Company has rights to payment, and rewards of ownership pass to the customer.

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The following tables present the Company's net sales disaggregated by product line and geographic area:

	Year ended March 31,
Product Line	2020		2019		2018
Heat transfer equipment	$	31,986	$	24,785	$	27,023
Vacuum equipment		33,354		34,461		22,175
All other		25,264		32,585		28,336
Net sales	$	90,604	$	91,831	$	77,534

	Year ended March 31,
Geographic Area	2020		2019		2018
Asia	$	5,517	$	10,292	$	10,200
Canada		8,907		16,602		8,888
Middle East		13,112		2,610		3,785
South America		3,783		324		1,560
U.S.		58,042		59,441		51,950
All other		1,243		2,562		1,151
Net sales	$	90,604	$	91,831	$	77,534

The final destination of products shipped is the basis used to determine net sales by geographic area.  No sales were made to the terrorist sponsoring nations of Sudan, Iran, or Syria.

A performance obligation represents a promise in a contract to provide a distinct good or service to a customer and is the unit of accounting pursuant to ASC 606.  The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.  Transaction price reflects the amount of consideration to which the Company expects to be entitled in exchange for transferred products.  A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized as the performance obligation is satisfied.  In certain cases, the Company may separate a contract into more than one performance obligation, while in other cases, several products may be part of a fully integrated solution and are bundled into a single performance obligation.  If a contract is separated into more than one performance obligation, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods underlying each performance obligation.  The Company has made an accounting policy election to exclude from the measurement of the contract price all taxes assessed by government authorities that are collected by the Company from its customers.  The Company does not adjust the contract price for the effects of a financing component if the Company expects, at contract inception, that the period between when a product is transferred to a customer and when the customer pays for the product will be one year or less. Shipping and handling fees billed to the customer are recorded in revenue and the related costs incurred for shipping and handling are included in cost of products sold.

Revenue on the majority of the Company’s contracts, as measured by number of contracts, is recognized upon shipment to the customer, however, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria established in ASC 606.   Revenue from contracts that is recognized upon shipment accounted for approximately 30% of revenue in fiscal 2020.  Revenue from contracts that is recognized over time accounted for approximately 70% of revenue in fiscal 2020.  The Company recognizes revenue over time when contract performance results in the creation of a product for which the Company does not have an alternative use and the contract includes an enforceable right to payment in an amount that corresponds directly with the value of the performance completed.  To measure progress towards completion on performance obligations for which revenue is recognized over time the Company utilizes an input method based upon a ratio of direct labor hours incurred to date to management’s estimate of the total labor hours to be incurred on each contract or an output method based upon completion of operational milestones, depending upon the nature of the contract.  The Company has established the systems and procedures essential to developing the estimates required to account for performance obligations over time.  These procedures include monthly review by management of costs incurred, progress towards completion, identified risks and opportunities, sourcing determinations, changes in estimates of costs yet to be incurred, availability of materials, and execution by subcontractors.  Sales and earnings are adjusted on a cumulative catch-up basis in current accounting periods based upon revisions in the contract value due to pricing changes and estimated costs at completion.  Losses on contracts are recognized immediately when evident to management.

The timing of revenue recognition, invoicing and cash collections affect trade accounts receivable, unbilled revenue (contract assets) and customer deposits (contract liabilities) on the Consolidated Balance Sheets.  Unbilled revenue represents revenue on contracts that is recognized over time and exceeds the amount that has been billed to the customer.  Unbilled revenue is separately

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presented in the Consolidated Balance Sheets.  The Company may receive a customer deposit or have an unconditional right to receive a customer deposit prior to revenue being recognized.  Because the performance obligations related to such customer deposits may not have been satisfied, a contract liability is recorded and an offsetting asset of equal amount is recorded as a trade accounts receivable until the deposit is collected.  Customer deposits are separately presented in the Consolidated Balance Sheets.  Customer deposits are not considered a significant financing component as they are generally received less than one year before the product is completed or used to procure specific material on a contract, as well as related overhead costs incurred during design and construction.

Net contract assets (liabilities) consisted of the following:

	March 31,			March 31,
	2020			2019			Change
Unbilled revenue	$	14,592		$	7,522		$	7,070
Customer deposits		(26,983	)		(30,847	)		3,864
Net (over) under billings	$	(12,391	)	$	(23,325	)	$	10,934

Contract liabilities at March 31, 2020 and 2019 include $3,660 and $6,382, respectively, of customer deposits for which the Company has an unconditional right to collect payment.  Trade accounts receivable, as presented on the Consolidated Balance Sheets, includes corresponding balances at March 31, 2020 and 2019, respectively.  Revenue recognized in fiscal 2020 that was included in the contract liability balance at March 31, 2019 was $17,040.  Changes in the net contract liability balance during fiscal 2020 were impacted by a $7,070 increase in contract assets, of which $20,585 was due to contract progress offset by invoicing to customers of $13,515.  In addition, contract liabilities decreased $3,864 driven by new customer deposits of $13,176 offset by revenue recognized in fiscal 2020 that was included in the contract liability balance at March 31, 2019.

Receivables billed but not paid under retainage provisions in the Company’s customer contracts were $2,016 and $2,214 at March 31, 2020 and 2019, respectively.

Incremental costs to obtain a contract consist of sales employee and agent commissions.  Commissions paid to employees and sales agents are capitalized when paid and amortized to selling, general and administrative expense when the related revenue is recognized.  Capitalized costs, net of amortization, to obtain a contract were $45 and $133 at March 31, 2020 and 2019, respectively, and are included in the line item "Prepaid expenses and other current assets" in the Consolidated Balance Sheets.  The related amortization expense was $169 in fiscal 2020.

The Company's remaining unsatisfied performance obligations represent a measure of the total dollar value of work to be performed on contracts awarded and in progress.  The Company also refers to this measure as backlog.  As of March 31, 2020, the Company had remaining unsatisfied performance obligations of $112,389.  The Company expects to recognize revenue on approximately 70% to 75% of the remaining performance obligations within one year, 15% to 20% in one to two years and the remaining beyond two years.  

Note 3 – Assets Dispositions:

In March 2019, the Company's Board of Directors approved a plan to sell Energy Steel.  Energy Steel met all of the criteria to classify its assets and liabilities as held for sale at March 31, 2019 and as a result its assets and liabilities are separately presented in the Consolidated Balance Sheet at March 31, 2019 in the captions "Assets held for sale" and "Liabilities held for sale".  The disposal of Energy Steel did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and was, therefore, not classified as discontinued operations in accordance with ASU 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360):  Reporting Discontinued Operation And Disclosures of Disposals Of Components Of An Entity."  As part of the required assessment under the held for sale guidance, the Company determined that the approximate fair value less costs to sell the operations was less than its carrying value and, as a result, an impairment loss totaling $6,449 was recorded in fiscal 2019.  (See Note 6 to the Consolidated Financial Statements for further discussion.)

On June 24, 2019, the Company completed the sale of Energy Steel to Hayward Tyler, a division of Avingtrans PLC, a global leader in performance-critical pumps and motors for the energy sector.  Under the terms of the stock purchase agreement, the Company received proceeds of $602, subject to certain adjustments, including a customary working capital adjustment.  The purchase price was finalized within 90 days of the sale and no adjustments to the purchase price were required.  In addition, $202 of Energy Steel’s net accounts receivable was retained by the Company.  The Company recognized a loss on the disposal of $181 in fiscal 2020.  During fiscal 2020, the Company incurred a bad debt charge of $98 and an inventory write down of $338 related to the bankruptcy of Westinghouse Electric Company.  All of these items are included in the line item “Other expense” in the Consolidated Statement of Operations for fiscal 2020.  As of June 24, 2019, all of the Energy Steel assets and liabilities were legally transferred, and therefore, are not included in the Company’s Consolidated Balance Sheet at March 31, 2020.

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The following table reconciles the major classes of assets and liabilities classified as held for sale in the Consolidated Balance Sheet at March 31, 2019:

	March 31, 2019
Major classes of assets included as held for sale
Cash	$	552
Trade accounts receivable, net of allowances		1,921
Unbilled revenue		302
Inventories		1,809
Prepaid expenses and other current assets		130
Income taxes receivable		10
Deferred tax asset		126
Total major classes of assets included as held for sale	$	4,850
Major classes of liabilities included as held for sale
Accounts payable	$	520
Accrued compensation		326
Accrued expenses and other current liabilities		746
Customer deposits		1,933
Total major classes of liabilities included as held for sale	$	3,525

Note 4 – Inventories:

Major classifications of inventories are as follows:

	March 31,
	2020		2019
Raw materials and supplies	$	3,061	$	2,787
Work in process		18,018		20,553
Finished products		1,212		1,330
	$	22,291	$	24,670

Note 5 – Property, Plant and Equipment:

Major classifications of property, plant and equipment are as follows:

	March 31,
	2020		2019
Land	$	171	$	171
Buildings and leasehold improvements		19,393		19,263
Machinery and equipment		30,474		29,530
Construction in progress		1,360		4
		51,398		48,968
Less – accumulated depreciation and amortization		33,811		31,897
	$	17,587	$	17,071

Depreciation expense in fiscal 2020, fiscal 2019 and fiscal 2018 was $1,957, $1,968, and $1,986, respectively.

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Note 6– Goodwill and Other Impairments:

Finite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives.  Intangible amortization expense was $0, $180 and $180 in fiscal 2020, fiscal 2019 and fiscal 2018.   

During fiscal 2018, the Company performed its annual goodwill and intangible asset impairment review.  The Company assessed impairment by comparing the fair value of its reporting units and intangible assets to their related carrying value.  The Company estimated the fair value of intangible assets and goodwill of its commercial nuclear utility business related to the December 2010 acquisition of Energy Steel using the income approach.  Under the income approach, the fair value of the business was calculated based on the present value of estimated future cash flows.  Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions.  The discount rate used was based on a weighted average cost of capital adjusted for the relevant risk associated with the characteristics of the business and the projected cash flows.  The inputs utilized in the analyses were classified as Level 3 inputs within the fair value hierarchy.  The impairment review indicated that the fair value of the intangible assets and goodwill of the business were substantially lower than the carrying value due to reduced investment from the U.S. commercial nuclear utility market, the strength of the Energy Steel brand relative to larger more vertically integrated suppliers, and the bankruptcy of Westinghouse Electric Company which resulted in the stoppage of work at the Summer, South Carolina nuclear facility.  As a result, in fiscal 2018 the Company recorded impairment losses of $8,600, $500, and $5,716 for permits, tradename and goodwill, respectively.   

As disclosed in Note 3, in the fourth quarter of fiscal 2019, the Company’s Board of Directors approved a plan to sell Energy Steel and, as a result, the Company classified the assets and liabilities of Energy Steel as "Assets held for sale" and "Liabilities held for sale" in the Consolidated Balance Sheet as of March 31, 2019.  An impairment loss totaling $6,449 was recorded in the fourth quarter of fiscal 2019 related to the disposition of Energy Steel which included impairment losses of $1,700, $2,000, $1,208, $1,222 and $319 for permits, tradename, customer relationships, goodwill and other long-lived assets.  On June 24, 2019, the Company completed the sale of Energy Steel.

Note 7 – Product Warranty Liability:

The reconciliation of the changes in the product warranty liability is as follows:

	Year ended March 31,
	2020			2019
Balance at beginning of year	$	366		$	493
Expense for product warranties		62			234
Product warranty claims paid		(69	)		(276	)
Reclassification to liabilities held for sale		—			(85	)
Balance at end of year	$	359		$	366

The product warranty liability is included in the line item "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets.

Note 8 - Leases:

The Company accounts for leases in accordance with Accounting Standard Codification 842, "Leases," which it adopted on April 1, 2019 using the modified retrospective approach.  See Note 1 to the Consolidated Financial Statements for further discussion of this adoption.

The Company leases certain manufacturing facilities, office space, machinery and office equipment.  An arrangement is considered to contain a lease if it conveys the right to use and control an identified asset for a period of time in exchange for consideration.  If it is determined that an arrangement contains a lease, then a classification of a lease as operating or finance is determined by evaluating the five criteria outlined in the lease accounting guidance at inception. Leases generally have remaining terms of one year to five years, whereas leases with an initial term of twelve months or less are not recorded on the Consolidated Balance Sheets.  The depreciable life of leased assets related to finance leases is limited by the expected term of the lease, unless there is a transfer of title or purchase option that the Company believes is reasonably certain of exercise.  Certain leases include options to renew or terminate.  Renewal options are exercisable per the discretion of the Company and vary based on the nature of each lease.  The term of the lease includes renewal periods only if the Company is reasonably certain that it will exercise the renewal option.  When determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not limited to, the cost of moving to another location, the cost of disrupting operations, whether the purpose or location of the leased asset is unique and the contractual terms associated with extending the lease.  The Company’s lease agreements do not contain any

46

residual value guarantees or any material restrictive covenants and the Company does not sublease to any third parties.  As of March 31, 2020, the Company did not have any material leases that have been signed but not commenced.

Right-of-use (“ROU”) lease assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date.  ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments in exchange for that right of use.  Finance lease ROU assets and operating lease ROU assets are included in the line items “Property, plant and equipment, net” and “Operating lease assets”, respectively, in the Condensed Consolidated Balance Sheets.  The current portion and non-current portion of finance and operating lease liabilities are all presented separately in the Consolidated Balance Sheets.

The discount rate implicit within the Company’s leases is generally not readily determinable, and therefore, the Company uses an incremental borrowing rate in determining the present value of lease payments based on rates available at commencement.

The weighted average remaining lease term and discount rate for finance and operating leases are as follows:

	March 31, 2020
Finance Leases
Weighted-average remaining lease term in years		2.81
Weighted-average discount rate		9.71	%
Operating Leases
Weighted-average remaining lease term in years		1.98
Weighted-average discount rate		5.49	%

The components of lease expense are as follows:

	Year Ended March 31, 2020
Finance lease cost:
Amortization of right-of-use assets	$	48
Interest on lease liabilities		12
Operating lease cost		229
Short-term lease cost		38
Total lease cost	$	327

Operating lease costs during fiscal 2020 were included within cost of sales and selling, general and administrative expenses.

As of March 31, 2020, future minimum payments required under non-cancelable leases are:

	Operating Leases		Finance Leases
2021	$	162	$	48
2022		48		26
2023		31		26
2024		8		10
2025		—		—
Total lease payments		249		110
Less – amount representing interest		14		15
Present value of net minimum lease payments	$	235	$	95

The Company’s future minimum lease commitments for operating leases as of March 31, 2019 for the fiscal years 2020 through 2024 were $501, $301, $37, $32, and $8, respectively.  Future minimum lease commitments for finance leases as of March 31, 2019 for the fiscal years 2020 through 2024 were $62, $47, $26, $26, and $11, respectively.  

ROU assets obtained in exchange for new operating lease liabilities were $223 in fiscal 2020.

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Note 9 - Debt:

Short-Term Debt

The Company and its subsidiaries had no short-term borrowings outstanding at March 31, 2020 and 2019.

On December 2, 2015, the Company entered into a revolving credit facility agreement with JPMorgan Chase Bank, N.A. that provides a $25,000 line of credit, including letters of credit and bank guarantees, expandable at the Company's option at any time up to $50,000.  The agreement has a five-year term.

At the Company's option, amounts outstanding under the agreement will bear interest at either: (i) a rate equal to the bank's prime rate; or (ii) a rate equal to LIBOR plus a margin.  The margin is based on the Company's funded debt to earnings before interest expense, income taxes, depreciation and amortization ("EBITDA") and may range from 1.75% to 0.95%.  Amounts available for borrowing under the agreement are subject to an unused commitment fee of between 0.30% and 0.20%, depending on the above ratio.  The bank’s prime rate was 3.25% and 5.50% at March 31, 2020 and 2019, respectively.  

Outstanding letters of credit under the agreement are subject to a fee of between 1.20% and 0.70%, depending on the Company's ratio of funded debt to EBITDA.  The agreement allows the Company to reduce the fee on outstanding letters of credit to a fixed rate of 0.40% by securing outstanding letters of credit with cash and cash equivalents and investments.  At March 31, 2020, all outstanding letters of credit were secured by a certificate of deposit.  At March 31, 2020, there were $5,397 letters of credit outstanding on the JPMorgan Chase Bank, N.A. revolving credit facility.  Availability under the line of credit was $19,603 at March 31, 2020.

Under the revolving credit facility, the Company covenants to maintain a maximum funded debt to EBITDA ratio, as defined in such credit facility, of 3.5 to 1.0 and a minimum earnings before interest expense and income taxes ("EBIT") to interest ratio, as defined in such credit facility, of 4.0 to 1.0.  The agreement also provides that the Company is permitted to pay dividends without limitation if it maintains a maximum funded debt to EBITDA ratio equal to or less than 2.0 to 1.0 and permits the Company to pay dividends in an amount equal to 25% of net income if it maintains a funded debt to EBITDA ratio of greater than 2.0 to 1.0.  The Company was in compliance with all such provisions as of and for the years ended March 31, 2020 and 2019.  Assets with a book value of $128,281 have been pledged to secure borrowings under the credit facility.

At March 31, 2019 the Company had an additional letter of credit facility agreement with HSBC Bank USA, N.A. to further support its international operations.  The agreement provided a $5,000 line of credit to be used for the issuance of letters of credit.  On October 8, 2019, the Company entered into an agreement to amend the letter of credit facility agreement and increase the letter of credit facility to $10,000.  Under the amended agreement, the Company incurs an annual facility fee of $5 and outstanding letters of credit are subject to a fee of between .75% and 0.65%, depending on the term of the letter of credit.  Interest is payable on the principal amounts of unreimbursed letter of credit draws under the facility at a rate of 3% plus the bank’s prime rate.  The bank’s prime rate was 3.25% at March 31, 2020.  The Company's obligations under the agreement are secured by certain certificates of deposit held with the bank.  At March 31, 2020 there were $7,931 letters of credit outstanding, and availability under the letter of credit facility was $2,069.  Subsequent to March 31, 2020, the Company entered into an agreement to amend the letter of credit facility agreement and increase the line of credit to $14,000, among other things.  See Note 19 - Subsequent Events for a discussion of this amendment.

Long-Term Debt

The Company and its subsidiaries had long-term capital lease obligations outstanding as follows:

	March 31,
	2020		2019
Finance lease obligations (Note 8)	$	95	$	146
Less: current amounts		40		51
Total	$	55	$	95

With the exception of capital leases, the Company has no long-term debt payment requirements over the next five years as of March 31, 2020.

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Note 10 - Financial Instruments and Derivative Financial Instruments:

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, investments, and trade accounts receivable.  The Company places its cash, cash equivalents, and investments with high credit quality financial institutions, and evaluates the credit worthiness of these financial institutions on a regular basis. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of customers comprising the Company's customer base and their geographic dispersion.  At March 31, 2020 and 2019, the Company had no significant concentrations of credit risk.

Letters of Credit

The Company has entered into standby letter of credit agreements with financial institutions relating to the guarantee of future performance on certain contracts.  At March 31, 2020 and 2019, the Company was contingently liable on outstanding standby letters of credit aggregating $13,328 and $8,503, respectively.

Fair Value of Financial Instruments

The estimates of the fair value of financial instruments are summarized as follows:

Cash and cash equivalents:  The carrying amount of cash and cash equivalents approximates fair value due to the short-term maturity of these instruments and are considered Level 1 assets in the fair value hierarchy.

Investments:  The fair value of investments at March 31, 2020 and 2019 approximated the carrying value and are considered Level 2 assets in the fair value hierarchy.

Note 11 – Income Taxes:

An analysis of the components of income (loss) before provision (benefit) for income taxes is presented below:

	Year ended March 31,
	2020			2019			2018
United States	$	2,405		$	(256	)	$	(12,861	)
Asia		(93	)		111			7
	$	2,312		$	(145	)	$	(12,854	)

The provision (benefit) for income taxes consists of:

	Year ended March 31,
	2020			2019			2018
Current:
Federal	$	547		$	181		$	6
State		176			141			72
Foreign		4			—			—
		727			322			78
Deferred:
Federal		(694	)		(3,993	)		(3,276	)
State		8			(84	)		61
Foreign		(12	)		41			12
Changes in valuation allowance		411			3,877			115
		(287	)		(159	)		(3,088	)
Total provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

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The reconciliation of the provision (benefit) calculated using the U.S. federal tax rate with the provision (benefit) for income taxes presented in the consolidated financial statements is as follows:

	Year ended March 31,
	2020			2019			2018
Provision (benefit) for income taxes at federal rate	$	486		$	(30	)	$	(3,958	)
State taxes		120			45			118
Charges not deductible for income tax purposes		55			89			48
Research and development tax credits		(211	)		(177	)		(102	)
Valuation allowance		411			3,877			(80	)
Difference in federal rate		(1	)		3			(2,799	)
Impairment of goodwill and intangible assets		—			257			1,760
Foreign-derived intangible income deduction		(95	)		(69	)		—
Capital loss from sale of Energy Steel		(325	)		(3,848	)		—
Stranded tax effects in accumulated other comprehensive loss		—			—			1,828
Mandatory repatriation of post-1986 undistributed foreign    subsidiary earnings and profits		—			—			185
Other		—			16			(10	)
Provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

In fiscal 2018 the impact on the valuation allowance of the difference in the federal rate as a result of the Tax Cuts and Jobs Act which became law in December 2017 (the "Tax Act") discussed below is reflected in the line item "Difference in federal rate" in the reconciliation above.

The net deferred income tax liability recorded in the Consolidated Balance Sheets results from differences between financial statement and tax reporting of income and deductions.  A summary of the composition of the Company's net deferred income tax liability follows:

	March 31,
	2020			2019
Depreciation	$	(1,707	)	$	(1,714	)
Accrued compensation		206			230
Prepaid pension asset		(783	)		(935	)
Accrued pension liability		169			145
Accrued postretirement benefits		143			150
Compensated absences		402			355
Inventories		(13	)		14
Warranty liability		81			80
Accrued expenses		366			267
Equity-based compensation		385			359
Operating lease assets		(58	)		—
Operating lease liabilities		60			—
New York State investment tax credit		1,108			1,069
Net operating loss carryforwards		75			50
Capital loss related to sale of Energy Steel		4,211			3,848
Other		1			(20	)
		4,646			3,898
Less:  Valuation allowance		(5,319	)		(4,917	)
Total	$	(673	)	$	(1,019	)

The foreign deferred income tax asset of $48 and $37 at March 31, 2020 and 2019, respectively, is included in the caption "Other assets" in the Consolidated Balance Sheet.  Deferred income taxes include the impact of state investment tax credits of $314, which expire from 2021 to 2034 and state investment tax credits of $794, which have an unlimited carryforward period.

Foreign net operating losses at March 31, 2020 were $301 and expire between 2022 through 2024.      

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In assessing the realizability of deferred tax assets, management considers, within each taxing jurisdiction, whether it is more likely than not that some portion or all of the deferred tax assets will not be realized.  Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the consideration of the weight of both positive and negative evidence, management determined that a portion of the deferred tax assets as of March 31, 2020 and 2019 related to certain state investment tax credits and the capital loss related to Energy Steel would not be realized, and recorded a valuation allowance of $5,319 and $4,917, respectively.  The deferred tax asset of $126 included in the caption "Assets held for sale" in the Consolidated Balance Sheet at March 31, 2019 included a valuation allowance of $34 related to net operating loss carryforwards for city income taxes.

The Company files federal and state income tax returns in several domestic and international jurisdictions.  In most tax jurisdictions, returns are subject to examination by the relevant tax authorities for a number of years after the returns have been filed.  The Company is subject to U.S. federal examination for tax years 2016 through 2019 and examination in state tax jurisdictions for tax years 2015 through 2019.  The Company is subject to examination in the People's Republic of China for tax years 2016 through 2019 and in India for tax year 2019.  The liability for unrecognized tax benefits was $0 at each of March 31, 2020 and 2019.

On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act into law.  The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses and allow businesses to carry back net operating losses arising in 2018, 2019 and 2020 to the five prior tax years, accelerate refunds of previously generated corporate alternative minimum tax credits, change the business interest limitation under IRC section 163(j) from 30% to 50%, and fix qualified improvement property from the Tax Act.  These provisions did not have a material impact on the Company’s consolidated financial statements.

On December 22, 2017, the Tax Act was signed into law.  The Tax Act significantly revised the U.S. tax code by, among other changes, lowering the corporate income tax rate from 35% to 21%, requiring a one-time transition tax on accumulated foreign earnings of certain foreign subsidiaries that were previously tax deferred and creating new taxes on certain foreign sourced earnings.  The Company remeasured certain U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%, and recorded an income tax benefit of $971 related to such re-measurement in fiscal 2018.

The one-time transition tax was based on the total post-1986 earnings and profits (“E&P”) of our foreign subsidiary that has previously been deferred from U.S. income taxes.  The Company recorded its one-time transition liability of its foreign subsidiary resulting in additional income tax expense of $185 in fiscal 2018.  The transition tax was based in part on the amount of those earnings held in cash and other specified assets.  

The Tax Act also included two new U.S. tax base-erosion provisions, the global intangible low-taxed income ("GILTI") provisions and the base-erosion and anti-abuse tax ("BEAT") provisions, beginning in 2018.  The GILTI provisions require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets.  The Company has elected to account for GILTI tax in the period in which it is incurred and recorded $ (1) and $11 of tax (benefit) related to GILTI in fiscal 2020 and fiscal 2019, respectively.  The BEAT provisions in the Tax Act eliminate the deduction of certain base-erosion payments made to related foreign corporations and impose a minimum tax if greater than regular tax.  The Company was not subject to this tax, and therefore has not included any tax impacts of BEAT in its consolidated financial statements.

The Tax Act also provided tax incentives to U.S. companies to earn income from the sale, lease or license of goods and services abroad in the form of a deduction for foreign-derived intangible income ("FDII").  FDII is taxed at an effective rate of 13.125% for taxable years beginning after December 31, 2017.  The incremental U.S. tax savings on FDII in fiscal 2020 and fiscal 2019 was $95 and $69, respectively.

The U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act.  The Company recognized the provisional tax impacts related to the revaluation of deferred tax assets and liabilities and included the amount in its consolidated financial statements in fiscal 2018 and during fiscal 2019 there were no significant changes made to the provisional amounts recorded in fiscal 2018.

Note 12 – Employee Benefit Plans:

Retirement Plans

The Company has a qualified defined benefit plan covering U.S. employees hired prior to January 1, 2003, which is non-contributory.  Benefits are based on the employee's years of service and average earnings for the five highest consecutive calendar

51

years of compensation in the ten-year period preceding retirement.  The Company's funding policy for the plan is to contribute the amount required by the Employee Retirement Income Security Act of 1974, as amended.

The components of pension cost (benefit) are:

	Year ended March 31,
	2020			2019			2018
Service cost during the period	$	496		$	571		$	598
Interest cost on projected benefit obligation		1,290			1,339			1,423
Expected return on assets		(2,657	)		(3,062	)		(2,977	)
Amortization of:
Actuarial loss		969			847			1,013
Net pension cost (benefit)	$	98		$	(305	)	$	57

The components of net pension cost (benefit) other than the service cost component are included in “Other income” in the Consolidated Statements of Operations.

The weighted average actuarial assumptions used to determine net pension cost are:

	Year ended March 31,
	2020			2019			2018
Discount rate		3.83	%		3.95	%		4.08	%
Rate of increase in compensation levels		3.00	%		3.00	%		3.00	%
Long-term rate of return on plan assets		7.00	%		8.00	%		8.00	%

The expected long-term rate of return is based on the mix of investments that comprise plan assets and external forecasts of future long-term investment returns, historical returns, correlations and market volatilities.

The Company does not expect to make any contributions to the plan during fiscal 2021.

Changes in the Company's benefit obligation, plan assets and funded status for the pension plan are presented below:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	34,149		$	34,441
Service cost		496			468
Interest cost		1,290			1,339
Actuarial loss (gain)		2,368			462
Benefit payments		(1,100	)		(972	)
Liability released through annuity purchase		(1,420	)		(1,589	)
Projected benefit obligation at end of year	$	35,783		$	34,149
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	38,416		$	38,810
Employer contribution		—			30
Actual return on plan assets		3,347			2,266
Benefit and administrative expense payments		(1,100	)		(972	)
Annuities purchased		(1,420	)		(1,718	)
Fair value of plan assets at end of year	$	39,243		$	38,416
Funded status
Funded status at end of year	$	3,460		$	4,267
Amount recognized in the Consolidated Balance Sheets	$	3,460		$	4,267

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The weighted average actuarial assumptions used to determine the benefit obligation are:

	March 31,
	2020			2019
Discount rate		3.44	%		3.83	%
Rate of increase in compensation levels		3.00	%		3.00	%

During fiscal 2020 and fiscal 2019, the pension plan released liabilities for vested benefits of certain participants through the purchase of nonparticipating annuity contracts with a third-party insurance company.  As a result of these transactions, in fiscal 2020 and fiscal 2019, the projected benefit obligation decreased $1,420 and $1,589, respectively, and plan assets decreased $1,420 and $1,718, respectively.  The projected benefit obligation is the actuarial present value of benefits attributable to employee service rendered to date, including the effects of estimated future pay increases.  The accumulated benefit obligation reflects the actuarial present value of benefits attributable to employee service rendered to date, but does not include the effects of estimated future pay increases.  The accumulated benefit obligation as of March 31, 2020 and 2019 was $31,715 and $30,380, respectively.  At March 31, 2020 and 2019, the pension plan was fully funded on an accumulated benefit obligation basis.

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	9,285	$	8,737

The increase in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial loss arising during the year	$	1,298		$	1,080
Amortization of actuarial loss		(750	)		(712	)
	$	548		$	368

The estimated net actuarial loss for the pension plan that will be amortized from accumulated other comprehensive loss into net pension cost in fiscal 2021 is $1,039.

The following benefit payments, which reflect future service, are expected to be paid during the fiscal years ending March 31:

2021	$	1,219
2022		1,271
2023		1,289
2024		1,358
2025		1,363
2026-2030		8,209
Total	$	14,709

The weighted average asset allocation of the plan assets by asset category is as follows:

				March 31,
Asset Category	Target Allocation			2020			2019
Equity securities		30	%		30	%		49	%
Debt securities		70	%		70	%		51	%
					100	%		100	%

The investment strategy of the plan is to generate a consistent total investment return sufficient to pay present and future plan benefits to retirees, while minimizing the long-term cost to the Company.  Target allocations for asset categories are used to earn a reasonable rate of return, provide required liquidity and minimize the risk of large losses.  Targets are adjusted when considered necessary to reflect trends and developments within the overall investment environment.  In fiscal 2020, the target allocation was adjusted to 30% from 50% for equity securities and to 70% from 50% for debt securities.

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The fair values of the Company's pension plan assets at March 31, 2020 and 2019, by asset category, are as follows:

			Fair Value Measurements Using
Asset Category	At March 31, 2020		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	82	$	82	$	—	$	—
Equity securities:
U.S. companies		9,409		9,409		—		—
International companies		2,327		2,327		—		—
Fixed income:
Corporate bond funds
Long-term		27,425		27,425		—		—
	$	39,243	$	39,243	$	—	$	—

			Fair Value Measurements Using
Asset Category	At March 31,  2019		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	87	$	87	$	—	$	—
Equity securities:
U.S. companies		15,130		15,130		—		—
International companies		3,795		3,795		—		—
Fixed income:
Corporate bond funds
Long-term		19,404		19,404		—		—
	$	38,416	$	38,416	$	—	$	—

The fair value of Level 1 pension assets is obtained by reference to the last quoted price of the respective security on the market which it trades.  See Note 1 to the Consolidated Financial Statements.

On February 4, 2003, the Company closed the defined benefit plan to all employees hired on or after January 1, 2003.  In place of the defined benefit plan, these employees participate in the Company's domestic defined contribution plan.  The Company contributes a fixed percentage of employee compensation to this plan on an annual basis for these employees.  The Company contribution to the defined contribution plan for these employees in fiscal 2020, fiscal 2019 and fiscal 2018 was $406, $325 and $284, respectively.

The Company has a Supplemental Executive Retirement Plan ("SERP") which provides retirement benefits associated with wages in excess of the legislated qualified plan maximums.  Pension expense recorded in fiscal 2020, fiscal 2019, and fiscal 2018 related to this plan was $85, $97 and $115, respectively.  At March 31, 2020 and 2019, the related liability was $747 and $662, respectively, and is separately presented in the caption "Accrued Pension Liability" in the Consolidated Balance Sheets.

The Company has a domestic defined contribution plan (401k) covering substantially all employees.  The Company provides matching contributions equal to 100% of the first 3% of an employee's salary deferral and 50% of the next 2% percent of an employee’s salary deferral.  Company contributions are immediately vested.  Contributions were $1,000 in fiscal 2020, $1,135 in fiscal 2019 and $805 in fiscal 2018.

Other Postretirement Benefits

In addition to providing pension benefits, the Company has a plan in the U.S. that provides health care benefits for eligible retirees and eligible survivors of retirees.  The Company's share of the medical premium cost has been capped at $4 for family coverage and $2 for single coverage for early retirees, and $1 for both family and single coverage for regular retirees.

54

On February 4, 2003, the Company terminated postretirement health care benefits for its U.S. employees.  Benefits payable to retirees of record on April 1, 2003 remained unchanged.

The components of postretirement benefit expense are:

	Year ended March 31,
	2020		2019		2018
Interest cost on accumulated benefit obligation	$	22	$	25	$	26
Amortization of actuarial loss		28		28		37
Net postretirement benefit expense	$	50	$	53	$	63

Net postretirement benefit expense is included in “Other income” in the Consolidated Statements of Operations.

The weighted average discount rates used to develop the net postretirement benefit cost were 3.37%, 3.63% and 3.23% in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.

Changes in the Company's benefit obligation, plan assets and funded status for the plan are as follows:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	682		$	723
Interest cost		22			25
Actuarial loss (gain)		(3	)		2
Benefit payments		(67	)		(68	)
Projected benefit obligation at end of year	$	634		$	682

Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	—		$	—
Employer contribution		67			68
Benefit payments		(67	)		(68	)
Fair value of plan assets at end of year	$	—		$	—
Funded status
Funded status at end of year	$	(634	)	$	(682	)
Amount recognized in the Consolidated Balance Sheets	$	(634	)	$	(682	)

The weighted average actuarial assumptions used to develop the accrued postretirement benefit obligation were:

	March 31,
	2020			2019
Discount rate		3.01	%		3.37	%
Medical care cost trend rate		7.00	%		7.00	%

The medical care cost trend rate used in the actuarial computation ultimately reduces to 4.5% in 2025 and subsequent years.  This was accomplished using 0.5% decrements for the years ended March 31, 2020 through 2025.

The current portion of the accrued postretirement benefit obligation of $77 and $78, at March 31, 2020 and 2019, respectively, is included in the caption "Accrued Compensation" and the long-term portion is separately presented in the Consolidated Balance Sheets.

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	187	$	210

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The decrease in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial (gain) loss arising during the year	$	(2	)	$	1
Amortization of actuarial loss		(21	)		(21	)
	$	(23	)	$	(20	)

The estimated net actuarial loss for the other postretirement benefit plan that will be amortized from accumulated other comprehensive loss into net postretirement benefit income in fiscal 2021 is $27. 

The following benefit payments are expected to be paid during the fiscal years ending March 31:

2021	$	77
2022		72
2023		67
2024		62
2025		57
2026-2030		216
Total	$	551

Assumed medical care cost trend rates could have a significant effect on the amounts reported for the postretirement benefit plan.  However, due to the caps imposed on the Company's share of the premium costs, a one percentage point change in assumed medical care cost trend rates would not have a significant effect on the total service and interest cost components or the postretirement benefit obligation.

Self-Insured Medical Plan

Effective January 1, 2014, the Company commenced self-funding the medical insurance coverage provided to its U.S. based employees.  The Company has obtained a stop loss insurance policy in an effort to limit its exposure to claims.  The Company has specific stop loss coverage per employee for claims incurred during the year exceeding $100 per employee with annual maximum aggregate stop loss coverage of $1,000.  The Company also has total plan annual maximum aggregate stop loss coverage of $2,592.  The liability of $124 and $150 on March 31, 2020 and 2019, respectively, related to the self-insured medical plan is primarily based upon claim history and is included in the caption "Accrued Compensation" in the Consolidated Balance Sheets.

Note 13 - Equity Compensation Plans:

The Amended and Restated 2000 Graham Corporation Incentive Plan to Increase Shareholder Value, as approved by the Company's stockholders at the Annual Meeting on July 28, 2016, provides for the issuance of up to 1,375 shares of common stock in connection with grants of incentive stock options, non-qualified stock options, stock awards and performance awards to officers, key employees and outside directors; provided, however, that no more than 467 shares of common stock may be used for awards other than stock options.  Stock options may be granted at prices not less than the fair market value at the date of grant and expire no later than ten years after the date of grant.

In fiscal 2020, fiscal 2019 and fiscal 2018, 83, 53 and 59 shares, respectively, of restricted stock were awarded.  Restricted shares of 40, 27 and 30 granted to officers in fiscal 2020, fiscal 2019 and fiscal 2018, respectively, vest 100% on the third anniversary of the grant date subject to the satisfaction of the performance metrics for the applicable three-year period.  Restricted shares of 28, 20, and 22 granted to officers and key employees in fiscal 2020, fiscal 2019, and fiscal 2018 respectively, vest 33⅓% per year over a three-year term.  The restricted shares granted to directors of 15, 6 and 7 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively, vest 100% on the first anniversary of the grant date.  The Company recognizes compensation cost over the period the shares vest.

During fiscal 2020, fiscal 2019, and fiscal 2018, the Company recognized $945, $1,069, and $577, respectively, of stock-based compensation cost related to stock option and restricted stock awards, and $208, $237 and $125, respectively, of related tax benefits.

The Company received cash proceeds from the exercise of stock options of $24, $307 and $0 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.

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The following table summarizes information about the Company's stock option awards during fiscal 2020, fiscal 2019 and fiscal 2018:

				Weighted
	Shares			Average		Weighted	Aggregate
	Under			Exercise		Average Remaining	Intrinsic
	Option			Price		Contractual Term	Value
Outstanding at April 1, 2017		69			20.26
Exercised		—
Outstanding at March 31, 2018		69			20.26
Exercised		(19	)		15.89
Cancelled		(11	)		33.02
Outstanding at March 31, 2019		39			18.76
Exercised		(2	)		15.25
Outstanding at March 31, 2020		37			18.92	2.07 years	$	—
Vested or expected to vest at March 31, 2020		37			18.92	2.07 years		—
Exercisable at March 31, 2020		37			18.92	2.07 years		—

The following table summarizes information about stock options outstanding at March 31, 2020:

Exercise Price	Options Outstanding at March 31, 2020		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
$18.65		33	$	18.65		2.17
$21.19		4		21.19		1.17
$18.65-21.19		37		18.92		2.07

The total intrinsic value of the stock options exercised during fiscal 2020, fiscal 2019 and fiscal 2018 was $10, $161 and $0, respectively.  As of March 31, 2020, there was $2,318 of total unrecognized stock-based compensation expense related to non-vested restricted stock.  The Company expects to recognize this expense over a weighted average period of 1.38 years.

The outstanding options expire between May 2021 and May 2022.  Options, stock awards and performance awards available for future grants were 202 at March 31, 2020.

The following table summarizes information about the Company's restricted stock awards during fiscal 2020, fiscal 2019 and fiscal 2018:

	Restricted Stock			Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Non-vested at April 1, 2017		120			21.96
Granted		59			23.03
Vested		(25	)		20.44
Forfeited		(28	)		25.27
Non-vested at March 31, 2018		126			22.02
Granted		53			30.08
Vested		(28	)		20.38
Forfeited		(2	)		22.83
Non-vested at March 31, 2019		149			25.19
Granted		83			22.95
Vested		(38	)		23.17
Forfeited		(45	)		22.52
Non-vested at March 31, 2020		149			25.26	$	—

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The Company has an Employee Stock Purchase Plan (the "ESPP"), which allows eligible employees to purchase shares of the Company's common stock at a discount of up to 15% of its fair market value on the (1) last, (2) first or (3) lower of the last or first day of the six-month offering period. A total of 200 shares of common stock may be purchased under the ESPP.  In fiscal 2020, fiscal 2019 and fiscal 2018, 9, 6 and 7 shares, respectively, were issued from treasury stock to the ESPP for the offering periods in each of the fiscal years.  During fiscal 2020, fiscal 2019 and fiscal 2018, the Company recognized stock-based compensation cost of $30, $0 and $0, respectively, related to the ESPP and $7, $0 and $0, respectively, of related tax benefits.  

Note 14 – Changes in Accumulated Other Comprehensive Loss:

The changes in accumulated other comprehensive loss by component for fiscal 2020 and fiscal 2019 are:

	Pension and Other Postretirement Benefit Items			Foreign Currency Items			Total
Balance at April 1, 2018	$	(8,599	)	$	349		$	(8,250	)
Other comprehensive loss before reclassifications		(1,081	)		(235	)		(1,316	)
Amounts reclassified from accumulated other   comprehensive loss		733			—			733
Net current-period other comprehensive loss		(348	)		(235	)		(583	)
Balance at March 31, 2019		(8,947	)		114			(8,833	)
Other comprehensive loss before reclassifications		(1,296	)		(198	)		(1,494	)
Amounts reclassified from accumulated other   comprehensive loss		771			—			771
Net current-period other comprehensive loss		(525	)		(198	)		(723	)
Balance at March 31, 2020	$	(9,472	)	$	(84	)	$	(9,556	)

The reclassifications out of accumulated other comprehensive loss by component are as follows:

Year ended March 31, 2020

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(997	)	(1)
		(997	)		Income before provision for income taxes
		(226	)		Provision for income taxes
	$	(771	)		Net income

Year ended March 31, 2019

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(875	)	(1)
		(875	)		Income before provision for income taxes
		(142	)		Provision for income taxes
	$	(733	)		Net income

(1) These accumulated other comprehensive loss components are included within the computation of net periodic pension and other postretirement benefit costs.  See Note 12.

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Note 15 - Segment Information:

The Company has one reporting segment as its operating segments meet the requirement for aggregation.  The Company and its operating subsidiaries design and manufacture heat transfer and vacuum equipment for the chemical, petrochemical, refining and electric power generating markets.  Heat transfer equipment includes surface condensers, Heliflows, water heaters and various types of heat exchangers.  Vacuum equipment includes steam jet ejector vacuum systems and liquid ring vacuum pumps.  These products are sold individually or combined into package systems.  The Company also services and sells spare parts for its equipment.

See Note 2 to the consolidated financial statements for net sales by product line and geographic area.

In fiscal 2020 and fiscal 2019, total sales to one customer amounted to 13% and 12%, respectively, of total consolidated net sales.  The single customer representing such sales was a different customer in each of fiscal 2020 and fiscal 2019.  There were no sales to a single customer that amounted to 10% or more of total consolidated net sales in fiscal 2018.

Note 16 – Purchase of Treasury Stock:

On January 29, 2015, the Company’s Board of Directors authorized a stock repurchase program.  Under the stock repurchase program the Company is permitted to repurchase up to $18,000 of its common stock either in the open market or through privately negotiated transactions. Cash on hand has been used to fund all stock repurchases under the program.  No shares were purchased under this program in fiscal 2020, fiscal 2019 or fiscal 2018.

Note 17– Commitments and Contingencies:

The Company has been named as a defendant in lawsuits alleging personal injury from exposure to asbestos allegedly contained in, or accompanying, products made by the Company. The Company is a co-defendant with numerous other defendants in these lawsuits and intends to vigorously defend itself against these claims. The claims in the Company’s current lawsuits are similar to those made in previous asbestos-related suits that named the Company as a defendant, which either were dismissed when it was shown that the Company had not supplied products to the plaintiffs’ places of work or were settled for immaterial amounts.  The Company cannot provide any assurances that any pending or future matters will be resolved in the same manner as previous lawsuits.

As of March 31, 2020, the Company was subject to the claims noted above, as well as other legal proceedings and potential claims that have arisen in the ordinary course of business.

Although the outcome of the lawsuits, legal proceedings or potential claims to which the Company is, or may become, a party to cannot be determined and an estimate of the reasonably possible loss or range of loss cannot be made for the majority of the claims, management does not believe that the outcomes, either individually or in the aggregate, will have a material adverse effect on the Company’s results of operations, financial position or cash flows.

Note 18 - Quarterly Financial Data (Unaudited):

A capsule summary of the Company's unaudited quarterly results for fiscal 2020 and fiscal 2019 is presented below:

	First		Second		Third		Fourth		Total
Year ended March 31, 2020	Quarter		Quarter		Quarter		Quarter		Year
Net sales	$	20,593	$	21,643	$	25,286	$	23,082	$	90,604
Gross profit		4,714		4,948		4,044		4,442		18,148
Net income		82		1,205		9		576		1,872
Per share:
Net income:
Basic	$	.01	$	.12	$	—	$	.06	$	0.19
Diluted	$	.01	$	.12	$	—	$	.06	$	0.19
Market price range of common stock	$18.96-22.84		$17.70-23.25		$19.03-23.77		$11.07-21.90		$11.07-23.77

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	First		Second		Third		Fourth				Total
Year ended March 31, 2019	Quarter		Quarter		Quarter		Quarter				Year
Net sales	$	29,551	$	21,441	$	17,198	$	23,641			$	91,831
Gross profit		7,142		6,227		3,742		4,798				21,909
Net (loss) income		2,323		1,827		95		(4,553	)	(1)		(308	)
Per share:
Net (loss) income:
Basic	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Diluted	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Market price range of common stock	$20.75-27.51		$22.55-28.98		$19.48-28.73		$19.00-24.90				$19.00-28.98

⁽¹⁾In the fourth quarter of fiscal 2019, the Company recorded goodwill and other impairment losses of $6,449 related to the commercial nuclear utility business that was held for sale at March 31, 2019.  As a result, net income in the fourth quarter of fiscal 2019 includes the impairment loss net of an income tax benefit of $1,129.          

Note 19 – Subsequent Events:

On May, 1, 2020, the Company entered into an agreement to amend the letter of credit facility agreement with HSBC Bank USA, N.A. and increased the Company’s line of credit to $14,000.  Under the amended agreement, the Company incurs an annual facility fee of $5 and outstanding letters of credit are subject to a fee of between 0.75% and 0.85%, depending on the term of the letter of credit.  Interest is payable on the principal amounts of unreimbursed letter of credit draws under the facility at a rate of 3% plus the bank’s prime rate.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of Graham Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Graham Corporation and subsidiaries (the "Company") as of March 31, 2020 and 2019, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders' equity, and cash flows, for each of the three years in the period ended March 31, 2020, and the related notes and schedule listed in the Index at Item 15 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/DELOITTE & TOUCHE LLP

Deloitte & Touche LLP

Rochester, New York

June 15, 2020

We have served as the Company’s auditor since 1993.

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

Conclusion Regarding Disclosure Controls and Procedures

Management, including our President and Chief Executive Officer (principal executive officer) and Vice President-Finance & Administration and Chief Financial Officer (principal financial officer), has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K.  Based upon, and as of the date of that evaluation, our President and Chief Executive Officer and Vice President-Finance & Administration and Chief Financial Officer concluded that the disclosure controls and procedures were effective, in all material respects, to ensure that information required to be disclosed in the reports we file and submit under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is (i) recorded, processed, summarized and reported as and when required and (ii) is accumulated and communicated to our management, including our President and Chief Executive Officer and Vice President-Finance & Administration and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change to our internal control over financial reporting during the fourth quarter of the fiscal year covered by this Annual Report on Form 10-K that has materially affected, or that is reasonably likely to materially affect our internal control over financial reporting.  We have not experienced any material impact to our internal controls over financial reporting despite the fact that most of our non-production employees are working remotely due to the COVID-19 pandemic.  We are continually monitoring and assessing the COVID-19 situation on our internal controls to minimize the impact on their design and operating effectiveness.

Management's Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f).  A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.  Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our organization have been detected.  These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.  Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override.  The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving our stated goals under all potential future conditions.  Moreover, over time controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.  Because of the inherent limitations in the design of an internal control system, misstatements due to error or fraud may occur and not be detected.  However, these inherent limitations are known features of the financial reporting process.  Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Under the supervision and with the participation of management, including our President and Chief Executive Officer (principal executive officer) and Vice President–Finance & Administration and Chief Financial Officer (principal financial officer), we conducted an assessment of the effectiveness of our internal control over financial reporting based on the framework established in Internal Control–Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.  Based on the assessment under this framework, management concluded that our internal control over financial reporting was effective as of March 31, 2020.

Item 9B. Other Information

Not applicable.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

Except as otherwise stated specifically in this response to Item 10, the information required by this Item 10 is incorporated herein by reference from the statements under the headings "Election of Directors," "Executive Officers," "Delinquent Section 16(a) Reports," and "Corporate Governance" contained in our proxy statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days after the year ended March 31, 2020.

Code of Ethics. We have adopted a Code of Business Conduct and Ethics applicable to our principal executive officer, principal financial officer, and principal accounting officer. Our Code of Business Conduct and Ethics also applies to all of our other employees and to our directors. Our Code of Business Conduct and Ethics is available on our website located at www.graham-mfg.com by clicking on the "Corporate Governance" heading in the "Investor Relations" tab. We intend to satisfy any disclosure requirements pursuant to Item 5.05 of Form 8-K regarding any amendment to, or a waiver from, certain provisions of our Code of Business Conduct and Ethics by posting such information on our website.

Item 11. Executive Compensation

The information required by this Item 11 is incorporated herein by reference from the statements under the headings "Executive Compensation" and "Director Compensation" contained in our proxy statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days after the year ended March 31, 2020.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Except as set forth below, the information required by this Item 12 is incorporated herein by reference from the statements under the headings "Security Ownership of Certain Beneficial Owners" and "Security Ownership of Management" contained in our proxy statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days after the year ended March 31, 2020.

Securities Authorized for Issuance under Equity Compensation Plans

as of March 31, 2020

	Equity Compensation Plan Information
Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security    holders		37	$	18.92		202
Equity compensation plans not approved by    security holders		—		—		—
Total		37	$	18.92		202

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this Item 13 is incorporated herein by reference from the statements under the headings "Certain Relationships and Related Transactions" and "Corporate Governance" contained in our proxy statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days after the year ended March 31, 2020.

Item 14. Principal Accounting Fees and Services

The information required by this Item 14 is incorporated herein by reference from the statements under the heading "Ratification of the Selection of our Independent Registered Public Accounting Firm" contained in our proxy statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days after the year ended March 31, 2020.

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Part IV

Item 15. Exhibits, Financial Statement Schedules

We have filed our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K and have listed such financial statements in the Index to Financial Statements included in Item 8.  In addition, the financial statement schedule entitled "Schedule II - Valuation and Qualifying Accounts" is filed as part of this Annual Report on Form 10-K under this Item 15.

All other schedules have been omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the Consolidated Financial Statements and notes thereto.

	INDEX TO EXHIBITS
(3)	Articles of Incorporation and By-Laws
	3.1	Certificate of Incorporation of Graham Corporation, as amended, is incorporated herein by reference from Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008.
	3.2	Amended and Restated By-laws of Graham Corporation is incorporated herein by reference from Exhibit 3.2 to the Company's Annual Report on Form 10-K for the year ended March 31, 2015.
(4)	Instrument Defining the Rights of Security Holders, including Indentures
	4.1	Description of Securities is incorporated herein by reference from Exhibit 4.1 to the Company’s Annual Report on Form 10-K for the year ended March 31, 2019.
(10)	Material Contracts
#	10.1	Graham Corporation Policy Statement for U.S. Foreign Service Employees is incorporated herein by reference from Exhibit 99.1 to the Company's Current Report on Form 8-K dated March 27, 2006.
#	10.2	Employment Agreement between Graham Corporation and James R. Lines executed July 27, 2006 with an effective date of August 1, 2006, is incorporated herein by reference from Exhibit 99.1 to the Company's Current Report on Form 8-K dated July 27, 2006.
#	10.3	Amended and Restated 2000 Graham Corporation Incentive Plan to Increase Shareholder Value is incorporated herein by reference from Appendix A to the Company's definitive Proxy Statement for its 2016 Annual Meeting of Stockholders filed with the Securities and Exchange Commission on June 13, 2016.
#	10.4	Employment Agreement between Graham Corporation and Alan E. Smith executed August 1, 2007 with an effective date of July 30, 2007, is incorporated herein by reference from Exhibit 10.19 to the Company's Annual Report on Form 10-K for the year ended March 31, 2008.
#	10.5	Form of Director Non-Qualified Stock Option Agreement is incorporated herein by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008.
#	10.6	Amendment to Employment Agreement dated as of December 31, 2008 by and between Graham Corporation and James R. Lines is incorporated herein by reference from Exhibit 99.1 to the Company's Current Report on Form 8-K dated December 31, 2008.
#	10.7	Amendment to Employment Agreement dated as of December 31, 2008 by and between Graham Corporation and Alan E. Smith is incorporated herein by reference from Exhibit 99.2 to the Company's Current Report on Form 8-K dated December 31, 2008.
#	10.8	Amended and Restated Graham Corporation Annual Stock-Based Long-Term Incentive Award Plan for Senior Executives is incorporated herein by reference from Exhibit 99.1 to the Company's Current Report on Form 8-K dated May 30, 2018.
#	10.9	Amended and Restated Graham Corporation Annual Executive Cash Bonus Plan is incorporated herein by reference from Exhibit 99.2 to the Company's Current Report on Form 8-K dated May 30, 2018.
#	10.10	Form of Director Restricted Stock Agreement is incorporated herein by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2009.

64

#	10.11		Form of Employee Non-Qualified Stock Option Agreement is incorporated herein by reference from Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2009.
#	10.12		Form of Employee Time-Vested Restricted Stock Agreement is incorporated herein by reference from Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013.
#	10.13		Form of Indemnification Agreement between Graham Corporation and each of its Directors and Officers is incorporated herein by reference from Exhibit 99.2 to the Company's Current Report on Form 8-K dated January 29, 2010.
#	10.14		Form of Employee Performance-Vested Restricted Stock Agreement is incorporated herein by reference from Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013.
#	10.15		Amended and Restated Employment Agreement between Graham Corporation and Jeffrey F. Glajch executed and effective on July 29, 2010 is incorporated herein by reference from Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2010.
			.
	10.16		Amended and Restated Policy on Stockholder Rights Plans is incorporated herein by reference from Exhibit 99.1 to the Company’s Current  Report on Form 8-K dated April 30, 2020.
#	10.17		Compensation information, including information regarding restricted stock grants made to the Company's named executive officers under the Amended and Restated 2000 Graham Corporation Incentive Plan to Increase Shareholder Value and named executive officer cash bonus information, previously filed on the Company's Current Report on Form 8-K dated June 9, 2020, is incorporated herein by reference.
#	10.18		First Amendment to Amended and Restated Employment Agreement between the Graham Corporation and Jeffrey F. Glajch executed and effective September 12, 2019 is incorporated herein by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K dated September 12, 2019.
#	10.19		Graham Corporation Supplemental Executive Retirement Plan is incorporated herein by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012.
#	10.20		Employment Agreement between Graham Corporation and Jennifer R. Condame executed and effective on July 25, 2013 is incorporated herein by reference from Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013.
	10.21	Continuing Letter of Credit Facility dated March 24, 2014 between Graham Corporation and HSBC Bank, USA, National Association is incorporated herein by reference from Exhibit 99.2 to the Company's Current Report on Form 8-K dated March 20, 2014.
	10.22	Letter Agreement dated May 1, 2020, with respect to the Continuing Letter of Credit Facility dated March 24, 2014, between the Company and HSBC Bank, USA, National Association is incorporated herein by reference from Exhibit 10.1 to the Company's Current Report on Form 8-K dated April 30, 2020.
	10.23	Credit Agreement between the Company and JPMorgan Chase Bank, N.A., dated December 2, 2015 is incorporated herein by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2015.
	10.24	Revolving Credit Note between the Company and JPMorgan Chase Bank, N.A., dated December 2, 2015 is incorporated herein by reference from Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2015.
	10.25	Pledge and Security Agreement between the Company and JPMorgan Chase Bank, N.A., dated December 2, 2015 is incorporated herein by reference from Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2015.
	10.26	Trademark Security Agreement between the Company and JPMorgan Chase Bank, N.A., dated December 2, 2015 is incorporated herein by reference from Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2015.
	10.27	Patent Security Agreement between the Company and JPMorgan Chase Bank, N.A., dated December 2, 2015 is incorporated herein by reference from Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2015.

65

#	10.28		Amendment to the Graham Corporation Supplemental Executive Retirement Plan is incorporated herein by reference from Exhibit 99.3 to the Company's Current Report on Form 8-K dated May 24, 2016.
#	10.29		Pledge Agreement between the Company and HSBC Bank, USA, National Association dated May 1, 2020 is incorporated herein by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K dated April 30, 2020.
	10.30		First Amendment to Credit Agreement dated May 1, 2020 between the Company and JPMorgan Chase Bank, N.A. is incorporate herein by reference from Exhibit 10.3 to the Company’s Current Report on Form 8-K dated April 30, 2020.
(14)	Code of Ethics
	14.1		Graham Corporation Code of Business Conduct and Ethics, as amended and restated, is incorporated herein by reference from Exhibit 14.1 to the Company's Annual Report on Form 10-K for the year ended March 31, 2014.
(21)		Subsidiaries of the registrant
*		21.1	Subsidiaries of the registrant
(23)		Consents of Experts and Counsel
*		23.1	Consent of Deloitte & Touche LLP
(31)		Rule 13a-14(a)/15d-14(a) Certifications
*		31.1	Certification of Principal Executive Officer
*		31.2	Certification of Principal Financial Officer
(32)		Section 1350 Certifications
*		32.1	Section 1350 Certifications
(101)		Interactive Data File
*		101.INS		XBRL Instance Document
*		101.SCH		XBRL Taxonomy Extension Schema Document
*		101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
*		101.DEF		XBRL Taxonomy Definitions Linkbase Document
*		101.LAB		XBRL Taxonomy Extension Label Linkbase Document
*		101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
*		Exhibits filed with this report.
#		Management contract or compensatory plan.

66

GRAHAM CORPORATION AND SUBSIDIARIES

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

(In Thousands)

	Balance at		Charged to			Charged to						Balance at
	Beginning		Costs and			Other						End of
Description	of Period		Expenses			Accounts			Deductions			Period
Year ended March 31, 2020
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	33	$	—		$	—		$	—		$	33
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	366	$	62		$	—		$	(69	)	$	359
Year ended March 31, 2019
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	339	$	(167	)	$	(13	)	$	(126	)	$	33
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	493	$	234		$	(85	)	$	(276	)	$	366
Reserves included in the balance sheet caption "accrued    compensation"
Restructuring reserve	$	18	$	—		$	—		$	(18	)	$	—
Year ended March 31, 2018
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	168	$	177		$	—		$	(6	)	$	339
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	538	$	527		$	—		$	(572	)	$	493
Reserves included in the balance sheet caption "accrued    compensation"
Restructuring reserve	$	120	$	316		$	—		$	(418	)	$	18

67

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GRAHAM CORPORATION
June 15, 2020	By:	/s/ Jeffrey F.  Glajch
		Jeffrey F. Glajch
		Vice President-Finance & Administration,
		Chief Financial Officer and Corporate Secretary

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature
/s/ James R. Lines	President and Chief Executive Officer and	June 15, 2020
James R. Lines	Director (Principal Executive Officer)
/s/ Jeffrey F. Glajch	Vice President-Finance & Administration,  Chief	June 15, 2020
Jeffrey F. Glajch	Financial Officer and Corporate Secretary
	(Principal Financial Officer)
/s/ Jennifer R. Condame	Chief Accounting Officer	June 15, 2020
Jennifer R. Condame	(Principal Accounting Officer)
/s/ James J. Barber	Director	June 15, 2020
James J. Barber
/s/ Alan Fortier	Director	June 15, 2020
Alan Fortier
/s/ James J. Malvaso	Director and Chairman of the Board	June 15, 2020
James J. Malvaso
/s/ Gerard T. Mazurkiewicz	Director	June 15, 2020
Gerard T. Mazurkiewicz
/s/ Jonathan W. Painter	Director	June 15, 2020
Jonathan W. Painter
/s/ Lisa M. Schnorr	Director	June 15, 2020
Lisa M. Schnorr

68

EX-21.1

EXHIBIT 21.1

SUBSIDIARIES OF THE REGISTRANT

Name	Jurisdiction of Incorporation
Graham Vacuum and Heat Transfer Technology (Suzhou) Co. Ltd.	People's Republic of China
Graham India Private Limited	Republic of India

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement No. 333-71044, 333-145116, 333-113426, 333-169015, and Post-Effective Amendment No. 1 to 333-113426 on Form S-8 of our report dated June 15, 2020, relating to the financial statements of Graham Corporation in this Annual Report on Form 10-K for the year ended March 31, 2020.

/s/DELOITTE & TOUCHE LLP

Deloitte & Touche LLP

Rochester, New York

June 15, 2020

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF

PRINCIPAL EXECUTIVE OFFICER

I, James R. Lines, certify that:

1. I have reviewed this Annual Report on Form 10-K of Graham Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

June 15, 2020

/s/James R. Lines

James R. Lines

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF

PRINCIPAL FINANCIAL OFFICER

I, Jeffrey F. Glajch, certify that:

1. I have reviewed this Annual Report on Form 10-K of Graham Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

June 15, 2020

/s/Jeffrey F. Glajch

Jeffrey F. Glajch

Vice President-Finance & Administration,

Chief Financial Officer and Corporate Secretary

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Graham Corporation (the "Company") on Form 10-K for the period ended March 31, 2020 as filed with the Securities and Exchange Commission (the "Report"), each of the undersigned certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/James R. Lines	/s/Jeffrey F. Glajch
James R. Lines	Jeffrey F. Glajch
President and Chief Executive Officer (Principal Executive Officer)	Vice President-Finance & Administration, Chief Financial Officer and Corporate Secretary
June 15, 2020	(Principal Financial Officer)
	June 15, 2020

A signed original of this written statement required by Section 906 has been provided to Graham Corporation and will be retained by Graham Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Property, Plant and Equipment

12 Months Ended

Mar. 31, 2020

Property Plant And Equipment [Abstract]

Property, Plant and Equipment

Note 5 – Property, Plant and Equipment:

Major classifications of property, plant and equipment are as follows:

	March 31,
	2020		2019
Land	$	171	$	171
Buildings and leasehold improvements		19,393		19,263
Machinery and equipment		30,474		29,530
Construction in progress		1,360		4
		51,398		48,968
Less – accumulated depreciation and amortization		33,811		31,897
	$	17,587	$	17,071

Depreciation expense in fiscal 2020, fiscal 2019 and fiscal 2018 was $1,957, $1,968, and $1,986, respectively.

XML

The Company and Its Accounting Policies

12 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

The Company and Its Accounting Policies

Note 1 - The Company and Its Accounting Policies:

Graham Corporation, and its operating subsidiaries, (together, the "Company"), is a global designer, manufacturer and supplier of vacuum and heat transfer equipment used in the chemical, petrochemical, petroleum refining, and electric power generating industries.  During the fiscal year ended March 31, 2019, the Company decided to divest of its wholly-owned subsidiary, Energy Steel & Supply Co. ("Energy Steel"), located in Lapeer, Michigan.  The sale of Energy Steel was completed in June 2019 and the accompanying Consolidated Financial Statements include the results of operation of Energy Steel for the period April 1, 2017 through June 23, 2019.  During the fiscal year ended March 31, 2019, the Company established Graham India Private Limited ("GIPL") as a wholly-owned subsidiary.  GIPL, located in Ahmedabad, India, serves as a sales and market development office focusing on the refining, petrochemical and fertilizer markets.  The Company's significant accounting policies are set forth below.

The Company's fiscal years ended March 31, 2020, 2019 and 2018 are referred to as "fiscal 2020," "fiscal 2019" and "fiscal 2018," respectively.

Principles of consolidation and use of estimates in the preparation of consolidated financial statements

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Energy Steel, located in Lapeer, Michigan, Graham Vacuum and Heat Transfer Technology (Suzhou) Co., Ltd., located in China, and GIPL, located in India.  All intercompany balances, transactions and profits are eliminated in consolidation.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the related revenues and expenses during the reporting period.  Actual amounts could differ from those estimated.

Translation of foreign currencies

Assets and liabilities of the Company's foreign subsidiary are translated into U.S. dollars at currency exchange rates in effect at year-end and revenues and expenses are translated at average exchange rates in effect for the year.  Gains and losses resulting from foreign currency transactions are included in results of operations. The Company's sales and purchases in foreign currencies are minimal.  Therefore, foreign currency transaction gains and losses are not significant.  Gains and losses resulting from translation of foreign subsidiary balance sheets are included in a separate component of stockholders' equity.  Translation adjustments are not adjusted for income taxes since they relate to an investment, which is permanent in nature.

Revenue recognition

The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.  

The Company recognizes revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, the Company has rights to payment, and rewards of ownership pass to the customer.  Customer acceptance may also be a factor in determining whether control of the product has transferred.  Although revenue on the majority of the Company’s contracts, as measured by number of contracts, is recognized upon shipment to the customer, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria in ASC 606.

Cash and cash equivalents

Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities at the time of purchase of three months or less.

Shipping and handling fees and costs

Shipping and handling fees billed to the customer are recorded in net sales and the related costs incurred for shipping and handling are included in cost of products sold.

Investments

Investments consist of certificates of deposits with financial institutions.  All investments have original maturities of greater than three months and less than one year and are classified as held-to-maturity, as the Company believes it has the intent and ability to hold the securities to maturity.  The investments are stated at amortized cost which approximates fair value.  All investments held by the Company at March 31, 2020 are scheduled to mature on or before June 25, 2020.

Inventories

Inventories are stated at the lower of cost or net realizable value, using the average cost method.  Unbilled revenue (contract assets) in the Consolidated Balance Sheets represents revenue recognized that has not been billed to customers on contracts in which revenue is recognized over time.  All progress payments exceeding unbilled revenue are presented as customer deposits (contract liabilities) in the Consolidated Balance Sheets.

Property, plant, equipment, depreciation and amortization

Property, plant and equipment are stated at cost net of accumulated depreciation and amortization.  Major additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred.  Depreciation and amortization are provided based upon the estimated useful lives, or lease term if shorter, under the straight-line method.  Estimated useful lives range from approximately five to eight years for office equipment, eight to 25 years for manufacturing equipment and 40 years for buildings and improvements.  Upon sale or retirement of assets, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations.

Business combinations

The Company records its business combinations under the acquisition method of accounting.  Under the acquisition method of accounting, the Company allocates the purchase price of each acquisition to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition.  The fair value of identifiable intangible assets is based upon detailed valuations that use various assumptions made by management.  Any excess of the purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill.  Direct acquisition-related costs are expensed as incurred.

Impairment of long-lived assets

The Company assesses the impairment of definite-lived long-lived assets or asset groups when events or changes in circumstances indicate that the carrying value may not be recoverable.  Factors that are considered in deciding when to perform an impairment review include: a significant decrease in the market price of the asset or asset group; a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; or a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life.  The term more likely than not refers to a level of likelihood that is more than 50%.

Recoverability potential is measured by comparing the carrying amount of the asset or asset group to its related total future undiscounted cash flows.  If the carrying value is not recoverable through related cash flows, the asset or asset group is considered to be impaired.  Impairment is measured by comparing the asset or asset group's carrying amount to its fair value.  When it is determined that useful lives of assets are shorter than originally estimated, and no impairment is present, the rate of depreciation is accelerated in order to fully depreciate the assets over their new shorter useful lives.

Goodwill and intangible assets with indefinite lives are tested annually for impairment as of December 31.  The Company assesses goodwill for impairment by comparing the fair value of its reporting units to their carrying amounts.  If the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the implied fair value of the goodwill within the reporting unit is less than its carrying value.  Fair values for reporting units are determined based on a weighted combination of the market approach and the income approach using discounted cash flows.  Indefinite lived intangible assets are assessed for impairment by comparing the fair value of the asset to its carrying value.

Assets and liabilities held for sale

The Company classifies long-lived assets (disposal group) to be sold as held for sale in accordance with Accounting Standards Update ("ASU") 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360):  Reporting Discontinued Operation And Disclosures of Disposals Of Components Of An Entity," in the period in which all of the following criteria are met:

1. Management, having the authority to approve the action, commits to a plan to sell the asset (disposal group);

2. The asset (disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (disposal group);

3. An active program to locate a buyer and other actions required to complete the plan to sell the asset (disposal group) have been initiated;

4. The sale of the asset (disposal group) is probable, and transfer of the asset (disposal group) is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond the Company's control extend the period of time required to sell the asset (disposal group) beyond one year;

5. The asset (disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and

6. Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

A long-lived asset (disposal group) that is classified as held for sale is initially measured at the lower of its carrying value or fair value less any costs to sell.  Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met.  Gains are not recognized on the sale of a long-lived asset (disposal group) until the date of sale.

The fair value of a long-lived asset (disposal group) less any costs to sell is assessed at each reporting period it remains classified as held for sale and any subsequent changes are reported as an adjustment to the carrying value of the asset (disposal group), as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale.  Upon determining that a long-lived asset (disposal group) met the criteria to be classified as held for sale, the Company reported the assets and liabilities of the disposal group for all periods presented in the line items "Assets held for sale" and "Liabilities held for sale," respectively, in the Consolidated Balance Sheet as of March 31, 2019.  See Note 3.

Product warranties

The Company estimates the costs that may be incurred under its product warranties and records a liability in the amount of such costs at the time revenue is recognized.  The reserve for product warranties is based upon past claims experience and ongoing evaluations of any specific probable claims from customers.  A reconciliation of the changes in the product warranty liability is presented in Note 7.

Research and development

Research and development costs are expensed as incurred.  The Company incurred research and development costs of $3,353, $3,538 and $3,211 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.  Research and development costs are included in the line item “Cost of products sold” in the Consolidated Statements of Operations.

Income taxes

The Company recognizes deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns.  Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using currently enacted tax rates.  The Company evaluates the available evidence about future taxable income and other possible sources of realization of deferred income tax assets and records a valuation allowance to reduce deferred income tax assets to an amount that represents the Company's best estimate of the amount of such deferred income tax assets that more likely than not will be realized.

The Company accounts for uncertain tax positions using a "more likely than not" recognition threshold.  The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective resolution of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position.  These tax positions are evaluated on a quarterly basis.  It is the Company's policy to recognize any interest related to uncertain tax positions in interest expense and any penalties related to uncertain tax positions in selling, general and administrative expense.

The Company files federal and state income tax returns in several U.S. and non-U.S. domestic and foreign jurisdictions.  In most tax jurisdictions, returns are subject to examination by the relevant tax authorities for a number of years after the returns have been filed.

Equity-based compensation

The Company records compensation costs related to equity-based awards based on the estimated fair value of the award on the grant date.  Compensation cost is recognized in the Company's Consolidated Statements of Operations over the applicable vesting period.  The Company uses the Black-Scholes valuation model as the method for determining the fair value of its stock option awards.  For service and performance based restricted stock awards, the fair market value of the award is determined based upon the closing value of the Company's stock price on the grant date.  The fair market value of market-based performance restricted stock awards is determined using the Monte Carlo valuation model.  The amount of equity-based compensation expense recognized during a period is based on the portion of the awards that are ultimately expected to vest.  The Company estimates the forfeiture rate at the grant date by analyzing historical data and revises the estimates in subsequent periods if the actual forfeiture rate differs from the estimates.

Income (loss) per share data

Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period.  Diluted income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding and, when applicable, potential common shares outstanding during the period.  

A reconciliation of the numerators and denominators of basic and diluted (loss) income per share is presented below:

	Year ended March 31,
	2020		2019			2018
Basic income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted common shares outstanding		9,876		9,823			9,764
Basic income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)
Diluted income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted average common shares and SEUs    outstanding		9,876		9,823			9,764
Stock options outstanding		3		—			—
Weighted average common and potential common    shares outstanding		9,879		9,823			9,764
Diluted income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)

None of the options to purchase shares of common stock which totaled 39 and 69 in fiscal 2019 and fiscal 2018, respectively, were included in the computation of diluted loss per share as the affect would be anti-dilutive due to the net losses in the fiscal years.

Cash flow statement

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Interest paid was $12 in each of fiscal 2020, fiscal 2019, and fiscal 2018.  In addition, income taxes paid (refunded) were $139 in fiscal 2020, $(73) in fiscal 2019 and $1,916 in fiscal 2018.

In fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included pension and other postretirement benefit adjustments, net of income tax, of $525, $348 and $(1,668), respectively.  In fiscal 2018, non-cash activities included the reclassification of $1,828 from accumulated other comprehensive loss to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the "Tax Act").  Also, in fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included the issuance of treasury stock valued at $170, $134 and $130, respectively, to the Company's Employee Stock Purchase Plan (See Note 13).

At March 31, 2020, 2019 and 2018, there were $162, $85, and $0, respectively, of capital purchases that were recorded in accounts payable and are not included in the caption "Purchase of property, plant and equipment" in the Consolidated Statements of Cash Flows.  In fiscal 2020, fiscal 2019 and fiscal 2018, capital expenditures totaling $0, $100 and $0, respectively, were financed through the issuance of capital leases.

Accumulated other comprehensive loss

Comprehensive income is comprised of net income and other comprehensive income or loss items, which are accumulated as a separate component of stockholders' equity.  For the Company, other comprehensive income or loss items include a foreign currency translation adjustment and pension and other postretirement benefit adjustments.

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the "exit price") in an orderly transaction between market participants at the measurement date.  The accounting standard for fair value establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.  Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company.  Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.  The hierarchy is broken down into three levels based on the reliability of inputs as follows:

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.  Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.

Level 2 – Valuations determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market.

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.  The degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

The availability of observable inputs can vary and is affected by a wide variety of factors, including, the type of asset/liability, whether the asset/liability is established in the marketplace, and other characteristics particular to the transaction.  To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment.  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure.  Therefore, even when market assumptions are not readily available, assumptions are required to reflect those that market participants would use in pricing the asset or liability at the measurement date.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of sales and expenses during the reporting period.  Actual results could differ materially from those estimates.

Accounting and reporting changes

In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board ("FASB"), the Securities and Exchange Commission ("SEC"), the Emerging Issues Task Force, the American Institute of Certified Public Accountants or any other authoritative accounting body to determine the potential impact they may have on the Company's consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)," which requires companies to recognize all leases as assets and liabilities on the consolidated balance sheet.  Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  This ASU retains a distinction between finance leases and operating leases, and the classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous accounting guidance.  The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.  Earlier application is permitted.

The Company adopted the new standard using the modified retrospective approach on April 1, 2019.  The Company elected the available transition method that uses the effective date of the amended guidance as the date of initial application.  The guidance provided for several practical expedients.  The Company elected the package of practical expedients permitted under the transition guidance which allows entities to carry forward historical lease classification.  The Company made an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  The Company recognizes those lease payments in the Condensed Consolidated Statements of Income on a straight-line basis over the lease term.  On April 1, 2019, the Company recognized the cumulative effect of initially applying the amended guidance which resulted in the recognition of operating lease ROU assets of $677, lease liabilities of $732 and a decrease to the opening balance of retained earnings of $80.  Other current assets and the deferred income tax liability were reduced by $47 and $22, respectively.  Approximately $500 of ROU assets and lease liabilities were related to the business held for sale at March 31, 2019 and subsequently sold on June 24, 2019.  See Note 8 to the Consolidated Financial Statements for additional information on the Company’s leases.

 In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326)," which replaces the current incurred loss impairment methodology for most financial assets with the current expected credit loss ("CECL") methodology.  Under the CECL method, the Company will be required to immediately recognize an estimate of credit losses expected to occur over the life of the financial asset at the time the financial asset is originated or acquired.  Estimated credit losses are determined by taking into consideration historical loss conditions, current conditions and reasonable and supportable forecasts.  Changes to the expected lifetime credit losses are required to be recognized each period.  The standard is effective for the Company on April 1, 2023.  The Company does not expect the adoption of this ASU will have a material effect on its Consolidated Financial Statements.

In August 2018, the FASB issued ASU No. 2018-14, "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20)," which removes disclosures that no longer are considered cost beneficial, clarifies specific disclosure requirements and adds disclosure requirements identified as relevant for defined benefit pension and other postretirement benefit plans.  This amendment is effective for fiscal years ending after December 15, 2020.  Early adoption is permitted. The amendment requires application on a retrospective basis to all periods presented.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

In December 2019, the FASB issue ASU No. 2019-12, “Simplifying the Accounting for Income Taxes.”.  The amended guidance simplifies the accounting for income taxes, eliminating certain exceptions to the general income tax principles, in an effort to reduce the cost and complexity of application.  The amended guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.  Earlier application is permitted.  The guidance requires application on either a prospective, retrospective or modified retrospective basis, contingent on the income tax exception being applied.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

Management does not expect any other recently issued accounting pronouncements, which have not already been adopted, to have a material impact on the Company's consolidated financial statements.

XML

Debt

12 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Debt

Note 9 - Debt:

Short-Term Debt

The Company and its subsidiaries had no short-term borrowings outstanding at March 31, 2020 and 2019.

On December 2, 2015, the Company entered into a revolving credit facility agreement with JPMorgan Chase Bank, N.A. that provides a $25,000 line of credit, including letters of credit and bank guarantees, expandable at the Company's option at any time up to $50,000.  The agreement has a five-year term.

At the Company's option, amounts outstanding under the agreement will bear interest at either: (i) a rate equal to the bank's prime rate; or (ii) a rate equal to LIBOR plus a margin.  The margin is based on the Company's funded debt to earnings before interest expense, income taxes, depreciation and amortization ("EBITDA") and may range from 1.75% to 0.95%.  Amounts available for borrowing under the agreement are subject to an unused commitment fee of between 0.30% and 0.20%, depending on the above ratio.  The bank’s prime rate was 3.25% and 5.50% at March 31, 2020 and 2019, respectively.  

Outstanding letters of credit under the agreement are subject to a fee of between 1.20% and 0.70%, depending on the Company's ratio of funded debt to EBITDA.  The agreement allows the Company to reduce the fee on outstanding letters of credit to a fixed rate of 0.40% by securing outstanding letters of credit with cash and cash equivalents and investments.  At March 31, 2020, all outstanding letters of credit were secured by a certificate of deposit.  At March 31, 2020, there were $5,397 letters of credit outstanding on the JPMorgan Chase Bank, N.A. revolving credit facility.  Availability under the line of credit was $19,603 at March 31, 2020.

Under the revolving credit facility, the Company covenants to maintain a maximum funded debt to EBITDA ratio, as defined in such credit facility, of 3.5 to 1.0 and a minimum earnings before interest expense and income taxes ("EBIT") to interest ratio, as defined in such credit facility, of 4.0 to 1.0.  The agreement also provides that the Company is permitted to pay dividends without limitation if it maintains a maximum funded debt to EBITDA ratio equal to or less than 2.0 to 1.0 and permits the Company to pay dividends in an amount equal to 25% of net income if it maintains a funded debt to EBITDA ratio of greater than 2.0 to 1.0.  The Company was in compliance with all such provisions as of and for the years ended March 31, 2020 and 2019.  Assets with a book value of $128,281 have been pledged to secure borrowings under the credit facility.

At March 31, 2019 the Company had an additional letter of credit facility agreement with HSBC Bank USA, N.A. to further support its international operations.  The agreement provided a $5,000 line of credit to be used for the issuance of letters of credit.  On October 8, 2019, the Company entered into an agreement to amend the letter of credit facility agreement and increase the letter of credit facility to $10,000.  Under the amended agreement, the Company incurs an annual facility fee of $5 and outstanding letters of credit are subject to a fee of between .75% and 0.65%, depending on the term of the letter of credit.  Interest is payable on the principal amounts of unreimbursed letter of credit draws under the facility at a rate of 3% plus the bank’s prime rate.  The bank’s prime rate was 3.25% at March 31, 2020.  The Company's obligations under the agreement are secured by certain certificates of deposit held with the bank.  At March 31, 2020 there were $7,931 letters of credit outstanding, and availability under the letter of credit facility was $2,069.  Subsequent to March 31, 2020, the Company entered into an agreement to amend the letter of credit facility agreement and increase the line of credit to $14,000, among other things.  See Note 19 - Subsequent Events for a discussion of this amendment.

Long-Term Debt

The Company and its subsidiaries had long-term capital lease obligations outstanding as follows:

	March 31,
	2020		2019
Finance lease obligations (Note 8)	$	95	$	146
Less: current amounts		40		51
Total	$	55	$	95

With the exception of capital leases, the Company has no long-term debt payment requirements over the next five years as of March 31, 2020.

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Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Current assets:
Cash and cash equivalents	$ 32,955	$ 15,021
Investments	40,048	62,732
Trade accounts receivable, net of allowances ($33 at each of March 31, 2020 and 2019)	15,400	17,582
Unbilled revenue	14,592	7,522
Inventories	22,291	24,670
Prepaid expenses and other current assets	906	1,333
Income taxes receivable	485	1,073
Assets held for sale		4,850
Total current assets	126,677	134,783
Property, plant and equipment, net	17,587	17,071
Prepaid pension asset	3,460	4,267
Operating lease assets	243
Other assets	153	149
Total assets	148,120	156,270
Current liabilities:
Current portion of finance lease obligations	40	51
Accounts payable	14,253	12,405
Accrued compensation	4,453	5,126
Accrued expenses and other current liabilities	3,352	2,933
Customer deposits	26,983	30,847
Operating lease liabilities	153
Liabilities held for sale		3,525
Total current liabilities	49,234	54,887
Finance lease obligations	55	95
Operating lease liabilities	82
Deferred income tax liability	721	1,056
Accrued pension liability	747	662
Accrued postretirement benefits	557	604
Total liabilities	51,396	57,304
Commitments and contingencies (Notes 8 and 17)
Stockholders’ equity:
Preferred stock, $1.00 par value, 500 shares authorized
Common stock, $.10 par value, 25,500 shares authorized; 10,689 and 10,650 shares issued and 9,881 and 9,843 shares outstanding at March 31, 2020 and 2019, respectively	1,069	1,065
Capital in excess of par value	26,361	25,277
Retained earnings	91,389	93,847
Accumulated other comprehensive loss	(9,556)	(8,833)
Treasury stock (808 and 807 shares at March 31, 2020 and 2019, respectively)	(12,539)	(12,390)
Total stockholders’ equity	96,724	98,966
Total liabilities and stockholders’ equity	$ 148,120	$ 156,270

XML

Document and Entity Information - USD ($)

12 Months Ended

Mar. 31, 2020

Jun. 01, 2020

Sep. 30, 2019

Cover [Abstract]

Document Type

10-K

Amendment Flag

false

Document Period End Date

Mar. 31, 2020

Document Fiscal Year Focus

2020

Document Fiscal Period Focus

FY

Trading Symbol

GHM

Entity Registrant Name

GRAHAM CORP

Entity Central Index Key

0000716314

Current Fiscal Year End Date

--03-31

Entity Well-known Seasoned Issuer

No

Entity Current Reporting Status

Yes

Entity Voluntary Filers

No

Entity Filer Category

Non-accelerated Filer

Entity Shell Company

false

Entity Emerging Growth Company

false

Entity Small Business

true

Title of 12(b) Security

Common Stock, Par Value $0.10 Per Share

Security Exchange Name

NYSE

Entity File Number

1-8462

Entity Tax Identification Number

16-1194720

Entity Incorporation, State or Country Code

DE

Entity Address, Address Line One

20 Florence Avenue

Entity Address, City or Town

Batavia

Entity Address, State or Province

NY

Entity Address, Postal Zip Code

14020

City Area Code

585

Local Phone Number

343-2216

Entity Interactive Data Current

Yes

Document Annual Report

true

Document Transition Report

false

Entity Common Stock, Shares Outstanding

9,855,963

Entity Public Float

$ 189,547,236

Documents Incorporated by Reference

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's definitive Proxy Statement, to be filed in connection with the Registrant's 2020 Annual Meeting of Stockholders to be held on August 11, 2020, are incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this filing.

XML

Property, Plant and Equipment (Tables)

12 Months Ended

Mar. 31, 2020

Property Plant And Equipment [Abstract]

Summary of Property, Plant and Equipment

Major classifications of property, plant and equipment are as follows:

	March 31,
	2020		2019
Land	$	171	$	171
Buildings and leasehold improvements		19,393		19,263
Machinery and equipment		30,474		29,530
Construction in progress		1,360		4
		51,398		48,968
Less – accumulated depreciation and amortization		33,811		31,897
	$	17,587	$	17,071

XML

The Company and Its Accounting Policies (Tables)

12 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Reconciliation of Numerators and Denominators of Basic and Diluted (Loss) Income Per Share

A reconciliation of the numerators and denominators of basic and diluted (loss) income per share is presented below:

	Year ended March 31,
	2020		2019			2018
Basic income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted common shares outstanding		9,876		9,823			9,764
Basic income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)
Diluted income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted average common shares and SEUs    outstanding		9,876		9,823			9,764
Stock options outstanding		3		—			—
Weighted average common and potential common    shares outstanding		9,879		9,823			9,764
Diluted income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)

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Income Taxes (Tables)

12 Months Ended

Mar. 31, 2020

Income Tax Disclosure [Abstract]

Components of Income (Loss) Before Provision (Benefit) for Income Taxes

An analysis of the components of income (loss) before provision (benefit) for income taxes is presented below:

	Year ended March 31,
	2020			2019			2018
United States	$	2,405		$	(256	)	$	(12,861	)
Asia		(93	)		111			7
	$	2,312		$	(145	)	$	(12,854	)

The Provision (Benefit) for Income Taxes

The provision (benefit) for income taxes consists of:

	Year ended March 31,
	2020			2019			2018
Current:
Federal	$	547		$	181		$	6
State		176			141			72
Foreign		4			—			—
		727			322			78
Deferred:
Federal		(694	)		(3,993	)		(3,276	)
State		8			(84	)		61
Foreign		(12	)		41			12
Changes in valuation allowance		411			3,877			115
		(287	)		(159	)		(3,088	)
Total provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

Reconciliation of the Provision (Benefit) for Income Taxes

The reconciliation of the provision (benefit) calculated using the U.S. federal tax rate with the provision (benefit) for income taxes presented in the consolidated financial statements is as follows:

	Year ended March 31,
	2020			2019			2018
Provision (benefit) for income taxes at federal rate	$	486		$	(30	)	$	(3,958	)
State taxes		120			45			118
Charges not deductible for income tax purposes		55			89			48
Research and development tax credits		(211	)		(177	)		(102	)
Valuation allowance		411			3,877			(80	)
Difference in federal rate		(1	)		3			(2,799	)
Impairment of goodwill and intangible assets		—			257			1,760
Foreign-derived intangible income deduction		(95	)		(69	)		—
Capital loss from sale of Energy Steel		(325	)		(3,848	)		—
Stranded tax effects in accumulated other comprehensive loss		—			—			1,828
Mandatory repatriation of post-1986 undistributed foreign    subsidiary earnings and profits		—			—			185
Other		—			16			(10	)
Provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

Summary of Net Deferred Income Tax Liability

The net deferred income tax liability recorded in the Consolidated Balance Sheets results from differences between financial statement and tax reporting of income and deductions.  A summary of the composition of the Company's net deferred income tax liability follows:

	March 31,
	2020			2019
Depreciation	$	(1,707	)	$	(1,714	)
Accrued compensation		206			230
Prepaid pension asset		(783	)		(935	)
Accrued pension liability		169			145
Accrued postretirement benefits		143			150
Compensated absences		402			355
Inventories		(13	)		14
Warranty liability		81			80
Accrued expenses		366			267
Equity-based compensation		385			359
Operating lease assets		(58	)		—
Operating lease liabilities		60			—
New York State investment tax credit		1,108			1,069
Net operating loss carryforwards		75			50
Capital loss related to sale of Energy Steel		4,211			3,848
Other		1			(20	)
		4,646			3,898
Less:  Valuation allowance		(5,319	)		(4,917	)
Total	$	(673	)	$	(1,019	)

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Leases - Future Minimum Payments Required under Non-cancelable Leases (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Operating Leases
2021	$ 162
2022	48
2023	31
2024	8
Total lease payments	249
Less – amount representing interest	14
Present value of net minimum lease payments	235
Finance Leases
2021	48
2022	26
2023	26
2024	10
Total lease payments	110
Less – amount representing interest	15
Present value of net minimum lease payments	$ 95	$ 146

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Inventories - Major Classifications of Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Inventory Disclosure [Abstract]
Raw materials and supplies	$ 3,061	$ 2,787
Work in process	18,018	20,553
Finished products	1,212	1,330
Total	$ 22,291	$ 24,670

XML

Product Warranty Liability - Reconciliation of the Changes in Product Warranty Liability (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Guarantees [Abstract]
Balance at beginning of year	$ 366	$ 493
Expense for product warranties	62	234
Product warranty claims paid	(69)	(276)
Reclassification to liabilities held for sale		(85)
Balance at end of year	$ 359	$ 366

XML

Segment Information - Additional Information (Detail)	12 Months Ended
	Mar. 31, 2020 Segment Customer	Mar. 31, 2019 Customer	Mar. 31, 2018 Customer
Segment Reporting Information [Line Items]
Number of reportable operating segments | Segment	1
Customer Concentration Risk [Member] | Net Sales [Member]
Segment Reporting Information [Line Items]
Number of customers | Customer	1	1	0
Concentration risk percentage	13.00%	12.00%
Customer Concentration Risk [Member] | Net Sales [Member] | Minimum [Member]
Segment Reporting Information [Line Items]
Concentration risk percentage			10.00%

XML

Employee Benefit Plans - Summary of Weighted Average Asset Allocation of Plan Assets by Asset Category (Detail)	Mar. 31, 2020	Mar. 31, 2019
Defined Benefit Plan Disclosure [Line Items]
Weighted average asset allocation	100.00%	100.00%
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Plan Asset Allocations	30.00%	50.00%
Weighted average asset allocation	30.00%	49.00%
Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Plan Asset Allocations	70.00%	50.00%
Weighted average asset allocation	70.00%	51.00%

XML

Employee Benefit Plans - Weighted Average Actuarial Assumptions Used to Determine Benefit Obligation (Detail) - Pension Plans, Defined Benefit [Member]	Mar. 31, 2020	Mar. 31, 2019
Defined Benefit Plan Disclosure [Line Items]
Discount rate	3.44%	3.83%
Rate of increase in compensation levels	3.00%	3.00%

XML

Equity Compensation Plans - Stock Options Outstanding (Detail) shares in Thousands	12 Months Ended
	Mar. 31, 2020 $ / shares shares
Range 1 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise Price, Maximum	$ 18.65
Options Outstanding at March 31, 2020 | shares	33
Weighted Average Exercise Price	$ 18.65
Weighted Average Remaining Contractual Life (in years)	2 years 2 months 1 day
Range 2 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise Price, Maximum	$ 21.19
Options Outstanding at March 31, 2020 | shares	4
Weighted Average Exercise Price	$ 21.19
Weighted Average Remaining Contractual Life (in years)	1 year 2 months 1 day
Range 3 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise Price, Minimum	$ 18.65
Exercise Price, Maximum	$ 21.19
Options Outstanding at March 31, 2020 | shares	37
Weighted Average Exercise Price	$ 18.92
Weighted Average Remaining Contractual Life (in years)	2 years 25 days

XML

The Company and Its Accounting Policies - Reconciliation of Numerators and Denominators of Basic and Diluted (Loss) Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Numerator:
Net income (loss)	$ 576	$ 9	$ 1,205	$ 82	$ (4,553)	$ 95	$ 1,827	$ 2,323	$ 1,872	$ (308)	$ (9,844)
Denominator:
Weighted average common shares and SEUs outstanding									9,876	9,823	9,764
Basic income (loss) per share	$ 0.06		$ 0.12	$ 0.01	$ (0.46)	$ 0.01	$ 0.19	$ 0.24	$ 0.19	$ (0.03)	$ (1.01)
Numerator:
Net income (loss)	$ 576	$ 9	$ 1,205	$ 82	$ (4,553)	$ 95	$ 1,827	$ 2,323	$ 1,872	$ (308)	$ (9,844)
Denominator:
Weighted average common shares and SEUs outstanding									9,876	9,823	9,764
Stock options outstanding									3
Weighted average common and potential common shares outstanding									9,879	9,823	9,764
Diluted income (loss) per share	$ 0.06		$ 0.12	$ 0.01	$ (0.46)	$ 0.01	$ 0.19	$ 0.24	$ 0.19	$ (0.03)	$ (1.01)

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Equity Compensation Plans (Tables)

12 Months Ended

Mar. 31, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Option Awards

The following table summarizes information about the Company's stock option awards during fiscal 2020, fiscal 2019 and fiscal 2018:

				Weighted
	Shares			Average		Weighted	Aggregate
	Under			Exercise		Average Remaining	Intrinsic
	Option			Price		Contractual Term	Value
Outstanding at April 1, 2017		69			20.26
Exercised		—
Outstanding at March 31, 2018		69			20.26
Exercised		(19	)		15.89
Cancelled		(11	)		33.02
Outstanding at March 31, 2019		39			18.76
Exercised		(2	)		15.25
Outstanding at March 31, 2020		37			18.92	2.07 years	$	—
Vested or expected to vest at March 31, 2020		37			18.92	2.07 years		—
Exercisable at March 31, 2020		37			18.92	2.07 years		—

Stock Options Outstanding

The following table summarizes information about stock options outstanding at March 31, 2020:

Exercise Price	Options Outstanding at March 31, 2020		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
$18.65		33	$	18.65		2.17
$21.19		4		21.19		1.17
$18.65-21.19		37		18.92		2.07

Schedule of Restricted Stock Awards

The following table summarizes information about the Company's restricted stock awards during fiscal 2020, fiscal 2019 and fiscal 2018:

	Restricted Stock			Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Non-vested at April 1, 2017		120			21.96
Granted		59			23.03
Vested		(25	)		20.44
Forfeited		(28	)		25.27
Non-vested at March 31, 2018		126			22.02
Granted		53			30.08
Vested		(28	)		20.38
Forfeited		(2	)		22.83
Non-vested at March 31, 2019		149			25.19
Granted		83			22.95
Vested		(38	)		23.17
Forfeited		(45	)		22.52
Non-vested at March 31, 2020		149			25.26	$	—

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Revenue Recognition - Additional Information (Detail1)	Mar. 31, 2020	Mar. 31, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-04-01
Contract With Customer Assets And Liabilities [Line Items]
Revenue remaining performance obligation, expected timing of satisfaction, period
Minimum [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-04-01
Contract With Customer Assets And Liabilities [Line Items]
Revenue remaining performance obligation percentage	70.00%
Revenue remaining performance obligation, expected timing of satisfaction, period	1 year
Minimum [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-04-01
Contract With Customer Assets And Liabilities [Line Items]
Revenue remaining performance obligation percentage	15.00%
Revenue remaining performance obligation, expected timing of satisfaction, period	2 years
Maximum [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-04-01
Contract With Customer Assets And Liabilities [Line Items]
Revenue remaining performance obligation percentage	75.00%
Revenue remaining performance obligation, expected timing of satisfaction, period	1 year
Maximum [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-04-01
Contract With Customer Assets And Liabilities [Line Items]
Revenue remaining performance obligation percentage	20.00%
Revenue remaining performance obligation, expected timing of satisfaction, period	2 years

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Income Taxes - Components of Income (Loss) Before Provision (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Income Taxes [Line Items]
Income (loss) before provision (benefit) for income taxes	$ 2,312	$ (145)	$ (12,854)
U.S. [Member]
Income Taxes [Line Items]
Income (loss) before provision (benefit) for income taxes	2,405	(256)	(12,861)
Asia [Member]
Income Taxes [Line Items]
Income (loss) before provision (benefit) for income taxes	$ (93)	$ 111	$ 7

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Income Taxes - Additional Information (Detail) - USD ($)			9 Months Ended	12 Months Ended
	Mar. 27, 2020	Mar. 26, 2020	Dec. 31, 2017	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Income Taxes [Line Items]
Valuation allowance				$ 5,319,000	$ 4,917,000
Liability unrecognized tax benefits				$ 0	0
Percentage of business interest limitation	50.00%	30.00%
Percentage of corporate income tax rate			35.00%	21.00%
Income tax benefit from remeasurement of deferred tax assets and liabilities						$ 971,000
One-time transition tax on accumulated foreign earnings						$ 185,000
Tax related to global intangible low-taxed income				$ (1,000)	11,000
Foreign derived intangible income (FDII) effective tax rate			13.125%
Incremental U.S. tax savings on foreign derived intangible income				95,000	69,000
Investment Tax Credit Carryforward [Member]
Income Taxes [Line Items]
Deferred income taxes include the impact of state investment tax credits				314,000
State investment tax credits with an unlimited carryforward period				794,000
International Tax Jurisdictions [Member]
Income Taxes [Line Items]
Net operating loss				$ 301,000
International Tax Jurisdictions [Member] | India [Member]
Income Taxes [Line Items]
Open tax year				2019
International Tax Jurisdictions [Member] | Earliest Tax Year [Member]
Income Taxes [Line Items]
Net operating loss, expiration date				Mar. 31, 2022
Open tax year				2016
International Tax Jurisdictions [Member] | Latest Tax Year [Member]
Income Taxes [Line Items]
Net operating loss, expiration date				Mar. 31, 2024
Open tax year				2019
International Tax Jurisdictions [Member] | Other Assets [Member]
Income Taxes [Line Items]
Deferred income tax asset				$ 48,000	37,000
State Tax Jurisdictions [Member] | Earliest Tax Year [Member]
Income Taxes [Line Items]
Open tax year				2015
State Tax Jurisdictions [Member] | Latest Tax Year [Member]
Income Taxes [Line Items]
Open tax year				2019
State Tax Jurisdictions [Member] | Assets Held for Sale [Member]
Income Taxes [Line Items]
Deferred income tax asset					126,000
Net operating loss carryforwards, valuation allowance					$ 34,000
Federal Tax Jurisdictions [Member] | Earliest Tax Year [Member]
Income Taxes [Line Items]
Open tax year				2016
Federal Tax Jurisdictions [Member] | Latest Tax Year [Member]
Income Taxes [Line Items]
Open tax year				2019
Maximum [Member] | Investment Tax Credit Carryforward [Member]
Income Taxes [Line Items]
Expiration date of state investment tax credits				Mar. 31, 2034
Minimum [Member] | Investment Tax Credit Carryforward [Member]
Income Taxes [Line Items]
Expiration date of state investment tax credits				Mar. 31, 2021

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The Company and Its Accounting Policies (Policies)

12 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Principles of consolidation and use of estimates in the preparation of consolidated financial statements

Principles of consolidation and use of estimates in the preparation of consolidated financial statements

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Energy Steel, located in Lapeer, Michigan, Graham Vacuum and Heat Transfer Technology (Suzhou) Co., Ltd., located in China, and GIPL, located in India.  All intercompany balances, transactions and profits are eliminated in consolidation.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the related revenues and expenses during the reporting period.  Actual amounts could differ from those estimated.

Translation of foreign currencies

Translation of foreign currencies

Assets and liabilities of the Company's foreign subsidiary are translated into U.S. dollars at currency exchange rates in effect at year-end and revenues and expenses are translated at average exchange rates in effect for the year.  Gains and losses resulting from foreign currency transactions are included in results of operations. The Company's sales and purchases in foreign currencies are minimal.  Therefore, foreign currency transaction gains and losses are not significant.  Gains and losses resulting from translation of foreign subsidiary balance sheets are included in a separate component of stockholders' equity.  Translation adjustments are not adjusted for income taxes since they relate to an investment, which is permanent in nature.

Revenue recognition

Revenue recognition

The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.  

The Company recognizes revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, the Company has rights to payment, and rewards of ownership pass to the customer.  Customer acceptance may also be a factor in determining whether control of the product has transferred.  Although revenue on the majority of the Company’s contracts, as measured by number of contracts, is recognized upon shipment to the customer, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria in ASC 606.

Cash and cash equivalents

Cash and cash equivalents

Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities at the time of purchase of three months or less.

Shipping and handling fees and costs

Shipping and handling fees and costs

Shipping and handling fees billed to the customer are recorded in net sales and the related costs incurred for shipping and handling are included in cost of products sold.

Investments

Investments

Investments consist of certificates of deposits with financial institutions.  All investments have original maturities of greater than three months and less than one year and are classified as held-to-maturity, as the Company believes it has the intent and ability to hold the securities to maturity.  The investments are stated at amortized cost which approximates fair value.  All investments held by the Company at March 31, 2020 are scheduled to mature on or before June 25, 2020.

Inventories

Inventories

Inventories are stated at the lower of cost or net realizable value, using the average cost method.  Unbilled revenue (contract assets) in the Consolidated Balance Sheets represents revenue recognized that has not been billed to customers on contracts in which revenue is recognized over time.  All progress payments exceeding unbilled revenue are presented as customer deposits (contract liabilities) in the Consolidated Balance Sheets.

Property, plant, equipment, depreciation and amortization

Property, plant, equipment, depreciation and amortization

Property, plant and equipment are stated at cost net of accumulated depreciation and amortization.  Major additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred.  Depreciation and amortization are provided based upon the estimated useful lives, or lease term if shorter, under the straight-line method.  Estimated useful lives range from approximately five to eight years for office equipment, eight to 25 years for manufacturing equipment and 40 years for buildings and improvements.  Upon sale or retirement of assets, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations.

Business combinations

Business combinations

The Company records its business combinations under the acquisition method of accounting.  Under the acquisition method of accounting, the Company allocates the purchase price of each acquisition to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition.  The fair value of identifiable intangible assets is based upon detailed valuations that use various assumptions made by management.  Any excess of the purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill.  Direct acquisition-related costs are expensed as incurred.

Impairment of long-lived assets

Impairment of long-lived assets

The Company assesses the impairment of definite-lived long-lived assets or asset groups when events or changes in circumstances indicate that the carrying value may not be recoverable.  Factors that are considered in deciding when to perform an impairment review include: a significant decrease in the market price of the asset or asset group; a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; or a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life.  The term more likely than not refers to a level of likelihood that is more than 50%.

Recoverability potential is measured by comparing the carrying amount of the asset or asset group to its related total future undiscounted cash flows.  If the carrying value is not recoverable through related cash flows, the asset or asset group is considered to be impaired.  Impairment is measured by comparing the asset or asset group's carrying amount to its fair value.  When it is determined that useful lives of assets are shorter than originally estimated, and no impairment is present, the rate of depreciation is accelerated in order to fully depreciate the assets over their new shorter useful lives.

Goodwill and intangible assets with indefinite lives are tested annually for impairment as of December 31.  The Company assesses goodwill for impairment by comparing the fair value of its reporting units to their carrying amounts.  If the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the implied fair value of the goodwill within the reporting unit is less than its carrying value.  Fair values for reporting units are determined based on a weighted combination of the market approach and the income approach using discounted cash flows.  Indefinite lived intangible assets are assessed for impairment by comparing the fair value of the asset to its carrying value.

Assets and Liabilities Held for Sale

Assets and liabilities held for sale

The Company classifies long-lived assets (disposal group) to be sold as held for sale in accordance with Accounting Standards Update ("ASU") 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360):  Reporting Discontinued Operation And Disclosures of Disposals Of Components Of An Entity," in the period in which all of the following criteria are met:

1. Management, having the authority to approve the action, commits to a plan to sell the asset (disposal group);

2. The asset (disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (disposal group);

3. An active program to locate a buyer and other actions required to complete the plan to sell the asset (disposal group) have been initiated;

4. The sale of the asset (disposal group) is probable, and transfer of the asset (disposal group) is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond the Company's control extend the period of time required to sell the asset (disposal group) beyond one year;

5. The asset (disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and

6. Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

A long-lived asset (disposal group) that is classified as held for sale is initially measured at the lower of its carrying value or fair value less any costs to sell.  Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met.  Gains are not recognized on the sale of a long-lived asset (disposal group) until the date of sale.

The fair value of a long-lived asset (disposal group) less any costs to sell is assessed at each reporting period it remains classified as held for sale and any subsequent changes are reported as an adjustment to the carrying value of the asset (disposal group), as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale.  Upon determining that a long-lived asset (disposal group) met the criteria to be classified as held for sale, the Company reported the assets and liabilities of the disposal group for all periods presented in the line items "Assets held for sale" and "Liabilities held for sale," respectively, in the Consolidated Balance Sheet as of March 31, 2019.  See Note 3.

Product warranties

Product warranties

The Company estimates the costs that may be incurred under its product warranties and records a liability in the amount of such costs at the time revenue is recognized.  The reserve for product warranties is based upon past claims experience and ongoing evaluations of any specific probable claims from customers.  A reconciliation of the changes in the product warranty liability is presented in Note 7.

Research and development

Research and development

Research and development costs are expensed as incurred.  The Company incurred research and development costs of $3,353, $3,538 and $3,211 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.  Research and development costs are included in the line item “Cost of products sold” in the Consolidated Statements of Operations.

Income taxes

Income taxes

The Company recognizes deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns.  Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using currently enacted tax rates.  The Company evaluates the available evidence about future taxable income and other possible sources of realization of deferred income tax assets and records a valuation allowance to reduce deferred income tax assets to an amount that represents the Company's best estimate of the amount of such deferred income tax assets that more likely than not will be realized.

The Company accounts for uncertain tax positions using a "more likely than not" recognition threshold.  The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective resolution of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position.  These tax positions are evaluated on a quarterly basis.  It is the Company's policy to recognize any interest related to uncertain tax positions in interest expense and any penalties related to uncertain tax positions in selling, general and administrative expense.

The Company files federal and state income tax returns in several U.S. and non-U.S. domestic and foreign jurisdictions.  In most tax jurisdictions, returns are subject to examination by the relevant tax authorities for a number of years after the returns have been filed.

Equity-based compensation

Equity-based compensation

The Company records compensation costs related to equity-based awards based on the estimated fair value of the award on the grant date.  Compensation cost is recognized in the Company's Consolidated Statements of Operations over the applicable vesting period.  The Company uses the Black-Scholes valuation model as the method for determining the fair value of its stock option awards.  For service and performance based restricted stock awards, the fair market value of the award is determined based upon the closing value of the Company's stock price on the grant date.  The fair market value of market-based performance restricted stock awards is determined using the Monte Carlo valuation model.  The amount of equity-based compensation expense recognized during a period is based on the portion of the awards that are ultimately expected to vest.  The Company estimates the forfeiture rate at the grant date by analyzing historical data and revises the estimates in subsequent periods if the actual forfeiture rate differs from the estimates.

Income (loss) per share data

Income (loss) per share data

Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period.  Diluted income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding and, when applicable, potential common shares outstanding during the period.  

A reconciliation of the numerators and denominators of basic and diluted (loss) income per share is presented below:

	Year ended March 31,
	2020		2019			2018
Basic income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted common shares outstanding		9,876		9,823			9,764
Basic income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)
Diluted income (loss) per share:
Numerator:
Net income (loss)	$	1,872	$	(308	)	$	(9,844	)
Denominator:
Weighted average common shares and SEUs    outstanding		9,876		9,823			9,764
Stock options outstanding		3		—			—
Weighted average common and potential common    shares outstanding		9,879		9,823			9,764
Diluted income (loss) per share	$	0.19	$	(0.03	)	$	(1.01	)

None of the options to purchase shares of common stock which totaled 39 and 69 in fiscal 2019 and fiscal 2018, respectively, were included in the computation of diluted loss per share as the affect would be anti-dilutive due to the net losses in the fiscal years.

Cash flow statement

Cash flow statement

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Interest paid was $12 in each of fiscal 2020, fiscal 2019, and fiscal 2018.  In addition, income taxes paid (refunded) were $139 in fiscal 2020, $(73) in fiscal 2019 and $1,916 in fiscal 2018.

In fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included pension and other postretirement benefit adjustments, net of income tax, of $525, $348 and $(1,668), respectively.  In fiscal 2018, non-cash activities included the reclassification of $1,828 from accumulated other comprehensive loss to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the "Tax Act").  Also, in fiscal 2020, fiscal 2019 and fiscal 2018, non-cash activities included the issuance of treasury stock valued at $170, $134 and $130, respectively, to the Company's Employee Stock Purchase Plan (See Note 13).

At March 31, 2020, 2019 and 2018, there were $162, $85, and $0, respectively, of capital purchases that were recorded in accounts payable and are not included in the caption "Purchase of property, plant and equipment" in the Consolidated Statements of Cash Flows.  In fiscal 2020, fiscal 2019 and fiscal 2018, capital expenditures totaling $0, $100 and $0, respectively, were financed through the issuance of capital leases.

Accumulated other comprehensive loss

Accumulated other comprehensive loss

Comprehensive income is comprised of net income and other comprehensive income or loss items, which are accumulated as a separate component of stockholders' equity.  For the Company, other comprehensive income or loss items include a foreign currency translation adjustment and pension and other postretirement benefit adjustments.

Fair value measurements

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the "exit price") in an orderly transaction between market participants at the measurement date.  The accounting standard for fair value establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.  Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company.  Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.  The hierarchy is broken down into three levels based on the reliability of inputs as follows:

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.  Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.

Level 2 – Valuations determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market.

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.  The degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

The availability of observable inputs can vary and is affected by a wide variety of factors, including, the type of asset/liability, whether the asset/liability is established in the marketplace, and other characteristics particular to the transaction.  To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment.  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure.  Therefore, even when market assumptions are not readily available, assumptions are required to reflect those that market participants would use in pricing the asset or liability at the measurement date.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of sales and expenses during the reporting period.  Actual results could differ materially from those estimates.

Accounting and reporting changes

Accounting and reporting changes

In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board ("FASB"), the Securities and Exchange Commission ("SEC"), the Emerging Issues Task Force, the American Institute of Certified Public Accountants or any other authoritative accounting body to determine the potential impact they may have on the Company's consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)," which requires companies to recognize all leases as assets and liabilities on the consolidated balance sheet.  Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  This ASU retains a distinction between finance leases and operating leases, and the classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous accounting guidance.  The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.  Earlier application is permitted.

The Company adopted the new standard using the modified retrospective approach on April 1, 2019.  The Company elected the available transition method that uses the effective date of the amended guidance as the date of initial application.  The guidance provided for several practical expedients.  The Company elected the package of practical expedients permitted under the transition guidance which allows entities to carry forward historical lease classification.  The Company made an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less.  The Company recognizes those lease payments in the Condensed Consolidated Statements of Income on a straight-line basis over the lease term.  On April 1, 2019, the Company recognized the cumulative effect of initially applying the amended guidance which resulted in the recognition of operating lease ROU assets of $677, lease liabilities of $732 and a decrease to the opening balance of retained earnings of $80.  Other current assets and the deferred income tax liability were reduced by $47 and $22, respectively.  Approximately $500 of ROU assets and lease liabilities were related to the business held for sale at March 31, 2019 and subsequently sold on June 24, 2019.  See Note 8 to the Consolidated Financial Statements for additional information on the Company’s leases.

 In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326)," which replaces the current incurred loss impairment methodology for most financial assets with the current expected credit loss ("CECL") methodology.  Under the CECL method, the Company will be required to immediately recognize an estimate of credit losses expected to occur over the life of the financial asset at the time the financial asset is originated or acquired.  Estimated credit losses are determined by taking into consideration historical loss conditions, current conditions and reasonable and supportable forecasts.  Changes to the expected lifetime credit losses are required to be recognized each period.  The standard is effective for the Company on April 1, 2023.  The Company does not expect the adoption of this ASU will have a material effect on its Consolidated Financial Statements.

In August 2018, the FASB issued ASU No. 2018-14, "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20)," which removes disclosures that no longer are considered cost beneficial, clarifies specific disclosure requirements and adds disclosure requirements identified as relevant for defined benefit pension and other postretirement benefit plans.  This amendment is effective for fiscal years ending after December 15, 2020.  Early adoption is permitted. The amendment requires application on a retrospective basis to all periods presented.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

In December 2019, the FASB issue ASU No. 2019-12, “Simplifying the Accounting for Income Taxes.”.  The amended guidance simplifies the accounting for income taxes, eliminating certain exceptions to the general income tax principles, in an effort to reduce the cost and complexity of application.  The amended guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.  Earlier application is permitted.  The guidance requires application on either a prospective, retrospective or modified retrospective basis, contingent on the income tax exception being applied.  The Company believes the adoption of this ASU will not have a material impact on its Consolidated Financial Statements.

Management does not expect any other recently issued accounting pronouncements, which have not already been adopted, to have a material impact on the Company's consolidated financial statements.

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Equity Compensation Plans

12 Months Ended

Mar. 31, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Equity Compensation Plans

Note 13 - Equity Compensation Plans:

The Amended and Restated 2000 Graham Corporation Incentive Plan to Increase Shareholder Value, as approved by the Company's stockholders at the Annual Meeting on July 28, 2016, provides for the issuance of up to 1,375 shares of common stock in connection with grants of incentive stock options, non-qualified stock options, stock awards and performance awards to officers, key employees and outside directors; provided, however, that no more than 467 shares of common stock may be used for awards other than stock options.  Stock options may be granted at prices not less than the fair market value at the date of grant and expire no later than ten years after the date of grant.

In fiscal 2020, fiscal 2019 and fiscal 2018, 83, 53 and 59 shares, respectively, of restricted stock were awarded.  Restricted shares of 40, 27 and 30 granted to officers in fiscal 2020, fiscal 2019 and fiscal 2018, respectively, vest 100% on the third anniversary of the grant date subject to the satisfaction of the performance metrics for the applicable three-year period.  Restricted shares of 28, 20, and 22 granted to officers and key employees in fiscal 2020, fiscal 2019, and fiscal 2018 respectively, vest 33⅓% per year over a three-year term.  The restricted shares granted to directors of 15, 6 and 7 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively, vest 100% on the first anniversary of the grant date.  The Company recognizes compensation cost over the period the shares vest.

During fiscal 2020, fiscal 2019, and fiscal 2018, the Company recognized $945, $1,069, and $577, respectively, of stock-based compensation cost related to stock option and restricted stock awards, and $208, $237 and $125, respectively, of related tax benefits.

The Company received cash proceeds from the exercise of stock options of $24, $307 and $0 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.

The following table summarizes information about the Company's stock option awards during fiscal 2020, fiscal 2019 and fiscal 2018:

				Weighted
	Shares			Average		Weighted	Aggregate
	Under			Exercise		Average Remaining	Intrinsic
	Option			Price		Contractual Term	Value
Outstanding at April 1, 2017		69			20.26
Exercised		—
Outstanding at March 31, 2018		69			20.26
Exercised		(19	)		15.89
Cancelled		(11	)		33.02
Outstanding at March 31, 2019		39			18.76
Exercised		(2	)		15.25
Outstanding at March 31, 2020		37			18.92	2.07 years	$	—
Vested or expected to vest at March 31, 2020		37			18.92	2.07 years		—
Exercisable at March 31, 2020		37			18.92	2.07 years		—

The following table summarizes information about stock options outstanding at March 31, 2020:

Exercise Price	Options Outstanding at March 31, 2020		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
$18.65		33	$	18.65		2.17
$21.19		4		21.19		1.17
$18.65-21.19		37		18.92		2.07

The total intrinsic value of the stock options exercised during fiscal 2020, fiscal 2019 and fiscal 2018 was $10, $161 and $0, respectively.  As of March 31, 2020, there was $2,318 of total unrecognized stock-based compensation expense related to non-vested restricted stock.  The Company expects to recognize this expense over a weighted average period of 1.38 years.

The outstanding options expire between May 2021 and May 2022.  Options, stock awards and performance awards available for future grants were 202 at March 31, 2020.

The following table summarizes information about the Company's restricted stock awards during fiscal 2020, fiscal 2019 and fiscal 2018:

	Restricted Stock			Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Non-vested at April 1, 2017		120			21.96
Granted		59			23.03
Vested		(25	)		20.44
Forfeited		(28	)		25.27
Non-vested at March 31, 2018		126			22.02
Granted		53			30.08
Vested		(28	)		20.38
Forfeited		(2	)		22.83
Non-vested at March 31, 2019		149			25.19
Granted		83			22.95
Vested		(38	)		23.17
Forfeited		(45	)		22.52
Non-vested at March 31, 2020		149			25.26	$	—

The Company has an Employee Stock Purchase Plan (the "ESPP"), which allows eligible employees to purchase shares of the Company's common stock at a discount of up to 15% of its fair market value on the (1) last, (2) first or (3) lower of the last or first day of the six-month offering period.  A total of 200 shares of common stock may be purchased under the ESPP.  In fiscal 2020, fiscal 2019 and fiscal 2018, 9, 6 and 7 shares, respectively, were issued from treasury stock to the ESPP for the offering periods in each of the fiscal years.  During fiscal 2020, fiscal 2019 and fiscal 2018, the Company recognized stock-based compensation cost of $30, $0 and $0, respectively, related to the ESPP and $7, $0 and $0, respectively, of related tax benefits.  

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Commitments and Contingencies

12 Months Ended

Mar. 31, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 17– Commitments and Contingencies:

The Company has been named as a defendant in lawsuits alleging personal injury from exposure to asbestos allegedly contained in, or accompanying, products made by the Company. The Company is a co-defendant with numerous other defendants in these lawsuits and intends to vigorously defend itself against these claims. The claims in the Company’s current lawsuits are similar to those made in previous asbestos-related suits that named the Company as a defendant, which either were dismissed when it was shown that the Company had not supplied products to the plaintiffs’ places of work or were settled for immaterial amounts.  The Company cannot provide any assurances that any pending or future matters will be resolved in the same manner as previous lawsuits.

As of March 31, 2020, the Company was subject to the claims noted above, as well as other legal proceedings and potential claims that have arisen in the ordinary course of business.

Although the outcome of the lawsuits, legal proceedings or potential claims to which the Company is, or may become, a party to cannot be determined and an estimate of the reasonably possible loss or range of loss cannot be made for the majority of the claims, management does not believe that the outcomes, either individually or in the aggregate, will have a material adverse effect on the Company’s results of operations, financial position or cash flows.

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Assets Dispositions - Additional Information (Detail) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended
	Jun. 24, 2019	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Impairment loss		$ 6,449		$ 6,449	$ 14,816
Proceeds from sale of subsidiary			$ 602
Loss on sale of Energy Steel & Supply Co.			181
Westinghouse Electric Company [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Bad debt charge			98
Inventory write down			338
Energy Steel [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Proceeds from sale of subsidiary	$ 602
Working capital adjustment determination period	90 days
Net accounts receivable	$ 202
Loss on sale of Energy Steel & Supply Co.			$ 181

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Revenue Recognition - Net Sales Disaggregated by Product Line and Geographic Area (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Disaggregation Of Revenue [Line Items]
Net sales	$ 23,082	$ 25,286	$ 21,643	$ 20,593	$ 23,641	$ 17,198	$ 21,441	$ 29,551	$ 90,604	$ 91,831	$ 77,534
Asia [Member]
Disaggregation Of Revenue [Line Items]
Net sales									5,517	10,292	10,200
Canada [Member]
Disaggregation Of Revenue [Line Items]
Net sales									8,907	16,602	8,888
Middle East [Member]
Disaggregation Of Revenue [Line Items]
Net sales									13,112	2,610	3,785
South America [Member]
Disaggregation Of Revenue [Line Items]
Net sales									3,783	324	1,560
U.S. [Member]
Disaggregation Of Revenue [Line Items]
Net sales									58,042	59,441	51,950
All Other [Member]
Disaggregation Of Revenue [Line Items]
Net sales									1,243	2,562	1,151
Heat Transfer Equipment [Member]
Disaggregation Of Revenue [Line Items]
Net sales									31,986	24,785	27,023
Vacuum Equipment [Member]
Disaggregation Of Revenue [Line Items]
Net sales									33,354	34,461	22,175
All Other [Member]
Disaggregation Of Revenue [Line Items]
Net sales									$ 25,264	$ 32,585	$ 28,336

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Changes in Accumulated Other Comprehensive Loss (Tables)

12 Months Ended

Mar. 31, 2020

Equity [Abstract]

Changes in Accumulated Other Comprehensive Loss by Component

The changes in accumulated other comprehensive loss by component for fiscal 2020 and fiscal 2019 are:

	Pension and Other Postretirement Benefit Items			Foreign Currency Items			Total
Balance at April 1, 2018	$	(8,599	)	$	349		$	(8,250	)
Other comprehensive loss before reclassifications		(1,081	)		(235	)		(1,316	)
Amounts reclassified from accumulated other   comprehensive loss		733			—			733
Net current-period other comprehensive loss		(348	)		(235	)		(583	)
Balance at March 31, 2019		(8,947	)		114			(8,833	)
Other comprehensive loss before reclassifications		(1,296	)		(198	)		(1,494	)
Amounts reclassified from accumulated other   comprehensive loss		771			—			771
Net current-period other comprehensive loss		(525	)		(198	)		(723	)
Balance at March 31, 2020	$	(9,472	)	$	(84	)	$	(9,556	)

Reclassifications Out of Accumulated Other Comprehensive Loss by Component

The reclassifications out of accumulated other comprehensive loss by component are as follows:

Year ended March 31, 2020

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(997	)	(1)
		(997	)		Income before provision for income taxes
		(226	)		Provision for income taxes
	$	(771	)		Net income

Year ended March 31, 2019

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(875	)	(1)
		(875	)		Income before provision for income taxes
		(142	)		Provision for income taxes
	$	(733	)		Net income

(1) These accumulated other comprehensive loss components are included within the computation of net periodic pension and other postretirement benefit costs.  See Note 12.

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Financial Instruments and Derivative Financial Instruments - Additional Information (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Derivative Instruments And Hedging Activities Disclosure [Abstract]
Letters of credit outstanding amount	$ 13,328	$ 8,503

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Income Taxes - Summary of Net Deferred Income Tax Liability (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Components Of Deferred Tax Assets And Liabilities [Abstract]
Depreciation	$ (1,707)	$ (1,714)
Accrued compensation	206	230
Prepaid pension asset	(783)	(935)
Accrued pension liability	169	145
Accrued postretirement benefits	143	150
Compensated absences	402	355
Inventories	(13)	14
Warranty liability	81	80
Accrued expenses	366	267
Equity-based compensation	385	359
Operating lease assets	(58)
Operating lease liabilities	60
New York State investment tax credit	1,108	1,069
Net operating loss carryforwards	75	50
Capital loss related to sale of Energy Steel	4,211	3,848
Other	1	(20)
Deferred Tax Assets, gross	4,646	3,898
Less: Valuation allowance	(5,319)	(4,917)
Total	$ (673)	$ (1,019)

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Employee Benefit Plans

12 Months Ended

Mar. 31, 2020

Compensation And Retirement Disclosure [Abstract]

Employee Benefit Plans

Note 12 – Employee Benefit Plans:

Retirement Plans

The Company has a qualified defined benefit plan covering U.S. employees hired prior to January 1, 2003, which is non-contributory.  Benefits are based on the employee's years of service and average earnings for the five highest consecutive calendar years of compensation in the ten-year period preceding retirement.  The Company's funding policy for the plan is to contribute the amount required by the Employee Retirement Income Security Act of 1974, as amended.

The components of pension cost (benefit) are:

	Year ended March 31,
	2020			2019			2018
Service cost during the period	$	496		$	571		$	598
Interest cost on projected benefit obligation		1,290			1,339			1,423
Expected return on assets		(2,657	)		(3,062	)		(2,977	)
Amortization of:
Actuarial loss		969			847			1,013
Net pension cost (benefit)	$	98		$	(305	)	$	57

The components of net pension cost (benefit) other than the service cost component are included in “Other income” in the Consolidated Statements of Operations.

The weighted average actuarial assumptions used to determine net pension cost are:

	Year ended March 31,
	2020			2019			2018
Discount rate		3.83	%		3.95	%		4.08	%
Rate of increase in compensation levels		3.00	%		3.00	%		3.00	%
Long-term rate of return on plan assets		7.00	%		8.00	%		8.00	%

The expected long-term rate of return is based on the mix of investments that comprise plan assets and external forecasts of future long-term investment returns, historical returns, correlations and market volatilities.

The Company does not expect to make any contributions to the plan during fiscal 2021.

Changes in the Company's benefit obligation, plan assets and funded status for the pension plan are presented below:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	34,149		$	34,441
Service cost		496			468
Interest cost		1,290			1,339
Actuarial loss (gain)		2,368			462
Benefit payments		(1,100	)		(972	)
Liability released through annuity purchase		(1,420	)		(1,589	)
Projected benefit obligation at end of year	$	35,783		$	34,149
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	38,416		$	38,810
Employer contribution		—			30
Actual return on plan assets		3,347			2,266
Benefit and administrative expense payments		(1,100	)		(972	)
Annuities purchased		(1,420	)		(1,718	)
Fair value of plan assets at end of year	$	39,243		$	38,416
Funded status
Funded status at end of year	$	3,460		$	4,267
Amount recognized in the Consolidated Balance Sheets	$	3,460		$	4,267

The weighted average actuarial assumptions used to determine the benefit obligation are:

	March 31,
	2020			2019
Discount rate		3.44	%		3.83	%
Rate of increase in compensation levels		3.00	%		3.00	%

During fiscal 2020 and fiscal 2019, the pension plan released liabilities for vested benefits of certain participants through the purchase of nonparticipating annuity contracts with a third-party insurance company.  As a result of these transactions, in fiscal 2020 and fiscal 2019, the projected benefit obligation decreased $1,420 and $1,589, respectively, and plan assets decreased $1,420 and $1,718, respectively.  The projected benefit obligation is the actuarial present value of benefits attributable to employee service rendered to date, including the effects of estimated future pay increases.  The accumulated benefit obligation reflects the actuarial present value of benefits attributable to employee service rendered to date, but does not include the effects of estimated future pay increases.  The accumulated benefit obligation as of March 31, 2020 and 2019 was $31,715 and $30,380, respectively.  At March 31, 2020 and 2019, the pension plan was fully funded on an accumulated benefit obligation basis.

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	9,285	$	8,737

The increase in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial loss arising during the year	$	1,298		$	1,080
Amortization of actuarial loss		(750	)		(712	)
	$	548		$	368

The estimated net actuarial loss for the pension plan that will be amortized from accumulated other comprehensive loss into net pension cost in fiscal 2021 is $1,039.

The following benefit payments, which reflect future service, are expected to be paid during the fiscal years ending March 31:

2021	$	1,219
2022		1,271
2023		1,289
2024		1,358
2025		1,363
2026-2030		8,209
Total	$	14,709

The weighted average asset allocation of the plan assets by asset category is as follows:

				March 31,
Asset Category	Target Allocation			2020			2019
Equity securities		30	%		30	%		49	%
Debt securities		70	%		70	%		51	%
					100	%		100	%

The investment strategy of the plan is to generate a consistent total investment return sufficient to pay present and future plan benefits to retirees, while minimizing the long-term cost to the Company.  Target allocations for asset categories are used to earn a reasonable rate of return, provide required liquidity and minimize the risk of large losses.  Targets are adjusted when considered necessary to reflect trends and developments within the overall investment environment.  In fiscal 2020, the target allocation was adjusted to 30% from 50% for equity securities and to 70% from 50% for debt securities.

The fair values of the Company's pension plan assets at March 31, 2020 and 2019, by asset category, are as follows:

			Fair Value Measurements Using
Asset Category	At March 31, 2020		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	82	$	82	$	—	$	—
Equity securities:
U.S. companies		9,409		9,409		—		—
International companies		2,327		2,327		—		—
Fixed income:
Corporate bond funds
Long-term		27,425		27,425		—		—
	$	39,243	$	39,243	$	—	$	—

			Fair Value Measurements Using
Asset Category	At March 31,  2019		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	87	$	87	$	—	$	—
Equity securities:
U.S. companies		15,130		15,130		—		—
International companies		3,795		3,795		—		—
Fixed income:
Corporate bond funds
Long-term		19,404		19,404		—		—
	$	38,416	$	38,416	$	—	$	—

The fair value of Level 1 pension assets is obtained by reference to the last quoted price of the respective security on the market which it trades.  See Note 1 to the Consolidated Financial Statements.

On February 4, 2003, the Company closed the defined benefit plan to all employees hired on or after January 1, 2003.  In place of the defined benefit plan, these employees participate in the Company's domestic defined contribution plan.  The Company contributes a fixed percentage of employee compensation to this plan on an annual basis for these employees.  The Company contribution to the defined contribution plan for these employees in fiscal 2020, fiscal 2019 and fiscal 2018 was $406, $325 and $284, respectively.

The Company has a Supplemental Executive Retirement Plan ("SERP") which provides retirement benefits associated with wages in excess of the legislated qualified plan maximums.  Pension expense recorded in fiscal 2020, fiscal 2019, and fiscal 2018 related to this plan was $85, $97 and $115, respectively.  At March 31, 2020 and 2019, the related liability was $747 and $662, respectively, and is separately presented in the caption "Accrued Pension Liability" in the Consolidated Balance Sheets.

The Company has a domestic defined contribution plan (401k) covering substantially all employees.  The Company provides matching contributions equal to 100% of the first 3% of an employee's salary deferral and 50% of the next 2% percent of an employee’s salary deferral.  Company contributions are immediately vested.  Contributions were $1,000 in fiscal 2020, $1,135 in fiscal 2019 and $805 in fiscal 2018.

Other Postretirement Benefits

In addition to providing pension benefits, the Company has a plan in the U.S. that provides health care benefits for eligible retirees and eligible survivors of retirees.  The Company's share of the medical premium cost has been capped at $4 for family coverage and $2 for single coverage for early retirees, and $1 for both family and single coverage for regular retirees.

On February 4, 2003, the Company terminated postretirement health care benefits for its U.S. employees.  Benefits payable to retirees of record on April 1, 2003 remained unchanged.

The components of postretirement benefit expense are:

	Year ended March 31,
	2020		2019		2018
Interest cost on accumulated benefit obligation	$	22	$	25	$	26
Amortization of actuarial loss		28		28		37
Net postretirement benefit expense	$	50	$	53	$	63

Net postretirement benefit expense is included in “Other income” in the Consolidated Statements of Operations.

The weighted average discount rates used to develop the net postretirement benefit cost were 3.37%, 3.63% and 3.23% in fiscal 2020, fiscal 2019 and fiscal 2018, respectively.

Changes in the Company's benefit obligation, plan assets and funded status for the plan are as follows:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	682		$	723
Interest cost		22			25
Actuarial loss (gain)		(3	)		2
Benefit payments		(67	)		(68	)
Projected benefit obligation at end of year	$	634		$	682

Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	—		$	—
Employer contribution		67			68
Benefit payments		(67	)		(68	)
Fair value of plan assets at end of year	$	—		$	—
Funded status
Funded status at end of year	$	(634	)	$	(682	)
Amount recognized in the Consolidated Balance Sheets	$	(634	)	$	(682	)

The weighted average actuarial assumptions used to develop the accrued postretirement benefit obligation were:

	March 31,
	2020			2019
Discount rate		3.01	%		3.37	%
Medical care cost trend rate		7.00	%		7.00	%

The medical care cost trend rate used in the actuarial computation ultimately reduces to 4.5% in 2025 and subsequent years.  This was accomplished using 0.5% decrements for the years ended March 31, 2020 through 2025.

The current portion of the accrued postretirement benefit obligation of $77 and $78, at March 31, 2020 and 2019, respectively, is included in the caption "Accrued Compensation" and the long-term portion is separately presented in the Consolidated Balance Sheets.

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	187	$	210

The decrease in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial (gain) loss arising during the year	$	(2	)	$	1
Amortization of actuarial loss		(21	)		(21	)
	$	(23	)	$	(20	)

The estimated net actuarial loss for the other postretirement benefit plan that will be amortized from accumulated other comprehensive loss into net postretirement benefit income in fiscal 2021 is $27. 

The following benefit payments are expected to be paid during the fiscal years ending March 31:

2021	$	77
2022		72
2023		67
2024		62
2025		57
2026-2030		216
Total	$	551

Assumed medical care cost trend rates could have a significant effect on the amounts reported for the postretirement benefit plan.  However, due to the caps imposed on the Company's share of the premium costs, a one percentage point change in assumed medical care cost trend rates would not have a significant effect on the total service and interest cost components or the postretirement benefit obligation.

Self-Insured Medical Plan

Effective January 1, 2014, the Company commenced self-funding the medical insurance coverage provided to its U.S. based employees.  The Company has obtained a stop loss insurance policy in an effort to limit its exposure to claims.  The Company has specific stop loss coverage per employee for claims incurred during the year exceeding $100 per employee with annual maximum aggregate stop loss coverage of $1,000.  The Company also has total plan annual maximum aggregate stop loss coverage of $2,592.  The liability of $124 and $150 on March 31, 2020 and 2019, respectively, related to the self-insured medical plan is primarily based upon claim history and is included in the caption "Accrued Compensation" in the Consolidated Balance Sheets.

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Purchase of Treasury Stock

12 Months Ended

Mar. 31, 2020

Equity [Abstract]

Purchase of Treasury Stock

Note 16 – Purchase of Treasury Stock:

On January 29, 2015, the Company’s Board of Directors authorized a stock repurchase program.  Under the stock repurchase program the Company is permitted to repurchase up to $18,000 of its common stock either in the open market or through privately negotiated transactions. Cash on hand has been used to fund all stock repurchases under the program.  No shares were purchased under this program in fiscal 2020, fiscal 2019 or fiscal 2018.

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Schedule II - Valuation and Qualifying Accounts

12 Months Ended

Mar. 31, 2020

Valuation And Qualifying Accounts [Abstract]

Schedule II - Valuation and Qualifying Accounts

GRAHAM CORPORATION AND SUBSIDIARIES

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

(In Thousands)

	Balance at		Charged to			Charged to						Balance at
	Beginning		Costs and			Other						End of
Description	of Period		Expenses			Accounts			Deductions			Period
Year ended March 31, 2020
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	33	$	—		$	—		$	—		$	33
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	366	$	62		$	—		$	(69	)	$	359
Year ended March 31, 2019
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	339	$	(167	)	$	(13	)	$	(126	)	$	33
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	493	$	234		$	(85	)	$	(276	)	$	366
Reserves included in the balance sheet caption "accrued    compensation"
Restructuring reserve	$	18	$	—		$	—		$	(18	)	$	—
Year ended March 31, 2018
Reserves deducted from the asset to which they apply:
Reserve for doubtful accounts receivable	$	168	$	177		$	—		$	(6	)	$	339
Reserves included in the balance sheet caption "accrued    expenses"
Product warranty liability	$	538	$	527		$	—		$	(572	)	$	493
Reserves included in the balance sheet caption "accrued    compensation"
Restructuring reserve	$	120	$	316		$	—		$	(418	)	$	18

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Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Statement Of Income And Comprehensive Income [Abstract]
Defined benefit pension and other postretirement plans, tax (benefit) provision	$ (153)	$ (63)	$ 476

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Inventories

12 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Note 4 – Inventories:

Major classifications of inventories are as follows:

	March 31,
	2020		2019
Raw materials and supplies	$	3,061	$	2,787
Work in process		18,018		20,553
Finished products		1,212		1,330
	$	22,291	$	24,670

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Consolidated Statements of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Capital in Excess of Par Value [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Loss [Member]	Treasury Stock [Member]
Beginning balance at Mar. 31, 2017	$ 114,110	$ 1,055	$ 23,176	$ 110,544	$ (8,434)	$ (12,231)
Beginning balance, shares at Mar. 31, 2017		10,548
Comprehensive (loss) income	(7,832)			(9,844)	2,012
Reclassification of stranded tax effects (See Note 1)				1,828	(1,828)
Issuance of shares		$ 6	(6)
Issuance of shares, shares		59
Forfeiture of shares		$ (3)	3
Forfeiture of shares, shares		(28)
Dividends	(3,517)			(3,517)
Recognition of equity-based compensation expense	577		577
Purchase of treasury stock	(119)					(119)
Issuance of treasury stock	130		76			54
Ending Balance at Mar. 31, 2018	103,349	$ 1,058	23,826	99,011	(8,250)	(12,296)
Ending Balance, shares at Mar. 31, 2018		10,579
Cumulative effect of change in accounting principle	(1,022)			(1,022)
Comprehensive (loss) income	(891)			(308)	(583)
Issuance of shares	307	$ 7	300
Issuance of shares, shares		72
Forfeiture of shares, shares		(1)
Dividends	(3,834)			(3,834)
Recognition of equity-based compensation expense	1,069		1,069
Purchase of treasury stock	(146)					(146)
Issuance of treasury stock	134		82			52
Ending Balance at Mar. 31, 2019	98,966	$ 1,065	25,277	93,847	(8,833)	(12,390)
Ending Balance, shares at Mar. 31, 2019		10,650
Cumulative effect of change in accounting principle	(80)			(80)
Comprehensive (loss) income	1,149			1,872	(723)
Issuance of shares	24	$ 8	16
Issuance of shares, shares		84
Forfeiture of shares		$ (4)	4
Forfeiture of shares, shares		(45)
Dividends	(4,250)			(4,250)
Recognition of equity-based compensation expense	975		975
Purchase of treasury stock	(230)					(230)
Issuance of treasury stock	170		89			81
Ending Balance at Mar. 31, 2020	$ 96,724	$ 1,069	$ 26,361	$ 91,389	$ (9,556)	$ (12,539)
Ending Balance, shares at Mar. 31, 2020		10,689

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Leases

12 Months Ended

Mar. 31, 2020

Leases [Abstract]

Leases

Note 8 - Leases:

The Company accounts for leases in accordance with Accounting Standard Codification 842, "Leases," which it adopted on April 1, 2019 using the modified retrospective approach.  See Note 1 to the Consolidated Financial Statements for further discussion of this adoption.

The Company leases certain manufacturing facilities, office space, machinery and office equipment.  An arrangement is considered to contain a lease if it conveys the right to use and control an identified asset for a period of time in exchange for consideration.  If it is determined that an arrangement contains a lease, then a classification of a lease as operating or finance is determined by evaluating the five criteria outlined in the lease accounting guidance at inception.  Leases generally have remaining terms of one year to five years, whereas leases with an initial term of twelve months or less are not recorded on the Consolidated Balance Sheets.  The depreciable life of leased assets related to finance leases is limited by the expected term of the lease, unless there is a transfer of title or purchase option that the Company believes is reasonably certain of exercise.  Certain leases include options to renew or terminate.  Renewal options are exercisable per the discretion of the Company and vary based on the nature of each lease.  The term of the lease includes renewal periods only if the Company is reasonably certain that it will exercise the renewal option.  When determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not limited to, the cost of moving to another location, the cost of disrupting operations, whether the purpose or location of the leased asset is unique and the contractual terms associated with extending the lease.  The Company’s lease agreements do not contain any residual value guarantees or any material restrictive covenants and the Company does not sublease to any third parties.  As of March 31, 2020, the Company did not have any material leases that have been signed but not commenced.

Right-of-use (“ROU”) lease assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date.  ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments in exchange for that right of use.  Finance lease ROU assets and operating lease ROU assets are included in the line items “Property, plant and equipment, net” and “Operating lease assets”, respectively, in the Condensed Consolidated Balance Sheets.  The current portion and non-current portion of finance and operating lease liabilities are all presented separately in the Consolidated Balance Sheets.

The discount rate implicit within the Company’s leases is generally not readily determinable, and therefore, the Company uses an incremental borrowing rate in determining the present value of lease payments based on rates available at commencement.

The weighted average remaining lease term and discount rate for finance and operating leases are as follows:

	March 31, 2020
Finance Leases
Weighted-average remaining lease term in years		2.81
Weighted-average discount rate		9.71	%
Operating Leases
Weighted-average remaining lease term in years		1.98
Weighted-average discount rate		5.49	%

The components of lease expense are as follows:

	Year Ended March 31, 2020
Finance lease cost:
Amortization of right-of-use assets	$	48
Interest on lease liabilities		12
Operating lease cost		229
Short-term lease cost		38
Total lease cost	$	327

Operating lease costs during fiscal 2020 were included within cost of sales and selling, general and administrative expenses.

As of March 31, 2020, future minimum payments required under non-cancelable leases are:

	Operating Leases		Finance Leases
2021	$	162	$	48
2022		48		26
2023		31		26
2024		8		10
2025		—		—
Total lease payments		249		110
Less – amount representing interest		14		15
Present value of net minimum lease payments	$	235	$	95

The Company’s future minimum lease commitments for operating leases as of March 31, 2019 for the fiscal years 2020 through 2024 were $501, $301, $37, $32, and $8, respectively.  Future minimum lease commitments for finance leases as of March 31, 2019 for the fiscal years 2020 through 2024 were $62, $47, $26, $26, and $11, respectively.  

ROU assets obtained in exchange for new operating lease liabilities were $223 in fiscal 2020.

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Employee Benefit Plans (Tables)

12 Months Ended

Mar. 31, 2020

Pension Plans, Defined Benefit [Member]

Components of Postretirement Benefit Expense (Income) and Pension Cost (Benefit)

The components of pension cost (benefit) are:

	Year ended March 31,
	2020			2019			2018
Service cost during the period	$	496		$	571		$	598
Interest cost on projected benefit obligation		1,290			1,339			1,423
Expected return on assets		(2,657	)		(3,062	)		(2,977	)
Amortization of:
Actuarial loss		969			847			1,013
Net pension cost (benefit)	$	98		$	(305	)	$	57

Weighted Average Actuarial Assumptions Used to Determine and Develop Net Pension Cost

The weighted average actuarial assumptions used to determine net pension cost are:

	Year ended March 31,
	2020			2019			2018
Discount rate		3.83	%		3.95	%		4.08	%
Rate of increase in compensation levels		3.00	%		3.00	%		3.00	%
Long-term rate of return on plan assets		7.00	%		8.00	%		8.00	%

Changes in Company's Benefit Obligation, Plan Assets and Funded Status for Plan

Changes in the Company's benefit obligation, plan assets and funded status for the pension plan are presented below:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	34,149		$	34,441
Service cost		496			468
Interest cost		1,290			1,339
Actuarial loss (gain)		2,368			462
Benefit payments		(1,100	)		(972	)
Liability released through annuity purchase		(1,420	)		(1,589	)
Projected benefit obligation at end of year	$	35,783		$	34,149
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	38,416		$	38,810
Employer contribution		—			30
Actual return on plan assets		3,347			2,266
Benefit and administrative expense payments		(1,100	)		(972	)
Annuities purchased		(1,420	)		(1,718	)
Fair value of plan assets at end of year	$	39,243		$	38,416
Funded status
Funded status at end of year	$	3,460		$	4,267
Amount recognized in the Consolidated Balance Sheets	$	3,460		$	4,267

Weighted Average Actuarial Assumptions Used to Determine and Develop Net Pension Cost

The weighted average actuarial assumptions used to determine the benefit obligation are:

	March 31,
	2020			2019
Discount rate		3.44	%		3.83	%
Rate of increase in compensation levels		3.00	%		3.00	%

Summary of Amounts Recognized in Accumulated Other Comprehensive Loss, Net of Income Tax

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	9,285	$	8,737

Summary of Increase (Decrease) in Accumulated Other Comprehensive Loss, Net of Income Tax

The increase in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial loss arising during the year	$	1,298		$	1,080
Amortization of actuarial loss		(750	)		(712	)
	$	548		$	368

Summary of Benefit Payments, Which Reflect Future Service, are Expected to be Paid

The following benefit payments, which reflect future service, are expected to be paid during the fiscal years ending March 31:

2021	$	1,219
2022		1,271
2023		1,289
2024		1,358
2025		1,363
2026-2030		8,209
Total	$	14,709

Summary of Weighted Average Asset Allocation of Plan Assets by Asset Category

The weighted average asset allocation of the plan assets by asset category is as follows:

				March 31,
Asset Category	Target Allocation			2020			2019
Equity securities		30	%		30	%		49	%
Debt securities		70	%		70	%		51	%
					100	%		100	%

Fair Values of Company's Pension Plan Assets by Asset Category

The fair values of the Company's pension plan assets at March 31, 2020 and 2019, by asset category, are as follows:

			Fair Value Measurements Using
Asset Category	At March 31, 2020		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	82	$	82	$	—	$	—
Equity securities:
U.S. companies		9,409		9,409		—		—
International companies		2,327		2,327		—		—
Fixed income:
Corporate bond funds
Long-term		27,425		27,425		—		—
	$	39,243	$	39,243	$	—	$	—

			Fair Value Measurements Using
Asset Category	At March 31,  2019		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash	$	87	$	87	$	—	$	—
Equity securities:
U.S. companies		15,130		15,130		—		—
International companies		3,795		3,795		—		—
Fixed income:
Corporate bond funds
Long-term		19,404		19,404		—		—
	$	38,416	$	38,416	$	—	$	—

Other Postretirement Benefit Plans [Member]

Components of Postretirement Benefit Expense (Income) and Pension Cost (Benefit)

The components of postretirement benefit expense are:

	Year ended March 31,
	2020		2019		2018
Interest cost on accumulated benefit obligation	$	22	$	25	$	26
Amortization of actuarial loss		28		28		37
Net postretirement benefit expense	$	50	$	53	$	63

Changes in Company's Benefit Obligation, Plan Assets and Funded Status for Plan

Changes in the Company's benefit obligation, plan assets and funded status for the plan are as follows:

	Year ended March 31,
	2020			2019
Change in the benefit obligation
Projected benefit obligation at beginning of year	$	682		$	723
Interest cost		22			25
Actuarial loss (gain)		(3	)		2
Benefit payments		(67	)		(68	)
Projected benefit obligation at end of year	$	634		$	682

Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	—		$	—
Employer contribution		67			68
Benefit payments		(67	)		(68	)
Fair value of plan assets at end of year	$	—		$	—
Funded status
Funded status at end of year	$	(634	)	$	(682	)
Amount recognized in the Consolidated Balance Sheets	$	(634	)	$	(682	)

Weighted Average Actuarial Assumptions Used to Determine and Develop Net Pension Cost

The weighted average actuarial assumptions used to develop the accrued postretirement benefit obligation were:

	March 31,
	2020			2019
Discount rate		3.01	%		3.37	%
Medical care cost trend rate		7.00	%		7.00	%

Summary of Amounts Recognized in Accumulated Other Comprehensive Loss, Net of Income Tax

Amounts recognized in accumulated other comprehensive loss, net of income tax, consist of:

	March 31,
	2020		2019
Net actuarial loss	$	187	$	210

Summary of Increase (Decrease) in Accumulated Other Comprehensive Loss, Net of Income Tax

The decrease in accumulated other comprehensive loss, net of income tax, consists of:

	March 31,
	2020			2019
Net actuarial (gain) loss arising during the year	$	(2	)	$	1
Amortization of actuarial loss		(21	)		(21	)
	$	(23	)	$	(20	)

Summary of Benefit Payments, Which Reflect Future Service, are Expected to be Paid

The following benefit payments are expected to be paid during the fiscal years ending March 31:

2021	$	77
2022		72
2023		67
2024		62
2025		57
2026-2030		216
Total	$	551

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Product Warranty Liability (Tables)

12 Months Ended

Mar. 31, 2020

Guarantees [Abstract]

Reconciliation of the Changes in Product Warranty Liability

The reconciliation of the changes in the product warranty liability is as follows:

	Year ended March 31,
	2020			2019
Balance at beginning of year	$	366		$	493
Expense for product warranties		62			234
Product warranty claims paid		(69	)		(276	)
Reclassification to liabilities held for sale		—			(85	)
Balance at end of year	$	359		$	366

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Revenue Recognition (Tables)

12 Months Ended

Mar. 31, 2020

Revenue From Contract With Customer [Abstract]

Net Sales Disaggregated by Product Line and Geographic Area

The following tables present the Company's net sales disaggregated by product line and geographic area:

	Year ended March 31,
Product Line	2020		2019		2018
Heat transfer equipment	$	31,986	$	24,785	$	27,023
Vacuum equipment		33,354		34,461		22,175
All other		25,264		32,585		28,336
Net sales	$	90,604	$	91,831	$	77,534

	Year ended March 31,
Geographic Area	2020		2019		2018
Asia	$	5,517	$	10,292	$	10,200
Canada		8,907		16,602		8,888
Middle East		13,112		2,610		3,785
South America		3,783		324		1,560
U.S.		58,042		59,441		51,950
All other		1,243		2,562		1,151
Net sales	$	90,604	$	91,831	$	77,534

Schedule of Net Contract Assets (Liabilities)

Net contract assets (liabilities) consisted of the following:

	March 31,			March 31,
	2020			2019			Change
Unbilled revenue	$	14,592		$	7,522		$	7,070
Customer deposits		(26,983	)		(30,847	)		3,864
Net (over) under billings	$	(12,391	)	$	(23,325	)	$	10,934

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Assets Dispositions - Reconciliation of Major Classes of Assets and Liabilities Classified as Held for Sale (Detail) - Disposal Group, Held-for-sale, Not Discontinued Operations [Member] $ in Thousands	Mar. 31, 2019 USD ($)
Major classes of assets included as held for sale
Cash	$ 552
Trade accounts receivable, net of allowances	1,921
Unbilled revenue	302
Inventories	1,809
Prepaid expenses and other current assets	130
Income taxes receivable	10
Deferred tax asset	126
Total major classes of assets included as held for sale	4,850
Major classes of liabilities included as held for sale
Accounts payable	520
Accrued compensation	326
Accrued expenses and other current liabilities	746
Customer deposits	1,933
Total major classes of liabilities included as held for sale	$ 3,525

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Goodwill and Other Impairments - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Finite Lived Intangible Assets [Line Items]
Intangible amortization expense		$ 11	$ 237	$ 236
Impairment losses, goodwill	$ 1,222			5,716
Impairment of goodwill and intangible assets	6,449		6,449	14,816
Permits [Member]
Finite Lived Intangible Assets [Line Items]
Impairment losses, intangible assets	1,700			8,600
Tradename [Member]
Finite Lived Intangible Assets [Line Items]
Impairment losses, intangible assets	2,000			500
Customer Relationships [Member]
Finite Lived Intangible Assets [Line Items]
Intangible amortization expense		$ 0	$ 180	$ 180
Impairment losses, intangible assets	1,208
Other Long-Lived Assets [Member]
Finite Lived Intangible Assets [Line Items]
Impairment losses, intangible assets	$ 319

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Leases - Summary of Components of Lease Expense (Detail) $ in Thousands	12 Months Ended
	Mar. 31, 2020 USD ($)
Finance lease cost:
Amortization of right-of-use assets	$ 48
Interest on lease liabilities	12
Operating lease cost	229
Short-term lease cost	38
Total lease cost	$ 327

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Purchase of Treasury Stock - Additional Information (Detail) - USD ($)	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018	Jan. 29, 2015
Equity [Abstract]
Stock repurchase program authorized amount				$ 18,000,000
Number of shares purchased during period	0	0	0

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Employee Benefit Plans - Fair Values of Company's Pension Plan Assets by Asset Category (Detail) - Pension Plans, Defined Benefit [Member] - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	$ 39,243	$ 38,416	$ 38,810
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	39,243	38,416
Cash [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	82	87
Cash [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	82	87
U.S. companies, Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	9,409	15,130
U.S. companies, Equity Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	9,409	15,130
International companies, Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	2,327	3,795
International companies, Equity Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	2,327	3,795
Fixed income, Corporate bond funds, Long-term [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	27,425	19,404
Fixed income, Corporate bond funds, Long-term [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets	$ 27,425	$ 19,404

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Employee Benefit Plans - Summary of Amounts Recognized in Accumulated Other Comprehensive Loss, Net of Income Tax (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss	$ 9,285	$ 8,737
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss	$ 187	$ 210

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Equity Compensation Plans - Schedule of Restricted Stock Awards (Detail) - Restricted Stock [Member] - $ / shares shares in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested, Restricted Stock, Beginning Balance	149	126	120
Restricted Stock, Granted	83	53	59
Restricted Stock, Vested	(38)	(28)	(25)
Restricted Stock, Forfeited	(45)	(2)	(28)
Non-vested, Restricted Stock, Ending Balance	149	149	126
Non-vested, Weighted Average Grant Date Fair Value, Beginning Balance	$ 25.19	$ 22.02	$ 21.96
Weighted Average Grant Date Fair Value, Granted	22.95	30.08	23.03
Weighted Average Grant Date Fair Value, Vested	23.17	20.38	20.44
Weighted Average Grant Date Fair Value, Forfeited	22.52	22.83	25.27
Non-vested, Weighted Average Grant Date Fair Value, Ending Balance	$ 25.26	$ 25.19	$ 22.02

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Employee Benefit Plans - Additional Information (Detail)	12 Months Ended
	Mar. 31, 2020 USD ($) $ / Employee	Mar. 31, 2019 USD ($)	Mar. 31, 2018 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Employee's years of service and average earnings	Five highest consecutive calendar years of compensation in the ten-year period preceding retirement
Accumulated benefit obligation	$ 31,715,000	$ 30,380,000
Contribution equal to employee salary deferral	100.00%
Employer contribution description	Matching contributions equal to 100% of the first 3% of an employee's salary deferral and 50% of the next 2% percent of an employee's salary deferral
Contribution next to employee salary deferral	3.00%
Contribution for additional employee salary deferral	50.00%
Contribution additional next to employee salary deferral	2.00%
Share of the medical premium cost for family coverage	$ 4,000
Share of the medical premium cost for single coverage	2,000
Share of the medical premium both family and single coverage for regular retirees	$ 1,000
Medical care cost trend rate	4.50%
Medical care trend year	2025
Medical care cost trend rate decrements	0.50%
Current portion of accrued postretirement benefit obligation	$ 77,000	78,000
Stop loss coverage per employee for claims | $ / Employee	100,000
Maximum aggregate stop loss coverage | $ / Employee	1,000
Total plan amount	$ 2,592,000
Self-Insured medical plan liability	124,000	150,000
Defined Contribution Plan 401K [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions to defined contribution plan	$ 1,000,000	$ 1,135,000	$ 805,000
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Plan Asset Allocations	30.00%	50.00%
Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Plan Asset Allocations	70.00%	50.00%
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions expected during fiscal 2020	$ 0
Liability released through annuity purchase	1,420,000	$ 1,589,000
Annuities purchased	1,420,000	1,718,000
Estimated net actuarial loss for pension plan	1,039,000
Pension expense	$ 98,000	$ (305,000)	$ 57,000
Weighted average discount rates used to develop net postretirement benefit cost	3.83%	3.95%	4.08%
Defined Contribution Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions to defined contribution plan	$ 406,000	$ 325,000	$ 284,000
Supplemental Executive Retirement Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Pension expense	85,000	97,000	115,000
Pension expense related liability	747,000	662,000
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Estimated net actuarial loss for pension plan	27,000
Pension expense	$ 50,000	$ 53,000	$ 63,000
Weighted average discount rates used to develop net postretirement benefit cost	3.37%	3.63%	3.23%

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Subsequent Events - Additional Information (Detail) - Letter of Credit [Member] - USD ($) $ in Thousands		12 Months Ended
	May 01, 2020	Mar. 31, 2019	Oct. 08, 2019
HSBC Bank USA [Member]
Subsequent Event [Line Items]
Line of credit		$ 5,000	$ 10,000
HSBC Bank USA [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Line of credit	$ 14,000
Revolving Credit Facility [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Annual facility fee	$ 5
Debt instrument, basis spread on variable rate	3.00%
Revolving Credit Facility [Member] | Minimum [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Fee for outstanding letters of credit	0.75%
Revolving Credit Facility [Member] | Maximum [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Fee for outstanding letters of credit	0.85%
Revolving Credit Facility [Member] | HSBC Bank USA [Member]
Subsequent Event [Line Items]
Annual facility fee		$ 5
Debt instrument, basis spread on variable rate		3.00%
Revolving Credit Facility [Member] | HSBC Bank USA [Member] | Minimum [Member]
Subsequent Event [Line Items]
Fee for outstanding letters of credit		0.65%
Revolving Credit Facility [Member] | HSBC Bank USA [Member] | Maximum [Member]
Subsequent Event [Line Items]
Fee for outstanding letters of credit		0.75%

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Debt - Additional Information (Detail) - USD ($)		12 Months Ended
	May 01, 2020	Mar. 31, 2020	Mar. 31, 2019	Oct. 08, 2019	Dec. 02, 2015
Debt Instrument [Line Items]
Short-term borrowings outstanding		$ 0	$ 0
Letters of credit outstanding amount		13,328,000	8,503,000
Long-term debt payment requirements over the next five years		0
HSBC Bank USA [Member] | Letter of Credit [Member]
Debt Instrument [Line Items]
Line of credit			$ 5,000,000	$ 10,000,000
Letters of credit outstanding amount		$ 7,931,000
HSBC Bank USA [Member] | Letter of Credit [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Line of credit	$ 14,000,000
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Debt Instrument, Covenant Compliance		The Company was in compliance with all such provisions as of and for the years ended March 31, 2020 and 2019.
Assets book value		$ 128,281,000
Revolving Credit Facility [Member] | Letter of Credit [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	3.00%
Annual facility fee	$ 5,000
Revolving Credit Facility [Member] | HSBC Bank USA [Member] | Letter of Credit [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			3.00%
Availability under the line of credit		$ 2,069,000
Annual facility fee			$ 5,000
Revolving Credit Facility [Member] | Maximum [Member] | Letter of Credit [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Fee for outstanding letters of credit	0.85%
Revolving Credit Facility [Member] | Maximum [Member] | HSBC Bank USA [Member] | Letter of Credit [Member]
Debt Instrument [Line Items]
Fee for outstanding letters of credit			0.75%
Revolving Credit Facility [Member] | Minimum [Member] | Letter of Credit [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Fee for outstanding letters of credit	0.75%
Revolving Credit Facility [Member] | Minimum [Member] | HSBC Bank USA [Member] | Letter of Credit [Member]
Debt Instrument [Line Items]
Fee for outstanding letters of credit			0.65%
Revolving Credit Facility [Member] | Prime Rate [Member]
Debt Instrument [Line Items]
Interest rate		3.25%	5.50%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member]
Debt Instrument [Line Items]
Line of credit					$ 25,000,000
Maximum limit of credit facility					$ 50,000,000
Term period of agreement		5 years
Interest rate description		interest at either: (i) a rate equal to the bank's prime rate; or (ii) a rate equal to LIBOR plus a margin
Fix rate to reduce fee on outstanding		0.40%
Availability under the line of credit		$ 19,603,000
Debt instrument, covenant description		Under the revolving credit facility, the Company covenants to maintain a maximum funded debt to EBITDA ratio, as defined in such credit facility, of 3.5 to 1.0 and a minimum earnings before interest expense and income taxes ("EBIT") to interest ratio, as defined in such credit facility, of 4.0 to 1.0. The agreement also provides that the Company is permitted to pay dividends without limitation if it maintains a maximum funded debt to EBITDA ratio equal to or less than 2.0 to 1.0 and permits the Company to pay dividends in an amount equal to 25% of net income if it maintains a funded debt to EBITDA ratio of greater than 2.0 to 1.0.
Percentage of net income to be paid as dividend if EBITDA ratio is greater than 2.0 to 1		25.00%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member] | Maximum [Member]
Debt Instrument [Line Items]
Unused commitment fee for borrowing		0.30%
Fee for outstanding letters of credit		1.20%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member] | Maximum [Member] | Dividend Payment Covenant [Member]
Debt Instrument [Line Items]
Maximum funded debt to EBITDA ratio		200.00%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member] | Minimum [Member]
Debt Instrument [Line Items]
Unused commitment fee for borrowing		0.20%
Fee for outstanding letters of credit		0.70%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		1.75%
Revolving Credit Facility [Member] | 2015 Credit Facility Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		0.95%
JPMorgan Chase Bank, N.A. [Member] | 2015 Credit Facility Agreement [Member]
Debt Instrument [Line Items]
Letters of credit outstanding amount		$ 5,397,000

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Income Taxes - The Provision (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Current:
Federal	$ 547	$ 181	$ 6
State	176	141	72
Foreign	4
Total Current	727	322	78
Deferred:
Federal	(694)	(3,993)	(3,276)
State	8	(84)	61
Foreign	(12)	41	12
Changes in valuation allowance	411	3,877	115
Total Deferred	(287)	(159)	(3,088)
Total provision (benefit) for income taxes	$ 440	$ 163	$ (3,010)

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Revenue Recognition - Schedule of Net Contract Assets (Liabilities) (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenue From Contract With Customer [Abstract]
Unbilled revenue	$ 14,592	$ 7,522
Customer deposits	(26,983)	(30,847)
Net (over) under billings	(12,391)	$ (23,325)
Unbilled revenue	7,070
Customer deposits	3,864
Net (over) under billings	$ 10,934

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The Company and Its Accounting Policies - Additional Information (Detail) - USD ($) shares in Thousands, $ in Thousands		12 Months Ended
	Apr. 01, 2019	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018	Jun. 24, 2019
Schedule Of Accounting Policies [Line Items]
Minimum level of likelihood		50.00%
Description of sale of asset		The sale of the asset (disposal group) is probable, and transfer of the asset (disposal group) is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond the Company's control extend the period of time required to sell the asset (disposal group) beyond one year;
Research and development costs		$ 3,353	$ 3,538	$ 3,211
Antidilutive securities excluded from computation of earnings per share			39	69
Interest paid		12	$ 12	$ 12
Income taxes paid (refunded)		139	(73)	1,916
Pension and other postretirement benefit adjustments, net of tax		525	348	(1,668)
Issuance of treasury stock		170	134	130
Capital expenditures		162	85	0
Capital leases		0	100	0
Right-of-use assets		243
Lease liabilities		235
Retained earnings		$ 91,389	93,847
Topic 842 [Member]
Schedule Of Accounting Policies [Line Items]
Right-of-use assets	$ 677				$ 500
Lease liabilities	732				$ 500
Retained earnings	80
Decrease in other current assets	47
Decrease in deferred income tax liability	$ 22
Topic 842 [Member] | Held for Sale [Member]
Schedule Of Accounting Policies [Line Items]
Right-of-use assets			500
Lease liabilities			$ 500
Retained Earnings [Member]
Schedule Of Accounting Policies [Line Items]
Amounts reclassified from accumulated other comprehensive loss to retained earnings				$ 1,828
Buildings and Leasehold Improvements [Member]
Schedule Of Accounting Policies [Line Items]
Estimated useful lives range		40 years
Minimum [Member]
Schedule Of Accounting Policies [Line Items]
Treasury with original maturities period		3 months
Minimum [Member] | Office Equipment [Member]
Schedule Of Accounting Policies [Line Items]
Estimated useful lives range		5 years
Minimum [Member] | Manufacturing Equipment [Member]
Schedule Of Accounting Policies [Line Items]
Estimated useful lives range		8 years
Maximum [Member]
Schedule Of Accounting Policies [Line Items]
Treasury with original maturities period		1 year
Investment maturity date range end		Jun. 25, 2020
Maximum [Member] | Topic 842 [Member]
Schedule Of Accounting Policies [Line Items]
Lease term		12 months
Maximum [Member] | Office Equipment [Member]
Schedule Of Accounting Policies [Line Items]
Estimated useful lives range		8 years
Maximum [Member] | Manufacturing Equipment [Member]
Schedule Of Accounting Policies [Line Items]
Estimated useful lives range		25 years

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Changes in Accumulated Other Comprehensive Loss

12 Months Ended

Mar. 31, 2020

Equity [Abstract]

Changes in Accumulated Other Comprehensive Loss

Note 14 – Changes in Accumulated Other Comprehensive Loss:

The changes in accumulated other comprehensive loss by component for fiscal 2020 and fiscal 2019 are:

	Pension and Other Postretirement Benefit Items			Foreign Currency Items			Total
Balance at April 1, 2018	$	(8,599	)	$	349		$	(8,250	)
Other comprehensive loss before reclassifications		(1,081	)		(235	)		(1,316	)
Amounts reclassified from accumulated other   comprehensive loss		733			—			733
Net current-period other comprehensive loss		(348	)		(235	)		(583	)
Balance at March 31, 2019		(8,947	)		114			(8,833	)
Other comprehensive loss before reclassifications		(1,296	)		(198	)		(1,494	)
Amounts reclassified from accumulated other   comprehensive loss		771			—			771
Net current-period other comprehensive loss		(525	)		(198	)		(723	)
Balance at March 31, 2020	$	(9,472	)	$	(84	)	$	(9,556	)

The reclassifications out of accumulated other comprehensive loss by component are as follows:

Year ended March 31, 2020

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(997	)	(1)
		(997	)		Income before provision for income taxes
		(226	)		Provision for income taxes
	$	(771	)		Net income

Year ended March 31, 2019

Details about Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss				Affected Line Item in the Consolidated Statements of Operations
Pension and other postretirement benefit items:
Amortization of unrecognized prior service    benefit	$	—
Amortization of actuarial loss		(875	)	(1)
		(875	)		Income before provision for income taxes
		(142	)		Provision for income taxes
	$	(733	)		Net income

(1) These accumulated other comprehensive loss components are included within the computation of net periodic pension and other postretirement benefit costs.  See Note 12.

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Quarterly Financial Data (Unaudited)

12 Months Ended

Mar. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited)

Note 18 - Quarterly Financial Data (Unaudited):

A capsule summary of the Company's unaudited quarterly results for fiscal 2020 and fiscal 2019 is presented below:

	First		Second		Third		Fourth		Total
Year ended March 31, 2020	Quarter		Quarter		Quarter		Quarter		Year
Net sales	$	20,593	$	21,643	$	25,286	$	23,082	$	90,604
Gross profit		4,714		4,948		4,044		4,442		18,148
Net income		82		1,205		9		576		1,872
Per share:
Net income:
Basic	$	.01	$	.12	$	—	$	.06	$	0.19
Diluted	$	.01	$	.12	$	—	$	.06	$	0.19
Market price range of common stock	$18.96-22.84		$17.70-23.25		$19.03-23.77		$11.07-21.90		$11.07-23.77

	First		Second		Third		Fourth				Total
Year ended March 31, 2019	Quarter		Quarter		Quarter		Quarter				Year
Net sales	$	29,551	$	21,441	$	17,198	$	23,641			$	91,831
Gross profit		7,142		6,227		3,742		4,798				21,909
Net (loss) income		2,323		1,827		95		(4,553	)	(1)		(308	)
Per share:
Net (loss) income:
Basic	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Diluted	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Market price range of common stock	$20.75-27.51		$22.55-28.98		$19.48-28.73		$19.00-24.90				$19.00-28.98

⁽¹⁾In the fourth quarter of fiscal 2019, the Company recorded goodwill and other impairment losses of $6,449 related to the commercial nuclear utility business that was held for sale at March 31, 2019.  As a result, net income in the fourth quarter of fiscal 2019 includes the impairment loss net of an income tax benefit of $1,129.          

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Debt (Tables)

12 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Long-term Capital Lease Obligations Outstanding

The Company and its subsidiaries had long-term capital lease obligations outstanding as follows:

	March 31,
	2020		2019
Finance lease obligations (Note 8)	$	95	$	146
Less: current amounts		40		51
Total	$	55	$	95

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Inventories (Tables)

12 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

Major Classifications of Inventories

Major classifications of inventories are as follows:

	March 31,
	2020		2019
Raw materials and supplies	$	3,061	$	2,787
Work in process		18,018		20,553
Finished products		1,212		1,330
	$	22,291	$	24,670

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Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Statement Of Financial Position [Abstract]
Allowances on trade accounts receivable	$ 33	$ 33
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	500,000	500,000
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	25,500,000	25,500,000
Common stock, shares issued	10,689,000	10,650,000
Common stock, shares outstanding	9,881,000	9,843,000
Treasury stock, shares	808,000	807,000

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Financial Instruments and Derivative Financial Instruments

12 Months Ended

Mar. 31, 2020

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Financial Instruments and Derivative Financial Instruments

Note 10 - Financial Instruments and Derivative Financial Instruments:

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, investments, and trade accounts receivable.  The Company places its cash, cash equivalents, and investments with high credit quality financial institutions, and evaluates the credit worthiness of these financial institutions on a regular basis. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of customers comprising the Company's customer base and their geographic dispersion.  At March 31, 2020 and 2019, the Company had no significant concentrations of credit risk.

Letters of Credit

The Company has entered into standby letter of credit agreements with financial institutions relating to the guarantee of future performance on certain contracts.  At March 31, 2020 and 2019, the Company was contingently liable on outstanding standby letters of credit aggregating $13,328 and $8,503, respectively.

Fair Value of Financial Instruments

The estimates of the fair value of financial instruments are summarized as follows:

Cash and cash equivalents:  The carrying amount of cash and cash equivalents approximates fair value due to the short-term maturity of these instruments and are considered Level 1 assets in the fair value hierarchy.

Investments:  The fair value of investments at March 31, 2020 and 2019 approximated the carrying value and are considered Level 2 assets in the fair value hierarchy.

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Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Net sales	$ 90,604	$ 91,831	$ 77,534
Cost of products sold	72,456	69,922	60,559
Gross profit	18,148	21,909	16,975
Other expenses and income:
Selling, general and administrative	16,868	17,641	15,533
Selling, general and administrative - amortization	11	237	236
Goodwill and other impairments		6,449	14,816
Restructuring charge			316
Other expense	617
Other income	(348)	(823)	(478)
Interest income	(1,324)	(1,462)	(606)
Interest expense	12	12	12
Total other expenses and income	15,836	22,054	29,829
Income (loss) before provision (benefit) for income taxes	2,312	(145)	(12,854)
Provision (benefit) for income taxes	440	163	(3,010)
Net income (loss)	$ 1,872	$ (308)	$ (9,844)
Basic:
Net income (loss)	$ 0.19	$ (0.03)	$ (1.01)
Diluted:
Net income (loss)	$ 0.19	$ (0.03)	$ (1.01)
Average common shares outstanding:
Basic	9,876	9,823	9,764
Diluted	9,879	9,823	9,764
Dividends declared per share	$ 0.43	$ 0.39	$ 0.36

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Revenue Recognition

12 Months Ended

Mar. 31, 2020

Revenue From Contract With Customer [Abstract]

Revenue Recognition

Note 2 – Revenue Recognition:

The Company accounts for revenue in accordance with Accounting Standard Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which it adopted on April 1, 2018 using the modified retrospective approach.

The Company recognizes revenue on all contracts when control of the product is transferred to the customer.  Control is generally transferred when products are shipped, title is transferred, significant risks of ownership have transferred, the Company has rights to payment, and rewards of ownership pass to the customer.

The following tables present the Company's net sales disaggregated by product line and geographic area:

	Year ended March 31,
Product Line	2020		2019		2018
Heat transfer equipment	$	31,986	$	24,785	$	27,023
Vacuum equipment		33,354		34,461		22,175
All other		25,264		32,585		28,336
Net sales	$	90,604	$	91,831	$	77,534

	Year ended March 31,
Geographic Area	2020		2019		2018
Asia	$	5,517	$	10,292	$	10,200
Canada		8,907		16,602		8,888
Middle East		13,112		2,610		3,785
South America		3,783		324		1,560
U.S.		58,042		59,441		51,950
All other		1,243		2,562		1,151
Net sales	$	90,604	$	91,831	$	77,534

The final destination of products shipped is the basis used to determine net sales by geographic area.  No sales were made to the terrorist sponsoring nations of Sudan, Iran, or Syria.

A performance obligation represents a promise in a contract to provide a distinct good or service to a customer and is the unit of accounting pursuant to ASC 606.  The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.  Transaction price reflects the amount of consideration to which the Company expects to be entitled in exchange for transferred products.  A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized as the performance obligation is satisfied.  In certain cases, the Company may separate a contract into more than one performance obligation, while in other cases, several products may be part of a fully integrated solution and are bundled into a single performance obligation.  If a contract is separated into more than one performance obligation, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods underlying each performance obligation.  The Company has made an accounting policy election to exclude from the measurement of the contract price all taxes assessed by government authorities that are collected by the Company from its customers.  The Company does not adjust the contract price for the effects of a financing component if the Company expects, at contract inception, that the period between when a product is transferred to a customer and when the customer pays for the product will be one year or less. Shipping and handling fees billed to the customer are recorded in revenue and the related costs incurred for shipping and handling are included in cost of products sold.

Revenue on the majority of the Company’s contracts, as measured by number of contracts, is recognized upon shipment to the customer, however, revenue on larger contracts, which are fewer in number but generally represent the majority of revenue, is recognized over time as these contracts meet specific criteria established in ASC 606.   Revenue from contracts that is recognized upon shipment accounted for approximately 30% of revenue in fiscal 2020.  Revenue from contracts that is recognized over time accounted for approximately 70% of revenue in fiscal 2020.  The Company recognizes revenue over time when contract performance results in the creation of a product for which the Company does not have an alternative use and the contract includes an enforceable right to payment in an amount that corresponds directly with the value of the performance completed.  To measure progress towards completion on performance obligations for which revenue is recognized over time the Company utilizes an input method based upon a ratio of direct labor hours incurred to date to management’s estimate of the total labor hours to be incurred on each contract or an output method based upon completion of operational milestones, depending upon the nature of the contract.  The Company has established the systems and procedures essential to developing the estimates required to account for performance obligations over time.  These procedures include monthly review by management of costs incurred, progress towards completion, identified risks and opportunities, sourcing determinations, changes in estimates of costs yet to be incurred, availability of materials, and execution by subcontractors.  Sales and earnings are adjusted on a cumulative catch-up basis in current accounting periods based upon revisions in the contract value due to pricing changes and estimated costs at completion.  Losses on contracts are recognized immediately when evident to management.

The timing of revenue recognition, invoicing and cash collections affect trade accounts receivable, unbilled revenue (contract assets) and customer deposits (contract liabilities) on the Consolidated Balance Sheets.  Unbilled revenue represents revenue on contracts that is recognized over time and exceeds the amount that has been billed to the customer.  Unbilled revenue is separately presented in the Consolidated Balance Sheets.  The Company may receive a customer deposit or have an unconditional right to receive a customer deposit prior to revenue being recognized.  Because the performance obligations related to such customer deposits may not have been satisfied, a contract liability is recorded and an offsetting asset of equal amount is recorded as a trade accounts receivable until the deposit is collected.  Customer deposits are separately presented in the Consolidated Balance Sheets.  Customer deposits are not considered a significant financing component as they are generally received less than one year before the product is completed or used to procure specific material on a contract, as well as related overhead costs incurred during design and construction.

Net contract assets (liabilities) consisted of the following:

	March 31,			March 31,
	2020			2019			Change
Unbilled revenue	$	14,592		$	7,522		$	7,070
Customer deposits		(26,983	)		(30,847	)		3,864
Net (over) under billings	$	(12,391	)	$	(23,325	)	$	10,934

Contract liabilities at March 31, 2020 and 2019 include $3,660 and $6,382, respectively, of customer deposits for which the Company has an unconditional right to collect payment.  Trade accounts receivable, as presented on the Consolidated Balance Sheets, includes corresponding balances at March 31, 2020 and 2019, respectively.  Revenue recognized in fiscal 2020 that was included in the contract liability balance at March 31, 2019 was $17,040.  Changes in the net contract liability balance during fiscal 2020 were impacted by a $7,070 increase in contract assets, of which $20,585 was due to contract progress offset by invoicing to customers of $13,515.  In addition, contract liabilities decreased $3,864 driven by new customer deposits of $13,176 offset by revenue recognized in fiscal 2020 that was included in the contract liability balance at March 31, 2019.

Receivables billed but not paid under retainage provisions in the Company’s customer contracts were $2,016 and $2,214 at March 31, 2020 and 2019, respectively.

Incremental costs to obtain a contract consist of sales employee and agent commissions.  Commissions paid to employees and sales agents are capitalized when paid and amortized to selling, general and administrative expense when the related revenue is recognized.  Capitalized costs, net of amortization, to obtain a contract were $45 and $133 at March 31, 2020 and 2019, respectively, and are included in the line item "Prepaid expenses and other current assets" in the Consolidated Balance Sheets.  The related amortization expense was $169 in fiscal 2020.

The Company's remaining unsatisfied performance obligations represent a measure of the total dollar value of work to be performed on contracts awarded and in progress.  The Company also refers to this measure as backlog.  As of March 31, 2020, the Company had remaining unsatisfied performance obligations of $112,389.  The Company expects to recognize revenue on approximately 70% to 75% of the remaining performance obligations within one year, 15% to 20% in one to two years and the remaining beyond two years.  

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Goodwill and Other Impairments

12 Months Ended

Mar. 31, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Other Impairments

Note 6– Goodwill and Other Impairments:

Finite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives.  Intangible amortization expense was $0, $180 and $180 in fiscal 2020, fiscal 2019 and fiscal 2018.   

During fiscal 2018, the Company performed its annual goodwill and intangible asset impairment review.  The Company assessed impairment by comparing the fair value of its reporting units and intangible assets to their related carrying value.  The Company estimated the fair value of intangible assets and goodwill of its commercial nuclear utility business related to the December 2010 acquisition of Energy Steel using the income approach.  Under the income approach, the fair value of the business was calculated based on the present value of estimated future cash flows.  Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions.  The discount rate used was based on a weighted average cost of capital adjusted for the relevant risk associated with the characteristics of the business and the projected cash flows.  The inputs utilized in the analyses were classified as Level 3 inputs within the fair value hierarchy.  The impairment review indicated that the fair value of the intangible assets and goodwill of the business were substantially lower than the carrying value due to reduced investment from the U.S. commercial nuclear utility market, the strength of the Energy Steel brand relative to larger more vertically integrated suppliers, and the bankruptcy of Westinghouse Electric Company which resulted in the stoppage of work at the Summer, South Carolina nuclear facility.  As a result, in fiscal 2018 the Company recorded impairment losses of $8,600, $500, and $5,716 for permits, tradename and goodwill, respectively.   

As disclosed in Note 3, in the fourth quarter of fiscal 2019, the Company’s Board of Directors approved a plan to sell Energy Steel and, as a result, the Company classified the assets and liabilities of Energy Steel as "Assets held for sale" and "Liabilities held for sale" in the Consolidated Balance Sheet as of March 31, 2019.  An impairment loss totaling $6,449 was recorded in the fourth quarter of fiscal 2019 related to the disposition of Energy Steel which included impairment losses of $1,700, $2,000, $1,208, $1,222 and $319 for permits, tradename, customer relationships, goodwill and other long-lived assets.  On June 24, 2019, the Company completed the sale of Energy Steel.

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Changes in Accumulated Other Comprehensive Loss - Reclassifications Out of Accumulated Other Comprehensive Loss by Component (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income before provision for income taxes									$ 2,312	$ (145)	$ (12,854)
Provision for income taxes									440	163	(3,010)
Net income	$ 576	$ 9	$ 1,205	$ 82	$ (4,553)	$ 95	$ 1,827	$ 2,323	1,872	(308)	$ (9,844)
Reclassifications Out of Accumulated Other Comprehensive Loss [Member] | Amortization of Actuarial Loss [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income before provision for income taxes									(997)	(875)
Reclassifications Out of Accumulated Other Comprehensive Loss [Member] | Pension and Other Postretirement Benefits Items [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income before provision for income taxes									(997)	(875)
Provision for income taxes									(226)	(142)
Net income									$ (771)	$ (733)

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Employee Benefit Plans - Summary of Benefit Payments, Which Reflect Future Service, are Expected to be Paid (Detail) $ in Thousands	Mar. 31, 2020 USD ($)
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
2021	$ 1,219
2022	1,271
2023	1,289
2024	1,358
2025	1,363
2026-2030	8,209
Total	14,709
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
2021	77
2022	72
2023	67
2024	62
2025	57
2026-2030	216
Total	$ 551

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Employee Benefit Plans - Changes in Company's Benefit Obligation, Plan Assets and Funded Status for Plan (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Projected benefit obligation at beginning of year	$ 34,149	$ 34,441
Service cost	496	468
Interest cost	1,290	1,339	$ 1,423
Actuarial loss (gain)	2,368	462
Benefit payments	(1,100)	(972)
Liability released through annuity purchase	(1,420)	(1,589)
Projected benefit obligation at end of year	35,783	34,149	34,441
Change in fair value of plan assets
Fair value of plan assets at beginning of year	38,416	38,810
Employer contribution		30
Actual return on plan assets	3,347	2,266
Benefit payments	(1,100)	(972)
Annuities purchased	(1,420)	(1,718)
Fair value of plan assets at end of year	39,243	38,416	38,810
Funded status
Funded status at end of year	3,460	4,267
Amount recognized in the Consolidated Balance Sheets	3,460	4,267
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Projected benefit obligation at beginning of year	682	723
Interest cost	22	25	26
Actuarial loss (gain)	(3)	2
Benefit payments	(67)	(68)
Projected benefit obligation at end of year	634	682	$ 723
Change in fair value of plan assets
Employer contribution	67	68
Benefit payments	(67)	(68)
Funded status
Funded status at end of year	(634)	(682)
Amount recognized in the Consolidated Balance Sheets	$ (634)	$ (682)

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Equity Compensation Plans - Stock Option Awards (Detail) - $ / shares shares in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Outstanding, Shares Under Option, Beginning Balance	39	69	69
Exercised, Shares Under Option	(2)	(19)
Cancelled, Shares Under Option		(11)
Outstanding, Shares Under Option, Ending Balance	37	39	69
Vested or expected to vest, Shares Under Option	37
Exercisable, Shares Under Option	37
Outstanding, Weighted Average Exercise Price, Beginning Balance	$ 18.76	$ 20.26	$ 20.26
Exercised, Weighted Average Exercise Price	15.25	15.89
Cancelled, Weighted Average Exercise Price		33.02
Outstanding, Weighted Average Exercise Price, Ending Balance	18.92	$ 18.76	$ 20.26
Vested or expected to vest, Weighted Average Exercise Price	18.92
Exercisable, Weighted Average Exercise Price	$ 18.92
Outstanding, Weighted Average Remaining Contractual Term, Ending Balance	2 years 25 days
Vested or expected to vest, Weighted Average Remaining Contractual Term	2 years 25 days
Exercisable, Weighted Average Remaining Contractual Term	2 years 25 days

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Employee Benefit Plans - Weighted Average Actuarial Assumptions Used to Develop Projected Benefit Obligation (Detail) - Other Postretirement Benefit Plans [Member]	Mar. 31, 2020	Mar. 31, 2019
Defined Benefit Plan Disclosure [Line Items]
Discount rate	3.01%	3.37%
Medical care cost trend rate	7.00%	7.00%

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Quarterly Financial Data (Unaudited) - Summary of Company's Unaudited Quarterly Results (Parenthetical) (Detail) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Mar. 31, 2019	Mar. 31, 2018
Loss from impairment of goodwill and intangible assets	$ 6,449	$ 6,449	$ 14,816
Income tax benefit on goodwill and intangible assets impairment	1,129
Commercial Nuclear Utility Business [Member]
Loss from impairment of goodwill and intangible assets	$ 6,449

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Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 51,398	$ 48,968
Less - accumulated depreciation and amortization	33,811	31,897
Property, plant and equipment, net	17,587	17,071
Land [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	171	171
Buildings and Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	19,393	19,263
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	30,474	29,530
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 1,360	$ 4

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Leases - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Leases [Line Items]
Lessee, option to renew or terminate leases, description	Certain leases include options to renew or terminate. Renewal options are exercisable per the discretion of the Company and vary based on the nature of each lease.
Operating leases, future minimum lease commitments, 2020		$ 501
Operating leases, future minimum lease commitments, 2021		301
Operating leases, future minimum lease commitments, 2022		37
Operating leases, future minimum lease commitments, 2023		32
Operating leases, future minimum lease commitments, 2024		8
Finance leases, future minimum lease commitments, 2020		62
Finance leases, future minimum lease commitments, 2021		47
Finance leases, future minimum lease commitments, 2022		26
Finance leases, future minimum lease commitments, 2023		26
Finance leases, future minimum lease commitments, 2024		$ 11
ROU assets obtained in exchange for operating lease liability	$ 223
Minimum [Member]
Leases [Line Items]
Remaining term of contract	1 year
Maximum [Member]
Leases [Line Items]
Remaining term of contract	5 years

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Leases (Tables)

12 Months Ended

Mar. 31, 2020

Leases [Abstract]

Schedule of Weighted Average Remaining Lease Term and Discount Rate for Finance and Operating Leases

The weighted average remaining lease term and discount rate for finance and operating leases are as follows:

	March 31, 2020
Finance Leases
Weighted-average remaining lease term in years		2.81
Weighted-average discount rate		9.71	%
Operating Leases
Weighted-average remaining lease term in years		1.98
Weighted-average discount rate		5.49	%

Schedule of Components of Lease Expense

The components of lease expense are as follows:

	Year Ended March 31, 2020
Finance lease cost:
Amortization of right-of-use assets	$	48
Interest on lease liabilities		12
Operating lease cost		229
Short-term lease cost		38
Total lease cost	$	327

Future Minimum Payments Required under Non-cancelable Leases

As of March 31, 2020, future minimum payments required under non-cancelable leases are:

	Operating Leases		Finance Leases
2021	$	162	$	48
2022		48		26
2023		31		26
2024		8		10
2025		—		—
Total lease payments		249		110
Less – amount representing interest		14		15
Present value of net minimum lease payments	$	235	$	95

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Assets Dispositions (Tables)

12 Months Ended

Mar. 31, 2020

Disposal Group, Held-for-sale, Not Discontinued Operations [Member]

Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]

Reconciliation of Major Classes of Assets and Liabilities Classified as Held for Sale

The following table reconciles the major classes of assets and liabilities classified as held for sale in the Consolidated Balance Sheet at March 31, 2019:

	March 31, 2019
Major classes of assets included as held for sale
Cash	$	552
Trade accounts receivable, net of allowances		1,921
Unbilled revenue		302
Inventories		1,809
Prepaid expenses and other current assets		130
Income taxes receivable		10
Deferred tax asset		126
Total major classes of assets included as held for sale	$	4,850
Major classes of liabilities included as held for sale
Accounts payable	$	520
Accrued compensation		326
Accrued expenses and other current liabilities		746
Customer deposits		1,933
Total major classes of liabilities included as held for sale	$	3,525

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Assets Dispositions

12 Months Ended

Mar. 31, 2020

Disposal Group, Held-for-sale, Not Discontinued Operations [Member]

Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]

Assets Dispositions

Note 3 – Assets Dispositions:

In March 2019, the Company's Board of Directors approved a plan to sell Energy Steel.  Energy Steel met all of the criteria to classify its assets and liabilities as held for sale at March 31, 2019 and as a result its assets and liabilities are separately presented in the Consolidated Balance Sheet at March 31, 2019 in the captions "Assets held for sale" and "Liabilities held for sale".  The disposal of Energy Steel did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and was, therefore, not classified as discontinued operations in accordance with ASU 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360):  Reporting Discontinued Operation And Disclosures of Disposals Of Components Of An Entity."  As part of the required assessment under the held for sale guidance, the Company determined that the approximate fair value less costs to sell the operations was less than its carrying value and, as a result, an impairment loss totaling $6,449 was recorded in fiscal 2019.  (See Note 6 to the Consolidated Financial Statements for further discussion.)

On June 24, 2019, the Company completed the sale of Energy Steel to Hayward Tyler, a division of Avingtrans PLC, a global leader in performance-critical pumps and motors for the energy sector.  Under the terms of the stock purchase agreement, the Company received proceeds of $602, subject to certain adjustments, including a customary working capital adjustment.  The purchase price was finalized within 90 days of the sale and no adjustments to the purchase price were required.  In addition, $202 of Energy Steel’s net accounts receivable was retained by the Company.  The Company recognized a loss on the disposal of $181 in fiscal 2020.  During fiscal 2020, the Company incurred a bad debt charge of $98 and an inventory write down of $338 related to the bankruptcy of Westinghouse Electric Company.  All of these items are included in the line item “Other expense” in the Consolidated Statement of Operations for fiscal 2020.  As of June 24, 2019, all of the Energy Steel assets and liabilities were legally transferred, and therefore, are not included in the Company’s Consolidated Balance Sheet at March 31, 2020.

The following table reconciles the major classes of assets and liabilities classified as held for sale in the Consolidated Balance Sheet at March 31, 2019:

	March 31, 2019
Major classes of assets included as held for sale
Cash	$	552
Trade accounts receivable, net of allowances		1,921
Unbilled revenue		302
Inventories		1,809
Prepaid expenses and other current assets		130
Income taxes receivable		10
Deferred tax asset		126
Total major classes of assets included as held for sale	$	4,850
Major classes of liabilities included as held for sale
Accounts payable	$	520
Accrued compensation		326
Accrued expenses and other current liabilities		746
Customer deposits		1,933
Total major classes of liabilities included as held for sale	$	3,525

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Product Warranty Liability

12 Months Ended

Mar. 31, 2020

Guarantees [Abstract]

Product Warranty Liability

Note 7 – Product Warranty Liability:

The reconciliation of the changes in the product warranty liability is as follows:

	Year ended March 31,
	2020			2019
Balance at beginning of year	$	366		$	493
Expense for product warranties		62			234
Product warranty claims paid		(69	)		(276	)
Reclassification to liabilities held for sale		—			(85	)
Balance at end of year	$	359		$	366

The product warranty liability is included in the line item "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets.

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Operating activities:
Net income (loss)	$ 1,872	$ (308)	$ (9,844)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation	1,957	1,968	1,986
Amortization	11	237	236
Amortization of unrecognized prior service cost and actuarial losses	997	875	1,050
Goodwill and other impairments		6,449	14,816
Equity-based compensation expense	975	1,069	577
(Gain) loss on disposal or sale of property, plant and equipment	(1)	30	26
Loss on sale of Energy Steel & Supply Co.	181
Deferred income taxes	(287)	(159)	(3,088)
(Increase) decrease in operating assets:
Accounts receivable	2,044	(1,227)	(5,472)
Unbilled revenue	(7,070)	(2,519)	7,866
Inventories	2,279	(2,068)	(2,311)
Income taxes receivable	588	396	(1,794)
Prepaid expenses and other current and non-current assets	358	(576)	(176)
Operating lease assets	214
Prepaid pension asset	(871)	(1,181)	(1,009)
Increase (decrease) in operating liabilities:
Accounts payable	1,826	(2,572)	5,757
Accrued compensation, accrued expenses and other current and non-current liabilities	(52)	1,118	(954)
Customer deposits	(3,683)	6,328	792
Operating lease liabilities	(140)
Long-term portion of accrued compensation, accrued pension liability and accrued postretirement benefits	41	57	53
Net cash provided by operating activities	1,239	7,917	8,511
Investing activities:
Purchase of property, plant and equipment	(2,417)	(2,138)	(2,051)
Proceeds from disposal of property, plant and equipment	12		6
Proceeds from the sale of Energy Steel & Supply Co.	602
Purchase of investments	(181,462)	(115,342)	(54,023)
Redemption of investments at maturity	204,146	88,633	52,000
Net cash provided (used) by investing activities	20,881	(28,847)	(4,068)
Financing activities:
Principal repayments on finance lease obligations	(51)	(97)	(107)
Issuance of common stock	24	307	0
Dividends paid	(4,250)	(3,834)	(3,517)
Purchase of treasury stock	(230)	(146)	(119)
Net cash used by financing activities	(4,507)	(3,770)	(3,743)
Effect of exchange rate changes on cash	(231)	(183)	282
Net increase (decrease) in cash and cash equivalents, including cash classified within current assets held for sale	17,382	(24,883)	982
Net decrease (increase) in cash classified within current assets held for sale	552	(552)
Net increase (decrease) in cash and cash equivalents	17,934	(25,435)	982
Cash and cash equivalents at beginning of year	15,021	40,456	39,474
Cash and cash equivalents at end of year	$ 32,955	$ 15,021	$ 40,456

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Income Taxes

12 Months Ended

Mar. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Note 11 – Income Taxes:

An analysis of the components of income (loss) before provision (benefit) for income taxes is presented below:

	Year ended March 31,
	2020			2019			2018
United States	$	2,405		$	(256	)	$	(12,861	)
Asia		(93	)		111			7
	$	2,312		$	(145	)	$	(12,854	)

The provision (benefit) for income taxes consists of:

	Year ended March 31,
	2020			2019			2018
Current:
Federal	$	547		$	181		$	6
State		176			141			72
Foreign		4			—			—
		727			322			78
Deferred:
Federal		(694	)		(3,993	)		(3,276	)
State		8			(84	)		61
Foreign		(12	)		41			12
Changes in valuation allowance		411			3,877			115
		(287	)		(159	)		(3,088	)
Total provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

The reconciliation of the provision (benefit) calculated using the U.S. federal tax rate with the provision (benefit) for income taxes presented in the consolidated financial statements is as follows:

	Year ended March 31,
	2020			2019			2018
Provision (benefit) for income taxes at federal rate	$	486		$	(30	)	$	(3,958	)
State taxes		120			45			118
Charges not deductible for income tax purposes		55			89			48
Research and development tax credits		(211	)		(177	)		(102	)
Valuation allowance		411			3,877			(80	)
Difference in federal rate		(1	)		3			(2,799	)
Impairment of goodwill and intangible assets		—			257			1,760
Foreign-derived intangible income deduction		(95	)		(69	)		—
Capital loss from sale of Energy Steel		(325	)		(3,848	)		—
Stranded tax effects in accumulated other comprehensive loss		—			—			1,828
Mandatory repatriation of post-1986 undistributed foreign    subsidiary earnings and profits		—			—			185
Other		—			16			(10	)
Provision (benefit) for income taxes	$	440		$	163		$	(3,010	)

In fiscal 2018 the impact on the valuation allowance of the difference in the federal rate as a result of the Tax Cuts and Jobs Act which became law in December 2017 (the "Tax Act") discussed below is reflected in the line item "Difference in federal rate" in the reconciliation above.

The net deferred income tax liability recorded in the Consolidated Balance Sheets results from differences between financial statement and tax reporting of income and deductions.  A summary of the composition of the Company's net deferred income tax liability follows:

	March 31,
	2020			2019
Depreciation	$	(1,707	)	$	(1,714	)
Accrued compensation		206			230
Prepaid pension asset		(783	)		(935	)
Accrued pension liability		169			145
Accrued postretirement benefits		143			150
Compensated absences		402			355
Inventories		(13	)		14
Warranty liability		81			80
Accrued expenses		366			267
Equity-based compensation		385			359
Operating lease assets		(58	)		—
Operating lease liabilities		60			—
New York State investment tax credit		1,108			1,069
Net operating loss carryforwards		75			50
Capital loss related to sale of Energy Steel		4,211			3,848
Other		1			(20	)
		4,646			3,898
Less:  Valuation allowance		(5,319	)		(4,917	)
Total	$	(673	)	$	(1,019	)

The foreign deferred income tax asset of $48 and $37 at March 31, 2020 and 2019, respectively, is included in the caption "Other assets" in the Consolidated Balance Sheet.  Deferred income taxes include the impact of state investment tax credits of $314, which expire from 2021 to 2034 and state investment tax credits of $794, which have an unlimited carryforward period.

Foreign net operating losses at March 31, 2020 were $301 and expire between 2022 through 2024.      

In assessing the realizability of deferred tax assets, management considers, within each taxing jurisdiction, whether it is more likely than not that some portion or all of the deferred tax assets will not be realized.  Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the consideration of the weight of both positive and negative evidence, management determined that a portion of the deferred tax assets as of March 31, 2020 and 2019 related to certain state investment tax credits and the capital loss related to Energy Steel would not be realized, and recorded a valuation allowance of $5,319 and $4,917, respectively.  The deferred tax asset of $126 included in the caption "Assets held for sale" in the Consolidated Balance Sheet at March 31, 2019 included a valuation allowance of $34 related to net operating loss carryforwards for city income taxes.

The Company files federal and state income tax returns in several domestic and international jurisdictions.  In most tax jurisdictions, returns are subject to examination by the relevant tax authorities for a number of years after the returns have been filed.  The Company is subject to U.S. federal examination for tax years 2016 through 2019 and examination in state tax jurisdictions for tax years 2015 through 2019.  The Company is subject to examination in the People's Republic of China for tax years 2016 through 2019 and in India for tax year 2019.  The liability for unrecognized tax benefits was $0 at each of March 31, 2020 and 2019.

On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act into law.  The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses and allow businesses to carry back net operating losses arising in 2018, 2019 and 2020 to the five prior tax years, accelerate refunds of previously generated corporate alternative minimum tax credits, change the business interest limitation under IRC section 163(j) from 30% to 50%, and fix qualified improvement property from the Tax Act.  These provisions did not have a material impact on the Company’s consolidated financial statements.

On December 22, 2017, the Tax Act was signed into law.  The Tax Act significantly revised the U.S. tax code by, among other changes, lowering the corporate income tax rate from 35% to 21%, requiring a one-time transition tax on accumulated foreign earnings of certain foreign subsidiaries that were previously tax deferred and creating new taxes on certain foreign sourced earnings.  The Company remeasured certain U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%, and recorded an income tax benefit of $971 related to such re-measurement in fiscal 2018.

The one-time transition tax was based on the total post-1986 earnings and profits (“E&P”) of our foreign subsidiary that has previously been deferred from U.S. income taxes.  The Company recorded its one-time transition liability of its foreign subsidiary resulting in additional income tax expense of $185 in fiscal 2018.  The transition tax was based in part on the amount of those earnings held in cash and other specified assets.  

The Tax Act also included two new U.S. tax base-erosion provisions, the global intangible low-taxed income ("GILTI") provisions and the base-erosion and anti-abuse tax ("BEAT") provisions, beginning in 2018.  The GILTI provisions require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets.  The Company has elected to account for GILTI tax in the period in which it is incurred and recorded $ (1) and $11 of tax (benefit) related to GILTI in fiscal 2020 and fiscal 2019, respectively.  The BEAT provisions in the Tax Act eliminate the deduction of certain base-erosion payments made to related foreign corporations and impose a minimum tax if greater than regular tax.  The Company was not subject to this tax, and therefore has not included any tax impacts of BEAT in its consolidated financial statements.

The Tax Act also provided tax incentives to U.S. companies to earn income from the sale, lease or license of goods and services abroad in the form of a deduction for foreign-derived intangible income ("FDII").  FDII is taxed at an effective rate of 13.125% for taxable years beginning after December 31, 2017.  The incremental U.S. tax savings on FDII in fiscal 2020 and fiscal 2019 was $95 and $69, respectively.

The U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act.  The Company recognized the provisional tax impacts related to the revaluation of deferred tax assets and liabilities and included the amount in its consolidated financial statements in fiscal 2018 and during fiscal 2019 there were no significant changes made to the provisional amounts recorded in fiscal 2018.

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Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Statement Of Income And Comprehensive Income [Abstract]
Net income (loss)	$ 1,872	$ (308)	$ (9,844)
Other comprehensive (loss) income:
Foreign currency translation adjustment	(198)	(235)	344
Defined benefit pension and other postretirement plans, net of income tax (benefit) provision of $(153), $(63), and $476, for the years ended March 31, 2020, 2019 and 2018, respectively	(525)	(348)	1,668
Total other comprehensive (loss) income	(723)	(583)	2,012
Total comprehensive income (loss)	$ 1,149	$ (891)	$ (7,832)

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Employee Benefit Plans - Components of Postretirement Benefit Expense (Income) and Pension Cost (Benefit) (Detail) - Other Postretirement Benefit Plans [Member] - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Interest cost on accumulated benefit obligation	$ 22	$ 25	$ 26
Amortization of actuarial loss	28	28	37
Net pension (benefit) cost and postretirement benefit expense	$ 50	$ 53	$ 63

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Quarterly Financial Data (Unaudited) - Summary of Company's Unaudited Quarterly Results (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Quarterly Financial Information [Line Items]
Net sales	$ 23,082	$ 25,286	$ 21,643	$ 20,593	$ 23,641	$ 17,198	$ 21,441	$ 29,551	$ 90,604	$ 91,831	$ 77,534
Gross profit	4,442	4,044	4,948	4,714	4,798	3,742	6,227	7,142	18,148	21,909	16,975
Net income (loss)	$ 576	$ 9	$ 1,205	$ 82	$ (4,553)	$ 95	$ 1,827	$ 2,323	$ 1,872	$ (308)	$ (9,844)
Per share:
Basic	$ 0.06		$ 0.12	$ 0.01	$ (0.46)	$ 0.01	$ 0.19	$ 0.24	$ 0.19	$ (0.03)	$ (1.01)
Diluted	0.06		0.12	0.01	(0.46)	0.01	0.19	0.24	0.19	(0.03)	$ (1.01)
Minimum [Member]
Per share:
Market price range of common stock	11.07	$ 19.03	17.70	18.96	19.00	19.48	22.55	20.75	11.07	19.00
Maximum [Member]
Per share:
Market price range of common stock	$ 21.90	$ 23.77	$ 23.25	$ 22.84	$ 24.90	$ 28.73	$ 28.98	$ 27.51	$ 23.77	$ 28.98

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Changes in Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Loss by Component (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ 98,966	$ 103,349	$ 114,110
Other comprehensive loss before reclassifications	(1,494)	(1,316)
Amounts reclassified from accumulated other comprehensive loss	771	733
Total other comprehensive (loss) income	(723)	(583)	2,012
Ending Balance	96,724	98,966	103,349
Pension and Other Postretirement Benefits Items [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(8,947)	(8,599)
Other comprehensive loss before reclassifications	(1,296)	(1,081)
Amounts reclassified from accumulated other comprehensive loss	771	733
Total other comprehensive (loss) income	(525)	(348)
Ending Balance	(9,472)	(8,947)	(8,599)
Foreign Currency Items [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	114	349
Other comprehensive loss before reclassifications	(198)	(235)
Total other comprehensive (loss) income	(198)	(235)
Ending Balance	(84)	114	349
Accumulated Other Comprehensive Loss [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(8,833)	(8,250)	(8,434)
Ending Balance	$ (9,556)	$ (8,833)	$ (8,250)

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Employee Benefit Plans - Summary of Increase (Decrease) in Accumulated Other Comprehensive Loss, Net of Income Tax (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Total	$ 525	$ 348	$ (1,668)
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss arising during the year	1,298	1,080
Amortization of actuarial loss	(750)	(712)
Total	548	368
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss arising during the year	(2)	1
Amortization of actuarial loss	(21)	(21)
Total	$ (23)	$ (20)

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Employee Benefit Plans - Weighted Average Actuarial Assumptions Used to Determine Net Pension Cost (Detail) - Pension Plans, Defined Benefit [Member]	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Discount rate	3.83%	3.95%	4.08%
Rate of increase in compensation levels	3.00%	3.00%	3.00%
Long-term rate of return on plan assets	7.00%	8.00%	8.00%

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Equity Compensation Plans - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cash proceeds from the exercise of stock options	$ 24	$ 307	$ 0
Total intrinsic value of the stock options exercised	10	$ 161	0
Options, stock awards and performance awards available for future grants		202,000
Stock Compensation Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	945	$ 1,069	577
Income tax benefit to stock based compensation	$ 208	$ 237	$ 125
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded	83,000	53,000	59,000
Unrecognized stock-based compensation expense	$ 2,318
Weighted average period for recognize expense	1 year 4 months 17 days
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options maximum term	10 years
Amended and Restated 2000 Incentive Plan [Member] | Stock Compensation Plan [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized	1,375,000
Amended and Restated 2000 Incentive Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded	83,000	53,000	59,000
Amended and Restated 2000 Incentive Plan [Member] | Restricted Stock [Member] | Performance Vested Restricted Stock [Member] | Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded	40,000	27,000	30,000
Share-based compensation vesting percentage	100.00%
Vesting period	3 years
Amended and Restated 2000 Incentive Plan [Member] | Restricted Stock [Member] | Time Vested Restricted Stock [Member] | Officers and Key Employees [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded	28,000	20,000	22,000
Share-based compensation vesting percentage	33.33%
Vesting period	3 years
Amended and Restated 2000 Incentive Plan [Member] | Restricted Stock [Member] | Time Vested Restricted Stock [Member] | Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded	15,000	6,000	7,000
Share-based compensation vesting percentage	100.00%
Vesting period	1 year
Amended and Restated 2000 Incentive Plan [Member] | Restricted Stock [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized	467,000
Amended and Restated 2000 Incentive Plan [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option awards granted	0
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 30	$ 0	$ 0
Income tax benefit to stock based compensation	$ 7	$ 0	$ 0
Maximum discount on purchase price of common stock percentage on fair market value	15.00%
Issue of treasury stock to the ESPP for the offering periods	9,000	6,000	7,000
Common stock may be purchased	200,000

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Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Property Plant And Equipment [Abstract]
Depreciation expense	$ 1,957	$ 1,968	$ 1,986

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Leases - Summary of Weighted Average Remaining Lease Term and Discount Rate for Finance and Operating Leases (Detail)	Mar. 31, 2020
Finance Leases
Weighted-average remaining lease term in years	2 years 9 months 21 days
Weighted-average discount rate	9.71%
Operating Leases
Weighted-average remaining lease term in years	1 year 11 months 23 days
Weighted-average discount rate	5.49%

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Schedule II - Valuation and Qualifying Accounts (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Reserve for Doubtful Accounts Receivable [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Period	$ 33	$ 339	$ 168
Charged to Costs and Expenses		(167)	177
Charged to Other Accounts		(13)
Deductions		(126)	(6)
Balance at End of Period	33	33	339
Product Warranty Liability [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Period	366	493	538
Charged to Costs and Expenses	62	234	527
Charged to Other Accounts		(85)
Deductions	(69)	(276)	(572)
Balance at End of Period	$ 359	366	493
Restructuring Reserve [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Period		18	120
Charged to Costs and Expenses			316
Deductions		$ (18)	(418)
Balance at End of Period			$ 18

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Debt - Long-term Capital Lease Obligations Outstanding (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Debt Disclosure [Abstract]
Finance lease obligations (Note 8)	$ 95	$ 146
Less: current amounts	40	51
Total	$ 55	$ 95

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Income Taxes - Reconciliation of the Provision (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Income Tax Expense Benefit Continuing Operations Income Tax Reconciliation [Abstract]
Provision (benefit) for income taxes at federal rate	$ 486	$ (30)	$ (3,958)
State taxes	120	45	118
Charges not deductible for income tax purposes	55	89	48
Research and development tax credits	(211)	(177)	(102)
Valuation allowance	411	3,877	(80)
Difference in federal rate	(1)	3	(2,799)
Impairment of goodwill and intangible assets		257	1,760
Foreign-derived intangible income deduction	(95)	(69)
Capital loss from sale of Energy Steel	(325)	(3,848)
Stranded tax effects in accumulated other comprehensive loss			1,828
Mandatory repatriation of post-1986 undistributed foreign subsidiary earnings and profits			185
Other		16	(10)
Total provision (benefit) for income taxes	$ 440	$ 163	$ (3,010)

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Employee Benefit Plans - Components of Postretirement Benefit Cost (Income) and Pension Cost (Benefit) (Detail) - Pension Plans, Defined Benefit [Member] - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Service cost during the period	$ 496	$ 571	$ 598
Interest cost on projected benefit obligation	1,290	1,339	1,423
Expected return on assets	(2,657)	(3,062)	(2,977)
Actuarial loss	969	847	1,013
Net pension (benefit) cost and postretirement benefit expense	$ 98	$ (305)	$ 57

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Revenue Recognition - Additional Information (Detail) - USD ($)	3 Months Ended								12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2018	Apr. 01, 2018
Contract With Customer Assets And Liabilities [Line Items]
Net sales	$ 23,082,000	$ 25,286,000	$ 21,643,000	$ 20,593,000	$ 23,641,000	$ 17,198,000	$ 21,441,000	$ 29,551,000	$ 90,604,000	$ 91,831,000	$ 77,534,000
Percentage of revenue from contracts recognized over time									70.00%
Percentage of revenue from contracts recognized upon shipment									30.00%
Revenue recognized included in contract liability									$ 17,040,000
Unbilled revenue (contract assets)									7,070,000
Contract with customer liability increase in contract asset due to contract progress.									20,585,000
Contract with customer liability offset by invoicing to customers.									13,515,000
Customer deposits, current									3,864,000
Contract with customer liability offset by new customer deposits									13,176,000
Receivables billed but not paid under retainage provisions in its customer contracts	2,016,000				2,214,000				2,016,000	2,214,000
Amortization expense									169,000
Revenue remaining unsatisfied performance obligations amount	112,389,000								112,389,000
Customer Deposit [Member]
Contract With Customer Assets And Liabilities [Line Items]
Contract liabilities	3,660,000								3,660,000			$ 6,382,000
Prepaid Expenses and Other Current Assets [Member]
Contract With Customer Assets And Liabilities [Line Items]
Capitalized costs, net of amortization	$ 45,000				$ 133,000				45,000	133,000
Sudan [Member]
Contract With Customer Assets And Liabilities [Line Items]
Net sales									0	0	0
Iran [Member]
Contract With Customer Assets And Liabilities [Line Items]
Net sales									0	0	0
Syria [Member]
Contract With Customer Assets And Liabilities [Line Items]
Net sales									$ 0	$ 0	$ 0

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Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Mar. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Summary of Company's Unaudited Quarterly Results

A capsule summary of the Company's unaudited quarterly results for fiscal 2020 and fiscal 2019 is presented below:

	First		Second		Third		Fourth		Total
Year ended March 31, 2020	Quarter		Quarter		Quarter		Quarter		Year
Net sales	$	20,593	$	21,643	$	25,286	$	23,082	$	90,604
Gross profit		4,714		4,948		4,044		4,442		18,148
Net income		82		1,205		9		576		1,872
Per share:
Net income:
Basic	$	.01	$	.12	$	—	$	.06	$	0.19
Diluted	$	.01	$	.12	$	—	$	.06	$	0.19
Market price range of common stock	$18.96-22.84		$17.70-23.25		$19.03-23.77		$11.07-21.90		$11.07-23.77

	First		Second		Third		Fourth				Total
Year ended March 31, 2019	Quarter		Quarter		Quarter		Quarter				Year
Net sales	$	29,551	$	21,441	$	17,198	$	23,641			$	91,831
Gross profit		7,142		6,227		3,742		4,798				21,909
Net (loss) income		2,323		1,827		95		(4,553	)	(1)		(308	)
Per share:
Net (loss) income:
Basic	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Diluted	$	.24	$	.19	$	.01	$	(0.46	)		$	(0.03	)
Market price range of common stock	$20.75-27.51		$22.55-28.98		$19.48-28.73		$19.00-24.90				$19.00-28.98

⁽¹⁾In the fourth quarter of fiscal 2019, the Company recorded goodwill and other impairment losses of $6,449 related to the commercial nuclear utility business that was held for sale at March 31, 2019.  As a result, net income in the fourth quarter of fiscal 2019 includes the impairment loss net of an income tax benefit of $1,129.          

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Segment Information

12 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Segment Information

Note 15 - Segment Information:

The Company has one reporting segment as its operating segments meet the requirement for aggregation.  The Company and its operating subsidiaries design and manufacture heat transfer and vacuum equipment for the chemical, petrochemical, refining and electric power generating markets.  Heat transfer equipment includes surface condensers, Heliflows, water heaters and various types of heat exchangers.  Vacuum equipment includes steam jet ejector vacuum systems and liquid ring vacuum pumps.  These products are sold individually or combined into package systems.  The Company also services and sells spare parts for its equipment.

See Note 2 to the consolidated financial statements for net sales by product line and geographic area.

In fiscal 2020 and fiscal 2019, total sales to one customer amounted to 13% and 12%, respectively, of total consolidated net sales.  The single customer representing such sales was a different customer in each of fiscal 2020 and fiscal 2019.  There were no sales to a single customer that amounted to 10% or more of total consolidated net sales in fiscal 2018.

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Subsequent Events

12 Months Ended

Mar. 31, 2020

Subsequent Events [Abstract]

Subsequent Events

Note 19 – Subsequent Events:

On May, 1, 2020, the Company entered into an agreement to amend the letter of credit facility agreement with HSBC Bank USA, N.A. and increased the Company’s line of credit to $14,000.  Under the amended agreement, the Company incurs an annual facility fee of $5 and outstanding letters of credit are subject to a fee of between 0.75% and 0.85%, depending on the term of the letter of credit.  Interest is payable on the principal amounts of unreimbursed letter of credit draws under the facility at a rate of 3% plus the bank’s prime rate.