10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

      X       Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

 For the fiscal year ended April 30, 2016.

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 0-23248

SIGMATRON INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)   2201 Landmeier Rd., Elk Grove Village, IL (Address of principal executive offices)   Registrant’s telephone number, including area code:  847-956-8000 Securities registered pursuant to Section 12(b) of the Act: 36-3918470 (I.R.S. Employer Identification Number)   60007 (Zip Code)    

	ASDAQ Capital Market
Title of each class Common Stock $0.01 par value per share	Name of each exchange on which registered The NASDAQ Capital Market

Securities registered pursuant to Section 12(g) of the Act:  None

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 Section 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 and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted 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 and post such files).   ☒ Yes  ☐  No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See definition of “accelerated filer” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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

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

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of October 31, 2015 (the last business day of the registrant’s most recently completed second fiscal quarter) was $24,574,354 based on the closing sale price of $6.62per share as reported by Nasdaq Capital Market as of such date.

The number of outstanding shares of the registrant’s Common Stock, $0.01 par value, as of July 22, 2016 was4,183,955.

DOCUMENTS INCORPORATED BY REFERENCE

Certain sections or portions of the definitive proxy statement of SigmaTron International, Inc., for use in connection with its 2016annual meeting of stockholders, which the Company intends to file within 120 days of the fiscal year ended April 30, 2016, are incorporated by reference into Part III of this Form 10-K.

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TABLE OF CONTENTS

PART I
	ITEM 1.	BUSINESS	4
	ITEM 1A.	RISK FACTORS	10
	ITEM IB.	UNRESOLVED STAFF COMMENTS	16
	ITEM 2.	PROPERTIES	16
	ITEM 3.	LEGAL PROCEEDINGS	17
	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	18
	ITEM 6.	SELECTED FINANCIAL DATA	19
	ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	19
	ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS	29
	ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	29
	ITEM 9.	CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	29
	ITEM 9A.	CONTROLS AND PROCEDURES	29
	ITEM 9B.	OTHER INFORMATION	30
PART III
	ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	30
	ITEM 11.	EXECUTIVE COMPENSATION	31
	ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	31
	ITEM 13.	CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE	31
	ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	31
PART IV
	ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	31
SIGNATURES			36

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PART I

ITEM 1.  BUSINESS

CAUTIONARY NOTE:

In addition to historical financial information, this discussion of the business of SigmaTron International, Inc. (“SigmaTron”), its wholly-owned subsidiaries Standard Components de Mexico S.A., AbleMex, S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd., wholly-owned foreign enterprises Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd. (collectively, “SigmaTron China”) and international procurement office SigmaTron Taiwan branch (collectively, the “Company”) and other Items in this Annual Report on Form 10-K contain forward-looking statements concerning the Company’s business or results of operations.  Words such as “continue,” “anticipate,” “will,” “expect,” “believe,” “plan,” and similar expressions identify forward-looking statements.  These forward-looking statements are based on the current expectations of the Company.  Because these forward-looking statements involve risks and uncertainties, the Company’s plans, actions and actual results could differ materially.  Such statements should be evaluated in the context of the risks and uncertainties inherent in the Company’s business including, but not necessarily limited to, the Company’s continued dependence on certain significant customers; the continued market acceptance of products and services offered by the Company and its customers; pricing pressures from the Company’s customers, suppliers and the market; the activities of competitors, some of which may have greater financial or other resources than the Company; the variability of our operating results; the results of long-lived assets and goodwill impairment testing; the variability of our customers’ requirements; the availability and cost of necessary components and materials; the ability of the Company and our customers to keep current with technological changes within our industries; regulatory compliance, including conflict minerals; the continued availability and sufficiency of our credit arrangements; changes in U.S., Mexican, Chinese, Vietnamese or Taiwanese regulations affecting the Company’s business; the turmoil in the global economy and financial markets; the stability of the U.S., Mexican, Chinese, Vietnamese and Taiwanese economic, labor and political systems and conditions; currency exchange fluctuations; and the ability of the Company to manage its growth.  These and other factors which may affect the Company’s future business and results of operations are identified throughout the Company’s Annual Report on Form 10-K, and as risk factors, and may be detailed from time to time in the Company’s filings with the Securities and Exchange Commission.  These statements speak as of the date of such filings, and the Company undertakes no obligation to update such statements in light of future events or otherwise unless otherwise required by law.

Overview

SigmaTron is a Delaware corporation, which was organized on November 16, 1993, and commenced operations when it became the successor to all of the assets and liabilities of SigmaTron L.P., an Illinois limited partnership, through a reorganization on February 8, 1994.

The Company operates in one business segment as an independent provider of electronic manufacturing services (“EMS”), which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies.  The Company provides these manufacturing services through an international network of facilities located in the United States, Mexico, China, Vietnam and Taiwan.

The Company provides manufacturing and assembly services ranging from the assembly of individual components to the assembly and testing of box-build electronic products.  The Company has the ability to produce assemblies requiring mechanical as well as electronic capabilities.  The products assembled by the

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Company are then incorporated into finished products sold in various industries, particularly appliance, consumer electronics, gaming, fitness, industrial electronics, medical/life sciences, semiconductor and telecommunications.  In some instances the Company manufactures the completed finished product for its customers.

The Company operates manufacturing facilities in Elk Grove Village, Illinois United States of America (“U.S.”); Union City, California U.S.; Acuna, Chihuahua and Tijuana, Mexico; Suzhou, China; and Ho Chi Minh City, Vietnam.  In addition, the Company maintains an International Procurement Office (IPO) in Taipei, Taiwan.  The Company also provides design services in Elgin, Illinois.

In an effort to facilitate the growth of our China operation, the Company established a new Chinese entity in October 2011 thatallows the Company to provide services competitively to the domestic market in China and in fiscal year 2015 expanded the Company’s manufacturing facility.  The Company expects the China operation to continue to grow despite increasing costs of operation.

The Company’s international footprint provides our customers with flexibility within the Company to manufacture in China,  Mexico,Vietnam or the U.S.We believe this strategy will continue to serve the Company well as its customers continuously evaluate their supply chain strategies.

Products and Services

The Company provides a broad range of electronic and electromechanical manufacturing related outsourcing solutions for its customers.  These solutions incorporate the Company’s knowledge and expertise in the EMS industry to provide its customers with advanced manufacturing technologies, complete supply chain management, responsive and flexible customer service, as well as product design, test and engineering support.  The Company’s EMS solutions are available from inception of product concept through the ultimate delivery of a finished product.  Such technologies and services include the following:

Manufacturing and Testing Services:  The Company’s core business is the assembly and testing of all types of electronic printed circuit board assemblies (“PCBA”) and often incorporating these PCBAs into electronic modules used in all types of devices and products that depend on electronics for their operation.  This assembly work utilizes state of the art manufacturing and test equipment to deliver highly reliable products to the Company’s customers.  The Company supports new product introduction (“NPI”), low volume / high mix as well as high volume/ low mix assembly work at all levels of complexity.  Assembly services include pin-through-hole (“PTH”) components, surface mount (“SMT”) components, including ball grid array (“BGA”), part-on-part components, conformal coating, parylene coating and others.  Test services include and are not limited to, in-circuit, automated optical inspection (“AOI”), functional, burn-in, hi-pot and boundary scan.  From simple component assembly through the most complicated industry testing, the Company offers virtually every service required to build electronic devices commercially available in the market today.

Design Services:To compliment the manufacturing services it offers its customers, the Company also offers DFM, design for manufacturing and DFT, design for test review services to help customers ensure that the products they have designed are optimized for production and testing.  In addition, through its Spitfire Control division, the Company offers complete product design services for a variety of industries and applications, including appliance controls.

Supply Chain Management:  The Company provides complete supply chain management for the procurement of components needed to build customers’ products.  This includes the procurement and management of all types of electronic components and related mechanical parts such as plastics and metals.  The Company’s resources supporting this activity are provided both on a plant specific basis as well as globally through its IPO in Taipei, Taiwan.  Each of its sites is linked together using the same Enterprise Resource Planning (“ERP”) system and custom IScore software tools with real-time on-line visibility for customer access.  The Company procures material from major manufacturers and distributors of electronic parts all over the world.

The Company relies on numerous third-party suppliers for components used in the Company’s production process.  Certain of these components are available only from single-sources or a limited number of suppliers.  In addition, a customer’s specifications may require the Company to obtain components from a

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single-source or a small number of suppliers.  The loss of any such suppliers could have a material impact on the Company’s results of operations.  Further, the Company could operate at a cost disadvantage compared to competitors who have greater direct buying power from suppliers.  The Company does not enter into long-term purchase agreements with major or single-source suppliers.  The Company believes that short-term purchase orders with its suppliers provides flexibility, given that the Company’s orders are based on the changing needs of its customers.

Warehousing and Distribution:  The Company provides both in-house and third party warehousing, shipping, and customs brokerage for border crossings as part of its service offering.  This includes international shipping, drop shipments to the end customer, as well as, support of inventory optimization activities such as kanban and consignment.

Green, Sustainability, and Social Responsible Initiatives:  The Company supports initiatives that promote sustainability, green environment and social responsibility.  The Company requires its supply chain to meet all government imposed requirements in these areas and helps its customers in achieving effective compliance.  Those include, but are not limited to, Restrictions of Hazardous Substances (“RoHS”), Restriction of Chemicals (“Reach”) and Conflict Minerals regulations.

Manufacturing Location and Certifications:The Company’s manufacturing and warehousing locations are  strategically located to support our customers with  locations in Elk Grove Village, Illinois U.S.; Union City, California U.S.; Acuna, Chihuahua and Tijuana, Mexico; Suzhou, China and Ho Chi Minh City, Vietnam.  The Company’s ability to transition manufacturing to lower cost regions without jeopardizing flexibility and service, differentiates it from many competitors.  Manufacturing certifications and registrations are location specific, and include ISO 9001:2008, ISO 14001:2004, Medical ISO 13485:2003, Aerospace AS9100C and International Traffic in Arms Regulations (“ITAR”) certifications. 

Markets and Customers

The Company’s customers are in the appliance, gaming, industrial electronics, fitness, medical/life sciences, semiconductor, telecommunications and consumer electronics industries.  As of April 30, 2016, the Company had approximately 125 active customers ranging from Fortune 500 companies to small, privately held enterprises.

The following table shows, for the periods indicated, the percentage of net sales to the principal end-user markets it serves.

	Percent of Net Sales
Markets	Typical OEM Application	Fiscal 2016 %	Fiscal 2015 %
Appliances	Household appliance controls	50.1	49.9
Industrial Electronics	Motor controls, power supplies, lighting products, scales, joysticks	30.1	31.2
Fitness	Treadmills, exercise bikes, cross trainers	7.3	6.7
Consumer Electronics	Personal grooming, computers	4.2	4.7
Semiconductor Equipment	Process control and yield management equipment for semiconductor productions	2.0	2.9
Medical/Life Sciences	Clinical diagnostic systems and instruments	4.5	2.6
Telecommunications	Routers, communication	1.0	1.7
Gaming	Slot machines, lighting displays	0.8	0.3
Total		100%	100%

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For the fiscal year ended April 30, 2016, the Company’s largest two customers, Electrolux and Whirlpool Inc., accounted for 35.2% and 10.6%, respectively, of the Company’s net sales.  For the fiscal year ended April 30, 2015, Electrolux and Whirlpool Inc., accounted for 36.8% and 9.9%, respectively, of the Company’s net sales.  The Company believes that Electrolux and Whirlpool will continue to account for a significant percentage of the Company’s net sales, although the percentage of net sales may vary from period to period.

Sales and Marketing

The Company markets its services through 9 independent manufacturers’ representative organizations that together currently employ 18 sales personnel in the United States and Canada.  Independent manufacturers’ representatives organizations receive variable commissions based on orders received by the Company and are assigned specific accounts, not territories.  Many of the members of the Company’s senior management are actively involved in sales and marketing efforts, and the Company has 4 direct sales employees.  In addition, the Company markets itself through its website and tradeshows. 

Mexico, Vietnam and China Operations

The Company’s wholly-owned subsidiary, Standard Components de Mexico, S.A, a Mexican corporation, is located in Acuna, Coahuila Mexico, a border town across the Rio Grande River from Del Rio, Texas, and is 155 miles west of San Antonio. Standard Components de Mexico, S.A. was incorporated and commenced operation in 1968 and had 838 employees at April 30, 2016.  The Company’s wholly-owned subsidiary, AbleMex S.A. de C.V., a Mexican corporation, is located in Tijuana, Baja California Mexico, a border town south of San Diego, California.  AbleMex S.A. de C.V. was incorporated and commenced operations in 2000.  The operation had 186 employees at April 30, 2016.  The Company’s wholly-owned subsidiary, Digital Appliance Controls de Mexico S.A., a Mexican corporation, operates in Chihuahua, Mexico, located approximately 235 miles from El Paso, Texas.  Digital Appliance Controls de Mexico S.A. was incorporated and commenced operations in 1997.  The operation had 474 employees at April 30, 2016.  The Company believes that one of the key benefits to having operations in Mexico is its access to cost-effective labor resources while having geographic proximity to the United States.

The Company’s wholly-owned foreign enterprises,Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd.,are located in Suzhou, China.  The Company has entered into an agreement with governmental authorities in the economic development zone of Wujiang, Jiangsu Province, Peoples Republic of China, pursuant to which the Company became the lessee of a parcel of land of approximately 100 Chinese acres.  The term of the land lease is 50 years.  The Company built a manufacturing plant, office space and dormitories on this site during 2004.  In fiscal 2015, the China facility expanded and added 40,000 square feet in warehouse and manufacturing.  The total square footage of the facility is 202,000 and has 487 employees as of April 30, 2016.  Both SigmaTron China entities operate at this site.

The Company’s wholly-owned subsidiary, Spitfire Controls (Vietnam) Co. Ltd. is located in Amata Industrial Park, Bien Hoa City, Dong Nai Province, Vietnam, and is 18 miles east of Ho Chi Minh City.  Spitfire Controls (Vietnam) Co. Ltd. was incorporated and commenced operation in 2005 and had 309 employees as of April 30, 2016.

The Company provides funds for salaries, wages, overhead and capital expenditure items as necessary to operate its wholly-owned Mexican, Vietnamese and Chinese subsidiaries and the Taiwan IPO.  The Company provides funding in U.S. dollars, which are exchanged for Pesos, Dong, Renminbi, and New Taiwan dollars.  The fluctuation of currencies from time to time, without an equal or greater increase in inflation, could have a material impact on the financial results of the Company.The impact of currency fluctuation for the fiscal year ended April 30, 2016 resulted in a net foreign currency loss of $59,000 compared to a net foreign currency gain of $40,000 in the prior year.  In fiscal year 2016, the Company paid approximately $52,000,000to its foreign subsidiaries.

The Company has not recorded U.S. income taxes on the undistributed earnings of the Company’s foreign subsidiaries. Since the earnings of the foreign subsidiaries have been, and will continue to be indefinitely reinvested, no deferred tax liability has been recorded.  The cumulative amount of unremitted earnings for which U.S. income taxes have not been recorded is $12,588,000 as of April 30, 2016.  The amount of U.S.

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income taxes on these earnings is impractical to compute due to the complexities of the hypothetical calculation.

During fiscal year 2015, the Company recorded tax expense of $643,708 related to the inability to realize the tax benefit recorded in fiscal year 2014 for potential foreign tax credits.  The Company’s estimate of cumulative taxable income during the foreign tax credit carryforward period was insufficient to support that the tax benefit from the foreign tax credit is more likely than not to be realized.

The consolidated financial statements as of April 30, 2016 include the accounts and transactions of SigmaTron, its wholly-owned subsidiaries, Standard Components de Mexico, S.A., AbleMex S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd., wholly-owned foreign enterprises Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd., and international procurement office, SigmaTron Taiwan Branch.  The functional currency of the Company’s foreign subsidiaries operationsis the U.S. dollar.  Intercompany transactions are eliminated in the consolidated financial statements.

Competition

The EMS industry is highly competitive and subject to rapid change.  Furthermore, both large and small companies compete in the industry, and many have significantly greater financial resources, more extensive business experience and greater marketing and production capabilities than the Company.  The significant competitive factors in this industry include price, quality, service, timeliness, reliability, the ability to source raw components, and manufacturing and technological capabilities.  The Company believes it can compete on all of these factors.

Consolidation

As a result of consolidation and other transactions involving competitors and other companies in the Company’s markets, the Company occasionally reviews potential transactions relating to its business, products and technologies.  Such transactions could include mergers, acquisitions, strategic alliances, joint ventures, licensing agreements, co-promotion agreements, financing arrangements or other types of transactions.  In the future, the Company may choose to enter into these types of or other transactions at any time depending on available sources of financing, and such transactions could have a material impact on the Company’s business, financial condition or operations.

Governmental Regulations

The Company’s operations are subject to certain foreign, federal, state and local regulatory requirements relating to, among others, environmental, waste management, labor and health and safety matters.  Management believes that the Company’s business is operated in material compliance with all such regulations, including Restriction of Hazardous Substances (“RoHS”) and Registration, Evaluation, Authorization and Restriction of Chemicals  (“REACH").  RoHS prohibits the use of lead, mercury and certain other specified substances in electronics products being sold into the European Union.  The Company has RoHS-dedicated manufacturing capabilities at all of its manufacturing operations. REACH is a European Union Regulation enacted as of December 2006.  The regulation imposes information reporting requirements on all listed SVHCs (substances of very high concern).From time-to-time the Company's customers request REACH required information and certifications on the assemblies the Company manufactures for them.  These requests require the Company to gather information from component suppliers to verify the presence and level of mass of any SVHCs greater than 0.1% in the assemblies the Company manufactures based on customer specifications.  If any SVHCs are present at more than 0.1% of the mass of the item, the specific concentration and mass of the SVHC must be reported to proper authorities by the Company'scustomer.

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) introduced reporting requirements for verification of whether the Company directly (or indirectly through suppliers of components) is purchasing the minerals or metals gold, columbite-tantalite, cassiterite, wolframite and their derivatives (tin, tungsten, and tantalum), that are being provided by sources in the conflict region of the

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Democratic Republic of Congo (“DRC”).  On May 1, 2016, the Company filed Form SD with the Securities and Exchange Commission stating the Company’s supply chain remains DRC conflict undeterminable.

The Company’s costs of compliance with environmental laws, including conflict mineral reporting, is estimated to be a total of approximately $750,000 for the three most recently completed fiscal years ending April 30, 2016.  Additional or modified requirements may be imposed in the future.  If such additional or modified requirements are imposed, or if conditions requiring remediation are found to exist, the Company may be required to incur additional expenditures.

Backlog

The Company relies on customers’ forecasted orders and purchase orders (firm orders) from its customers to estimate backlog.  The Company’s backlog of firm orders as of April 30, 2016 and 2015 was approximately $167,290,000 and $142,520,000, respectively.  The Company anticipates a significant portion of the backlog at April 30, 2016 will ship in fiscal year 2017.  Because customers may cancel or reschedule deliveries, backlog may not be a meaningful indicator of future revenue.  Variations in the magnitude and duration of contracts, forecasts and purchase orders received by the Company and delivery requirements generally may result in substantial fluctuations in backlog from period to period.

Employees

The Company employed approximately 2,790full-time employees as of April 30, 2016, including 186 engaged in engineering or engineering-related services, 2,226 in manufacturing and 378 in administrative and marketing functions.

The Company has a labor contract with Chemical & Production Workers Union Local No. 30, AFL-CIO, covering the Company’s workers in Elk Grove Village, Illinois which expires on December 31, 2018. The Company’s Mexican subsidiary, Standard Components de Mexico S.A., has a labor contract with Sindicato De Trabajadores de la Industra Electronica, Similares y Conexos del Estado de Coahuila, C.T.M. covering the Company’s workers in Acuna, Mexico which expires on February 1, 2018.  The Company’s subsidiary located in Tijuana Mexico has a labor contract with Sindicato Mexico Moderno De Trabajadores De La, Baja California, C.R.O.C.  The contract does not have an expiration date.  The Company’s subsidiary located in Ho Chi Minh City, Vietnam, has a labor contract with CONG DOAN CO SO CONG TY TNHH Spitfire Controls Vietnam. The contract expires February 28, 2017.

Since the time the Company commenced operations, it has not experienced any union-related work stoppages.  The Company believes its relations with both unions and its other employees are good.

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Executive Officers of the Registrant

Name	Age	Position
Gary R. Fairhead	64	President and Chief Executive Officer.  Gary R. Fairhead has been the President of the Company since January 1990 and Chairman of the Board of Directors of the Company since August 2011.  Gary R. Fairhead is the brother of Gregory A. Fairhead.
Linda K. Frauendorfer	55	Chief Financial Officer, Vice President of Finance, Treasurer and Secretary since February 1994. Director of the Company since August 2011.
Gregory A. Fairhead	60	Executive Vice President and Assistant Secretary.  Gregory A. Fairhead has been the Executive Vice President since February 2000 and Assistant Secretary since 1994.  Mr. Fairhead was Vice President - Acuna Operations for the Company from February 1990 to February 2000.  Gregory A. Fairhead is the brother of Gary R. Fairhead.
John P. Sheehan	55	Vice President, Director of Supply Chain and Assistant Secretary since February 1994.
Daniel P. Camp	67	Vice President, Acuna Operations since 2007.  Vice President - China Operations from 2003 to 2007.  General Manager / Vice President of Acuna Operations from 1994 to 2003.
Rajesh B. Upadhyaya	61	Executive Vice President, West Coast Operations since 2005.  Mr. Upadhyaya was the Vice President of the Fremont Operations from 2001 until 2005.
Hom-Ming Chang	56	Vice President, China Operations since 2007.  Vice President - Hayward Materials / Test / IT from 2005 - 2007.  Vice President of Engineering Fremont Operation from 2001 to 2005.

ITEM 1A. RISK FACTORS

The following risk factors should be read carefully in connection with evaluating our business and the forward-looking information contained in this Annual Report on Form 10-K.  Any of the following risks could materially adversely affect our business, operations, industry or financial position or our future financial performance.  While the Company believes it has identified and discussed below the key risk factors affecting its business, there may be additional risks and uncertainties that are not presently known or that are not currently believed to be significant that may adversely affect its business, operations, industry, financial position and financial performance in the future.

The Company’s ability to secure and maintain sufficient credit arrangements is key to its continued operations.

There is no assurance that the Company will be able to retain or renew its credit agreements and other finance agreements in the future.  In the event the business grows rapidly, the uncertain economic climate continues or the Company considers another acquisition, additional financing resources could be necessary in the current or future fiscal years.  There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all in the future.

The Company has a senior secured credit facility with Wells Fargo, N.A. with a credit limit up to $30,000,000.  The credit facility is collateralized by substantially all of the domestically located assets of the Company and

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the Company has pledged 65% of its equity ownership interest in some of its foreign entities.  The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of two and one quarter percent plus one percent (effectively 3.25% at April 30, 2016) or LIBOR plus two and one quarter percent (effectively 2.875% at April 30, 2016).  Interest is paid monthly.  Under the senior secured credit facility, the Company may borrow up to the lesser of (i) $30,000,000 or (ii) an amount equal to a percentage of the eligible receivable borrowing base plus a percentage of the inventory borrowing base (collectively, “Borrowing Base”), which cannot exceed 50% of combined eligible receivables and inventory.  In January 2016, the existing senior credit facility was modified, including increasing the amount available under the Borrowing Base calculation and extending the term of the facility through October 31, 2018.  The bank fee for the modification was $23,333 and is amortized over the term of the credit facility agreement.  As of April 30, 2016, there was a $20,014,069 outstanding balance and $3,630,035 of unused availability under the credit facility agreement compared to a $27,416,793 outstanding balance and $2,583,207 of unused availability at April 30, 2015.  The Company is required to be in compliance with several financial covenants.  At April 30, 2016, the Company was in compliance with its financial covenants.

The Company anticipates that its credit facilities, cash flow from operations and leasing resources are adequate to meet its working capital requirements and capital expenditures for fiscal year 2017at the Company’s current level of business.  The Company has received forecasts from current customers for increased business that would require additional investments in inventory. To the extent that these forecasts come to fruition, the Company may need to raise capital from other sources of debt or equity.  The Company engaged an investment banker for the purpose of completing a capital raise during fiscal year 2016 and subsequently terminated that agreement.  The Company plans to evaluate alternatives for raising capital in fiscal year 2017.

In addition, in the event the Company desires to expand its operations, its business grows more rapidly than expected, the current economic climate deteriorates, customers delay payments, or the Company desires to consummate an acquisition, additional financing resources may be necessary in the current or future fiscal years.  There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

Adverse changes in the economy or political conditionscould negatively impact the Company’s business, results of operations and financial condition.

The Company’s sales and gross margins depend significantly on market demand for its customers’ products.  The uncertainty in the U.S. and international economic and political environments could result in a decline in demand for our customers’ products in any industry.  Further, any adverse changes in tax rates and laws affecting our customers could result in decreasing gross margins.  Any of these factors could negatively impact the Company’s business, results of operations and financial condition.

The Company experiences variable operating results.

The Company’s results of operations have varied and may continue to fluctuate significantly from period to period, including on a quarterly basis.  Consequently, results of operations in any period should not be considered indicative of the results for any future period, and fluctuations in operating results may also result in fluctuations in the price of the Company’s common stock.

The Company’s quarterly and annual results may vary significantly depending on numerous factors, many of which are beyond the Company’s control.  Some of these factors include:

-          changes in sales mix to customers

-          changes in availability and rising component costs

-          volume of customer orders relative to capacity

-          market demand and acceptance of our customers’ products

-          price erosion within the EMS marketplace

-          capital equipment requirements needed to remain technologically competitive

-          volatility in the U.S. and international economic and financial markets

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The Company’s customer base is concentrated.

Sales to the Company’s five largest customers accounted for 61.9% and 62.5% of net sales for the fiscal years ended April 30, 2016 and 2015, respectively.  For the year ended April 30, 2016, two customers accounted for 35.2% and 10.6%, respectively, of net sales of the Company, and 6.5% and 2.4%, respectively, of accounts receivable at April 30, 2016.  For the year ended April 30, 2015, two customers accounted for 36.8% and 9.9%, respectively, of net sales of the Company and 9.6% and 5.5%, respectively, of accounts receivable at April 30, 2015.  Significant reductions in sales to any of the Company’s major customers or the loss of a major customer could have a material impact on the Company’s operations.  If the Company cannot replace canceled or reduced orders, sales will decline, which could have a material impact on the results of operations.  There can be no assurance that the Company will retain any or all of its largest customers.  This risk may be further complicated by pricing pressures and intense competition prevalent in our industry.

If any of the Company’s customers have financial difficulties, the Company could encounter delays or defaults in the payment of amounts owed for accounts receivable and inventory obligations.  This could have a significant adverse impact on the Company’s results of operations and financial condition.

Most of the Company’scustomers do not commit to long-term production schedules, which makes it difficult to schedule production and achieve maximum efficiency at the Company’s manufacturing facilities and manage inventory levels.

The volume and timing of sales to the Company’s customers may vary due to:

-          customers’ attempts to manage their inventory

-          variation in demand for the Company’s customers’ products

-          design changes, or

-          acquisitions of or consolidation among customers

Many of the Company’s customers do not commit to firm production schedules.  The Company’s inability to forecast the level of customer orders with certainty can make it difficult to schedule production and maximize utilization of manufacturing capacity and manage inventory levels.  The Company could be required to increase or decrease staffing and more closely manage other expenses in order to meet the anticipated demand of its customers.  Orders from the Company’s customers could be cancelled or delivery schedules could be deferred as a result of changes in our customers’ demand, thereby adversely affecting the Company’s results of operationsin any given quarter.

The Company and its customers may be unable to keep current with the industry’s technological changes.

The market for the Company’s manufacturing services is characterized by rapidly changing technology and continuing product development.  The future success of the Company’s business will depend in large part upon our customers’ ability to maintain and enhance their technological capabilities, develop and market manufacturing services which meet changing customer needs and successfully anticipate or respond to technological changes in manufacturing processes on a cost-effective and timely basis.

Our customers have competitive challenges, including rapid technological changes, pricing pressure and decreasing demand from their customers, which could adversely affect their business and the Company’s.

Factors affecting the industries that utilize our customers’ products could negatively impact our customers and the Company.  These factors include:

-          increased competition among our customers and their competitors

-          the inability of our customers to develop and market their products

-          recessionary periods in our customers’ markets

-          the potential that our customers’ products become obsolete

-          our customers’ inability to react to rapidly changing technology

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Any such factor or a combination of factors could negatively impact our customers’ need for or ability to pay for our products, which could, in turn, affect the Company’s results of operations.

Adverse market conditions could reduce our future sales and earnings per share.

Uncertainty over the erosion of global consumer confidence amidst concerns about volatile energy costs, geopolitical issues, the availability and cost of credit, declining asset values, inflation, rising unemployment, and the stability and solvency of financial institutions, financial markets, businesses, and sovereign nations has slowed global economic growth and resulted in recessions in many countries, including in the United States, Europe and certain countries in Asia over the past several years.  The economic recovery of recent years is fragile and recessionary conditions may return.  Any of these potential negative economic conditions may reduce demand for the Company’s customers’ products and adversely affect the Company’s sales.  Consequently, the Company’s past operating results, earnings and cash flows may not be indicative of the Company’s future operating results, earnings and cash flows.

Customer relationships with start-up companies present more risk.

A small portion of the Company’s current customer base is comprised of start-up companies.  Customer relationships with start-up companies may present heightened risk due to the lack of product history.  Slow market acceptance of their products could result in demand fluctuations causing inventory levels to rise.  Further, the current economic environment could make it difficult for such emerging companies to obtain additional funding.  This may result in additional credit risk including, but not limited to, the collection of trade account receivables and payment for their inventory.  If the Company does not have adequate allowances recorded, the results of operations may be negatively affected.

The Company faces intense industry competition and downward pricing pressures.

The EMS industry is highly fragmented and characterized by intense competition.  Many of the Company’s competitors have greater experience, as well as greater manufacturing, purchasing, marketing and financial resources than the Company.

Competition from existing or potential new competitors may have a material adverse impact on the Company’s business, financial condition or results of operations.  The introduction of lower priced competitive products, significant price reductions by the Company’s competitors or significant pricing pressures from its customers could adversely affect the Company’s business, financial condition, and results of operations.

The Company has foreign operations that may pose additional risks.

The Company has substantial manufacturing operations in multiple countries.  Therefore, the Company’s foreign businesses and results of operations are dependent upon numerous related factors, including the stability of the foreign economies, the political climate, relations with the United States, prevailing worker wages, the legal authority of the Company to own and operate its business in a foreign country, and the ability to identify, hire, train and retain qualified personnel and operating management in Mexico, China and Vietnam.

The Company obtains many of its materials and components through its IPO in Taipei, Taiwan.  The Company’s access to these materials and components is dependent on the continued viability of its Asian suppliers.

Approximately15.0%of the total non-current consolidated assets of the Company are located in foreign jurisdictions outside the United States as of April 30, 2016 and 2015.

Disclosure and internal controls may not detect all errors or fraud.

The Company’s management, including the Chief Executive Officer and Chief Financial Officer, believe that the Company’s disclosure controls and internal controls may not prevent all errors and all fraud.  The Company’s disclosure controls and internal controls can provide only reasonable assurance that the procedures

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will meet the control objectives.  Controls are limited in their effectiveness by human error, including faulty judgments in decision-making.  Further, controls can be circumvented by collusion of two or more people or by management override of controls.

Inadequate internal control over financial reporting could result in a reduction in the value of our common stock.

If the Company identifies and reports a material weakness in its internal control over financial reporting, shareholders and the Company’s lenders could lose confidence in the reliability of the Company’s financial statements.  This could have a material adverse impact on the value of the Company’s stock and the Company’s liquidity.

There is a risk of fluctuation of various currencies integral to the Company’s operations.

The Company purchases some of its material components and funds some of its operations in foreign currencies.  From time to time the currencies fluctuate against the U.S. dollar.  Such fluctuations could have a material impact on the Company’s results of operations and performance.  The impact of currency fluctuation for the year ended April 30, 2016 resulted in a net foreign currency loss of approximately $59,000 compared to a net foreign currency gain of $40,000 in the prior year.  These fluctuations are expected to continue and could have a negative impact on the Company’s results of operations.  The Company did not, and is not expected to, utilize derivatives or hedge foreign currencies to reduce the risk of such fluctuations.

The availability of raw components or an increase in their price may affect the Company’s operations and profits.

The Company relies on numerous third-party suppliers for components used in the Company’s production process.  Certain of these components are available only from single-sources or a limited number of suppliers.  In addition, a customer’s specifications may require the Company to obtain components from a single-source or a small number of suppliers.  The loss of any such suppliers could have a material impact on the Company’s results of operations.  Further, the Company could operate at a cost disadvantage compared to competitors who have greater direct buying power from suppliers.  The Company does not enter into long-term purchase agreements with major or single-source suppliers.  The Company believes that short-term purchase orders with its suppliers provides flexibility, given that the Company’s orders are based on the changing needs of its customers.

The Company depends on management and skilled personnel.

The Company depends significantly on its President/CEO and other executive officers.  The Company’s employees generally are not bound by employment agreements and the Company cannot assure that it will retain its executive officers or skilled personnel.  The loss of the services of any of these key employees could have a material impact on the Company’s business and results of operations.  In addition, despite significant competition, continued growth and expansion of the Company’s EMS business will require that the Company attract, motivate and retain additional skilled and experienced personnel.  The inability to satisfy such requirements could have a negative impact on the Company’s ability to remain competitive in the future.

Favorable labor relations are important to the Company.

The Company currently has labor union contracts with its employees constituting approximately 45% of its workforce for both fiscal years 2016 and 2015.  Although the Company believes its labor relations are good, any labor disruptions, whether union-related or otherwise, could significantly impair the Company’s business, substantially increase the Company’s costs or otherwise have a material impact on the Company’s results of operations.

Failure to comply with environmental regulations could subject the Company to liability.

The Company is subject to a variety of environmental regulations relating to the use, storage, discharge and disposal of hazardous chemicals used during its manufacturing process.  To date, the cost to the Company of

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such compliance has not had a material impact on the Company’s business, financial condition or results of operations.  However, there can be no assurance that violations will not occur in the future as a result of human error, equipment failure or other causes.  Further, the Company cannot predict the nature, scope or effect of environmental legislation or regulatory requirements that could be imposed or how existing or future laws or regulations will be administered or interpreted.  Compliance with more stringent laws or regulations, as well as more vigorous enforcement policies of regulatory agencies, could require substantial expenditures by the Company and could have a material impact on the Company’s business, financial condition and results of operations.  Any failure by the Company to comply with present or future regulations could subject it to future liabilities or the suspension of production which could have a material negative impact on the Company’s results of operations.

Conflict minerals regulations may cause the Company to incur additional expenses and could increase the cost of components contained in its products and adversely affect its inventory supply chain.

The Dodd-Frank Act, and the rules promulgated by the Securities and Exchange Commission (“SEC”) thereunder, requires the Company to determine and report annually whether any conflict minerals contained in our products originated from the DRC or an adjoining country. The Dodd-Frank Act and these rules could affect our ability to source components that contain conflict minerals at acceptable prices and could impact the availability of conflict minerals, since there may be only a limited number of suppliers of conflict-free conflict minerals. Our customers may require that our products contain only conflict-free conflict minerals, and our revenues and margins may be negatively impacted if we are unable to meet this requirement at a reasonable price or are unable to pass through any increased costs associated with meeting this requirement. Additionally, the Company may suffer reputational harm with our customers and other stakeholders if our products are not conflict-free.  The Company could incur significant costs in the event we are unable to manufacture products that contain only conflict-free conflict minerals or to the extent that we are required to make changes to products, processes, or sources of supply due to the foregoing requirements or pressures.

The price of the Company’s stock is volatile.

The price of the Company’s common stock historically has experienced significant volatility due to fluctuations in the Company’s revenue and earnings, other factors relating to the Company’s operations, the market’s changing expectations for the Company’s growth, overall equity market conditions and other factors unrelated to the Company’s operations.  In addition, the limited float of the Company’s common stock and the limited number of market makers also affect the volatility of the Company’s common stock.  Such fluctuations are expected to continue in the future.

An adverse change in the interest rates for our borrowings could adversely affect our results of operations.

The Company pays interest on outstanding borrowings under its senior secured credit facility and certain other long-term debt obligations at interest rates that fluctuate.  An adverse change in the Company’s interest rates could have a material adverse effect on its results of operations.

Changes in securities laws and regulations may increase costs.

The Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and listing requirements subsequently adopted by Nasdaq in response to Sarbanes-Oxley, have required changes in corporate governance practices, internal control policies and securities disclosure and compliancepractices of public companies.  More recently the Dodd-Frank Act requires changes to our corporate governance, compliance practices and securities disclosures.  Compliance following the implementation of these rules has increased our legal, financial and accounting costs.  The Company expects increased costs related to these new regulations to continue, including, but not limited to, legal, financial and accounting costs.  These developments may result in the Company having difficulty in attracting and retaining qualified members of the board or qualified officers.  Further, the costs associated with the compliance with and implementation of procedures under these laws and related rules could have a material impact on the Company’s results of operations.

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Any litigation, even where a claim is without merit, could result in substantial costs and diversion of resources.

In the past, the Company has been notified of claims relating to various matters including intellectual property rights, contractual matters, labor issues or other matters arising in the ordinary course of business.  In the event of any such claim, the Company may be required to spend a significant amount of money and resources, even where the claim is without merit.  Accordingly, the resolution of such disputes, even those encountered in the ordinary course of business, could have a material adverse effect on the Company’s business, consolidated financial conditions and results of operations.

ITEM 1B.UNRESOLVED STAFF COMMENTS

None.

ITEM 2.  PROPERTIES

At April 30, 2016, the Company, operating in one business segment as an independent EMS provider, had manufacturing facilities located in Elk Grove Village, Illinois U.S., Union City, California U.S., Acuna, Chihuahua and Tijuana, Mexico, Ho Chi Minh City, Vietnam and Suzhou, China.  In addition, the Company provides materials procurement services through its Elk Grove Village, Illinois U.S., Union City, California U.S, and Taipei, Taiwan offices.  The Company provides design services in Elgin, Illinois U.S.

Certain information about the Company’s manufacturing, warehouse, purchasing and design facilities is set forth below:

Location	Square Feet	Services Offered	Owned/Leased
Suzhou, China	202,000	Electronic and electromechanical manufacturing solutions	*                  ***
Elk Grove Village, IL	124,300	Corporate headquarters and electronic and electromechanical manufacturing solutions	Owned
Union City, CA	117,000	Electronic and electromechanical manufacturing solutions	Leased
Acuna, Mexico	115,000	Electronic and electromechanical manufacturing solutions	Owned **
Chihuahua, Mexico	113,000	Electronic and electromechanical manufacturing solutions	Leased
Tijuana, Mexico	112,100	Electronic and electromechanical manufacturing solutions	Leased
Ho Chi Minh City, Vietnam	24,475	Electronic and electromechanical manufacturing solutions	Leased
Del Rio, TX	44,000	Warehousing and distribution	Leased

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Taipei, Taiwan	4,685	International procurement office	Leased
Elgin, IL	45,000	Design services	Owned
San Diego, CA	30,240	Warehousing and distribution	Leased

*The Company’s Suzhou, China building is owned by the Company and the land is leased from the Chinese government for a 50 year term.

**A portion of the facility is leased and the Company has an option to purchase it.

***Total square footage includes 70,000 square feet of dormitories.

The Union City and San Diego, California, Tijuana and Chihuahua, Mexico, Ho Chi Minh City, Vietnam and Del Rio, Texas properties are occupied pursuant to leases of the premises.  The lease agreements for the Del Rio, Texas properties expire December 2016.  The lease agreement for the San Diego, California property expires August 2019.  The lease agreement for the Union City, California property expires March 2021.  The Chihuahua, Mexico lease expires July 2017.  The Tijuana, Mexico lease expires November 2018.  The lease agreement for the Ho Chi Minh City, Vietnam property expires July 2020.  The Company’s manufacturing facilities located in Acuna, Mexico, Elgin, Illinois and Elk Grove Village, Illinois are owned by the Company, except for a portion of the facility in Acuna, Mexico, which is leased.  The Company has an option to buy the leased portion of the facility in Acuna, Mexico.  The properties in Elk Grove Village, Illinois and Elgin, Illinois are financed underseparate mortgage loan agreements.  The Company leases the IPO office in Taipei, Taiwan to coordinate Far East purchasing activities.  The Company believes its current facilities are adequate to meet its current needs.  In addition, the Company believes it can find alternative facilities to meet its needs in the future, if required.

ITEM 3.  LEGAL PROCEEDINGS

In November 2008, the Company received notice of an Equal Employment Opportunity Commission (“EEOC”) claim based on allegations of discrimination, sexual harassment, and retaliation filed by Maria Gracia, a former employee. The EEOC declined to pursue Ms. Gracia’s charges against the Company, but on July 26, 2011, Ms. Gracia received a right to sue letter from the EEOC. On October 25, 2011, Ms. Gracia filed suit against the Company in the U.S. District Court for the Northern District of Illinois under Title VII of the Civil Rights Act. The Complaint alleged claims that Ms. Gracia was subject to discrimination, harassment, and hostile work environment based on sex and national origin. Further, the Complaint also alleged that the Company retaliated by terminating Ms. Gracia’s employment after she filed her initial charge of discrimination with the EEOC. Ms. Gracia sought relief in the form of (a) damages sufficient to compensate her injuries; (b) attorney’s fees; (c) costs of the action; (d) and equitable remedies.

In December 2014, a jury found for the Company on the claim regarding discrimination, harassment and hostile work environment but awarded plaintiff damages regarding the retaliation/wrongful discharge claim totaling $307,000. In post-trial motions, the judge reduced the verdict to $300,000.  Subsequently, on September 17, 2015, the court ruled on plaintiff’s Claim for Equitable Relief, awarding the plaintiff an additional $74,478. Including the equitable relief award, the judgment against the Company is currently $374,478. Along with the grant of equitable relief to the plaintiff, the court denied the Company’s motion for sanctions. The judge has yet to make a ruling on attorney’s fees and costs.

On October 16, 2015, the Company appealed the judgment to the Seventh Circuit Court of Appeals.

From time to time the Company is involved in legal proceedings, claims or investigations that are incidental to the conduct of the Company’s business. In future periods, the Company could be subjected to cash cost or non-cash charges to earnings if any of these matters are resolved on unfavorable terms. However, although the

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ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of any particular claim, the Company does not expect that these legal proceedings or claims will have any material adverse impact on its future consolidated financial position or results of operations.

ITEM 4.  MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

The Company’s common stock is traded on the NASDAQ Capital Market System under the symbol SGMA.  The following table sets forth the range of quarterly high and low sales price information for the common stock for the periods ended April 30, 2016 and 2015.

Common Stock as Reported

by NASDAQ

Period		High		Low
Fiscal 2016
Fourth Quarter	$	7.80	$	5.85
Third Quarter		7.91		6.10
Second Quarter		7.34		5.02
First Quarter		9.12		6.11
Fiscal 2015
Fourth Quarter	$	8.08	$	5.84
Third Quarter		8.24		5.55
Second Quarter		11.49		6.29
First Quarter		12.44		8.12

As of July 22, 2016, there were approximately40holders of record of the Company’s common stock, which does not include shareholders whose stock is held through securities position listings.  The Company estimates there to be approximately 2,965beneficial owners of the Company’s common stock.

The Company has not paid cash dividends on its common stock since completing its February 1994 initial public offering and does not intend to pay any dividends in the foreseeable future.  So long as any indebtedness remains unpaid under the Company’s revolving loan facility, the Company is prohibited from paying or declaring any dividends on any of its capital stock, except stock dividends, without the written consent of the lender under the facility.

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On May 1, 2015, the Company sold 74,000 shares of its common stock to three individual investors in a private offering, pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), at $7.00 per share, representing an approximate average of the market price of the Company’s common stock in the public market during the immediately preceding thirty day period.  The transaction resulted in $518,000 of proceeds from the sale of restricted stock.  The stock was unregistered and may be sold only upon registration or the availability of an exemption from registration under the Securities Act.

Equity Compensation Plan Information

For information concerning securities authorized for issuance under our equity compensation plans, see Part III, Item 12 of this Annual Report, under the caption “Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters” as well as the Company’s audited financial statements and notes thereto, including Note N, filed herewith and all such information is incorporated herein by reference.

ITEM 6.SELECTED FINANCIAL DATA

As a smaller reporting company, as defined in Rule 10(f)(1) of Regulation S-K under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company is not required to provide the information required by this item.

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

                AND RESULTS OF OPERATIONS

In addition to historical financial information, this discussion of the business of SigmaTron International, Inc. (“SigmaTron”), its wholly-owned subsidiaries Standard Components de Mexico S.A., AbleMex, S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd., wholly-owned foreign enterprises Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd. (collectively, “SigmaTron China”) and international procurement office SigmaTron Taiwan branch (collectively, the “Company”) and other Items in this Annual Report on Form 10-K contain forward-looking statements concerning the Company’s business or results of operations.  Words such as “continue,” “anticipate,” “will,” “expect,” “believe,” “plan,” and similar expressions identify forward-looking statements.  These forward-looking statements are based on the current expectations of the Company.  Because these forward-looking statements involve risks and uncertainties, the Company’s plans, actions and actual results could differ materially.  Such statements should be evaluated in the context of the risks and uncertainties inherent in the Company’s business including, but not necessarily limited to, the Company’s continued dependence on certain significant customers; the continued market acceptance of products and services offered by the Company and its customers; pricing pressures from the Company’s customers, suppliers and the market; the activities of competitors, some of which may have greater financial or other resources than the Company; the variability of our operating results; the results of long-lived assets and goodwill impairment testing; the variability of our customers’ requirements; the availability and cost of necessary components and materials; the ability of the Company and our customers to keep current with technological changes within our industries; regulatory compliance, including conflict minerals; the continued availability and sufficiency of our credit arrangements; changes in U.S., Mexican, Chinese, Vietnamese or Taiwanese regulations affecting the Company’s business; the turmoil in the global economy and financial markets; the stability of the U.S., Mexican, Chinese, Vietnamese and Taiwanese economic, labor and political systems and conditions; currency exchange fluctuations; and the ability of the Company to manage its growth.  These and other factors which may affect the Company’s future business and results of operations are identified throughout the Company’s Annual Report on Form 10-K, and as risk factors, and may be detailed from time to time in the Company’s filings with the Securities and Exchange Commission.  These statements speak as of the date of such filings, and the Company undertakes no obligation to update such statements in light of future events or otherwise unless otherwise required by law.

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Overview

The Company operates in one business segment as an independent provider of EMS, which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies.  The Company provides these manufacturing services through an international network of facilities located in the United States, Mexico, China, Vietnam and Taiwan.

The Company relies on numerous third-party suppliers for components used in the Company’s production process.  Certain of these components are available only from single-sources or a limited number of suppliers.  In addition, a customer’s specifications may require the Company to obtain components from a single-source or a small number of suppliers.  The loss of any such suppliers could have a material impact on the Company’s results of operations.  Further, the Company could operate at a cost disadvantage compared to competitors who have greater direct buying power from suppliers.  The Company does not enter into long-term purchase agreements with major or single-source suppliers.  The Company believes that short-term purchase orders with its suppliers provides flexibility, given that the Company’s orders are based on the changing needs of its customers.

Sales can be a misleading indicator of the Company’s financial performance.  Sales levels can vary considerably among customers and products depending on the type of services (turnkey versus consignment) rendered by the Company and the demand by customers.  Consignment orders require the Company to perform manufacturing services on components and other materials supplied by a customer, and the Company charges only for its labor, overhead and manufacturing costs, plus a profit.  In the case of turnkey orders, the Company provides, in addition to manufacturing services, the components and other materials used in assembly.  Turnkey contracts, in general, have a higher dollar volume of sales for each given assembly, owing to inclusion of the cost of components and other materials in net sales and cost of goods sold.  Variations in the number of turnkey orders compared to consignment orders can lead to significant fluctuations in the Company’s revenue and gross margin levels.  Consignment orders accounted for less than 5% of the Company’s revenues for each of the fiscal years ended April 30, 2016 and 2015.

In an effort to facilitate the growth of our China operation, the Company established a new Chinese entity in October 2011 thatallows the Company to provide services competitively to the domestic market in China and in fiscal year 2015 expanded the Company’s manufacturing facility.  The Company expects the China operation to continue to grow despite increasing costs of operation.

The Company’s international footprint provides our customers with flexibility within the Company to manufacture in China,  Mexico, Vietnam or the U.S.We believe this strategy will continue to serve the Company well as its customers continuously evaluate their supply chain strategies.

Revenues in fiscal year 2016 increased compared to the same period in the prior year. The increase was the result of sales to existing customers, new customers and from new programs with various customers. However, the Company experienced a decrease in revenue in the second half of fiscal year 2016 compared to the first six months of fiscal year 2016. The Company believes the decrease is the result of the continuing stagnant global economy. The Company remains optimistic, however, that full-year revenues in fiscal year 2017 will continue to increase.

Critical Accounting Policies:

Management Estimates and Uncertainties - The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  Significant estimates made in preparing the consolidated financial statements include depreciation and amortization periods, the allowance for

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doubtful accounts, reserves for inventory and valuation of long-lived assets.  Actual results could materially differ from these estimates.

Revenue Recognition - Revenues from sales of the Company's electronic manufacturing services business are recognized when the finished good product is shipped to the customer.  In general, and except for consignment inventory, it is the Company's policy to recognize revenue and related costs when the finished goods have been shipped from its facilities, which is also the same point that title passes under the terms of the purchase order.  Finished goods inventory for certain customers is shipped from the Company to an independent warehouse for storage or shipped directly to the customer and stored in a segregated part of the customer’s own facility.  Upon the customer’s request for finished goods inventory, the inventory is shipped to the customer if the inventory was stored off-site, or transferred from the segregated part of the customer’s facility for consumption or use by the customer.  The Company recognizes revenue upon such shipment or transfer.  The Company does not earn a fee for such arrangements.  The Company from time to time may ship finished goods from its facilities, which is also the same point that title passes under the terms of the purchase order, and invoice the customer at the end of the calendar month.  This is done only in special circumstances to accommodate a specific customer.  Further, from time to time customers request the Company hold finished goods after they have been invoiced to consolidate finished goods for shipping purposes.  The Company generally provides a warranty for workmanship, unless the assembly was designed by the Company, in which case it warrants assembly/design.  The Company does not have any installation, acceptance or sales incentives (although the Company has negotiated longer warranty terms in certain instances).  The Company assembles and tests assemblies based on customers’ specifications.  Historically, the amount of returns for workmanship issues has been de minimis under the Company’s standard or extended warranties.

Inventories - Inventories are valued at the lower of cost or market.  Cost is determined by an average cost method and the Company allocates labor and overhead to work-in-process and finished goods.  In the event of an inventory write-down, the Company records expense to state the inventory at lower of cost or market.  The Company establishes inventory reserves for valuation, shrinkage, and excess and obsolete inventory.  The Company records provisions for inventory shrinkage based on historical experience to account for unmeasured usage or loss.  Actual results differing from these estimates could significantly affect the Company’s inventories and cost of products sold.  The Company records provisions for excess and obsolete inventories for the difference between the cost of inventory and its estimated realizable value based on assumptions about future product demand and market conditions.  For convenience, the Company reduces inventory cost through a contra asset rather than through a new cost basis.  Upon a subsequent sale or disposal of the impaired inventory, the corresponding reserve is relieved to ensure the cost basis of the inventory reflects any reductions.  Actual product demand or market conditions could be different than that projected by management.

Goodwill - Goodwill represents the purchase price in excess of the fair value of assets acquired in business combinations.  Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Goodwill and other Intangible Assets,” requires the Company to assess goodwill and other indefinite-lived intangible assets for impairment at least annually in the absence of an indicator of possible impairment and immediately upon an indicator of possible impairment.  The Company is permitted the option to first assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the fair value of any reporting unit is less than its corresponding carrying value.  If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of any reporting unit is less than its corresponding carrying value, then the Company is not required to take further action.  However, if the Company concludes otherwise, then it is required to perform a quantitative impairment test,including computing the fair value of the reporting unit and comparing that value to its carrying value.  If the fair value is less than its carrying value, a second step of the test is required to determine if recorded goodwill is impaired.  The Company also has the option to bypass the qualitative assessment for goodwill in any period and proceed directly to performing the quantitative impairment test.  The Company will be able to resume performing the qualitative assessment in any subsequent period.  The Company performed its annual goodwill impairment test as of February 1, 2016 and determined no impairment existed as of that date.

Intangible Assets-  Intangible assets are comprised of finite life intangible assets including patents, trade names, backlog, non-compete agreements, and customer relationships.  Finite life intangible assets are amortized on a straight line basis over their estimated useful lives of 5 years for patents, 20 years for trade

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names, 1 year for backlog and 7 years for non-compete agreements except for customer relationships which are amortized on an accelerated basis over their estimated useful life of 15 years.

Impairment of Long-Lived Assets - The Company reviews long-lived assets, including amortizable intangible assets, for impairment.  Property, machinery and equipment and finite life intangible assets are reviewed whenever events or changes in circumstances occur that indicate possible impairment.  If events or changes in circumstances occur that indicate possible impairment, the Company’s impairment review is based on an undiscounted cash flow analysis at the lowest level at which cash flows of the long-lived assets are largely independent of other groups of its assets and liabilities.  This analysis requires management judgment with respect to changes in technology, the continued success of product lines, and future volume, revenue and expense growth rates.  The Company conducts annual reviews for idle and underutilized equipment, and reviews business plans for possible impairment.  Impairment occurs when the carrying value of the assets exceeds the future undiscounted cash flows expected to be earned by the use of the asset group.  When impairment is indicated, the estimated future cash flows are then discounted to determine the estimated fair value of the asset or asset group and an impairment charge is recorded for the difference between the carrying value and the estimated fair value.  As of April  30, 2016, there were no indicators of possible impairment of long-lived assets.

Income Tax - The Company’s income tax expense, deferred tax assets and liabilities and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid.  The Company is subject to income taxes in both the U.S. and several foreign jurisdictions.  Significant judgments and estimates by management are required in determining the consolidated income tax expense assessment.

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistent with the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across its global operations.  Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future.  Management is not aware of any such changes that would have a material effect on the Company’s results of operations, cash flows or financial position.

A tax benefit from an uncertain tax position may only be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.

The Company adjusts its tax liabilities when its judgment changes as a result of the evaluation of new information not previously available.  Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from its current estimate of the tax liabilities.  These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

Reclassifications - Certain reclassifications have been made to the previously reported 2015 financial statements to conform to the 2016 presentation.

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During the third quarter of fiscal year 2016, the Company began presenting all deferred tax assets and liabilities as noncurrent on its Condensed Consolidated Balance Sheets as discussed further in New Accounting Standards below.

New Accounting Standards:

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers."  ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB deferred the effective date of ASU No. 2014-09 by issuing ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date.”  ASU No. 2015-14 defers the effective date of ASU No. 2014-09 to annual reporting periods beginning after December 15, 2017, with early adoption permitted but not earlier than the original effective date. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08), which clarifies the implementation guidance of principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing (ASU 2016-10), which clarifies the identification of performance obligations and licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients (ASU 2016-12), to improve guidance on assessing collectability, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition. The effective date and transition requirements in ASU 2016-08, ASU 2016-10, and ASU 2016-12 are the same as the effective date and transition requirements of ASU 2015-14. The Company has not yet selected a transition method and is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40)”.  The amendments in this ASU provide guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures.  An entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued, when applicable).  ASU 2014-15 is effective for reporting periods beginning after December 15, 2016.  Early adoption is permitted. The Company elected early adoption of this ASU and it did not have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015- 03, “Interest — Imputation of Interest (Subtopic 835-30) — Simplifying the Presentation of Debt Issuance Costs.” ASU No. 2015-03 simplifies the presentation of debt issuance costs by requiring that these costs related to a recognized debt liability be presented in the statement of financial condition as a direct reduction from the carrying amount of that liability. ASU No. 2015-03 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period.  ASU No. 2015-03 is required to be applied retrospectively to all periods presented beginning in the year of adoption.  The Company does not expect the impact of adoption of this ASU to have a material impact on its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”.  ASU No. 2015-11 requires an entity that determines the cost of inventory by methods other than last-in, first-out (LIFO) and the retail inventory method (RIM) to measure inventory at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This amendment applies to all inventory that is measured using the average costs or first-in first-out (FIFO) methods. This supersedes prior guidance which allowed entities to measure inventory at the lower of cost or market, where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin.  ASU No. 2015-11 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016.  Prospective application is required.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company does not expect the impact of the adoption of this ASU to have a material impact on the Company’s consolidated financial statements.

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In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”.  ASU No. 2015-17 requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position.  ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods.  This update may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company elected to early adopt ASU 2015-17 during its third quarter of fiscal year 2016 on a retrospective basis.  Accordingly, it reclassified the current deferred taxes to noncurrent on the April 30, 2015 Consolidated Balance Sheets, which decreased current deferred tax assets by $2,179,178, increased noncurrent deferred tax assets by $365,935 and decreased noncurrent deferred tax liabilities by $1,813,244.

In February 2016, the FASB issued ASU No. 2016-02, “Leases”. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for capital leases and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  While the Company is still evaluating the impact of its pending adoption of the new standard on its consolidated financial statements, the Company expects that upon adoption it will recognize ROU assets and lease liabilities and that the amounts could be material.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”, a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or benefit in the Consolidated Statements of Income, introducing a new element of volatility to the provision for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this standards update may have on its consolidated financial statements.

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Results of Operations:

FISCAL YEAR ENDED APRIL 30, 2016 COMPARED

TO FISCAL YEAR ENDED APRIL 30, 2015

The following table sets forth the percentage relationships of expense items to net sales for the years indicated:

	Fiscal Years
	2016	2015
Net sales	100.0%	100.0%
Operating expenses:
Cost of products sold	90.0	90.4
Selling and administrative expenses	8.3	8.5
Total operating expenses	98.3	98.9
Operating income	1.7%	1.1%

Net sales increased 10.3% to $253,904,146 in fiscal year 2016 from $230,237,161 in the prior year.  The Company’s sales increased in fiscal year 2016 in appliance,fitness, medical/life sciences and gaming marketplaces as compared to the prior year.  The increase in sales dollars for these marketplaces was partially offset by a decrease in sales dollars in the industrial electronics,  consumer electronics, semiconductor equipment and telecommunications marketplaces.  The increase in revenues is from sales to existing customers, new customers and from new programs with various customers.  The Company believes sales growth with existing customers and new customers is an indication of customer satisfaction with the Company’s global footprint and service capabilities among other things.    The Company remains optimistic revenues in fiscal year 2017 will continue to increase.

The Company’s sales in a particular industry are driven by the fluctuating forecasts and end-market demand of the customers within that industry.  Sales to customers are subject to variations from period to period depending on customer order cancellations, the life cycle of customer products and product transition.  Sales to the Company’s five largest customers accounted for 61.9% and 62.5% of net sales for fiscal years 2016 and 2015, respectively.

Gross profit increased to $25,518,531, or 10.1% of net sales, in fiscal year 2016 compared to $22,068,838 or 9.6% of net sales, in the prior fiscal year.  The increase in gross profit dollars for fiscal year 2016 was the result of increased sales and product mix.  Margin pressures continue from both customers and vendors and will likely continue in fiscal year 2017.

Selling and administrative expenses increased in fiscal year 2016to $21,194,211, or8.3% of net sales compared to $19,431,637, or 8.5% of net sales, in fiscal year 2015.  The increase in selling and administrative dollars was attributable to sales salaries, professional fees and bonus expense.  The increase in the foregoing selling and administrative expenses were partially offset by a decrease in legal fees, computer maintenance and freight out.  Selling and administrative expenses decreased as a percent of net sales due to increased revenue in fiscal year 2016 compared to the prior year. 

Interest expense, net, decreased to $1,004,988in fiscal year 2016 compared to $1,081,323 in fiscal year 2015.  Interest expense decreased primarily due to the decreased borrowings under the Company’s banking arrangements and mortgage obligations.  Interest expense for fiscal year 2017 may increase if interest rates or borrowings, or both, increase during fiscal year 2017.

In fiscal year 2016, the income tax expense was $1,402,537 compared to income tax expense of $801,049 in fiscal year 2015.  The effective rate for the years ended April 30, 2016 and 2015 was 40.2% and 47.0%, respectively.  The increase in income tax expense is due to an increase in pre-tax income in the current year. The decrease in the effective rate for the year ended April 30, 2016 is primarily due to the U.S. tax impact of

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foreign dividends recognized in the prior year. In addition, the Company recognized higher pretax income in the U.S. in the current year and lower pretax income in Mexico compared to the prior year as a result of the filing of an application for an Advanced Pricing Agreement with the Mexican tax authorities in December 2015. The agreement is effective for fiscal years beginning with fiscal year 2016 and ending with fiscal year 2019.

The Company reported net income of $2,082,659 in fiscal year 2016 compared to $903,412 for fiscal year 2015.  Basic and diluted earnings per share for fiscal year 2016 were $0.50 and $0.49, respectively, compared to basic and diluted earnings per share of $0.22 each, for the year ended April 30, 2015.

Liquidity and Capital Resources:

Operating Activities.

Cash flow provided by operating activities was $13,130,447 for the fiscal year ended April 30, 2016 compared to cash flow used in operating activities of $2,908,494 for the prior fiscal year.  Cash flow provided by operating activities was primarily the result of net income, the non-cash effects of depreciation and amortization, a decrease in accounts receivable and inventory and an increase in accounts payable and accrued expenses.  Net cash provided by operations was partially offset by an increase in income tax receivable. 

Cash flow used in operating activities was $2,908,494 for the fiscal year ended April 30, 2015.  Cash flow used in operating activities was primarily the result of increased inventories and accounts receivable and a decrease in accrued expenses and wages.  Net cash used in operating activities was partially offset by the result of net income adjusted by the non-cash effects of depreciation and amortization and an increase in accounts payable.  The increase in inventory of $14,412,734 and increase in accounts receivable of $913,776was primarily due to additional customer orders and the startup of new programs.  The increase in accounts payable is due to renegotiated vendor terms with several of the Company’s largest vendors.

Investing Activities.

In fiscal year 2016, the Company purchased $3,165,083 in machinery and equipment to be used in the ordinary course of business.  The Company anticipates it may purchase up to $3,000,000 in machinery and equipmentin fiscal year 2017, which the Company plans to fund by lease or loan transactions.  There is no assurance that the Company will be able to obtain debt financing at acceptable terms, or at all, in the future. 

In fiscal year 2015, the Company purchased $5,506,035 in machinery and equipment to be used in the ordinary course of business.  The Company purchases were funded by lease transactions and its’ bank line of credit.

Financing Activities.

Cash used in financing activities was $8,623,453 for the fiscal year ended April 30, 2016 compared to cash provided by financing activities of $5,138,781 in fiscal year 2015.  Cash used in financing activities in fiscal year 2016was primarily the result of net repayments under the line of credit of approximately $7,400,000 under the credit facility andpayments under capital leaseagreements.

On May 1, 2015, the Company sold 74,000 shares of its common stock to three individual investors in a private offering, pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), at $7.00 per share, representing an approximate average of the market price of the Company’s common stock in the public market during the immediately preceding thirty day period.  The transaction resulted in $518,000 of proceeds from the sale of restricted stock.  The stock was unregistered and may be sold only upon registration or the availability of an exemption from registration under the Securities Act.

Cash provided by financing activities was $5,138,781 for the fiscal year ended April 30, 2015.  Cash provided by financing activities in fiscal year 2015 was primarily the result of increased net borrowings of $4,400,000 under the credit facility.  The additional borrowings were required to support the purchases of machinery and equipment, and the increase in inventory.

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Financing Summary.

The Company has a senior secured credit facility with Wells Fargo, N.A. with a credit limit up to $30,000,000.  The credit facility is collateralized by substantially all of the domestically located assets of the Company and the Company has pledged 65% of its equity ownership interest in some of its foreign entities.  The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of two and one quarter percent plus one percent (effectively 3.25% at April 30, 2016) or LIBOR plus two and one quarter percent (effectively 2.875% at April 30, 2016).  Interest is paid monthly.  Under the senior secured credit facility, the Company may borrow up to the lesser of (i) $30,000,000 or (ii) an amount equal to a percentage of the eligible receivable borrowing base plus a percentage of the inventory borrowing base (collectively, “Borrowing Base”), which cannot exceed 50% of combined eligible receivables and inventory.  In January 2016, the existing senior credit facility was modified, including increasing the amount available under the Borrowing Base calculation and extending the term of the facility through October 31, 2018.  The bank fee for the modification was $23,333 and is amortized over the term of the credit facility agreement.  As of April 30, 2016, there was a $20,014,069 outstanding balance and $3,630,035 of unused availability under the credit facility agreement compared to a $27,416,793 outstanding balance and $2,583,207 of unused availability at April 30, 2015.  The Company is required to be in compliance with several financial covenants.  At April 30, 2016, the Company was in compliance with its financial covenants.

The Company entered into a mortgage agreement on January 8, 2010, in the amount of $2,500,000, with Wells Fargo, N.A. to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility.  The Wells Fargo, N.A. note historically bore interest at a fixed rate of 6.42% per year and was amortized over a sixty  - month period.  A final payment of approximately $2,000,000 was due on or before January 8, 2015.  On November 24, 2014, the Company refinanced the mortgage agreement with Wells Fargo, N.A.  The note requires the Company to pay monthly principal payments in the amount of $9,500, bears an interest rate of LIBOR plus two and one-quarter percent(effectively 3.00% at April 30, 2016) and is payable over a sixty -  month period.  Final payment of approximately $2,289,500 is due on or before November 8, 2019.  The outstanding balance was $2,688,500 and $2,802,500 at April 30, 2016 and April 30, 2015, respectively.

The Company entered into a mortgage agreement on October 24, 2013, in the amount of $1,275,000, with Wells Fargo, N.A. to finance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The Wells Fargo, N.A. note requires the Company to pay monthly principal payments in the amount of $4,250, bears interest at a fixed rate of 4.5% per year and is payable over a sixty  - month period.  A final payment of approximately $1,030,000 is due on or before October 24, 2018.  The outstanding balance was $1,147,500 and $1,198,500 at April 30, 2016 and April 30, 2015, respectively.

During 2010, the Company entered into various capital lease agreements with Wells Fargo Equipment Finance to purchase equipment totaling $1,376,799.  The terms of the lease agreements extend to July 2016 through October 2016 with monthly installment payments ranging from $3,627 to $13,207 and a fixed interest rate ranging from 4.41% to 4.99%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $106,767 compared to $336,883 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $703,424 compared to $817,324 in fiscal year 2015.

From October 2013 through December 2015, the Company entered into various capital lease agreements with Associated Bank, National Association to purchase equipment totaling $4,176,683.  The terms of the lease agreements extend to September 2018 through November 2020 with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 4.14%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $2,599,820 compared to $2,732,713 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $3,224,661 compared to $2,938,211 in fiscal year 2015.

From April 2014 through July 2015, the Company entered into various capital lease agreements with CIT Finance LLC to purchase equipment totaling $2,512,051.  The terms of the lease agreements extend to March 2019 through July 2020 with monthly installment payments ranging from $1,931 to $12,764 and a fixed interest rate ranging from 5.65% through 6.50%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $1,886,069 compared to $1,577,950 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $2,155,363 compared to $1,661,473 in fiscal year 2015.

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In September 2010, the Company entered into a real estate lease agreement in Union City, CA, to rent 116,993 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through March 2021.  The amount of the deferred rent income recorded for the fiscal year ended April 30, 2016 was $51,509 compared to $33,950 in fiscal year 2015.  In addition, the landlord provided the Company tenant incentives of $418,000, which are being amortized over the life of the lease.

On May 31, 2012, the Company entered into a lease agreement in Tijuana, MX, to rent 112,000 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through November 2018.  The amount of the deferred rent income for the fiscal year ended April 30, 2016 was $115,837 compared to $8,353 in fiscal year 2015.

The Company provides funds for salaries, wages, overhead and capital expenditure items as necessary to operate its wholly-owned Mexican, Vietnam and Chinese subsidiaries and the Taiwan IPO.  The Company provides funding in U.S. dollars, which are exchanged for Pesos, Dong, Renminbi, and New Taiwan dollars.  The fluctuation of currencies from time to time, without an equal or greater increase in inflation, could have a material impact on the financial results of the Company.  The impact of currency fluctuation for the fiscal year ended April 30, 2016 resulted in a net foreign currency loss of $59,000 compared to a net foreign currency gain of $40,000 in the prior year.  In fiscal year 2016, the Company paid approximately $52,000,000 to its foreign subsidiaries.

The Company has not recorded U.S. income taxes on the undistributed earnings of the Company’s foreign subsidiaries. Since the earnings of the foreign subsidiaries have been, and under fiscal April 30, 2016 plans, will continue to be indefinitely reinvested, no deferred tax liability has been recorded.  The cumulative amount of unremitted earnings for which U.S. income taxes have not been recorded is $12,588,000 as of April 30, 2016.  The amount of U.S. income taxes on these earnings is impractical to compute due to the complexities of the hypothetical calculation.

The Company anticipates that its credit facilities, cash flow from operations and leasing resources are adequate to meet its working capital requirements and capital expenditures for fiscal year 2017 at the Company’s current level of business.  The Company has received forecasts from current customers for increased business that would require additional investments in inventory. To the extent that these forecasts come to fruition, the Company may need to raise capital from other sources of debt or equity.  The Company engaged an investment banker for the purpose of completing a capital raise during fiscal year 2016 and subsequently terminated that agreement.  The Company plans to evaluate alternatives for raising capital in fiscal year 2017.

In addition, in the event the Company desires to expand its operations, its business grows more rapidly than expected, the current economic climate deteriorates, customers delay payments, or the Company desires to consummate an acquisition, additional financing resources may be necessary in the current or future fiscal years.  There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

The impact of inflation on the Company’s net sales, revenues and incomes from continuing operations for the past two fiscal years has been minimal.

Off-balance Sheet Transactions:

The Company has no off-balance sheet transactions.

Tabular Disclosure of Contractual Obligations:

As a smaller reporting company, as defined in Rule 10(f)(1) of Regulation S-K under the Exchange Act, the Company is not required to provide the information required by this item.

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ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

As a smaller reporting company, as defined in Rule 10(f)(1) of Regulation S-K under the Exchange Act, the Company is not required to provide the information required by this item.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The response to this item is included in Item 15(a) of this Report.

ITEM 9.CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING

AND FINANCIAL DISCLOSURE

None.

ITEM 9A.CONTROLS AND PROCEDURES

Disclosure Controls:

The Company’s management, including its President and Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of its disclosure controls and procedures (as defined under the SecuritiesExchange Act of 1934, as amended (the “Exchange Act”), Rules 13a-15(e) and 15(d)-15(e)) as of April 30, 2016.  The Company’s disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and its President and Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at the reasonable assurance level as of April 30, 2016.

Internal Controls:

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Exchange Act Rules 13a-15(f) and 15d-15(f).The Company’s internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with U.S. GAAP.  Under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission.  Based on the Company’s evaluation, management concluded that its internal controls over financial reporting were effective at the reasonable assurance level as of April 30, 2016.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to the rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.

There has been no change in the Company’s internal control over financial reporting during the quarter ended April 30, 2016, that has materially affected or is reasonably likely to materially affect, its internal control over financial reporting.

On May 14, 2013, COSO issued an updated version of its Internal Control - Integrated Framework (the “2013 Framework”) which officially superseded the 1992 Framework on December 15, 2014. Originally issued in 1992, the framework helps organizations design, implement and evaluate the effectiveness of internal control concepts and simplify their use and application. Neither COSO, the Securities and Exchange Commission or any other regulatory body has mandated adoption of the 2013 Framework by a specified date. We intend to perform an analysis to evaluate what changes to our control environment, if any, would be needed to

29

successfully implement the 2013 Framework. Until such time as such analysis and any related transition to the 2013 Framework is complete, we will continue to use the 1992 Framework in connection with our assessment of internal control.

ITEM 9B.OTHER INFORMATION

Not Applicable.

PART III

ITEM 10.DIRECTORS,  EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended April 30, 2016.

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ITEM 11.EXECUTIVE COMPENSATION

The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended April 30, 2016.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERSAND MANAGEMENT

AND RELATED STOCKHOLDER MATTERS

The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended April 30, 2016.

ITEM 13.CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS ANDDIRECTOR

INDEPENDENCE

The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended April 30, 2016.

ITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended April 30, 2016.

PART IV

ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1)

The financial statements are listed in the Index to Financial Statements filed as part of this AnnualReport onForm 10-K beginning on Page F-1.

(a)(2)

Financial statement schedules are omitted because they are not applicable or required.

(a)(3) and (b)

The exhibits required by Item 601 of Regulations S-K are listed in the Index to Exhibits filed as part of this Annual Report on Form 10-K beginning on Page 32.

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Index to Exhibits

3.1	Certificate of Incorporation of the Company, incorporated herein by reference to Exhibit 3.1 to Registration Statement on Form S-1, File No. 33-72100, dated February 9, 1994.
3.2	Amended and Restated By-laws of the Company, adopted on September 24, 1999, incorporated herein by reference to Exhibit  3.2 to the Company’s Form 10-K for the fiscal year ended April 30, 2000.
10.1	Form of 1993 Stock Option Plan, incorporated herein by reference to Exhibit 10.4 to the Company’s Registration Statement on Form S-1, File No. 33-72100.*
10.2	Form of Incentive Stock Option Agreement for the Company’s 1993 Stock Option Plan , incorporated herein by reference to Exhibit 10.5 to the Company’s Registration Statement on Form S-1, File No. 33-72100.*
10.3	Form of Non-Statutory Stock Option Agreement for the Company’s 1993 Stock Option Plan, incorporated herein by reference to Exhibit 10.6 to the Company’s Registration Statement on Form S-1, File No. 33-72100.*
10.4	2004 Directors’ Stock Option Plan, incorporated herein by reference to Appendix C to the Company’s 2004 Proxy Statement filed on August 16, 2004.*
10.5	2004 Employee Stock Option Plan, incorporated herein by reference to Appendix B to the Company’s 2004 Proxy Statement filed on August 16, 2004. *
10.6	Revolving Line of Credit Note issued by SigmaTron International, Inc. to Wells Fargo International Banking and Trade Solutions (IBTS), dated January 8, 2010 incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K filed on January 14, 2010.
10.7	Promissory Note issued by SigmaTron International, Inc. to Wells Fargo International Banking and Trade Solutions (IBTS), dated January 8, 2010, incorporated herein by reference to Exhibit 10.3 to the Company’s Form 8-K filed on January 14, 2010.
10.8	SigmaTron International, Inc. 2011 Employee Stock Option Plan dated September 16, 2011, incorporated herein by reference to Exhibit 10.14 to the Company’s Registration Statement on Form S-8 filed on December 14, 2011.*
10.9	Purchase Agreement between SigmaTron International, Inc., and its nominees and Spitfire Control, Inc., dated as of May 31, 2012, incorporated herein by reference to Exhibit 2.1 to the Company’s Form 8-K filed on June 4, 2012.
10.10	SigmaTron International, Inc. 2014 Employee Bonus Plan dated May 21, 2013, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on May 23, 2013.*
10.11	SigmaTron International, Inc. 2013 Employee Stock Purchase Plan dated September 20, 2013, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on September 25, 2013.*
10.12	SigmaTron International, Inc. 2013 Non-Employee Director Restricted Stock Plan dated September 20, 2013, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on September 25, 2013.*

32

10.13	Mortgage and Assignment of Rents and Leases executed as of October 24, 2013, by SigmaTron International, Inc., to Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.18 to the Company’s Form 10-Q filed on December 13, 2013.
10.14	Second Amended and Restated Credit Agreement entered into as of October 24, 2013, by and between SigmaTron International, Inc., and Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.19 to the Company’s Form 10-Q filed on December 13, 2013.
10.15	Master Lease Agreement # 2170 entered into between Associated Bank, National Association, a national banking association and SigmaTron International, Inc., dated October 3, 2013, incorporated herein by reference to Exhibit 10.20 to the Company’s Form 10-Q filed on December 13, 2013.
10.16	SigmaTron International, Inc. Amended and Restated Change in Control Severance Payment Plan dated March 11, 2014, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K/A filed on March 14, 2014.*
10.17	Master Lease Number 81344 entered into between CIT Finance LLC and SigmaTron International, Inc., dated March 6, 2014, incorporated herein by reference to Exhibit 10.17 to the Company’s Form 10-K filed on July 24, 2014.
10.18	Schedule # 1217927 to Master Lease Agreement Number 81344 entered into between CIT Finance LLC and SigmaTron International, Inc. dated May 7, 2014, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 10-Q filed on September 11, 2014.
10.19	Third Amended and Restated Credit Agreement entered into as of October 31, 2014, by and between SigmaTron International, Inc., and Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on December 10, 2014.
10.20	Second Amended and Restated Promissory Note dated November 24, 2014 issued by the Company to Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K filed on December 10, 2014.
10.21	Schedule # 1223197 to Master Lease Agreement Number 81344 entered into by and between CIT Finance LLC and SigmaTron International, Inc. dated August 1, 2014, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 10-Q filed on December 12, 2014.
10.22	Lease No. 003 is an attachment to Master Lease No. 2170 dated October 17, 2013 by and between Associated Bank, National Association and SigmaTron International, Inc. dated September 22, 2014, incorporated herein by reference to Exhibit 10.2 to the Company’s Form 10-Q filed on December 12, 2014.
10.23	Lease No. 004 is an attachment to Master Lease No. 2170 dated October 17, 2013 by and between Associated Bank, National Association and SigmaTron International, Inc. dated September 22, 2014, incorporated herein by reference to Exhibit 10.3 to the Company’s Form 10-Q filed on December 12, 2014.
10.24	Lease No. 005 is an attachment to Master Lease No. 2170 dated October 17, 2013 by and between Associated Bank, National Association and SigmaTron International, Inc. dated September 22, 2014, incorporated herein by reference to Exhibit 10.4 to the Company’s Form 10-Q filed on December 12, 2014.
10.25	Schedule # 1246045 to Master Lease Agreement Number 81344 entered into by and between CIT Finance LLC and SigmaTron International, Inc. dated October 27, 2014, incorporated herein by reference to Exhibit 10.5 to the Company’s Form 10-Q filed on December 12, 2014.

33

10.26	First Amendment to Third Amended and Restated Credit Agreement entered into as of March 7, 2015, by and between SigmaTron International, Inc. and Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on March 12, 2015.
10.27	Lease No. 006 is an attachment to Master Lease No. 2170 dated October 17, 2013 by and between Associated Bank, National Association and SigmaTron International, Inc. dated January 16, 2015, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 10-Q filed on March 16, 2015.
10.28	SigmaTron International, Inc. Employee Bonus Plan for Fiscal Year 2016 dated July 9, 2015, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on July 10, 2015.*
10.29	Schedule # 1284094 to Master Lease Agreement Number 81344 entered into by and between CIT Finance LLC and SigmaTron International, Inc. dated June 2, 2015, incorporated herein by reference to Exhibit 10.29 to the Company’s Form 10-K filed on July 24, 2015.
10.30	Second Amendment to Third Amended and Restated Credit Agreement entered into as of January 25, 2016, by and between SigmaTron International, Inc., and Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on March 14, 2016.
10.31	Fifth Amended and Restated Revolving Line of Credit Note delivered as of January 25, 2016, by SigmaTron International, Inc. to Wells Fargo Bank, National Association, incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K filed on March 14, 2016.
10.32	Lease No. 007 is an attachment to Master Lease No. 2170 dated October 17, 2013 by and between Association Bank, National Association and SigmaTron International, Inc. dated December 22, 2015, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 10-Q filed on March 15, 2016.
10.33	SigmaTron International, Inc. Employee Bonus Plan for Fiscal Year 2017 dated June 2, 2016, incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on June 6, 2016.*
21.0	Subsidiaries of the Registrant, incorporated herein by reference to Exhibit 21 to the Company’s Form 10-K for the fiscal year ended April 30, 2014, filed on July 24, 2014.
23.1	Consent of BDO USA, LLP.**
24.0	Power of Attorney of Directors and Executive Officers (included on the signature page of this Form 10-K for the fiscal year ended April 30, 2016).**
31.1	Certification of Principal Executive Officer of the Company Pursuant to Rule 13a-14(a) under the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.**
31.2	Certification of Principal Financial Officer of the Company Pursuant to Rule 13a-14(a) under the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.**
32.1	Certification by the Principal Executive Officer of SigmaTron International, Inc. Pursuant to Rule 13a-14(b) under the Exchange Act and Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).**
32.2	Certification by the Principal Financial Officer of SigmaTron International, Inc. Pursuant to Rule 13a-14(b) under the Exchange Act and Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).**

101.INS  XBRL Instance Document

34

101.SCH	XBRL Taxonomy Extension Scheme Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

* Indicates management contract or compensatory plan.

** Filed herewith

(c) Exhibits

The Company hereby files as exhibits to this Report the exhibits listed in Item 15(a)(3) above, which are

attached hereto or incorporated herein.

35

SIGNATURES

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

SIGMATRON INTERNATIONAL, INC.

By:      /s/ Gary R. Fairhead

Gary R. Fairhead, President and Chief Executive Officer,

Principal Executive Officer and Director

Dated:  July 29, 2016

 KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned directors and officers of SigmaTron International, Inc., a Delaware corporation, which is filing an Annual Report on Form 10-K with the Securities and Exchange Commission under the provisions of the Securities Exchange Act of 1934 as amended, hereby constitute and appoint Gary R. Fairhead and Linda K. Frauendorfer, and each of them, each of their true and lawful attorneys-in fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in all capacities, to sign any or all amendments to the report to be filed with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as each of them might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

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	Title	Date
/s/ Gary R. Fairhead	Chairman of the Board of Directors,	July 29, 2016
Gary R. Fairhead	President and Chief Executive Officer,
	(Principal Executive Officer) and Director
/s/ Linda K. Frauendorfer	Chief Financial Officer, Secretary and Treasurer	July 29, 2016
Linda K. Frauendorfer	(Principal Financial Officer and Principal
	Accounting Officer) and Director
/s/ Thomas W. Rieck	Director	July 29, 2016
Thomas W. Rieck
/s/ Dilip S. Vyas	Director	July 29, 2016
Dilip S. Vyas
/s/ Paul J. Plante	Director	July 29, 2016
Paul J. Plante
/s/ Barry R. Horek	Director	July 29, 2016
Barry R. Horek
/s/ Bruce J. Mantia	Director	July 29, 2016
Bruce J. Mantia

36

INDEX TO FINANCIAL STATEMENTS

Page

SigmaTron International, Inc. and Subsidiaries

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	F-2
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS	F-3
CONSOLIDATED STATEMENTS OF INCOME	F-5
CONSOLIDATED STATEMENTS OF CHANGES IN
STOCKHOLDERS’ EQUITY	F-6
CONSOLIDATED STATEMENTS OF CASH FLOWS	F-7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	F-9

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Stockholders

SigmaTron International, Inc.

Elk Grove Village, Illinois

We have audited the accompanying consolidated balance sheets of SigmaTron International, Inc. as of April 30, 2016 and 2015and the related consolidated statements of income, changes in stockholders' equity and cash flows for the years then ended.  These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of SigmaTron International, Inc. at April 30, 2016 and 2015 and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ BDO USA, LLP

Chicago, Illinois

July 29, 2016

F-2

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

APRIL 30, 2016 and 2015

ASSETS		2016		2015
CURRENT ASSETS
Cash and cash equivalents	$	4,325,268	$	2,868,217
Accounts receivable, less allowance for doubtful accounts of
$100,000 and $186,844 at April 30, 2016 and 2015,
respectively		17,844,228		20,170,723
Inventories		67,649,022		68,669,709
Prepaid expenses and other assets		2,128,128		2,103,367
Refundable income taxes		774,847		81,046
Note receivable		887,531		-
Other receivables		481,860		486,085
Total current assets		94,090,884		94,379,147
PROPERTY, MACHINERY AND EQUIPMENT, NET		33,080,858		33,864,527
OTHER LONG-TERM ASSETS
Intangible assets		4,703,245		5,174,144
Goodwill		3,222,899		3,222,899
Deferred income taxes		233,057		365,935
Other assets		1,531,315		1,319,901
Total other long-term assets		9,690,516		10,082,879
TOTAL ASSETS	$	136,862,258	$	138,326,553

The accompanying notes are an integral part of these statements.

F-3

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS - CONTINUED

APRIL 30, 2016 and 2015

LIABILITIES AND STOCKHOLDERS’ EQUITY		2016		2015
CURRENT LIABILITIES
Trade accounts payable	$	37,011,786	$	35,838,275
Accrued expenses		710,466		532,695
Accrued wages		6,260,982		5,140,851
Income taxes payable		-		141,297
Current portion of long-term debt		165,000		165,000
Current portion of capital lease obligations		1,374,898		1,245,632
Current portion of contingent consideration		275,288		275,288
Current portion of deferred rent		187,889		150,594
Total current liabilities		45,986,309		43,489,632
Long-term debt,
less current portion		23,685,069		31,252,793
Capital lease obligations,
less current portion		3,217,758		3,401,913
Contingent consideration,
less current portion		875,793		1,223,697
Other long-term liabilities		870,542		536,209
Deferred rent, less current portion		795,289		999,929
Deferred income taxes		1,355,620		736,993
Total long-term liabilities		30,800,071		38,151,534
Total liabilities		76,786,380		81,641,166
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Preferred stock, $.01 par value; 500,000 shares
authorized, none issued or outstanding		-		-
Common stock, $.01 par value; 12,000,000 shares
authorized, 4,183,955 and 4,075,785 shares issued
and outstanding at April 30, 2016 and 2015, respectively		41,560		40,703
Capital in excess of par value		22,546,616		21,239,641
Retained earnings		37,487,702		35,405,043
Total stockholders’ equity		60,075,878		56,685,387
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY	$	136,862,258	$	138,326,553

The accompanying notes are an integral part of these statements.

F-4

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF INCOME

Years ended April 30, 2016 and 2015

		2016		2015
Net sales	$	253,904,146	$	230,237,161
Cost of products sold		228,385,615		208,168,323
Gross profit		25,518,531		22,068,838
Selling and administrative expenses		21,194,211		19,431,637
Operating income		4,324,320		2,637,201
Other income		(165,864)		(148,583)
Interest expense		1,004,988		1,081,323
Income before income tax expense		3,485,196		1,704,461
Income tax expense		1,402,537		801,049
NET INCOME	$	2,082,659	$	903,412
Earnings per common share
Basic	$	0.50	$	0.22
Diluted	$	0.49	$	0.22
Weighted-average shares of common
stock outstanding
Basic		4,164,815		4,046,988
Diluted		4,224,030		4,116,424

The accompanying notes are an integral part of these statements.

F-5

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Years ended April 30, 2016 and 2015

						Capital in				Total
		Preferred		Common		excess of par		Retained		stockholders’
		stock		stock		value		earnings		equity
Balance at May 1, 2014	$	-		40,215		20,864,497		34,501,631		55,406,343
Recognition of stock-based compensation		-		-		59,648		-		59,648
Exercise of stock options		-		136		57,825		-		57,961
Issuance and vesting of restricted stock		-		150		61,796		-		61,946
Employee stock purchases		-		202		126,612		-		126,814
Tax benefit from contingent consideration		-		-		69,263		-		69,263
Net income		-		-		-		903,412		903,412
Balance at April 30, 2015		-		40,703		21,239,641		35,405,043		56,685,387
Recognition of stock-based compensation		-		-		588,245		-		588,245
Exercise of stock options		-		20		7,180		-		7,200
Vesting of restricted stock		-		-		69,400		-		69,400
Sale of restricted stock		-		740		517,260		-		518,000
Employee stock purchases		-		97		52,169		-		52,266
Tax benefit from contingent consideration		-		-		23,972		-		23,972
Excess tax benefits on stock options and awards		-		-		48,749		-		48,749
Net income		-		-		-		2,082,659		2,082,659
Balance at April 30, 2016	$	-	$	41,560	$	22,546,616	$	37,487,702	$	60,075,878

The accompanying notes are an integral part of these statements.

F-6

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years ended April 30, 2016 and 2015

		2016		2015
Cash flows from operating activities
Net income	$	2,082,659	$	903,412
Adjustments to reconcile net income to net
cash provided by (used in)  operating activities
Depreciation		5,119,376		4,985,272
Stock-based compensation		588,245		59,648
Restricted stock expense		69,400		61,946
(Benefit from) provision for doubtful accounts		-		36,844
Tax benefit from contingent consideration		(23,972)		(69,263)
Deferred income tax expense (benefit)		775,477		(252,347)
Amortization of intangible assets		470,899		428,610
Fair value adjustment of contingent consideration		(5,742)		(106,015)
Loss from disposal or sale of machinery and equipment		23,101		52,615
Changes in assets and liabilities
Accounts receivable		1,438,964		(913,776)
Inventories		1,020,687		(14,941,332)
Prepaid expenses and other assets		(72,334)		(1,082,509)
Income taxes receivable		(693,801)		-
Income taxes payable		(141,297)		(80,634)
Trade accounts payable		1,173,511		8,697,196
Deferred rent		(167,345)		(25,598)
Accrued expenses and wages		1,472,619		(662,563)
Net cash provided by (used in) operating activities		13,130,447		(2,908,494)
Cash flows from investing activities
Purchases of machinery and equipment		(3,165,083)		(5,506,035)
Disposals of machinery and equipment		115,140		703,646
Net cash used in investing activities		(3,049,943)		(4,802,389)
Cash flows from financing activities
Proceeds from the exercise of common stock options		7,200		57,961
Proceeds from the sale of restricted stock		518,000		-
Proceeds from Employee stock purchases		52,266		126,814
Proceeds from tax benefit on stock options and awards		48,749		-
Proceeds under sale leaseback agreements		-		1,102,317
Payments of contingent consideration		(342,162)		(260,000)
Payments under capital lease and sale leaseback agreements		(1,363,754)		(1,050,850)
Proceeds under building notes payable		-		834,481
Payments under building notes payable		(165,000)		(157,998)
Borrowings under lines of credit		194,424,157		165,496,222
Payments under lines of credit		(201,826,881)		(161,079,429)
Tax benefit from contingent consideration		23,972		69,263
Net cash (used in) provided by financing activities		(8,623,453)		5,138,781
Change in cash		1,457,051		(2,572,102)
Cash and cash equivalents at beginning of year		2,868,217		5,440,319
Cash and cash equivalents at end of year	$	4,325,268	$	2,868,217

F-7

SigmaTron International, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS - Continued

Years ended April 30, 2016 and 2015

		2016		2015
Supplementary disclosures of cash flow information
Cash paid for interest	$	964,537	$	1,018,419
Cash paid for income taxes		1,634,772		1,159,362
Purchase of machinery and equipment financed
under capital leases		1,308,865		1,407,116
Purchase of machinery and equipment financed
under sale leaseback agreements		-		1,102,317
Financing of insurance policy		159,616		146,546
Conversion of accounts receivable into a note receivable		887,531		-

The accompanying notes are an integral part of these statements.

F-8

DRAFT - A

DRAFT - A

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

April 30, 2016 and 2015

NOTE A - DESCRIPTION OF THE BUSINESS

SigmaTron International, Inc., its subsidiaries, foreign enterprises and international procurement office (collectively, the “Company”) operates in one business segment as an independent provider of electronic manufacturing services (“EMS”), which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies.  As of April 30, 2016, the Company provided these manufacturing services through an international network of facilities located in the United States, Mexico, China, Vietnam and Taiwan.  Approximately 15.0% of the total non-current consolidated assets of the Company are located outside of the United States as of April 30, 2016 and 2015, respectively.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation Policy

The consolidated financial statements include the accounts and transactions of SigmaTron International, Inc. (“SigmaTron”), its wholly-owned subsidiaries, Standard Components de Mexico, S.A., AbleMex S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd. and SigmaTron International Trading Co., wholly-owned foreign enterprises Suzhou SigmaTron Electronics Co. Ltd., and SigmaTron Electronic Technology Co., Ltd. (collectively, “SigmaTron China”), and its international procurement office, SigmaTron Taiwan.  The functional currency of the Mexican, Vietnamese and Chinese subsidiaries and procurement branch is the U.S. dollar.  Intercompany transactions are eliminated in the consolidated financial statements.  The impact of foreign currency fluctuation for the fiscal year ended April 30, 2016 resulted in a net loss of approximately $59,000 compared to a net foreign currency gain of $40,000 in the prior year.

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  Significant estimates made in preparing the consolidated financial statements include depreciation and amortization periods, the allowance for doubtful accounts, reserves for inventory, lower of cost or market adjustment for inventory, deferred taxes, uncertain tax positions, valuation allowance for deferred taxes and valuation of long-lived assets.  Actual results could materially differ from these estimates.

Cash and Cash Equivalents

Cash and cash equivalents include cash and all highly liquid short-term investments with original maturities within three months of the purchase date.

F-9

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Accounts Receivable

The majority of the Company’s accounts receivable are due from companies in the consumer electronics, gaming, fitness, industrial electronics, medical/life sciences, semiconductor, telecommunications and appliance industries.  Credit is extended based on evaluation of a customer’s financial condition, and, generally, collateral is not required.  Accounts receivable are due in accordance with agreed upon terms, and are stated at amounts due from customers net of an allowance for doubtful accounts.  Accounts outstanding longer than the contractual payments terms are considered past due.  The Company writes off accounts receivable when they are determined to be uncollectible.

Allowance for Doubtful Accounts

The Company’s allowance for doubtful accounts relates to receivables not expected to be collected from its customers.  This allowance is based on management’s assessment of specific customer balances, considering the age of receivables and financial stability of the customer and a five year average of prior uncollectible amounts.  If there is an adverse change in the financial condition of the Company’s customers, or if actual defaults are higher than provided for, an addition to the allowance may be necessary.

Inventories

Inventories are valued at the lower of cost or market.  Cost is determined by an average cost method and the Company allocates labor and overhead to work-in-process and finished goods.  In the event of an inventory write-down, the Company records expense to state the inventory at lower of cost or market.  The Company establishes inventory reserves for valuation, shrinkage, and excess and obsolete inventory.  The Company records provisions for inventory shrinkage based on historical experience to account for unmeasured usage or loss.  Actual results differing from these estimates could significantly affect the Company’s inventories and cost of products sold.  The Company records provisions for excess and obsolete inventories for the difference between the cost of inventory and its estimated realizable value based on assumptions about future product demand and market conditions.  For convenience, the Company reduces inventory cost through a contra asset rather than through a new cost basis.  Upon a subsequent sale or disposal of the impaired inventory, the corresponding reserve is relieved to ensure the cost basis of the inventory reflects any reductions.  Actual product demand or market conditions could be different than that projected by management.

Property, Machinery and Equipment

Property, machinery and equipment are valued at cost.  The Company provides for depreciation and amortization using the straight-line method over the estimated useful life of the assets:

Buildings	20 years
Machinery and equipment	5-12 years
Office equipment and software	3-5 years
Tools and dies	12 months
Leasehold improvements	lesser of lease term or useful life

Expenses for repairs and maintenance are charged to selling and administrative expenses as incurred.

Deferred Financing Costs

Deferred financing costs consist of costs incurred to obtain the Company’s long-term debt and are amortized using the straight-line method over the term of the related debt.  Deferred financing fees of $113,286 and $147,537 net of

F-10

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

accumulated amortization of $443,763 and $390,266, respectively, as of April 30, 2016 and 2015, respectively, are classified in other long-term assets on the Company’s balance sheet.

Income Taxes

The Company’s income tax expense, deferred tax assets and liabilities and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid.  The Company is subject to income taxes in both the U.S. and several foreign jurisdictions.  Significant judgments and estimates by management are required in determining the consolidated income tax expense assessment.

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistent with the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across its global operations.  Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future.  Management is not aware of any such changes that would have a material effect on the Company’s results of operations, cash flows or financial position.

A tax benefit from an uncertain tax position may only be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.

The Company adjusts its tax liabilities when its judgment changes as a result of the evaluation of new information not previously available.  Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from its current estimate of the tax liabilities.  These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

F-11

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Earnings per Share

Basic earnings per share are computed by dividing net income (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period.  The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common stock equivalents such as stock options and restricted stock, had been exercised or vested.  There were 991, anti-dilutive common stock equivalents at April 30, 2015, which have been excluded from the calculation of diluted earnings per share.  There were no anti-dilutive common stock equivalents at April 30, 2016. 

	Twelve Months Ended
	April 30,
	2016		2015
Net income	$	2,082,659	$	903,412
Weighted-average shares
Basic		4,164,815		4,046,988
Effect of dilutive stock options		59,215		69,436
Diluted		4,224,030		4,116,424
Basic earnings per share	$	0.50	$	0.22
Diluted earnings per share	$	0.49	$	0.22

Revenue Recognition

Revenues from sales of the Company's electronic manufacturing services business are recognized when the finished good product is shipped to the customer.  In general, and except for consignment inventory, it is the Company's policy to recognize revenue and related costs when the finished goods have been shipped from its facilities, which is also the same point that title passes under the terms of the purchase order.  Finished goods inventory for certain customers is shipped from the Company to an independent warehouse for storage or shipped directly to the customer and stored in a segregated part of the customer’s own facility.  Upon the customer’s request for finished goods inventory, the inventory is shipped to the customer if the inventory was stored off-site, or transferred from the segregated part of the customer’s facility for consumption or use by the customer.  The Company recognizes revenue upon such shipment or transfer.  The Company does not earn a fee for such arrangements.  The Company from time to time may ship finished goods from its facilities, which is also the same point that title passes under the terms of the purchase order, and invoice the customer at the end of the calendar month.  This is done only in special circumstances to accommodate a specific customer.  Further, from time to time customers request the Company hold finished goods after they have been invoiced to consolidate finished goods for shipping purposes.  The Company generally provides a warranty for workmanship, unless the assembly was designed by the Company, in which case it warrants assembly/design.  The Company does not have any installation, acceptance or sales incentives (although the Company has negotiated longer warranty terms in certain instances).  The Company assembles and tests assemblies based on customers’ specifications.  Historically, the amount of returns for workmanship issues has been de minimis under the Company’s standard or extended warranties.

F-12

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Shipping and Handling Costs

The Company records shipping and handling costs as selling and administrative expenses.  Customers are typically invoiced for shipping costs and such amounts are included in net sales.  Shipping and handling costs were not material to the financial statements for fiscal years 2016 or 2015.

Fair Value Measurements

Fair value measurements are determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants exclusive of any transaction costs.  The Company utilizes a fair value hierarchy based upon the observability of inputs used in valuation techniques as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, other receivables, accounts payable and accrued expenses which approximate fair value at April 30, 2016 and 2015, due to their short-term nature.  The carrying amounts of the Company’s debt obligations approximate fair value based on future payments discounted at current interest rates for similar obligations or interest rates which fluctuate with the market.

The Company measured the contingent consideration included in the fiscal 2013 Spitfire acquisition under the fair value standard (primarily using level 3 measurement inputs).  The contingent consideration continues to be measured and reported at fair value at each period end.  The Company currently does not have any other non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.

Goodwill

Goodwill represents the purchase price in excess of the fair value of assets acquired in business combinations.  Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Goodwill and other Intangible Assets,” requires the Company to assess goodwill and other indefinite-lived intangible assets for impairment at least annually in the absence of an indicator of possible impairment and immediately upon an indicator of possible impairment.  The Company is permitted the option to first assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the fair value of any reporting unit is less than its corresponding carrying value.  If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of any reporting unit is less than its corresponding carrying value, then the Company is not required to take further action.  However, if the Company concludes otherwise, then it is required to perform a quantitative impairment test, including computing the fair value of the reporting unit and comparing that value to its carrying value.  If the fair value is less than its carrying value, a second step of the test is required to determine if recorded goodwill is impaired.  The Company also has the option to bypass the qualitative assessment for goodwill in any period and proceed directly to performing the quantitative impairment test.  The Company will be able to resume performing the qualitative assessment in any subsequent period.  The Company performed its annual goodwill impairment test as of February 1, 2016 and determined no impairment existed as of that date.

F-13

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Intangible Assets

Intangible assets are comprised of finite life intangible assets including patents, trade names, backlog, non-compete agreements, and customer relationships.  Finite life intangible assets are amortized on a straight line basis over their estimated useful lives of 5 years for patents, 20 years for trade names, 1 year for backlog and 7 years for non-compete agreements except for customer relationships which are amortized on an accelerated basis over their estimated useful life of 15 years.

Impairment of Long-Lived Assets

The Company reviews long-lived assets, including amortizable intangible assets, for impairment.  Property, machinery and equipment and finite life intangible assets are reviewed whenever events or changes in circumstances occur that indicate possible impairment.  If events or changes in circumstances occur that indicate possible impairment, the Company’s impairment review is based on an undiscounted cash flow analysis at the lowest level at which cash flows of the long-lived assets are largely independent of other groups of its assets and liabilities.  This analysis requires management judgment with respect to changes in technology, the continued success of product lines, and future volume, revenue and expense growth rates.  The Company conducts annual reviews for idle and underutilized equipment, and reviews business plans for possible impairment.  Impairment occurs when the carrying value of the assets exceeds the future undiscounted cash flows expected to be earned by the use of the asset group.  When impairment is indicated, the estimated future cash flows are then discounted to determine the estimated fair value of the asset or asset group and an impairment charge is recorded for the difference between the carrying value and the estimated fair value.  As of April 30, 2016, there were no indicators of possible impairment of long-lived assets.

Stock Incentive Plans

Under the Company’s stock option plans, options to acquire shares of common stock have been made available for grant to certain employees and directors.  Each option granted has an exercise price of not less than 100% of the market value of the common stock on the date of grant.  The contractual life of each option is generally 10 years.  The vesting of the grants varies according to the individual options granted.  The Company measures the cost of employee services received in exchange for an equity award based on the grant date fair value and records that cost over the respective vesting period of the award.

Reclassifications

Certain reclassifications have been made to the previously reported 2015 financial statements to conform to the 2016 presentation.

During the third quarter of fiscal year 2016, the Company began presenting all deferred tax assets and liabilities as noncurrent on its Condensed Consolidated Balance Sheets as discussed further in New Accounting Standards below.

F-14

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

New Accounting Standards

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers."  ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB deferred the effective date of ASU No. 2014-09 by issuing ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date.”  ASU No. 2015-14 defers the effective date of ASU No. 2014-09 to annual reporting periods beginning after December 15, 2017 , with early adoption permitted but not earlier than the original effective date. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08), which clarifies the implementation guidance

of principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing (ASU 2016-10), which clarifies the identification of performance obligations and licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients (ASU 2016-12), to improve guidance on assessing collectability, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition. The effective date and transition requirements in ASU 2016-08, ASU 2016-10, and ASU 2016-12 are the same as the effective date and transition requirements of ASU 2015-14. The Company has not yet selected a transition method and is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40)”.  The amendments in this ASU provide guidance about management’s responsibility to evaluate

whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures.  An entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued, when applicable).  ASU 2014-15 is effective for reporting periods beginning after December 15, 2016.  Early adoption is permitted. The Company elected early adoption of this ASU and it did not have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015- 03, “Interest — Imputation of Interest (Subtopic 835-30) — Simplifying the Presentation of Debt Issuance Costs.” ASU No. 2015-03 simplifies the presentation of debt issuance costs by requiring that these costs related to a recognized debt liability be presented in the statement of financial condition as a direct reduction from the carrying amount of that liability. ASU No. 2015-03 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period.  ASU No. 2015-03 is required to be applied retrospectively to all periods presented beginning in the year of adoption.  The Company does not expect the impact of adoption of this ASU to have a material impact on its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”.  ASU No. 2015-11 requires an entity that determines the cost of inventory by methods other than last-in, first-out (LIFO) and the retail inventory method (RIM) to measure inventory at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This amendment applies to all inventory that is measured using the average costs or first-in first-out (FIFO) methods. This supersedes prior guidance which allowed entities to measure inventory at the lower of cost or market, where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin.  ASU No. 2015-11 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016.  Prospective application is required.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company does not expect the impact of the adoption of this ASU to have a material impact on the Company’s consolidated financial statements.

F-15

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

New Accounting Standards - Continued

In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”.  ASU No. 2015-17 requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position.  ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods.  This update may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company elected to early adopt ASU 2015-17 during its third quarter of fiscal year 2016 on a retrospective basis.  Accordingly, it reclassified the current deferred taxes to noncurrent on the April 30, 2015 Consolidated Balance Sheets, which decreased current deferred tax assets by $2,179,178, increased noncurrent deferred tax assets by $365,935 and decreased noncurrent deferred tax liabilities by $1,813,244.

In February 2016, the FASB issued ASU No. 2016-02, “Leases”. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective

transition approach is required for capital leases and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  While the Company is still evaluating the impact of its pending adoption of the new standard on its

consolidated financial statements, the Company expects that upon adoption it will recognize ROU assets and lease liabilities and that the amounts could be material.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”, a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or benefit in the Consolidated Statement of Income, introducing a new element of volatility to the provision for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after

December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this standards update may have on its consolidated financial statements.

F-16

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE C - ALLOWANCE FOR DOUBTFUL ACCOUNTS

Changes in the Company’s allowance for doubtful accounts are as follows:

		2016		2015
Beginning Balance	$	186,844	$	150,000
Bad debt expense		-		36,844
Write-offs		(86,844)		-
	$	100,000	$	186,844

NOTE D - INVENTORIES

Inventories consist of the following at April 30:

	2016		2015
Finished products	$	23,295,138	$	24,316,404
Work-in-process		3,035,459		2,966,846
Raw materials		42,530,957		42,662,845
		68,861,554		69,946,095
Less obsolescence reserve		1,212,532		1,276,386
	$	67,649,022	$	68,669,709

Changes in the Company’s inventory obsolescence reserve are as follows:

	2016		2015
Beginning balance	$	1,276,386	$	1,804,984
Write-offs		(63,854)		(528,598)
	$	1,212,532	$	1,276,386

F-17

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE E - RELATED PARTIES

In March, 2015, two of the Company’s executive officers invested in a start-up customer.  The executive officers’ investments constitute less than 2% (individually and in aggregate) of the outstanding beneficial ownership of the customer, according to information provided by the customer to the executive officers.  As of April 30, 2016, the Company had an outstanding note receivable and account receivable from that customer of approximately $888,000 and $233,000, respectively.  Inventory on hand related to this customer of approximately $1,600,000.  Sales to this customer, have not been material for the fiscal year ended April 30, 2016.

On January 29, 2016, the Company entered into a memorandum of understanding with this customer.  Under the subsequent agreement, effective January 29, 2016, the account receivable of approximately $888,000 was converted into a short-term promissory note.  The promissory note bears interest at the rate of 8% per annum, payable at the maturity of the promissory note.  The promissory note matures at the earlier of October 31, 2016, within 10 days after the customer obtains certain equity financing, or at the closing of a sale of substantially all of the customer’s stock or assets.  As additional consideration, the Company received warrants under the agreement.  The warrants are ten years in duration and may be exercised at an exercise price of $0.01 per share and for a number of shares determined pursuant to the warrant, expected to be, at a minimum, approximately 1% of the customer’s then – outstanding equity securities.  The Company believes the warrants have nil value.  Further, the Company has been granted a security interest in the customer’s accounts receivable and authority to access and be a signatory on the customer’s deposit accounts.

F-18

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE F - PROPERTY, MACHINERY AND EQUIPMENT, NET

Property, machinery and equipment consist of the following at April 30:

		2016		2015
Land and buildings	$	16,220,619	$	15,265,758
Machinery and equipment		57,604,080		56,142,919
Office equipment and software		9,134,187		8,640,964
Leasehold improvements		2,566,250		2,540,693
Equipment under capital leases		8,055,533		6,746,668
		93,580,669		89,337,002
Less accumulated depreciation
and amortization, including
amortization of assets under
capital leases of $1,972,085
and $1,329,661 at April 30,
2016 and 2015, respectively		60,499,811		55,472,475
Property, machinery and
equipment, net
	$	33,080,858	$	33,864,527

Depreciation and amortization expense was $5,119,376 and $4,985,272 for the years ended April 30, 2016 and 2015, respectively.

F-19

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE G - GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

There were no changes in carrying amount of tax deductible goodwill in the amount of $3,222,899 for the fiscal years ended April 30, 2016 and 2015. 

Other Intangible Assets

Intangible assets subject to amortization are summarized as of April 30, 2016 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	11.08		4,690,000		883,540
Backlog	-		22,000		22,000
Trade names	16.08		980,000		191,901
Non-compete agreements	3.08		50,000		27,965
Patents	1.08		400,000		313,349
Total		$	8,912,000	$	4,208,755

Intangible assets subject to amortization are summarized as of April 30, 2015 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	12.08		4,690,000		548,781
Backlog	-		22,000		22,000
Trade names	17.08		980,000		142,905
Non-compete agreements	4.08		50,000		20,825
Patents	2.08		400,000		233,345
Total		$	8,912,000	$	3,737,856

F-20

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE G - GOODWILL AND OTHER INTANGIBLE ASSETS - Continued

Estimated aggregate amortization expense for the Company’s intangible assets, which become fully amortized in 2032, for the remaining fiscal years is as follows:

For the fiscal year ending April 30:
	2017	$	490,010
	2018		435,043
	2019		423,721
	2020		411,406
	2021		403,199
	Thereafter		2,539,866
		$	4,703,245

Amortization expense was $470,899 and $428,610 for the years ended April 30, 2016 and 2015, respectively.

In conjunction with the May 2012 acquisition of Spitfire, an estimate of the fair value of the contingent consideration, $2,320,000, was recorded based on expected operating results through fiscal 2019 and the specific terms of when such consideration would be earned.  Those terms provide for additional consideration to be paid based on a percentage of sales and pre-tax profits over those years in excess of certain minimums.  Payments are made quarterly each year and adjusted after each year-end audit.  The Company made payments totaling $342,162 during fiscal year 2016.  As of April 30, 2016, the Company had not materially changed its estimated aggregate consideration expected to be earned under this arrangement.  Any change in the Company’s estimate is reflected as a change in the contingent consideration liability and as additional charges or credits to selling and administrative expenses.  As of April 30, 2016, the contingent consideration liability was $1,151,081 compared to $1,498,985 at April 30, 2015.

F-21

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE H - LONG-TERM DEBT

Note Payable - Bank

The Company has a senior secured credit facility with Wells Fargo, N.A. with a credit limit up to $30,000,000.  The credit facility is collateralized by substantially all of the domestically located assets of the Company and the Company has pledged 65% of its equity ownership interest in some of its foreign entities.  The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of two and one quarter percent plus one percent (effectively 3.25% at April 30, 2016) or LIBOR plus two and one quarter percent (effectively 2.875% at April 30, 2016).  Interest is paid monthly.  Under the senior secured credit facility, the Company may borrow up to the lesser of (i) $30,000,000 or (ii) an amount equal to a percentage of the eligible receivable borrowing base plus a percentage of the inventory borrowing base (collectively, “Borrowing Base”), which cannot exceed 50% of combined eligible receivables and inventory.  In January 2016, the existing senior credit facility was modified, including increasing the amount available under the Borrowing Base calculation and extending the term of the facility through October 31, 2018.  The bank fee for the modification was $23,333 and is amortized over the term of the credit facility agreement.  As of April 30, 2016, there was a $20,014,069 outstanding balance and $3,630,035 of unused availability under the credit facility agreement compared to a $27,416,793 outstanding balance and $2,583,207 of unused availability at April 30, 2015.  The Company is required to be in compliance with several financial covenants.  At April 30, 2016, the Company was in compliance with its financial covenants.

The Company anticipates that its credit facilities, cash flow from operations and leasing resources are adequate to meet its working capital requirements and capital expenditures for fiscal year 2017 at the Company’s current level of business.  The Company has received forecasts from current customers for increased business that would require additional investments in inventory. To the extent that these forecasts come to fruition, the Company may need to raise capital from other sources of debt or equity.  The Company engaged an investment banker for the purpose of completing a capital raise during fiscal year 2016 and subsequently terminated that agreement.  The Company plans to evaluate alternatives for raising capital in fiscal year 2017.

In addition, in the event the Company desires to expand its operations, its business grows more rapidly than expected, the current economic climate deteriorates, customers delay payments, or the Company desires to consummate an acquisition, additional financing resources may be necessary in the current or future fiscal years.  There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

Capital Lease Obligations

During 2010, the Company entered into various capital lease agreements with Wells Fargo Equipment Finance to purchase equipment totaling $1,376,799.  The terms of the lease agreements extend to July 2016 through October 2016 with monthly installment payments ranging from $3,627 to $13,207 and a fixed interest rate ranging from 4.41% to 4.99%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $106,767 compared to $336,883 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $703,424 compared to $817,324 in fiscal year 2015.

From October 2013 through December 2015, the Company entered into various capital lease agreements with Associated Bank, National Association to purchase equipment totaling $4,176,683.  The terms of the lease agreements extend to September 2018 through November 2020 with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 4.14%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $2,599,820 compared to $2,732,713 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $3,224,661 compared to $2,938,211 in fiscal year 2015.

F-22

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE H - LONG-TERM DEBT - Continued

Capital Lease Obligations - Continued

From April 2014 through July 2015, the Company entered into various capital lease agreements with CIT Finance LLC to purchase equipment totaling $2,512,051.  The terms of the lease agreements extend to March 2019 through July 2020 with monthly installment payments ranging from $1,931 to $12,764 and a fixed interest rate ranging from 5.65% through 6.50%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $1,886,069 compared to $1,577,950 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $2,155,363 compared to $1,661,473 in fiscal year 2015.

Note Payable - Buildings

The Company entered into a mortgage agreement on January 8, 2010, in the amount of $2,500,000, with Wells Fargo, N.A. to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility.  The Wells Fargo, N.A. note historically bore interest at a fixed rate of 6.42% per year and was amortized over a sixty  - month period.  A final payment of approximately $2,000,000 was due on or before January 8, 2015.  On November 24, 2014, the Company refinanced the mortgage agreement with Wells Fargo, N.A.  The note requires the Company to pay monthly principal payments in the amount of $9,500, bears an interest rate of LIBOR plus two and one-quarter percent (effectively 3.00% at April 30, 2016) and is payable over a sixty  - month period.  Final payment of approximately $2,289,500 is due on or before November 8, 2019.  The outstanding balance was $2,688,500 and $2,802,500 at April 30, 2016 and April 30, 2015, respectively.

The Company entered into a mortgage agreement on October 24, 2013, in the amount of $1,275,000, with Wells Fargo, N.A. to finance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The Wells Fargo, N.A. note requires the Company to pay monthly principal payments in the amount of $4,250, bears interest at a fixed rate of 4.5% per year and is payable over a sixty  - month period.  A final payment of approximately $1,030,000 is due on or before October 24, 2018.  The outstanding balance was $1,147,500 and $1,198,500 at April 30, 2016 and April 30, 2015, respectively.

F-23

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE H - LONG-TERM DEBT - Continued

The aggregate amount of debt maturing in each of the following fiscal years and thereafter is as follows:

Fiscal Year	Total
2017	$	165,000
2018		165,000
2019		21,173,569
2020		2,346,500
	$	23,850,069

See Note M - Leases, Page F-30for future maturities under capital lease obligations.

Other Long-Term Liabilities

As of April 30, 2016 and 2015, the Company had recorded $870,542 and $536,209, respectively, for seniority premiums and retirement accounts related to benefits for employees, $800,067 and $467,221 of which, respectively, are for the Company’s foreign subsidiaries.

F-24

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE I - ACCRUED EXPENSES AND WAGES

Accrued expenses consist of the following at April 30:

		2016		2015
Interest	$	61,350	$	74,395
Commissions		80,819		57,681
Professional fees		397,375		304,864
Other		170,922		95,755
	$	710,466	$	532,695

Accrued wages consist of the following at April 30:

		2016		2015
Wages	$	1,706,141	$	1,544,959
Bonuses		920,563		409,549
Foreign wages		1,572,443		1,689,934
Foreign benefits		2,061,835		1,496,409
	$	6,260,982	$	5,140,851

F-25

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE J - INCOME TAX

U.S. and foreign income (loss) before income tax expense for the years ended April 30 are as follows:

		2016		2015
Domestic	$	2,224,802	$	(2,481,049)
Foreign		1,260,394		4,185,510
	$	3,485,196	$	1,704,461

Provision (benefit) for Income Taxes

The income tax provision (benefit) for the years ended April 30 consists of the following:

		2016		2015
Current
Federal	$	279,043	$	2,963
State		29,217		29,613
Foreign		318,800		1,020,820
Total Current		627,060		1,053,396
Deferred
Federal		577,149		(138,335)
State		65,451		(154,208)
Foreign		132,877		40,196
Total Deferred		775,477		(252,347)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

F-26

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE J - INCOME TAX - Continued

Provision (benefit) for Income Taxes - Continued

The difference between the income tax provision (benefit) and the amounts computed by applying the statutory Federal income tax rates to income before tax expense for the years ended April 30 are as follows:

		2016		2015
U.S Federal Provision:
At statutory rate	$	1,184,967	$	579,516
State taxes		117,922		(86,377)
Change in valuation allowance		(46,615)		46,615
Foreign tax differential		(94,124)		(256,343)
Impact of state tax rate change		(8,826)		(42,471)
Foreign valuation allowance		(48,680)		(53,011)
Foreign profit sharing		-		32,912
Foreign dividends		-		643,708
Other		42,850		22,996
Foreign currency exchange gain/loss		311,867		136,299
Impact of foreign permanent items		(20,056)		(123,987)
Foreign inflation adjustment		(36,768)		(98,808)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

F-27

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE J - INCOME TAX - Continued

Deferred Tax Assets and Liabilities

Deferred income taxes reflect the net tax effects of loss and credit carryforwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Significant components of the deferred tax assets for federal and state income taxes are as follows:

		2016		2015
Deferred Tax Assets
Federal & State NOL carryforwards	$	85,288	$	449,325
Research & Other Credits		-		78,100
Reserves and accruals		615,431		795,721
Stock based compensation		244,199		133,744
Inventory		1,074,546		1,154,335
Other intangibles		203,789		207,044
Deferred rent		240,439		263,703
Allowance for doubtful accounts		38,150		72,271
Other DTA		8,902		19,083
Federal Benefit of State		25,228		3,895
Total Gross Deferred Tax Assets		2,535,972		3,177,221
Less: Valuation allowance		-		(95,295)
Net Deferred Tax Assets	$	2,535,972	$	3,081,926
Deferred Tax Liabilities
Other assets	$	(113,665)	$	(272,409)
Property, machinery & equipment		(3,273,902)		(3,180,575)
Prepaids		(270,968)		-
Total Deferred Tax Liabilities	$	(3,658,535)	$	(3,452,984)
Net Deferred Tax Liability	$	(1,122,563)	$	(371,058)

The Company has state net operating loss carry-forwards totaling approximately $1,071,000 at April 30, 2016, that will begin to expire in fiscal year April 30, 2024. The Company recognizes a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. The Company determined it is more likely than not that it will realize the deferred tax assets due to the reversal of deferred tax liabilities. The state deferred tax liabilities exceed the state deferred tax assets and based

F-28

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE J - INCOME TAX - Continued

Deferred Tax Assets and Liabilities-Continued

on the reversing pattern the Company has concluded that all of the state deferred tax liabilities are expected to reverse within the period of time available to fully utilize all state deferred tax assets. Therefore, the Company has concluded that a valuation allowance is not required as of April 30, 2016, related to state net operating loss carryforwards.  The valuation allowance relating to the Company’s Vietnam net operating loss carry-forward was reversed in the current year, as the loss carry-forward was used to reduce current year taxable income in that jurisdiction. 

The Company has not recorded U.S. income taxes on the undistributed earnings of the Company’s foreign subsidiaries. Since the earnings of the foreign subsidiaries have been, and under fiscal April 30, 2016 plans, will continue to be indefinitely reinvested, no deferred tax liability has been recorded. The cumulative amount of unremitted earnings for which U.S. income taxes have not been recorded is $12,588,000 as of April 30, 2016.  The amount of U.S. income taxes on these earnings is impractical to compute due to the complexities of the hypothetical calculation.

Unrecognized Tax Benefits

The Company has not identified any uncertain tax positions or expects any to be taken in the Company’s tax returns.  For the fiscal year ended April 30, 2016 and 2015, the amount of consolidated worldwide liability for uncertain tax positions that impacted the Company’s effective tax rate was $0 for each year.

Other

Interest and penalties related to tax positions taken in the Company’s tax returns are recorded in income tax expense and miscellaneous selling, general and administrative expense, respectively, in the Consolidated Statements of Income.  For the fiscal year ended April 30, 2016 and 2015, the amount included in the Company’s balance sheet for such liabilities was $0 for each year.

The Company is subject to taxation in the U.S. and various state and foreign jurisdictions.  With few exceptions, the Company is no longer subject to state, local or foreign examinations by tax authorities for tax years before fiscal year 2013.  The Internal Revenue Service concluded an audit of the Company’s fiscal year 2013 tax return in the current year, and a no change letter was issued.

NOTE K - 401(k) RETIREMENT SAVINGS PLAN

The Company sponsors 401(k) retirement savings plans, which are available to all non-union U.S. employees.  The Company may elect to match participant contributions up to $300 per participant annually.  The Company contributed $75,448 and $114,207 to the plans during the fiscal years ended April 30, 2016 and 2015, respectively.  The Company incurred total expenses of $13,460 and $8,500 for the fiscal years ended April 30, 2016 and 2015, respectively, relating to costs associated with the administration of the plans.

F-29

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE L - MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of uncollateralized accounts receivable.  For the year ended April 30, 2016, two customers accounted for 35.2% and 10.6% of net sales of the Company, and 6.5% and 2.4%, respectively, of accounts receivable at April 30, 2016.  For the year ended April 30, 2015, two customers accounted for 36.8% and 9.9% of net sales of the Company and 9.6% and 5.5%, respectively, of accounts receivable at April 30, 2015.  Further, the Company has $3,940,197 in cash in China as of April 30, 2016.  These funds are not insured by a guaranteed deposit insurance system.  Effective May 1, 2015, China implemented a deposit insurance program to insure up to approximately $81,000 in deposits, under certain circumstances.

NOTE M - LEASES

The Company leases certain facilities and office space under various operating leases expiring at various dates through March 2021.  The Company also leases various machinery and equipment under capital leases.

Future minimum lease payments under leases with terms of one year or more are as follows:

		Capital		Operating
Years ending April 30,		Leases		Leases
2017	$	1,562,593	$	2,009,228
2018		1,454,538		2,043,424
2019		1,211,612		1,740,801
2020		597,028		1,033,798
2021		173,925		674,506
Total future minimum lease payments	$	4,999,696	$	7,501,757
Less amounts representing interest		407,040
		4,592,656
Less Current Portion		1,374,898
Long Term Portion	$	3,217,758

F-30

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE M - LEASES - Continued

Rent expense incurred under operating leases was $2,258,359 and $2,102,312 for the years ended April 30, 2016 and 2015, respectively.

In September 2010, the Company entered into a real estate lease agreement in Union City, CA, to rent 116,993 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through March 2021.  The amount of the deferred rent income recorded for the fiscal year ended April 30, 2016 was $51,509 compared to $33,950 in fiscal year 2015.  In addition, the landlord provided the Company tenant incentives of $418,000, which are being amortized over the life of the lease.

On May 31, 2012, the Company entered into a lease agreement in Tijuana, MX, to rent 112,000 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through November 2018.  The amount of the deferred rent income for the fiscal year ended April 30, 2016 was $115,837 compared to $8,353 in fiscal year 2015.

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS

The Company has stock option plans (“Option Plans”) under which certain employees and non-employee directors may acquire shares of common stock.  All Option Plans have been approved by the Company’s shareholders.  At April 30, 2016, the Company has 117,914 shares available for future issuance to employees under the employee plans and none are available under the non-employee director plans.  The Option Plans are interpreted and administered by the Compensation Committee of the Board of Directors.  The maximum term of options granted under the Option Plans is generally 10 years.  Options granted under the Option Plans are either incentive stock options or nonqualified options.  Each option under the Option Plans is exercisable for one share of stock.  Options forfeited under the Option Plans are available for reissuance.  Options granted under these plans are granted at an exercise price equal to the fair market value of a share of the Company’s common stock on the date of grant.

The Company granted 25,000 options to employees in fiscal year 2014.  The Company recognized approximately $18,100 in compensation expense in fiscal year 2016 and 2015.  The balance of unrecognized compensation expense at April 30, 2016 was approximately $3,500.

The Company granted 285,000 options to employees in fiscal year 2016.  The Company recognized approximately $556,400 in compensation expense in fiscal year 2016.  The balance of unrecognized compensation expense at April 30, 2016 was approximately $409,300.

F-31

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

The table below summarizes option activity through April 30, 2016:

	Number of			Number of
	securities to be		Weighted-	options
	issued upon		average	exercisable
	exercise of		exercise	at end
	outstanding options		price	of year
Outstanding at April 30, 2014	101,554	$	3.88	48,304
Options exercised during 2015	(13,600)		4.26
Options expired during 2015	(2,000)		4.24
Outstanding at April 30, 2015	85,954		3.81	76,954
Options granted during 2016	285,000		6.45
Options exercised during 2016	(2,000)		3.60
Options expired during 2016	(991)		9.17
Outstanding at April 30, 2016	367,963	$	5.84	172,513

Intrinsic value is calculated as the positive difference between the market price of the Company’s common stock and the exercise price of the underlying options.  During the fiscal years ended April 30, 2016 and 2015, the aggregate intrinsic value of options exercised was $5,100 and $51,520, respectively.  As of April 30, 2016 and 2015, the aggregate intrinsic value of in the money options outstanding was $198,715 and $365,245, respectively.

Information with respect to stock options outstanding at April 30, 2016 follows:

			Options outstanding
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	367,963	7.47 years	$	5.84
		367,963		$	5.84

F-32

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

Information with respect to stock options outstanding and exercisable at April 30, 2016 follows:

		Options outstanding and exercisable
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	172,513	7.47 years	$	5.21
		172,513		$	5.21

Information with respect to stock options non-vested at April 30, 2016 follows:

		Options non-vested
		Number	Weighted-average		Weighted-
		non-vested at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	4.24-6.45	195,450	8.23 years	$	6.40
		195,450		$	6.40

The Company implemented an employee stock purchase plan (“ESPP”), for all eligible employees on February 1, 2014.  Under the ESPP, employees may purchase shares of the Company’s common stock at three-month intervals at 85% of the lower of the fair market value of the Company’s common stock on the first day or the last day of the offering period (calculated in the manner provided in the plan). Employees purchase such stock using payroll deductions, which may not be less than 1% nor exceed 15% of their total gross compensation. Shares of common stock are offered under the ESPP through a series of successive offering periods. The plan imposes certain limitations upon an employee’s right to acquire common stock, including the following: (i) termination of employment for any reason immediately terminates the employee’s participation in the plan (ii) no employee may be granted rights to purchase more than $25,000 worth of common stock for each calendar year that such rights are at any time outstanding, and (iii) the maximum number of shares of common stock purchasable in total by all participants in the ESPP on any purchase date is limited to 500,000 shares. The number of shares of common stock reserved for issuance under the plan automatically increases on the first day of the Company’s fiscal years by 25,000 shares.  There were 9,670 and 18,118 shares issued under the ESPP and the Company recorded $13,728 and $27,747 in compensation expense, for fiscal years ended April 30, 2016 and 2015, respectively.

F-33

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

On October 1, 2014, the Company granted 1,750 shares to each non-employee director pursuant to the 2013 Non-Employee Director Restricted Stock Plan.  A total of 8,750 restricted shares were granted and the shares vest in six months from the date of grant.  The Company recognized $60,200 in compensation expense in fiscal year 2015.  There was no unrecognized compensation expense related to the 8,750 shares of restricted stock at April 30, 2016.

On October 1, 2015, the Company granted 2,000 shares to each non-employee director pursuant to the 2013 Non-Employee Director Restricted Stock Plan.  A total of 10,000 restricted shares were granted and the shares vest in six months from the date of grant.  The Company recognized $69,400 in compensation expense in fiscal year 2016.  There was no unrecognized compensation expense related to the 10,000 shares of restricted stock at April 30, 2016.

On May 1, 2015, the Company sold 74,000 shares of its common stock to three individual investors in a private offering, pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), at $7.00 per share, representing an approximate average of the market price of the Company’s common stock in the public market during the immediately preceding thirty day period.  The transaction resulted in $518,000 of proceeds from the sale of restricted stock.  The stock was unregistered and may be sold only upon registration or the availability of an exemption from registration under the Securities Act.

F-34

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE O - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following is a summary of unaudited quarterly financial data for fiscal year 2016:

		First		Second		Third		Fourth
2016		Quarter		Quarter		Quarter		Quarter
Net sales	$	64,220,946	$	69,723,493	$	59,206,344	$	60,753,363
Gross profit		6,230,274		7,597,013		5,708,096		5,983,148
Income before income		962,323		1,857,036		377,599		288,238
tax expense
Net income		658,806		1,156,298		218,728		48,827
Earnings per share	$	0.16	$	0.28	$	0.05	$	0.01
Basic
Earnings per share	$	0.16	$	0.27	$	0.05	$	0.01
Diluted
Total shares- Basic		4,148,285		4,166,758		4,170,193		4,174,251
Total shares- Diluted		4,193,657		4,214,317		4,229,378		4,208,184

F-35

SigmaTron International, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED

April 30, 2016 and 2015

NOTE O - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) - Continued

The following is a summary of unaudited quarterly financial data for fiscal year 2015:

		First		Second		Third		Fourth
2015		Quarter		Quarter		Quarter		Quarter
Net sales	$	54,947,477	$	61,533,519	$	53,702,613	$	60,053,552
Gross profit		4,746,448		5,813,753		5,695,365		5,813,272
Income before income
tax expense		15,566		723,254		562,123		403,518
Net income		16,810		146,429		564,080		176,093
Earnings per share
Basic	$	0.00	$	0.04	$	0.14	$	0.04
Earnings per share
Diluted	$	0.00	$	0.04	$	0.14	$	0.04
Total shares- Basic		4,028,535		4,044,240		4,054,146		4,061,504
Total shares- Diluted		4,105,627		4,120,178		4,116,015		4,117,600

NOTE P – LITIGATION

On October 25, 2011, Maria Gracia, a former employee of the Company, filed suit against the Company in the U.S. District Court for the Northern District of Illinois under Title VII of the Civil Rights Act, alleging among other things sexual harassment and retaliation.  

In December 2014, a jury found for the Company on the sexual harassment claim but found for the plaintiff on her retaliation claim and awarded her damages totaling $307,000.In post-trial motions, the judge reduced the verdict to $300,000.  Subsequently, on September 17, 2015, the court ruled on plaintiff’s Claim for Equitable Relief, awarding the plaintiff an additional $74,478. Including the equitable relief award, the judgment against the Company is currently $374,478.

On October 16, 2015, the Company appealed the judgment to the Seventh Circuit Court of Appeals.

As of April 30, 2016, the Company has accrued $375,000 in recognition of the current judgment entered against the Company.

F-36

EX-23.1

	Tel:  312-856-9100	330 N. Wabash, Suite 3200
	Fax: 312-856-1379	Chicago, IL 60611
	www.bdo.com

EXHIBIT 23.1

Consent of Independent Registered Public Accounting Firm

SigmaTron International, Inc.

Elk Grove Village, Illinois

We hereby consent to the incorporation by reference in the Registration Statements on Form S­8  (No. 33-80147, 333-166210,333-178478 and 333-207579)  of SigmaTron International, Inc. of our report dated July 29, 2016, relating to the consolidatedfinancial statements, which appear in this Form 10-K.

/s/ BDO USA, LLP

BDO USA, LLP

Chicago,  Illinois

July 29, 2016

BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

BDO is the brand name for the BDO network and for each of the BDO Member Firms.

EX-31.1

                             EXHIBIT 31.1

Certification of Principal Executive Officer of

SigmaTron International, Inc.

Pursuant to Rule 13a-14(a) under the Exchange Act,

as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Gary R. Fairhead, President and Chief Executive Officer of SigmaTron International, Inc., certify that:

1.I have reviewed this Annual Report on Form 10-K of SigmaTron International, Inc.;

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 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 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.

Date:  July 29, 2016

/s/ Gary R. Fairhead

Gary R. Fairhead

President and Chief Executive Officer of

SigmaTron International, Inc.

EX-31.2

EXHIBIT 31.2

Certification of Principal Financial Officer of

SigmaTron International, Inc.

Pursuant to Rule 13a-14(a) under the Exchange Act,

as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Linda K. Frauendorfer, Chief Financial Officer, Secretary and Treasurer of SigmaTron International, Inc., certify that:

1.I have reviewed this Annual Report on Form 10-K of SigmaTron International, Inc.;

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 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 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.

Date:  July 29,  2016

/s/ Linda K. Frauendorfer

Linda K. Frauendorfer

Chief Financial Officer, Secretary and

Treasurer of SigmaTron International, Inc.

EX-32.1

EXHIBIT 32.1

Certification by the Principal Executive Officer of

SigmaTron International, Inc.

Pursuant to Rule 13a-14(b) under the Exchange Act and

Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)

I, Gary R. Fairhead, am President and Chief Executive Officer of SigmaTron International, Inc. (the “Company”).

This certification is being furnished pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Company’s Annual Report on Form 10-K for the year ended April 30, 2016 (the “Report”).

I hereby certify that to the best of my knowledge:

(a)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act (15 U.S.C. 78 m(a) or 78o(d)); and

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

Date:  July 29, 2016

/s/ Gary R. Fairhead

Gary R. Fairhead

President and Chief Executive Officer of

SigmaTron International, Inc.

EX-32.2

EXHIBIT 32.2

Certification by the Principal Financial Officer of

SigmaTron International, Inc.

Pursuant to Rule 13a-14(b) under the Exchange Act and

Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)

I, Linda K. Frauendorfer, am Chief Financial Officer, Secretary and Treasurer of SigmaTron International, Inc. (the “Company”).

This certification is being furnished pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Company’s Annual Report on Form 10-K for the year ended April 30, 2016(the “Report”).

I hereby certify that to the best of my knowledge:

(a)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act (15 U.S.C. 78 m(a) or 78o(d)); and

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

Date:  July 29, 2016

/s/ Linda K. Frauendorfer

Linda K. Frauendorfer

Chief Financial Officer, Secretary and

Treasurer of SigmaTron International, Inc.

XML

Document And Entity Information - USD ($)	12 Months Ended
	Apr. 30, 2016	Jul. 22, 2016	Oct. 31, 2015
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Apr. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY
Trading Symbol	sgma
Entity Registrant Name	SIGMATRON INTERNATIONAL INC
Entity Central Index Key	0000915358
Current Fiscal Year End Date	--04-30
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 24,574,354
Entity Common Stock, Shares Outstanding		4,183,955

XML

Consolidated Balance Sheets - USD ($)	Apr. 30, 2016	Apr. 30, 2015
CURRENT ASSETS
Cash and cash equivalents	$ 4,325,268	$ 2,868,217
Accounts receivable, less allowance for doubtful accounts of $100,000 and $186,844 at April 30, 2016 and 2015, respectively	17,844,228	20,170,723
Inventories	67,649,022	68,669,709
Prepaid expenses and other assets	2,128,128	2,103,367
Refundable income taxes	774,847	81,046
Note receivable	887,531
Other receivables	481,860	486,085
Total current assets	94,090,884	94,379,147
PROPERTY, MACHINERY AND EQUIPMENT, NET	33,080,858	33,864,527
OTHER LONG-TERM ASSETS
Intangible assets	4,703,245	5,174,144
Goodwill	3,222,899	3,222,899
Deferred income taxes	233,057	365,935
Other assets	1,531,315	1,319,901
Total other long-term assets	9,690,516	10,082,879
TOTAL ASSETS	136,862,258	138,326,553
CURRENT LIABILITIES
Trade accounts payable	37,011,786	35,838,275
Accrued expenses	710,466	532,695
Accrued wages	6,260,982	5,140,851
Income taxes payable		141,297
Current portion of long-term debt	165,000	165,000
Current portion of capital lease obligations	1,374,898	1,245,632
Current portion of contingent consideration	275,288	275,288
Current portion of deferred rent	187,889	150,594
Total current liabilities	45,986,309	43,489,632
Long-term debt, less current portion	23,685,069	31,252,793
Capital lease obligations, less current portion	3,217,758	3,401,913
Contingent consideration, less current portion	875,793	1,223,697
Other long-term liabilities	870,542	536,209
Deferred rent, less current portion	795,289	999,929
Deferred income taxes	1,355,620	736,993
Total long-term liabilities	30,800,071	38,151,534
Total liabilities	76,786,380	81,641,166
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 500,000 shares authorized, none issued or outstanding
Common stock, $.01 par value; 12,000,000 shares authorized, 4,183,955 and 4,075,785 shares issued and outstanding at April 30, 2016 and 2015, respectively	41,560	40,703
Capital in excess of par value	22,546,616	21,239,641
Retained earnings	37,487,702	35,405,043
Total stockholders' equity	60,075,878	56,685,387
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 136,862,258	$ 138,326,553

XML

Consolidated Balance Sheets (Parenthetical) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Consolidated Balance Sheets [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 100,000	$ 186,844
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	12,000,000	12,000,000
Common stock, shares issued	4,183,955	4,075,785
Common stock, shares outstanding	4,183,955	4,075,785

XML

Consolidated Statements Of Income - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Consolidated Statements Of Income [Abstract]
Net sales	$ 253,904,146	$ 230,237,161
Cost of products sold	228,385,615	208,168,323
Gross profit	25,518,531	22,068,838
Selling and administrative expenses	21,194,211	19,431,637
Operating income	4,324,320	2,637,201
Other income	(165,864)	(148,583)
Interest expense	1,004,988	1,081,323
Income before income tax expense	3,485,196	1,704,461
Income tax expense	1,402,537	801,049
NET INCOME	$ 2,082,659	$ 903,412
Earnings per common share, Basic	$ 0.50	$ 0.22
Earnings per common share, Diluted	$ 0.49	$ 0.22
Weighted average shares of common stock outstanding - Basic	4,164,815	4,046,988
Weighted average shares of common stock outstanding - Diluted	4,224,030	4,116,424

XML

Consolidated Statements Of Changes In Stockholders' Equity - USD ($)	Preferred Stock [Member]	Common Stock [Member]	Capital In Excess Of Par Value [Member]	Retained Earnings [Member]	Total
Balance at Apr. 30, 2014		$ 40,215	$ 20,864,497	$ 34,501,631	$ 55,406,343
Recognition of stock-based compensation			59,648		59,648
Exercise of stock options		136	57,825		57,961
Issuance and vesting of restricted stock		150	61,796		61,946
Employee stock purchases		202	126,612		126,814
Tax benefit from contingent consideration			69,263		69,263
Net income				903,412	903,412
Balance at Apr. 30, 2015		40,703	21,239,641	35,405,043	56,685,387
Recognition of stock-based compensation			588,245		588,245
Exercise of stock options		20	7,180		7,200
Vesting of restricted stock			69,400		69,400
Sale of restricted stock		740	517,260		518,000
Employee stock purchases		97	52,169		52,266
Tax benefit from contingent consideration			23,972		23,972
Excess tax benefits on stock options			48,749		48,749
Net income				2,082,659	2,082,659
Balance at Apr. 30, 2016		$ 41,560	$ 22,546,616	$ 37,487,702	$ 60,075,878

XML

Consolidated Statements Of Cash Flows - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Cash flows from operating activities
Net income	$ 2,082,659	$ 903,412
Adjustments to reconcile net income to net cash provided by (used in) operating activities
Depreciation	5,119,376	4,985,272
Stock-based compensation	588,245	59,648
Restricted stock expense	69,400	61,946
(Benefit from) provision for doubtful accounts		36,844
Tax benefit from contingent consideration	(23,972)	(69,263)
Deferred income tax expense (benefit)	775,477	(252,347)
Amortization of intangible assets	470,899	428,610
Fair value adjustment of contingent consideration	(5,742)	(106,015)
Loss from disposal or sale of machinery and equipment	23,101	52,615
Changes in assets and liabilities
Accounts receivable	1,438,964	(913,776)
Inventories	1,020,687	(14,941,332)
Prepaid expenses and other assets	(72,334)	(1,082,509)
Income taxes receivable	(693,801)
Income taxes payable	(141,297)	(80,634)
Trade accounts payable	1,173,511	8,697,196
Deferred rent	(167,345)	(25,598)
Accrued expenses and wages	1,472,619	(662,563)
Net cash provided by (used in) operating activities	13,130,447	(2,908,494)
Cash flows from investing activities
Purchases of machinery and equipment	(3,165,083)	(5,506,035)
Disposals of machinery and equipment	115,140	703,646
Net cash used in investing activities	(3,049,943)	(4,802,389)
Cash flows from financing activities
Proceeds from the exercise of common stock options	7,200	57,961
Proceeds from the sale of restricted stock	518,000
Proceeds from Employee stock purchases	52,266	126,814
Proceeds from tax benefit on stock options and awards	48,749
Proceeds under sale leaseback agreements		1,102,317
Payments of contingent consideration	(342,162)	(260,000)
Payments under capital lease and sale leaseback agreements	(1,363,754)	(1,050,850)
Proceeds under building notes payable		834,481
Payments under building notes payable	(165,000)	(157,998)
Borrowings under lines of credit	194,424,157	165,496,222
Payments under lines of credit	(201,826,881)	(161,079,429)
Tax benefit from contingent consideration	23,972	69,263
Net cash (used in) provided by financing activities	(8,623,453)	5,138,781
Change in cash	1,457,051	(2,572,102)
Cash and cash equivalents at beginning of year	2,868,217	5,440,319
Cash and cash equivalents at end of year	4,325,268	2,868,217
Supplementary disclosures of cash flow information
Cash paid for interest	964,537	1,018,419
Cash paid for income taxes	1,634,772	1,159,362
Purchase of machinery and equipment financed under capital leases	1,308,865	1,407,116
Purchase of machinery and equipment financed under sale leaseback agreements		1,102,317
Financing of insurance policy	159,616	$ 146,546
Conversion of accounts receivable into a note receivable	$ 887,531

XML

Description Of The Business

12 Months Ended

Apr. 30, 2016

Description Of The Business [Abstract]

Description Of The Business

NOTE A - DESCRIPTION OF THE BUSINESS

SigmaTron International, Inc., its subsidiaries, foreign enterprises and international procurement office (collectively, the “Company”) operates in one business segment as an independent provider of electronic manufacturing services (“EMS”), which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies.  As of April 30, 2016, the Company provided these manufacturing services through an international network of facilities located in the United States, Mexico, China, Vietnam and Taiwan.  Approximately 15.0% of the total non-current consolidated assets of the Company are located outside of the United States as of April 30, 2016 and 2015, respectively.

XML

Summary Of Significant Accounting Policies

12 Months Ended

Apr. 30, 2016

Summary Of Significant Accounting Policies [Abstract]

Summary Of Significant Accounting Policies

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation Policy

The consolidated financial statements include the accounts and transactions of SigmaTron International, Inc. (“SigmaTron”), its wholly-owned subsidiaries, Standard Components de Mexico, S.A., AbleMex S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd. and SigmaTron International Trading Co., wholly-owned foreign enterprises Suzhou SigmaTron Electronics Co. Ltd., and SigmaTron Electronic Technology Co., Ltd. (collectively, “SigmaTron China”), and its international procurement office, SigmaTron Taiwan.  The functional currency of the Mexican, Vietnamese and Chinese subsidiaries and procurement branch is the U.S. dollar.  Intercompany transactions are eliminated in the consolidated financial statements.  The impact of foreign currency fluctuation for the fiscal year ended April 30, 2016 resulted in a net loss of approximately $59,000 compared to a net foreign currency gain of $40,000 in the prior year.

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  Significant estimates made in preparing the consolidated financial statements include depreciation and amortization periods, the allowance for doubtful accounts, reserves for inventory, lower of cost or market adjustment for inventory, deferred taxes, uncertain tax positions, valuation allowance for deferred taxes and valuation of long-lived assets.  Actual results could materially differ from these estimates.

Cash and Cash Equivalents

Cash and cash equivalents include cash and all highly liquid short-term investments with original maturities within three months of the purchase date.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Accounts Receivable

The majority of the Company’s accounts receivable are due from companies in the consumer electronics, gaming, fitness, industrial electronics, medical/life sciences, semiconductor, telecommunications and appliance industries.  Credit is extended based on evaluation of a customer’s financial condition, and, generally, collateral is not required.  Accounts receivable are due in accordance with agreed upon terms, and are stated at amounts due from customers net of an allowance for doubtful accounts.  Accounts outstanding longer than the contractual payments terms are considered past due.  The Company writes off accounts receivable when they are determined to be uncollectible.

Allowance for Doubtful Accounts

The Company’s allowance for doubtful accounts relates to receivables not expected to be collected from its customers.  This allowance is based on management’s assessment of specific customer balances, considering the age of receivables and financial stability of the customer and a five year average of prior uncollectible amounts.  If there is an adverse change in the financial condition of the Company’s customers, or if actual defaults are higher than provided for, an addition to the allowance may be necessary.

Inventories

Inventories are valued at the lower of cost or market.  Cost is determined by an average cost method and the Company allocates labor and overhead to work-in-process and finished goods.  In the event of an inventory write-down, the Company records expense to state the inventory at lower of cost or market.  The Company establishes inventory reserves for valuation, shrinkage, and excess and obsolete inventory.  The Company records provisions for inventory shrinkage based on historical experience to account for unmeasured usage or loss.  Actual results differing from these estimates could significantly affect the Company’s inventories and cost of products sold.  The Company records provisions for excess and obsolete inventories for the difference between the cost of inventory and its estimated realizable value based on assumptions about future product demand and market conditions.  For convenience, the Company reduces inventory cost through a contra asset rather than through a new cost basis.  Upon a subsequent sale or disposal of the impaired inventory, the corresponding reserve is relieved to ensure the cost basis of the inventory reflects any reductions.  Actual product demand or market conditions could be different than that projected by management.

Property, Machinery and Equipment

Property, machinery and equipment are valued at cost.  The Company provides for depreciation and amortization using the straight-line method over the estimated useful life of the assets:

Buildings	20 years
Machinery and equipment	5-12 years
Office equipment and software	3-5 years
Tools and dies	12 months
Leasehold improvements	lesser of lease term or useful life

Expenses for repairs and maintenance are charged to selling and administrative expenses as incurred.

Deferred Financing Costs

Deferred financing costs consist of costs incurred to obtain the Company’s long-term debt and are amortized using the straight-line method over the term of the related debt.  Deferred financing fees of $113,286 and $147,537 net of

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

accumulated amortization of $443,763 and $390,266, respectively, as of April 30, 2016 and 2015, respectively, are classified in other long-term assets on the Company’s balance sheet.

Income Taxes

The Company’s income tax expense, deferred tax assets and liabilities and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid.  The Company is subject to income taxes in both the U.S. and several foreign jurisdictions.  Significant judgments and estimates by management are required in determining the consolidated income tax expense assessment.

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistent with the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across its global operations.  Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future.  Management is not aware of any such changes that would have a material effect on the Company’s results of operations, cash flows or financial position.

A tax benefit from an uncertain tax position may only be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.

The Company adjusts its tax liabilities when its judgment changes as a result of the evaluation of new information not previously available.  Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from its current estimate of the tax liabilities.  These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Earnings per Share

Basic earnings per share are computed by dividing net income (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period.  The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common stock equivalents such as stock options and restricted stock, had been exercised or vested.  There were 991, anti-dilutive common stock equivalents at April 30, 2015, which have been excluded from the calculation of diluted earnings per share.  There were no anti-dilutive common stock equivalents at April 30, 2016. 

	Twelve Months Ended
	April 30,
	2016		2015
Net income	$	2,082,659	$	903,412
Weighted-average shares
Basic		4,164,815		4,046,988
Effect of dilutive stock options		59,215		69,436
Diluted		4,224,030		4,116,424
Basic earnings per share	$	0.50	$	0.22
Diluted earnings per share	$	0.49	$	0.22

Revenue Recognition

Revenues from sales of the Company's electronic manufacturing services business are recognized when the finished good product is shipped to the customer.  In general, and except for consignment inventory, it is the Company's policy to recognize revenue and related costs when the finished goods have been shipped from its facilities, which is also the same point that title passes under the terms of the purchase order.  Finished goods inventory for certain customers is shipped from the Company to an independent warehouse for storage or shipped directly to the customer and stored in a segregated part of the customer’s own facility.  Upon the customer’s request for finished goods inventory, the inventory is shipped to the customer if the inventory was stored off-site, or transferred from the segregated part of the customer’s facility for consumption or use by the customer.  The Company recognizes revenue upon such shipment or transfer.  The Company does not earn a fee for such arrangements.  The Company from time to time may ship finished goods from its facilities, which is also the same point that title passes under the terms of the purchase order, and invoice the customer at the end of the calendar month.  This is done only in special circumstances to accommodate a specific customer.  Further, from time to time customers request the Company hold finished goods after they have been invoiced to consolidate finished goods for shipping purposes.  The Company generally provides a warranty for workmanship, unless the assembly was designed by the Company, in which case it warrants assembly/design.  The Company does not have any installation, acceptance or sales incentives (although the Company has negotiated longer warranty terms in certain instances).  The Company assembles and tests assemblies based on customers’ specifications.  Historically, the amount of returns for workmanship issues has been de minimis under the Company’s standard or extended warranties.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Shipping and Handling Costs

The Company records shipping and handling costs as selling and administrative expenses.  Customers are typically invoiced for shipping costs and such amounts are included in net sales.  Shipping and handling costs were not material to the financial statements for fiscal years 2016 or 2015.

Fair Value Measurements

Fair value measurements are determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants exclusive of any transaction costs.  The Company utilizes a fair value hierarchy based upon the observability of inputs used in valuation techniques as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, other receivables, accounts payable and accrued expenses which approximate fair value at April 30, 2016 and 2015, due to their short-term nature.  The carrying amounts of the Company’s debt obligations approximate fair value based on future payments discounted at current interest rates for similar obligations or interest rates which fluctuate with the market.

The Company measured the contingent consideration included in the fiscal 2013 Spitfire acquisition under the fair value standard (primarily using level 3 measurement inputs).  The contingent consideration continues to be measured and reported at fair value at each period end.  The Company currently does not have any other non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.

Goodwill

Goodwill represents the purchase price in excess of the fair value of assets acquired in business combinations.  Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Goodwill and other Intangible Assets,” requires the Company to assess goodwill and other indefinite-lived intangible assets for impairment at least annually in the absence of an indicator of possible impairment and immediately upon an indicator of possible impairment.  The Company is permitted the option to first assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the fair value of any reporting unit is less than its corresponding carrying value.  If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of any reporting unit is less than its corresponding carrying value, then the Company is not required to take further action.  However, if the Company concludes otherwise, then it is required to perform a quantitative impairment test, including computing the fair value of the reporting unit and comparing that value to its carrying value.  If the fair value is less than its carrying value, a second step of the test is required to determine if recorded goodwill is impaired.  The Company also has the option to bypass the qualitative assessment for goodwill in any period and proceed directly to performing the quantitative impairment test.  The Company will be able to resume performing the qualitative assessment in any subsequent period.  The Company performed its annual goodwill impairment test as of February 1, 2016 and determined no impairment existed as of that date.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Intangible Assets

Intangible assets are comprised of finite life intangible assets including patents, trade names, backlog, non-compete agreements, and customer relationships.  Finite life intangible assets are amortized on a straight line basis over their estimated useful lives of 5 years for patents, 20 years for trade names, 1 year for backlog and 7 years for non-compete agreements except for customer relationships which are amortized on an accelerated basis over their estimated useful life of 15 years.

Impairment of Long-Lived Assets

The Company reviews long-lived assets, including amortizable intangible assets, for impairment.  Property, machinery and equipment and finite life intangible assets are reviewed whenever events or changes in circumstances occur that indicate possible impairment.  If events or changes in circumstances occur that indicate possible impairment, the Company’s impairment review is based on an undiscounted cash flow analysis at the lowest level at which cash flows of the long-lived assets are largely independent of other groups of its assets and liabilities.  This analysis requires management judgment with respect to changes in technology, the continued success of product lines, and future volume, revenue and expense growth rates.  The Company conducts annual reviews for idle and underutilized equipment, and reviews business plans for possible impairment.  Impairment occurs when the carrying value of the assets exceeds the future undiscounted cash flows expected to be earned by the use of the asset group.  When impairment is indicated, the estimated future cash flows are then discounted to determine the estimated fair value of the asset or asset group and an impairment charge is recorded for the difference between the carrying value and the estimated fair value.  As of April 30, 2016, there were no indicators of possible impairment of long-lived assets.

Stock Incentive Plans

Under the Company’s stock option plans, options to acquire shares of common stock have been made available for grant to certain employees and directors.  Each option granted has an exercise price of not less than 100% of the market value of the common stock on the date of grant.  The contractual life of each option is generally 10 years.  The vesting of the grants varies according to the individual options granted.  The Company measures the cost of employee services received in exchange for an equity award based on the grant date fair value and records that cost over the respective vesting period of the award.

Reclassifications

Certain reclassifications have been made to the previously reported 2015 financial statements to conform to the 2016 presentation.

During the third quarter of fiscal year 2016, the Company began presenting all deferred tax assets and liabilities as noncurrent on its Condensed Consolidated Balance Sheets as discussed further in New Accounting Standards below.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

New Accounting Standards

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers."  ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB deferred the effective date of ASU No. 2014-09 by issuing ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date.”  ASU No. 2015-14 defers the effective date of ASU No. 2014-09 to annual reporting periods beginning after December 15, 2017 , with early adoption permitted but not earlier than the original effective date. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08), which clarifies the implementation guidance

of principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing (ASU 2016-10), which clarifies the identification of performance obligations and licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients (ASU 2016-12), to improve guidance on assessing collectability, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition. The effective date and transition requirements in ASU 2016-08, ASU 2016-10, and ASU 2016-12 are the same as the effective date and transition requirements of ASU 2015-14. The Company has not yet selected a transition method and is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40)”.  The amendments in this ASU provide guidance about management’s responsibility to evaluate

whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures.  An entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued, when applicable).  ASU 2014-15 is effective for reporting periods beginning after December 15, 2016.  Early adoption is permitted. The Company elected early adoption of this ASU and it did not have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015- 03, “Interest — Imputation of Interest (Subtopic 835-30) — Simplifying the Presentation of Debt Issuance Costs.” ASU No. 2015-03 simplifies the presentation of debt issuance costs by requiring that these costs related to a recognized debt liability be presented in the statement of financial condition as a direct reduction from the carrying amount of that liability. ASU No. 2015-03 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period.  ASU No. 2015-03 is required to be applied retrospectively to all periods presented beginning in the year of adoption.  The Company does not expect the impact of adoption of this ASU to have a material impact on its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”.  ASU No. 2015-11 requires an entity that determines the cost of inventory by methods other than last-in, first-out (LIFO) and the retail inventory method (RIM) to measure inventory at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This amendment applies to all inventory that is measured using the average costs or first-in first-out (FIFO) methods. This supersedes prior guidance which allowed entities to measure inventory at the lower of cost or market, where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin.  ASU No. 2015-11 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016.  Prospective application is required.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company does not expect the impact of the adoption of this ASU to have a material impact on the Company’s consolidated financial statements.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

New Accounting Standards - Continued

In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”.  ASU No. 2015-17 requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position.  ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods.  This update may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company elected to early adopt ASU 2015-17 during its third quarter of fiscal year 2016 on a retrospective basis.  Accordingly, it reclassified the current deferred taxes to noncurrent on the April 30, 2015 Consolidated Balance Sheets, which decreased current deferred tax assets by $2,179,178, increased noncurrent deferred tax assets by $365,935 and decreased noncurrent deferred tax liabilities by $1,813,244.  

In February 2016, the FASB issued ASU No. 2016-02, “Leases”. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective

transition approach is required for capital leases and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  While the Company is still evaluating the impact of its pending adoption of the new standard on its

consolidated financial statements, the Company expects that upon adoption it will recognize ROU assets and lease liabilities and that the amounts could be material.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”, a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or benefit in the Consolidated Statement of Income, introducing a new element of volatility to the provision for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after

December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this standards update may have on its consolidated financial statements.

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Allowance For Doubtful Accounts

12 Months Ended

Apr. 30, 2016

Allowance For Doubtful Accounts [Abstract]

Allowance For Doubtful Accounts

NOTE C - ALLOWANCE FOR DOUBTFUL ACCOUNTS

Changes in the Company’s allowance for doubtful accounts are as follows:

		2016		2015
Beginning Balance	$	186,844	$	150,000
Bad debt expense		-		36,844
Write-offs		(86,844)		-
	$	100,000	$	186,844

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Inventories

12 Months Ended

Apr. 30, 2016

Inventories [Abstract]

Inventories

NOTE D - INVENTORIES

Inventories consist of the following at April 30:

	2016		2015
Finished products	$	23,295,138	$	24,316,404
Work-in-process		3,035,459		2,966,846
Raw materials		42,530,957		42,662,845
		68,861,554		69,946,095
Less obsolescence reserve		1,212,532		1,276,386
	$	67,649,022	$	68,669,709

Changes in the Company’s inventory obsolescence reserve are as follows:

	2016		2015
Beginning balance	$	1,276,386	$	1,804,984
Write-offs		(63,854)		(528,598)
	$	1,212,532	$	1,276,386

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Related Parties

12 Months Ended

Apr. 30, 2016

Related Parties [Abstract]

Related Parties

NOTE E - RELATED PARTIES

In March, 2015, two of the Company’s executive officers invested in a start-up customer.  The executive officers’ investments constitute less than 2% (individually and in aggregate) of the outstanding beneficial ownership of the customer, according to information provided by the customer to the executive officers.  As of April 30, 2016, the Company had an outstanding note receivable and account receivable from that customer of approximately $888,000 and $233,000, respectively.  Inventory on hand related to this customer of approximately $1,600,000.  Sales to this customer, have not been material for the fiscal year ended April 30, 2016.

On January 29, 2016, the Company entered into a memorandum of understanding with this customer.  Under the subsequent agreement, effective January 29, 2016, the account receivable of approximately $888,000 was converted into a short-term promissory note.  The promissory note bears interest at the rate of 8% per annum, payable at the maturity of the promissory note.  The promissory note matures at the earlier of October 31, 2016, within 10 days after the customer obtains certain equity financing, or at the closing of a sale of substantially all of the customer’s stock or assets.  As additional consideration, the Company received warrants under the agreement.  The warrants are ten years in duration and may be exercised at an exercise price of $0.01 per share and for a number of shares determined pursuant to the warrant, expected to be, at a minimum, approximately 1% of the customer’s then – outstanding equity securities.  The Company believes the warrants have nil value.  Further, the Company has been granted a security interest in the customer’s accounts receivable and authority to access and be a signatory on the customer’s deposit accounts.

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Property, Machinery And Equipment, Net

12 Months Ended

Apr. 30, 2016

Property, Machinery And Equipment, Net [Abstract]

Property, Machinery And Equipment, Net

NOTE F - PROPERTY, MACHINERY AND EQUIPMENT, NET

Property, machinery and equipment consist of the following at April 30:

		2016		2015
Land and buildings	$	16,220,619	$	15,265,758
Machinery and equipment		57,604,080		56,142,919
Office equipment and software		9,134,187		8,640,964
Leasehold improvements		2,566,250		2,540,693
Equipment under capital leases		8,055,533		6,746,668
		93,580,669		89,337,002
Less accumulated depreciation
and amortization, including
amortization of assets under
capital leases of $1,972,085
and $1,329,661 at April 30,
2016 and 2015, respectively		60,499,811		55,472,475
Property, machinery and
equipment, net
	$	33,080,858	$	33,864,527

Depreciation and amortization expense was $5,119,376 and $4,985,272 for the years ended April 30, 2016 and 2015, respectively.

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Goodwill And Other Intangible Assets

12 Months Ended

Apr. 30, 2016

Goodwill And Other Intangible Assets [Abstract]

Goodwill And Other Intangible Assets

NOTE G - GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

There were no changes in carrying amount of tax deductible goodwill in the amount of $3,222,899 for the fiscal years ended April 30, 2016 and 2015. 

Other Intangible Assets

Intangible assets subject to amortization are summarized as of April 30, 2016 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	11.08		4,690,000		883,540
Backlog	-		22,000		22,000
Trade names	16.08		980,000		191,901
Non-compete agreements	3.08		50,000		27,965
Patents	1.08		400,000		313,349
Total		$	8,912,000	$	4,208,755

Intangible assets subject to amortization are summarized as of April 30, 2015 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	12.08		4,690,000		548,781
Backlog	-		22,000		22,000
Trade names	17.08		980,000		142,905
Non-compete agreements	4.08		50,000		20,825
Patents	2.08		400,000		233,345
Total		$	8,912,000	$	3,737,856

NOTE G - GOODWILL AND OTHER INTANGIBLE ASSETS - Continued

Estimated aggregate amortization expense for the Company’s intangible assets, which become fully amortized in 2032, for the remaining fiscal years is as follows:

For the fiscal year ending April 30:
	2017	$	490,010
	2018		435,043
	2019		423,721
	2020		411,406
	2021		403,199
	Thereafter		2,539,866
		$	4,703,245

Amortization expense was $470,899 and $428,610 for the years ended April 30, 2016 and 2015, respectively.

In conjunction with the May 2012 acquisition of Spitfire, an estimate of the fair value of the contingent consideration, $2,320,000, was recorded based on expected operating results through fiscal 2019 and the specific terms of when such consideration would be earned.  Those terms provide for additional consideration to be paid based on a percentage of sales and pre-tax profits over those years in excess of certain minimums.  Payments are made quarterly each year and adjusted after each year-end audit.  The Company made payments totaling $342,162 during fiscal year 2016.  As of April 30, 2016, the Company had not materially changed its estimated aggregate consideration expected to be earned under this arrangement.  Any change in the Company’s estimate is reflected as a change in the contingent consideration liability and as additional charges or credits to selling and administrative expenses.  As of April 30, 2016, the contingent consideration liability was $1,151,081 compared to $1,498,985at April 30, 2015.

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Long-Term Debt

12 Months Ended

Apr. 30, 2016

Long-Term Debt [Abstract]

Long-Term Debt

NOTE H - LONG-TERM DEBT

Note Payable - Bank

The Company has a senior secured credit facility with Wells Fargo, N.A. with a credit limit up to $30,000,000.  The credit facility is collateralized by substantially all of the domestically located assets of the Company and the Company has pledged 65% of its equity ownership interest in some of its foreign entities.  The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of two and one quarter percent plus one percent (effectively 3.25% at April 30, 2016) or LIBOR plus two and one quarter percent (effectively 2.875% at April 30, 2016).  Interest is paid monthly.  Under the senior secured credit facility, the Company may borrow up to the lesser of (i) $30,000,000 or (ii) an amount equal to a percentage of the eligible receivable borrowing base plus a percentage of the inventory borrowing base (collectively, “Borrowing Base”), which cannot exceed 50% of combined eligible receivables and inventory.  In January 2016, the existing senior credit facility was modified, including increasing the amount available under the Borrowing Base calculation and extending the term of the facility through October 31, 2018.  The bank fee for the modification was $23,333 and is amortized over the term of the credit facility agreement.  As of April 30, 2016, there was a $20,014,069 outstanding balance and $3,630,035 of unused availability under the credit facility agreement compared to a $27,416,793 outstanding balance and $2,583,207 of unused availability at April 30, 2015.  The Company is required to be in compliance with several financial covenants.  At April 30, 2016, the Company was in compliance with its financial covenants.

The Company anticipates that its credit facilities, cash flow from operations and leasing resources are adequate to meet its working capital requirements and capital expenditures for fiscal year 2017 at the Company’s current level of business.  The Company has received forecasts from current customers for increased business that would require additional investments in inventory. To the extent that these forecasts come to fruition, the Company may need to raise capital from other sources of debt or equity.  The Company engaged an investment banker for the purpose of completing a capital raise during fiscal year 2016 and subsequently terminated that agreement.  The Company plans to evaluate alternatives for raising capital in fiscal year 2017.

In addition, in the event the Company desires to expand its operations, its business grows more rapidly than expected, the current economic climate deteriorates, customers delay payments, or the Company desires to consummate an acquisition, additional financing resources may be necessary in the current or future fiscal years.  There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

Capital Lease Obligations

During 2010, the Company entered into various capital lease agreements with Wells Fargo Equipment Finance to purchase equipment totaling $1,376,799.  The terms of the lease agreements extend to July 2016 through October 2016 with monthly installment payments ranging from $3,627 to $13,207 and a fixed interest rate ranging from 4.41% to 4.99%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $106,767 compared to $336,883 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $703,424 compared to $817,324 in fiscal year 2015.

From October 2013 through December 2015, the Company entered into various capital lease agreements with Associated Bank, National Association to purchase equipment totaling $4,176,683.  The terms of the lease agreements extend to September 2018 through November 2020 with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 4.14%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $2,599,820 compared to $2,732,713 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $3,224,661 compared to $2,938,211 in fiscal year 2015.

NOTE H - LONG-TERM DEBT - Continued

Capital Lease Obligations - Continued

From April 2014 through July 2015, the Company entered into various capital lease agreements with CIT Finance LLC to purchase equipment totaling $2,512,051.  The terms of the lease agreements extend to March 2019 through July 2020 with monthly installment payments ranging from $1,931 to $12,764 and a fixed interest rate ranging from 5.65% through 6.50%.  At April 30, 2016, the balance outstanding under these capital lease agreements was $1,886,069 compared to $1,577,950 in fiscal year 2015.  The net book value of the equipment under these leases at April 30, 2016 was $2,155,363 compared to $1,661,473 in fiscal year 2015.

Note Payable - Buildings

The Company entered into a mortgage agreement on January 8, 2010, in the amount of $2,500,000, with Wells Fargo, N.A. to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility.  The Wells Fargo, N.A. note historically bore interest at a fixed rate of 6.42% per year and was amortized over a sixty - month period.  A final payment of approximately $2,000,000 was due on or before January 8, 2015.  On November 24, 2014, the Company refinanced the mortgage agreement with Wells Fargo, N.A.  The note requires the Company to pay monthly principal payments in the amount of $9,500, bears an interest rate of LIBOR plus two and one-quarter percent (effectively 3.00% at April 30, 2016) and is payable over a sixty - month period.  Final payment of approximately $2,289,500 is due on or before November 8, 2019.  The outstanding balance was $2,688,500 and $2,802,500 at April 30, 2016 and April 30, 2015, respectively.

The Company entered into a mortgage agreement on October 24, 2013, in the amount of $1,275,000, with Wells Fargo, N.A. to finance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The Wells Fargo, N.A. note requires the Company to pay monthly principal payments in the amount of $4,250, bears interest at a fixed rate of 4.5% per year and is payable over a sixty - month period.  A final payment of approximately $1,030,000 is due on or before October 24, 2018.  The outstanding balance was $1,147,500 and $1,198,500 at April 30, 2016 and April 30, 2015, respectively.

NOTE H - LONG-TERM DEBT - Continued

The aggregate amount of debt maturing in each of the following fiscal years and thereafter is as follows:

Fiscal Year	Total
2017	$	165,000
2018		165,000
2019		21,173,569
2020		2,346,500
	$	23,850,069

See Note M - Leases, Page F-30 for future maturities under capital lease obligations.

Other Long-Term Liabilities

As of April 30, 2016 and 2015, the Company had recorded $870,542 and $536,209, respectively, for seniority premiums and retirement accounts related to benefits for employees,$800,067 and $467,221 of which, respectively, are for the Company’s foreign subsidiaries.

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Accrued Expenses And Wages

12 Months Ended

Apr. 30, 2016

Accrued Expenses And Wages [Abstract]

Accrued Expenses And Wages

NOTE I - ACCRUED EXPENSES AND WAGES

Accrued expenses consist of the following at April 30:

		2016		2015
Interest	$	61,350	$	74,395
Commissions		80,819		57,681
Professional fees		397,375		304,864
Other		170,922		95,755
	$	710,466	$	532,695

Accrued wages consist of the following at April 30:

		2016		2015
Wages	$	1,706,141	$	1,544,959
Bonuses		920,563		409,549
Foreign wages		1,572,443		1,689,934
Foreign benefits		2,061,835		1,496,409
	$	6,260,982	$	5,140,851

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Income Tax

12 Months Ended

Apr. 30, 2016

Income Tax [Abstract]

Income Tax

NOTE J - INCOME TAX

U.S. and foreign income (loss) before income tax expense for the years ended April 30 are as follows:

		2016		2015
Domestic	$	2,224,802	$	(2,481,049)
Foreign		1,260,394		4,185,510
	$	3,485,196	$	1,704,461

Provision (benefit) for Income Taxes

The income tax provision (benefit) for the years ended April 30 consists of the following:

		2016		2015
Current
Federal	$	279,043	$	2,963
State		29,217		29,613
Foreign		318,800		1,020,820
Total Current		627,060		1,053,396
Deferred
Federal		577,149		(138,335)
State		65,451		(154,208)
Foreign		132,877		40,196
Total Deferred		775,477		(252,347)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

NOTE J - INCOME TAX - Continued

Provision (benefit) for Income Taxes - Continued

The difference between the income tax provision (benefit) and the amounts computed by applying the statutory Federal income tax rates to income before tax expense for the years ended April 30 are as follows:

		2016		2015
U.S Federal Provision:
At statutory rate	$	1,184,967	$	579,516
State taxes		117,922		(86,377)
Change in valuation allowance		(46,615)		46,615
Foreign tax differential		(94,124)		(256,343)
Impact of state tax rate change		(8,826)		(42,471)
Foreign valuation allowance		(48,680)		(53,011)
Foreign profit sharing		-		32,912
Foreign dividends		-		643,708
Other		42,850		22,996
Foreign currency exchange gain/loss		311,867		136,299
Impact of foreign permanent items		(20,056)		(123,987)
Foreign inflation adjustment		(36,768)		(98,808)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

NOTE J - INCOME TAX - Continued

Deferred Tax Assets and Liabilities

Deferred income taxes reflect the net tax effects of loss and credit carryforwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Significant components of the deferred tax assets for federal and state income taxes are as follows:

		2016		2015
Deferred Tax Assets
Federal & State NOL carryforwards	$	85,288	$	449,325
Research & Other Credits		-		78,100
Reserves and accruals		615,431		795,721
Stock based compensation		244,199		133,744
Inventory		1,074,546		1,154,335
Other intangibles		203,789		207,044
Deferred rent		240,439		263,703
Allowance for doubtful accounts		38,150		72,271
Other DTA		8,902		19,083
Federal Benefit of State		25,228		3,895
Total Gross Deferred Tax Assets		2,535,972		3,177,221
Less: Valuation allowance		-		(95,295)
Net Deferred Tax Assets	$	2,535,972	$	3,081,926
Deferred Tax Liabilities
Other assets	$	(113,665)	$	(272,409)
Property, machinery & equipment		(3,273,902)		(3,180,575)
Prepaids		(270,968)		-
Total Deferred Tax Liabilities	$	(3,658,535)	$	(3,452,984)
Net Deferred Tax Liability	$	(1,122,563)	$	(371,058)

The Company has state net operating loss carry-forwards totaling approximately $1,071,000 at April 30, 2016, that will begin to expire in fiscal year April 30, 2024. The Company recognizes a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. The Company determined it is more likely than not that it will realize the deferred tax assets due to the reversal of deferred tax liabilities. The state deferred tax liabilities exceed the state deferred tax assets and based

NOTE J - INCOME TAX - Continued

Deferred Tax Assets and Liabilities-Continued

on the reversing pattern the Company has concluded that all of the state deferred tax liabilities are expected to reverse within the period of time available to fully utilize all state deferred tax assets. Therefore, the Company has concluded that a valuation allowance is not required as of April 30, 2016, related to state net operating loss carryforwards.  The valuation allowance relating to the Company’s Vietnam net operating loss carry-forward was reversed in the current year, as the loss carry-forward was used to reduce current year taxable income in that jurisdiction. 

The Company has not recorded U.S. income taxes on the undistributed earnings of the Company’s foreign subsidiaries. Since the earnings of the foreign subsidiaries have been, and under fiscal April 30, 2016 plans, will continue to be indefinitely reinvested, no deferred tax liability has been recorded. The cumulative amount of unremitted earnings for which U.S. income taxes have not been recorded is $12,588,000 as of April 30, 2016.  The amount of U.S. income taxes on these earnings is impractical to compute due to the complexities of the hypothetical calculation.

Unrecognized Tax Benefits

The Company has not identified any uncertain tax positions or expects any to be taken in the Company’s tax returns.  For the fiscal year ended April 30, 2016 and 2015, the amount of consolidated worldwide liability for uncertain tax positions that impacted the Company’s effective tax rate was $0 for each year.

Other

Interest and penalties related to tax positions taken in the Company’s tax returns are recorded in income tax expense and miscellaneous selling, general and administrative expense, respectively, in the Consolidated Statements of Income.  For the fiscal year ended April 30, 2016 and 2015, the amount included in the Company’s balance sheet for such liabilities was $0 for each year. 

The Company is subject to taxation in the U.S. and various state and foreign jurisdictions.  With few exceptions, the Company is no longer subject to state, local or foreign examinations by tax authorities for tax years before fiscal year 2013.  The Internal Revenue Service concluded an audit of the Company’s fiscal year 2013 tax return in the current year, and a no change letter was issued.

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401(k) Retirement Savings Plan

12 Months Ended

Apr. 30, 2016

401(k) Retirement Savings Plan [Abstract]

401(k) Retirement Savings Plan

NOTE K - 401(k) RETIREMENT SAVINGS PLAN

The Company sponsors 401(k) retirement savings plans, which are available to all non-union U.S. employees.  The Company may elect to match participant contributions up to $300 per participant annually.  The Company contributed$75,448 and $114,207 to the plans during the fiscal years ended April 30, 2016 and 2015, respectively.  The Company incurred total expenses of $13,460 and $8,500 for the fiscal years ended April 30, 2016 and 2015, respectively, relating to costs associated with the administration of the plans.

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Major Customers And Concentration Of Credit Risk

12 Months Ended

Apr. 30, 2016

Major Customers And Concentration Of Credit Risk [Abstract]

Major Customers And Concentration Of Credit Risk

NOTE L - MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of uncollateralized accounts receivable.  For the year ended April 30, 2016, two customers accounted for 35.2% and 10.6% of net sales of the Company, and 6.5% and 2.4%, respectively, of accounts receivable at April 30, 2016.  For the year ended April 30, 2015, two customers accounted for 36.8% and 9.9% of net sales of the Company and 9.6% and 5.5%, respectively, of accounts receivable at April 30, 2015.  Further, the Company has $3,940,197 in cash in China as of April 30, 2016.  These funds are not insured by a guaranteed deposit insurance system.  Effective May 1, 2015, China implemented a deposit insurance program to insure up to approximately $81,000 in deposits, under certain circumstances.

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Leases

12 Months Ended

Apr. 30, 2016

Leases [Abstract]

Leases

NOTE M - LEASES

The Company leases certain facilities and office space under various operating leases expiring at various dates through March 2021.  The Company also leases various machinery and equipment under capital leases.

Future minimum lease payments under leases with terms of one year or more are as follows:

		Capital		Operating
Years ending April 30,		Leases		Leases
2017	$	1,562,593	$	2,009,228
2018		1,454,538		2,043,424
2019		1,211,612		1,740,801
2020		597,028		1,033,798
2021		173,925		674,506
Total future minimum lease payments	$	4,999,696	$	7,501,757
Less amounts representing interest		407,040
		4,592,656
Less Current Portion		1,374,898
Long Term Portion	$	3,217,758

NOTE M - LEASES - Continued

Rent expense incurred under operating leases was $2,258,359 and $2,102,312 for the years ended April 30, 2016 and 2015, respectively.

In September 2010, the Company entered into a real estate lease agreement in Union City, CA, to rent 116,993 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through March 2021.  The amount of the deferred rent income recorded for the fiscal year ended April 30, 2016 was $51,509 compared to $33,950 in fiscal year 2015.  In addition, the landlord provided the Company tenant incentives of $418,000, which are being amortized over the life of the lease.

On May 31, 2012, the Company entered into a lease agreement in Tijuana, MX, to rent 112,000 square feet of manufacturing and office space.  Under the terms of the lease agreement, the Company receives incentives over the life of the lease, which extends through November 2018.  The amount of the deferred rent income for the fiscal year ended April 30, 2016 was $115,837 compared to $8,353 in fiscal year 2015.

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Stock Compensation And Equity Transactions

12 Months Ended

Apr. 30, 2016

Stock Compensation And Equity Transactions [Abstract]

Stock Compensation And Equity Transactions

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS

The Company has stock option plans (“Option Plans”) under which certain employees and non-employee directors may acquire shares of common stock.  All Option Plans have been approved by the Company’s shareholders.  At April 30, 2016, the Company has 117,914 shares available for future issuance to employees under the employee plans and none are available under the non-employee director plans.  The Option Plans are interpreted and administered by the Compensation Committee of the Board of Directors.  The maximum term of options granted under the Option Plans is generally 10 years.  Options granted under the Option Plans are either incentive stock options or nonqualified options.  Each option under the Option Plans is exercisable for one share of stock.  Options forfeited under the Option Plans are available for reissuance.  Options granted under these plans are granted at an exercise price equal to the fair market value of a share of the Company’s common stock on the date of grant.

The Company granted 25,000 options to employees in fiscal year 2014.  The Company recognized approximately $18,100 in compensation expense in fiscal year 2016 and 2015.  The balance of unrecognized compensation expense at April 30, 2016 was approximately $3,500.

The Company granted 285,000 options to employees in fiscal year 2016.  The Company recognized approximately $556,400 in compensation expense in fiscal year 2016.  The balance of unrecognized compensation expense at April 30, 2016 was approximately $409,300.

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

The table below summarizes option activity through April 30, 2016:

	Number of			Number of
	securities to be		Weighted-	options
	issued upon		average	exercisable
	exercise of		exercise	at end
	outstanding options		price	of year
Outstanding at April 30, 2014	101,554	$	3.88	48,304
Options exercised during 2015	(13,600)		4.26
Options expired during 2015	(2,000)		4.24
Outstanding at April 30, 2015	85,954		3.81	76,954
Options granted during 2016	285,000		6.45
Options exercised during 2016	(2,000)		3.60
Options expired during 2016	(991)		9.17
Outstanding at April 30, 2016	367,963	$	5.84	172,513

Intrinsic value is calculated as the positive difference between the market price of the Company’s common stock and the exercise price of the underlying options.  During the fiscal years ended April 30, 2016 and 2015, the aggregate intrinsic value of options exercised was $5,100 and $51,520, respectively.  As of April 30, 2016 and 2015, the aggregate intrinsic value of in the money options outstanding was $198,715 and $365,245, respectively.

Information with respect to stock options outstanding at April 30, 2016 follows:

			Options outstanding
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	367,963	7.47 years	$	5.84
		367,963		$	5.84

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

Information with respect to stock options outstanding and exercisable at April 30, 2016 follows:

		Options outstanding and exercisable
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	172,513	7.47 years	$	5.21
		172,513		$	5.21

Information with respect to stock options non-vested at April 30, 2016 follows:

		Options non-vested
		Number	Weighted-average		Weighted-
		non-vested at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	4.24-6.45	195,450	8.23 years	$	6.40
		195,450		$	6.40

The Company implemented an employee stock purchase plan (“ESPP”), for all eligible employees on February 1, 2014.  Under the ESPP, employees may purchase shares of the Company’s common stock at three-month intervals at 85% of the lower of the fair market value of the Company’s common stock on the first day or the last day of the offering period (calculated in the manner provided in the plan). Employees purchase such stock using payroll deductions, which may not be less than 1% nor exceed 15% of their total gross compensation. Shares of common stock are offered under the ESPP through a series of successive offering periods. The plan imposes certain limitations upon an employee’s right to acquire common stock, including the following: (i) termination of employment for any reason immediately terminates the employee’s participation in the plan (ii) no employee may be granted rights to purchase more than $25,000 worth of common stock for each calendar year that such rights are at any time outstanding, and (iii) the maximum number of shares of common stock purchasable in total by all participants in the ESPP on any purchase date is limited to 500,000 shares. The number of shares of common stock reserved for issuance under the plan automatically increases on the first day of the Company’s fiscal years by 25,000 shares.  There were 9,670 and 18,118 shares issued under the ESPP and the Company recorded $13,728 and $27,747 in compensation expense, for fiscal years ended April 30, 2016 and 2015, respectively.

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

On October 1, 2014, the Company granted 1,750 shares to each non-employee director pursuant to the 2013 Non-Employee Director Restricted Stock Plan.  A total of 8,750 restricted shares were granted and the shares vest in six months from the date of grant.  The Company recognized $60,200 in compensation expense in fiscal year 2015.  There was no unrecognized compensation expense related to the 8,750 shares of restricted stock at April 30, 2016.

On October 1, 2015, the Company granted 2,000 shares to each non-employee director pursuant to the 2013 Non-Employee Director Restricted Stock Plan.  A total of 10,000 restricted shares were granted and the shares vest in six months from the date of grant.  The Company recognized $69,400 in compensation expense in fiscal year 2016.  There was no unrecognized compensation expense related to the 10,000 shares of restricted stock at April 30, 2016.

On May 1, 2015, the Company sold 74,000 shares of its common stock to three individual investors in a private offering, pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), at $7.00 per share, representing an approximate average of the market price of the Company’s common stock in the public market during the immediately preceding thirty day period.  The transaction resulted in $518,000 of proceeds from the sale of restricted stock.  The stock was unregistered and may be sold only upon registration or the availability of an exemption from registration under the Securities Act.

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Selected Quarterly Financial Data (Unaudited)

12 Months Ended

Apr. 30, 2016

Selected Quarterly Financial Data (Unaudited) [Abstract]

Selected Quarterly Financial Data (Unaudited)

NOTE O - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following is a summary of unaudited quarterly financial data for fiscal year 2016:

		First		Second		Third		Fourth
2016		Quarter		Quarter		Quarter		Quarter
Net sales	$	64,220,946	$	69,723,493	$	59,206,344	$	60,753,363
Gross profit		6,230,274		7,597,013		5,708,096		5,983,148
Income before income		962,323		1,857,036		377,599		288,238
tax expense
Net income		658,806		1,156,298		218,728		48,827
Earnings per share	$	0.16	$	0.28	$	0.05	$	0.01
Basic
Earnings per share	$	0.16	$	0.27	$	0.05	$	0.01
Diluted
Total shares- Basic		4,148,285		4,166,758		4,170,193		4,174,251
Total shares- Diluted		4,193,657		4,214,317		4,229,378		4,208,184

NOTE O - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) - Continued

The following is a summary of unaudited quarterly financial data for fiscal year 2015:

		First		Second		Third		Fourth
2015		Quarter		Quarter		Quarter		Quarter
Net sales	$	54,947,477	$	61,533,519	$	53,702,613	$	60,053,552
Gross profit		4,746,448		5,813,753		5,695,365		5,813,272
Income before income
tax expense		15,566		723,254		562,123		403,518
Net income		16,810		146,429		564,080		176,093
Earnings per share
Basic	$	0.00	$	0.04	$	0.14	$	0.04
Earnings per share
Diluted	$	0.00	$	0.04	$	0.14	$	0.04
Total shares- Basic		4,028,535		4,044,240		4,054,146		4,061,504
Total shares- Diluted		4,105,627		4,120,178		4,116,015		4,117,600

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Litigation

12 Months Ended

Apr. 30, 2016

Litigation [Abstract]

Litigation

NOTE P – LITIGATION

On October 25, 2011, Maria Gracia, a former employee of the Company, filed suit against the Company in the U.S. District Court for the Northern District of Illinois under Title VII of the Civil Rights Act, alleging among other things sexual harassment and retaliation.  

In December 2014, a jury found for the Company on the sexual harassment claim but found for the plaintiff on her retaliation claim and awarded her damages totaling $307,000.  In post-trial motions, the judge reduced the verdict to $300,000.  Subsequently, on September 17, 2015, the court ruled on plaintiff’s Claim for Equitable Relief, awarding the plaintiff an additional $74,478.  Including the equitable relief award, the judgment against the Company is currently $374,478.

On October 16, 2015, the Company appealed the judgment to the Seventh Circuit Court of Appeals.

As of April 30, 2016, the Company has accrued $375,000 in recognition of the current judgment entered against the Company.

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Summary Of Significant Accounting Policies (Policies)

12 Months Ended

Apr. 30, 2016

Summary Of Significant Accounting Policies [Abstract]

Consolidation Policy

Consolidation Policy

The consolidated financial statements include the accounts and transactions of SigmaTron International, Inc. (“SigmaTron”), its wholly-owned subsidiaries, Standard Components de Mexico, S.A., AbleMex S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd. and SigmaTron International Trading Co., wholly-owned foreign enterprises Suzhou SigmaTron Electronics Co. Ltd., and SigmaTron Electronic Technology Co., Ltd. (collectively, “SigmaTron China”), and its international procurement office, SigmaTron Taiwan.  The functional currency of the Mexican, Vietnamese and Chinese subsidiaries and procurement branch is the U.S. dollar.  Intercompany transactions are eliminated in the consolidated financial statements.  The impact of foreign currency fluctuation for the fiscal year ended April 30, 2016 resulted in a net loss of approximately $59,000 compared to a net foreign currency gain of $40,000 in the prior year.

Use Of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  Significant estimates made in preparing the consolidated financial statements include depreciation and amortization periods, the allowance for doubtful accounts, reserves for inventory, lower of cost or market adjustment for inventory, deferred taxes, uncertain tax positions, valuation allowance for deferred taxes and valuation of long-lived assets.  Actual results could materially differ from these estimates.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include cash and all highly liquid short-term investments with original maturities within three months of the purchase date.

Accounts Receivable

Accounts Receivable

The majority of the Company’s accounts receivable are due from companies in the consumer electronics, gaming, fitness, industrial electronics, medical/life sciences, semiconductor, telecommunications and appliance industries.  Credit is extended based on evaluation of a customer’s financial condition, and, generally, collateral is not required.  Accounts receivable are due in accordance with agreed upon terms, and are stated at amounts due from customers net of an allowance for doubtful accounts.  Accounts outstanding longer than the contractual payments terms are considered past due.  The Company writes off accounts receivable when they are determined to be uncollectible.

Allowance For Doubtful Accounts

Allowance for Doubtful Accounts

The Company’s allowance for doubtful accounts relates to receivables not expected to be collected from its customers.  This allowance is based on management’s assessment of specific customer balances, considering the age of receivables and financial stability of the customer and a five year average of prior uncollectible amounts.  If there is an adverse change in the financial condition of the Company’s customers, or if actual defaults are higher than provided for, an addition to the allowance may be necessary.

Inventories

Inventories

Inventories are valued at the lower of cost or market.  Cost is determined by an average cost method and the Company allocates labor and overhead to work-in-process and finished goods.  In the event of an inventory write-down, the Company records expense to state the inventory at lower of cost or market.  The Company establishes inventory reserves for valuation, shrinkage, and excess and obsolete inventory.  The Company records provisions for inventory shrinkage based on historical experience to account for unmeasured usage or loss.  Actual results differing from these estimates could significantly affect the Company’s inventories and cost of products sold.  The Company records provisions for excess and obsolete inventories for the difference between the cost of inventory and its estimated realizable value based on assumptions about future product demand and market conditions.  For convenience, the Company reduces inventory cost through a contra asset rather than through a new cost basis.  Upon a subsequent sale or disposal of the impaired inventory, the corresponding reserve is relieved to ensure the cost basis of the inventory reflects any reductions.  Actual product demand or market conditions could be different than that projected by management.

Property, Machinery And Equipment

Property, Machinery and Equipment

Property, machinery and equipment are valued at cost.  The Company provides for depreciation and amortization using the straight-line method over the estimated useful life of the assets:

Buildings	20 years
Machinery and equipment	5-12 years
Office equipment and software	3-5 years
Tools and dies	12 months
Leasehold improvements	lesser of lease term or useful life

Expenses for repairs and maintenance are charged to selling and administrative expenses as incurred.

Deferred Financing Costs

Deferred Financing Costs

Deferred financing costs consist of costs incurred to obtain the Company’s long-term debt and are amortized using the straight-line method over the term of the related debt.  Deferred financing fees of $113,286 and $147,537 net of

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

accumulated amortization of $443,763 and $390,266, respectively, as of April 30, 2016 and 2015, respectively, are classified in other long-term assets on the Company’s balance sheet.

Income Tax

Income Taxes

The Company’s income tax expense, deferred tax assets and liabilities and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid.  The Company is subject to income taxes in both the U.S. and several foreign jurisdictions.  Significant judgments and estimates by management are required in determining the consolidated income tax expense assessment.

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistent with the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across its global operations.  Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future.  Management is not aware of any such changes that would have a material effect on the Company’s results of operations, cash flows or financial position.

A tax benefit from an uncertain tax position may only be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.

The Company adjusts its tax liabilities when its judgment changes as a result of the evaluation of new information not previously available.  Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from its current estimate of the tax liabilities.  These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

Earnings Per Share

Earnings per Share

Basic earnings per share are computed by dividing net income (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period.  The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common stock equivalents such as stock options and restricted stock, had been exercised or vested.  There were 991, anti-dilutive common stock equivalents at April 30, 2015, which have been excluded from the calculation of diluted earnings per share.  There were no anti-dilutive common stock equivalents at April 30, 2016. 

	Twelve Months Ended
	April 30,
	2016		2015
Net income	$	2,082,659	$	903,412
Weighted-average shares
Basic		4,164,815		4,046,988
Effect of dilutive stock options		59,215		69,436
Diluted		4,224,030		4,116,424
Basic earnings per share	$	0.50	$	0.22
Diluted earnings per share	$	0.49	$	0.22

Revenue Recognition

Revenue Recognition

Revenues from sales of the Company's electronic manufacturing services business are recognized when the finished good product is shipped to the customer.  In general, and except for consignment inventory, it is the Company's policy to recognize revenue and related costs when the finished goods have been shipped from its facilities, which is also the same point that title passes under the terms of the purchase order.  Finished goods inventory for certain customers is shipped from the Company to an independent warehouse for storage or shipped directly to the customer and stored in a segregated part of the customer’s own facility.  Upon the customer’s request for finished goods inventory, the inventory is shipped to the customer if the inventory was stored off-site, or transferred from the segregated part of the customer’s facility for consumption or use by the customer.  The Company recognizes revenue upon such shipment or transfer.  The Company does not earn a fee for such arrangements.  The Company from time to time may ship finished goods from its facilities, which is also the same point that title passes under the terms of the purchase order, and invoice the customer at the end of the calendar month.  This is done only in special circumstances to accommodate a specific customer.  Further, from time to time customers request the Company hold finished goods after they have been invoiced to consolidate finished goods for shipping purposes.  The Company generally provides a warranty for workmanship, unless the assembly was designed by the Company, in which case it warrants assembly/design.  The Company does not have any installation, acceptance or sales incentives (although the Company has negotiated longer warranty terms in certain instances).  The Company assembles and tests assemblies based on customers’ specifications.  Historically, the amount of returns for workmanship issues has been de minimis under the Company’s standard or extended warranties.

Shipping And Handling Costs

Shipping and Handling Costs

The Company records shipping and handling costs as selling and administrative expenses.  Customers are typically invoiced for shipping costs and such amounts are included in net sales.  Shipping and handling costs were not material to the financial statements for fiscal years 2016 or 2015.

Fair Value Measurements

Fair Value Measurements

Fair value measurements are determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants exclusive of any transaction costs.  The Company utilizes a fair value hierarchy based upon the observability of inputs used in valuation techniques as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Fair Value Of Financial Instruments

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, other receivables, accounts payable and accrued expenses which approximate fair value at April 30, 2016 and 2015, due to their short-term nature.  The carrying amounts of the Company’s debt obligations approximate fair value based on future payments discounted at current interest rates for similar obligations or interest rates which fluctuate with the market.

The Company measured the contingent consideration included in the fiscal 2013 Spitfire acquisition under the fair value standard (primarily using level 3 measurement inputs).  The contingent consideration continues to be measured and reported at fair value at each period end.  The Company currently does not have any other non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.

Goodwill

Goodwill

Goodwill represents the purchase price in excess of the fair value of assets acquired in business combinations.  Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Goodwill and other Intangible Assets,” requires the Company to assess goodwill and other indefinite-lived intangible assets for impairment at least annually in the absence of an indicator of possible impairment and immediately upon an indicator of possible impairment.  The Company is permitted the option to first assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the fair value of any reporting unit is less than its corresponding carrying value.  If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of any reporting unit is less than its corresponding carrying value, then the Company is not required to take further action.  However, if the Company concludes otherwise, then it is required to perform a quantitative impairment test, including computing the fair value of the reporting unit and comparing that value to its carrying value.  If the fair value is less than its carrying value, a second step of the test is required to determine if recorded goodwill is impaired.  The Company also has the option to bypass the qualitative assessment for goodwill in any period and proceed directly to performing the quantitative impairment test.  The Company will be able to resume performing the qualitative assessment in any subsequent period.  The Company performed its annual goodwill impairment test as of February 1, 2016 and determined no impairment existed as of that date.

Intangible Assets

Intangible Assets

Intangible assets are comprised of finite life intangible assets including patents, trade names, backlog, non-compete agreements, and customer relationships.  Finite life intangible assets are amortized on a straight line basis over their estimated useful lives of 5 years for patents, 20 years for trade names, 1 year for backlog and 7 years for non-compete agreements except for customer relationships which are amortized on an accelerated basis over their estimated useful life of 15 years.

Impairment Of Long-Lived Assets

Impairment of Long-Lived Assets

The Company reviews long-lived assets, including amortizable intangible assets, for impairment.  Property, machinery and equipment and finite life intangible assets are reviewed whenever events or changes in circumstances occur that indicate possible impairment.  If events or changes in circumstances occur that indicate possible impairment, the Company’s impairment review is based on an undiscounted cash flow analysis at the lowest level at which cash flows of the long-lived assets are largely independent of other groups of its assets and liabilities.  This analysis requires management judgment with respect to changes in technology, the continued success of product lines, and future volume, revenue and expense growth rates.  The Company conducts annual reviews for idle and underutilized equipment, and reviews business plans for possible impairment.  Impairment occurs when the carrying value of the assets exceeds the future undiscounted cash flows expected to be earned by the use of the asset group.  When impairment is indicated, the estimated future cash flows are then discounted to determine the estimated fair value of the asset or asset group and an impairment charge is recorded for the difference between the carrying value and the estimated fair value.  As of April 30, 2016, there were no indicators of possible impairment of long-lived assets.

Stock Incentive Plans

Stock Incentive Plans

Under the Company’s stock option plans, options to acquire shares of common stock have been made available for grant to certain employees and directors.  Each option granted has an exercise price of not less than 100% of the market value of the common stock on the date of grant.  The contractual life of each option is generally 10 years.  The vesting of the grants varies according to the individual options granted.  The Company measures the cost of employee services received in exchange for an equity award based on the grant date fair value and records that cost over the respective vesting period of the award.

Reclassifications

Reclassifications

Certain reclassifications have been made to the previously reported 2015 financial statements to conform to the 2016 presentation.

During the third quarter of fiscal year 2016, the Company began presenting all deferred tax assets and liabilities as noncurrent on its Condensed Consolidated Balance Sheets as discussed further in New Accounting Standards below.

New Accounting Standards

New Accounting Standards

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers."  ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB deferred the effective date of ASU No. 2014-09 by issuing ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date.”  ASU No. 2015-14 defers the effective date of ASU No. 2014-09 to annual reporting periods beginning after December 15, 2017 , with early adoption permitted but not earlier than the original effective date. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08), which clarifies the implementation guidance

of principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing (ASU 2016-10), which clarifies the identification of performance obligations and licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients (ASU 2016-12), to improve guidance on assessing collectability, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition. The effective date and transition requirements in ASU 2016-08, ASU 2016-10, and ASU 2016-12 are the same as the effective date and transition requirements of ASU 2015-14. The Company has not yet selected a transition method and is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40)”.  The amendments in this ASU provide guidance about management’s responsibility to evaluate

whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures.  An entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued, when applicable).  ASU 2014-15 is effective for reporting periods beginning after December 15, 2016.  Early adoption is permitted. The Company elected early adoption of this ASU and it did not have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015- 03, “Interest — Imputation of Interest (Subtopic 835-30) — Simplifying the Presentation of Debt Issuance Costs.” ASU No. 2015-03 simplifies the presentation of debt issuance costs by requiring that these costs related to a recognized debt liability be presented in the statement of financial condition as a direct reduction from the carrying amount of that liability. ASU No. 2015-03 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period.  ASU No. 2015-03 is required to be applied retrospectively to all periods presented beginning in the year of adoption.  The Company does not expect the impact of adoption of this ASU to have a material impact on its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”.  ASU No. 2015-11 requires an entity that determines the cost of inventory by methods other than last-in, first-out (LIFO) and the retail inventory method (RIM) to measure inventory at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This amendment applies to all inventory that is measured using the average costs or first-in first-out (FIFO) methods. This supersedes prior guidance which allowed entities to measure inventory at the lower of cost or market, where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin.  ASU No. 2015-11 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016.  Prospective application is required.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company does not expect the impact of the adoption of this ASU to have a material impact on the Company’s consolidated financial statements.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

New Accounting Standards - Continued

In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”.  ASU No. 2015-17 requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position.  ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods.  This update may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented.  Early application is permitted as of the beginning of the interim or annual reporting period.  The Company elected to early adopt ASU 2015-17 during its third quarter of fiscal year 2016 on a retrospective basis.  Accordingly, it reclassified the current deferred taxes to noncurrent on the April 30, 2015 Consolidated Balance Sheets, which decreased current deferred tax assets by $2,179,178, increased noncurrent deferred tax assets by $365,935 and decreased noncurrent deferred tax liabilities by $1,813,244.  

In February 2016, the FASB issued ASU No. 2016-02, “Leases”. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective

transition approach is required for capital leases and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  While the Company is still evaluating the impact of its pending adoption of the new standard on its

consolidated financial statements, the Company expects that upon adoption it will recognize ROU assets and lease liabilities and that the amounts could be material.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”, a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or benefit in the Consolidated Statement of Income, introducing a new element of volatility to the provision for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after

December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this standards update may have on its consolidated financial statements.

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Summary Of Significant Accounting Policies (Tables)

12 Months Ended

Apr. 30, 2016

Summary Of Significant Accounting Policies [Abstract]

Depreciation and Amortization Using Straight-Line Method Over Estimated Useful Life

Buildings	20 years
Machinery and equipment	5-12 years
Office equipment and software	3-5 years
Tools and dies	12 months
Leasehold improvements	lesser of lease term or useful life

Computation Of Basic And Diluted Earnings Per Share

	Twelve Months Ended
	April 30,
	2016		2015
Net income	$	2,082,659	$	903,412
Weighted-average shares
Basic		4,164,815		4,046,988
Effect of dilutive stock options		59,215		69,436
Diluted		4,224,030		4,116,424
Basic earnings per share	$	0.50	$	0.22
Diluted earnings per share	$	0.49	$	0.22

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Allowance for Doubtful Accounts (Tables)

12 Months Ended

Apr. 30, 2016

Allowance For Doubtful Accounts [Abstract]

Changes in Company's Allowance for Doubtful Accounts

		2016		2015
Beginning Balance	$	186,844	$	150,000
Bad debt expense		-		36,844
Write-offs		(86,844)		-
	$	100,000	$	186,844

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Inventories (Tables)

12 Months Ended

Apr. 30, 2016

Inventories [Abstract]

Components Of Inventory

	2016		2015
Finished products	$	23,295,138	$	24,316,404
Work-in-process		3,035,459		2,966,846
Raw materials		42,530,957		42,662,845
		68,861,554		69,946,095
Less obsolescence reserve		1,212,532		1,276,386
	$	67,649,022	$	68,669,709

Changes In Inventory Obsolescence Reserve

	2016		2015
Beginning balance	$	1,276,386	$	1,804,984
Write-offs		(63,854)		(528,598)
	$	1,212,532	$	1,276,386

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Property, Machinery And Equipment, Net (Tables)

12 Months Ended

Apr. 30, 2016

Property, Machinery And Equipment, Net [Abstract]

Schedule Of Property, Machinery And Equipment

		2016		2015
Land and buildings	$	16,220,619	$	15,265,758
Machinery and equipment		57,604,080		56,142,919
Office equipment and software		9,134,187		8,640,964
Leasehold improvements		2,566,250		2,540,693
Equipment under capital leases		8,055,533		6,746,668
		93,580,669		89,337,002
Less accumulated depreciation
and amortization, including
amortization of assets under
capital leases of $1,972,085
and $1,329,661 at April 30,
2016 and 2015, respectively		60,499,811		55,472,475
Property, machinery and
equipment, net
	$	33,080,858	$	33,864,527

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Goodwill And Other Intangible Assets (Tables)

12 Months Ended

Apr. 30, 2016

Goodwill And Other Intangible Assets [Abstract]

Summary Of Intangible Assets Subject To Amortization

Intangible assets subject to amortization are summarized as of April 30, 2016 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	11.08		4,690,000		883,540
Backlog	-		22,000		22,000
Trade names	16.08		980,000		191,901
Non-compete agreements	3.08		50,000		27,965
Patents	1.08		400,000		313,349
Total		$	8,912,000	$	4,208,755

Intangible assets subject to amortization are summarized as of April 30, 2015 as follows:

	Weighted Average
	Remaining	Gross
	Amortization	Carrying		Accumulated
	Period (Years)	Amount		Amortization
Other intangible assets – Able	-	$	375,000	$	375,000
Customer relationships – Able	-		2,395,000		2,395,000
Spitfire:
Non-contractual customer relationships	12.08		4,690,000		548,781
Backlog	-		22,000		22,000
Trade names	17.08		980,000		142,905
Non-compete agreements	4.08		50,000		20,825
Patents	2.08		400,000		233,345
Total		$	8,912,000	$	3,737,856

Estimated Aggregate Amortization Expense

For the fiscal year ending April 30:
	2017	$	490,010
	2018		435,043
	2019		423,721
	2020		411,406
	2021		403,199
	Thereafter		2,539,866
		$	4,703,245

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Long-Term Debt (Tables)

12 Months Ended

Apr. 30, 2016

Long-Term Debt [Abstract]

Aggregate Amount of Debt Maturing

Fiscal Year	Total
2017	$	165,000
2018		165,000
2019		21,173,569
2020		2,346,500
	$	23,850,069

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Accrued Expenses and Wages (Tables)

12 Months Ended

Apr. 30, 2016

Accrued Expenses And Wages [Abstract]

Schedule Of Accrued Expenses

		2016		2015
Interest	$	61,350	$	74,395
Commissions		80,819		57,681
Professional fees		397,375		304,864
Other		170,922		95,755
	$	710,466	$	532,695

Schedule Of Accrued Wages

		2016		2015
Wages	$	1,706,141	$	1,544,959
Bonuses		920,563		409,549
Foreign wages		1,572,443		1,689,934
Foreign benefits		2,061,835		1,496,409
	$	6,260,982	$	5,140,851

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Income Tax (Tables)

12 Months Ended

Apr. 30, 2016

Income Tax [Abstract]

Income (Loss) Before Income Tax Expense

		2016		2015
Domestic	$	2,224,802	$	(2,481,049)
Foreign		1,260,394		4,185,510
	$	3,485,196	$	1,704,461

Income Tax Provision

		2016		2015
Current
Federal	$	279,043	$	2,963
State		29,217		29,613
Foreign		318,800		1,020,820
Total Current		627,060		1,053,396
Deferred
Federal		577,149		(138,335)
State		65,451		(154,208)
Foreign		132,877		40,196
Total Deferred		775,477		(252,347)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

Reconciliation of Income Taxes

		2016		2015
U.S Federal Provision:
At statutory rate	$	1,184,967	$	579,516
State taxes		117,922		(86,377)
Change in valuation allowance		(46,615)		46,615
Foreign tax differential		(94,124)		(256,343)
Impact of state tax rate change		(8,826)		(42,471)
Foreign valuation allowance		(48,680)		(53,011)
Foreign profit sharing		-		32,912
Foreign dividends		-		643,708
Other		42,850		22,996
Foreign currency exchange gain/loss		311,867		136,299
Impact of foreign permanent items		(20,056)		(123,987)
Foreign inflation adjustment		(36,768)		(98,808)
Provision (benefit) for income taxes	$	1,402,537	$	801,049

Deferred Tax Assets and Liabilities

		2016		2015
Deferred Tax Assets
Federal & State NOL carryforwards	$	85,288	$	449,325
Research & Other Credits		-		78,100
Reserves and accruals		615,431		795,721
Stock based compensation		244,199		133,744
Inventory		1,074,546		1,154,335
Other intangibles		203,789		207,044
Deferred rent		240,439		263,703
Allowance for doubtful accounts		38,150		72,271
Other DTA		8,902		19,083
Federal Benefit of State		25,228		3,895
Total Gross Deferred Tax Assets		2,535,972		3,177,221
Less: Valuation allowance		-		(95,295)
Net Deferred Tax Assets	$	2,535,972	$	3,081,926
Deferred Tax Liabilities
Other assets	$	(113,665)	$	(272,409)
Property, machinery & equipment		(3,273,902)		(3,180,575)
Prepaids		(270,968)		-
Total Deferred Tax Liabilities	$	(3,658,535)	$	(3,452,984)
Net Deferred Tax Liability	$	(1,122,563)	$	(371,058)

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Leases (Tables)

12 Months Ended

Apr. 30, 2016

Leases [Abstract]

Future Minimum Lease Payments Under Leases

		Capital		Operating
Years ending April 30,		Leases		Leases
2017	$	1,562,593	$	2,009,228
2018		1,454,538		2,043,424
2019		1,211,612		1,740,801
2020		597,028		1,033,798
2021		173,925		674,506
Total future minimum lease payments	$	4,999,696	$	7,501,757
Less amounts representing interest		407,040
		4,592,656
Less Current Portion		1,374,898
Long Term Portion	$	3,217,758

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Stock Compensation And Equity Transactions (Tables)

12 Months Ended

Apr. 30, 2016

Stock Compensation And Equity Transactions [Abstract]

Summarized Option Activity

	Number of			Number of
	securities to be		Weighted-	options
	issued upon		average	exercisable
	exercise of		exercise	at end
	outstanding options		price	of year
Outstanding at April 30, 2014	101,554	$	3.88	48,304
Options exercised during 2015	(13,600)		4.26
Options expired during 2015	(2,000)		4.24
Outstanding at April 30, 2015	85,954		3.81	76,954
Options granted during 2016	285,000		6.45
Options exercised during 2016	(2,000)		3.60
Options expired during 2016	(991)		9.17
Outstanding at April 30, 2016	367,963	$	5.84	172,513

Stock Options Outstanding, Exercisable, and Non-vested

Information with respect to stock options outstanding at April 30, 2016 follows:

			Options outstanding
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	367,963	7.47 years	$	5.84
		367,963		$	5.84

NOTE N - STOCK COMPENSATION AND EQUITY TRANSACTIONS - Continued

Information with respect to stock options outstanding and exercisable at April 30, 2016 follows:

		Options outstanding and exercisable
		Number	Weighted-average		Weighted-
		outstanding at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	3.60-6.45	172,513	7.47 years	$	5.21
		172,513		$	5.21

Information with respect to stock options non-vested at April 30, 2016 follows:

		Options non-vested
		Number	Weighted-average		Weighted-
		non-vested at	remaining		average
		April 30, 2016	contract life		exercise price
Range of exercise prices
$	4.24-6.45	195,450	8.23 years	$	6.40
		195,450		$	6.40

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Selected Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Apr. 30, 2016

Selected Quarterly Financial Data (Unaudited) [Abstract]

Summary Of Quarterly Financial Data

The following is a summary of unaudited quarterly financial data for fiscal year 2016:

		First		Second		Third		Fourth
2016		Quarter		Quarter		Quarter		Quarter
Net sales	$	64,220,946	$	69,723,493	$	59,206,344	$	60,753,363
Gross profit		6,230,274		7,597,013		5,708,096		5,983,148
Income before income		962,323		1,857,036		377,599		288,238
tax expense
Net income		658,806		1,156,298		218,728		48,827
Earnings per share	$	0.16	$	0.28	$	0.05	$	0.01
Basic
Earnings per share	$	0.16	$	0.27	$	0.05	$	0.01
Diluted
Total shares- Basic		4,148,285		4,166,758		4,170,193		4,174,251
Total shares- Diluted		4,193,657		4,214,317		4,229,378		4,208,184

NOTE O - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) - Continued

The following is a summary of unaudited quarterly financial data for fiscal year 2015:

		First		Second		Third		Fourth
2015		Quarter		Quarter		Quarter		Quarter
Net sales	$	54,947,477	$	61,533,519	$	53,702,613	$	60,053,552
Gross profit		4,746,448		5,813,753		5,695,365		5,813,272
Income before income
tax expense		15,566		723,254		562,123		403,518
Net income		16,810		146,429		564,080		176,093
Earnings per share
Basic	$	0.00	$	0.04	$	0.14	$	0.04
Earnings per share
Diluted	$	0.00	$	0.04	$	0.14	$	0.04
Total shares- Basic		4,028,535		4,044,240		4,054,146		4,061,504
Total shares- Diluted		4,105,627		4,120,178		4,116,015		4,117,600

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Description Of The Business (Narrative) (Details) - segment	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Description Of Business [Abstract]
Number of business segments as an independent provider of electronic manufacturing services	1
Total consolidated assets of the Company located in foreign jurisdictions outside the United States	15.00%	15.00%

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Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Summary Of Significant Accounting Policies [Line Items]
Impact of currency fluctuation, resulted net foreign currency gain	$ (59,000)	$ 40,000
Accounts receivables period	5 years
Deferred financing fees	$ 113,286	147,537
Deferred finance cost accumulated amortization	$ 443,763	$ 390,266
Anti dilutive common stock excluded from the calculation of diluted earnings per share	0	991
Contractual life of options	10 years
Increased noncurrent deferred tax assets	$ 233,057	$ 365,935
Decreased noncurrent deferred tax liabilities	$ 1,355,620	736,993
Accounting Standards Update 2015-17 [Member] | Reclassification Of April 30, 2015 Deferred Tax Assets And Liabilities [Member]
Summary Of Significant Accounting Policies [Line Items]
Increased noncurrent deferred tax assets		365,935
Decreased noncurrent deferred tax liabilities		$ 1,813,244
Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Option exercise price as a percentage of market price of shares	100.00%
Patents [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life	5 years
Trade Names [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life	20 years
Backlog [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life	1 year
Non-Compete Agreements [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life	7 years
Customer Relationships [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life	15 years

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Summary Of Significant Accounting Policies (Depreciation and Amortization Using Straight-Line Method Over Estimated Useful Life) (Details)	12 Months Ended
	Apr. 30, 2016
Buildings [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	20 years
Machinery And Equipment [Member] | Minimum [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Machinery And Equipment [Member] | Maximum [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	12 years
Office Equipment And Software [Member] | Minimum [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Office Equipment And Software [Member] | Maximum [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Tools And Dies [Member]
Property Plant and Equipment Estimated Useful Lives [Line Items]
Property, Plant and Equipment, Useful Life	12 months

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Summary Of Significant Accounting Policies (Computation Of Basic And Diluted Earnings Per Share) (Details) - USD ($)	3 Months Ended								12 Months Ended
	Apr. 30, 2016	Jan. 31, 2016	Oct. 31, 2015	Jul. 31, 2015	Apr. 30, 2015	Jan. 31, 2015	Oct. 31, 2014	Jul. 31, 2014	Apr. 30, 2016	Apr. 30, 2015
Earnings Per Share [Abstract]
Net income	$ 48,827	$ 218,728	$ 1,156,298	$ 658,806	$ 176,093	$ 564,080	$ 146,429	$ 16,810	$ 2,082,659	$ 903,412
Weighted-average shares, Basic	4,174,251	4,170,193	4,166,758	4,148,285	4,061,504	4,054,146	4,044,240	4,028,535	4,164,815	4,046,988
Weighted-average shares, Effect of dilutive stock options									59,215	69,436
Weighted-average shares, Diluted	4,208,184	4,229,378	4,214,317	4,193,657	4,117,600	4,116,015	4,120,178	4,105,627	4,224,030	4,116,424
Basic earnings per share	$ 0.01	$ 0.05	$ 0.28	$ 0.16	$ 0.04	$ 0.14	$ 0.04	$ 0.00	$ 0.50	$ 0.22
Diluted earnings per share	$ 0.01	$ 0.05	$ 0.27	$ 0.16	$ 0.04	$ 0.14	$ 0.04	$ 0.00	$ 0.49	$ 0.22

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Allowance For Doubtful Accounts (Changes in Company's Allowance for Doubtful Accounts) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Allowance For Doubtful Accounts [Abstract]
Beginning Balance	$ 186,844	$ 150,000
Bad debt expense		36,844
Write-offs	(86,844)
Ending Balance	$ 100,000	$ 186,844

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Inventories (Components Of Inventory) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015	Apr. 30, 2014
Inventories [Abstract]
Finished products	$ 23,295,138	$ 24,316,404
Work-in-process	3,035,459	2,966,846
Raw materials	42,530,957	42,662,845
Total inventory, gross	68,861,554	69,946,095
Less obsolescence reserve	1,212,532	1,276,386	$ 1,804,984
Total inventory, net	$ 67,649,022	$ 68,669,709

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Inventories (Changes in Inventory Obsolescence Reserve) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Inventories [Abstract]
Beginning balance	$ 1,276,386	$ 1,804,984
Write-offs	(63,854)	(528,598)
Ending balance	$ 1,212,532	$ 1,276,386

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Related Parties (Narrative) (Details)	Jan. 29, 2016 USD ($) $ / shares	Apr. 30, 2016 USD ($)	Mar. 31, 2015 employee
Related Party Transaction [Line Items]
Outstanding note receivable from related parties		$ 888,000
Outstanding account receivable from related parties		233,000
Inventory on hand from related parties		$ 1,600,000
Promissory Note [Member]
Related Party Transaction [Line Items]
Conversion of accounts receivable into a notes receivable	$ 888,000
Interest rate	8.00%
Maturity date	Oct. 31, 2016
Maturity within number of days after obtains equity financing by related parties	10 days
Warrants period	10 years
Warrants exercise price, per share | $ / shares	$ 0.01
Executive [Member]
Related Party Transaction [Line Items]
Number of executive officers invested in a start-up customer | employee			2
Minimum [Member] | Promissory Note [Member]
Related Party Transaction [Line Items]
Percentage of warrants exercised on equity securities with related parties	1.00%
Maximum [Member] | Executive [Member]
Related Party Transaction [Line Items]
Executive officers' investment holding, percentage			2.00%

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Property, Machinery and Equipment, Net (Narrative) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Property, Machinery And Equipment, Net [Abstract]
Depreciation and amortization expense	$ 5,119,376	$ 4,985,272

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Property, Machinery and Equipment, Net (Schedule Of Property, Machinery And Equipment) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	$ 93,580,669	$ 89,337,002
Less accumulated depreciation and amortization, including amortization of assets under capital leases of $1,972,085 and $1,329,661 at April 30, 2016 and 2015, respectively	60,499,811	55,472,475
Property, machinery and equipment, net	33,080,858	33,864,527
Amortization of assets under capital leases	1,972,085	1,329,661
Land And Buildings [Member]
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	16,220,619	15,265,758
Machinery And Equipment [Member]
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	57,604,080	56,142,919
Office Equipment And Software [Member]
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	9,134,187	8,640,964
Leasehold Improvements [Member]
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	2,566,250	2,540,693
Equipment Under Capital Leases [Member]
Property, Machinery and Equipment [Line Items]
Property, machinery and equipment, gross	$ 8,055,533	$ 6,746,668

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Goodwill And Other Intangible Assets (Narrative) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015	May 31, 2012
Goodwill And Other Intangible Assets [Abstract]
Changes in goodwill carrying amount	$ 0	$ 0
Goodwill	3,222,899	3,222,899
Amortization expense	470,899	428,610
Estimated fair value of contingent consideration			$ 2,320,000
Total payment for business acquisition	342,162
Contingent consideration liability	$ 1,151,081	$ 1,498,985

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Goodwill And Other Intangible Assets (Summary Of Intangible Assets Subject To Amortization) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 8,912,000	$ 8,912,000
Accumulated Amortization	4,208,755	3,737,856
Able [Member] | Other Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	375,000	375,000
Accumulated Amortization	375,000	375,000
Able [Member] | Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	2,395,000	2,395,000
Accumulated Amortization	$ 2,395,000	$ 2,395,000
Spitfire [Member] | Non-Contractual Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Amortization Period	11 years 29 days	12 years 29 days
Gross Carrying Amount	$ 4,690,000	$ 4,690,000
Accumulated Amortization	883,540	548,781
Spitfire [Member] | Backlog [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	22,000	22,000
Accumulated Amortization	$ 22,000	$ 22,000
Spitfire [Member] | Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Amortization Period	16 years 29 days	17 years 29 days
Gross Carrying Amount	$ 980,000	$ 980,000
Accumulated Amortization	$ 191,901	$ 142,905
Spitfire [Member] | Non-Compete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Amortization Period	3 years 29 days	4 years 29 days
Gross Carrying Amount	$ 50,000	$ 50,000
Accumulated Amortization	$ 27,965	$ 20,825
Spitfire [Member] | Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Amortization Period	1 year 29 days	2 years 29 days
Gross Carrying Amount	$ 400,000	$ 400,000
Accumulated Amortization	$ 313,349	$ 233,345

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Goodwill And Other Intangible Assets (Estimated Aggregate Amortization Expense) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Goodwill And Other Intangible Assets [Abstract]
For the fiscal year ending April 30, 2017	$ 490,010
For the fiscal year ending April 30, 2018	435,043
For the fiscal year ending April 30, 2019	423,721
For the fiscal year ending April 30, 2020	411,406
For the fiscal year ending April 30, 2021	403,199
Thereafter	2,539,866
Total	$ 4,703,245	$ 5,174,144

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Long-Term Debt (Narrative) (Details) - USD ($)					12 Months Ended		16 Months Ended	25 Months Ended
	Apr. 30, 2016	Nov. 24, 2014	Oct. 24, 2013	Jan. 08, 2010	Apr. 30, 2016	Dec. 31, 2010	Jul. 31, 2015	Oct. 31, 2015	Apr. 30, 2015
Debt Instrument [Line Items]
Cumulative amount of unremitted earnings	$ 12,588,000				$ 12,588,000
Equipment refinanced through leasing transaction	4,592,656				4,592,656
Monthly installment payments under capital lease	4,999,696				4,999,696
Other long-term liabilities	870,542				870,542				$ 536,209
Wells Fargo Equipment Finance [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Total equipment purchased under the capital lease						$ 1,376,799
Outstanding amount under capital lease	106,767				106,767				336,883
Net book value of capital leased assets	703,424				703,424				817,324
Associated Bank, National Association [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Total equipment purchased under the capital lease								$ 4,176,683
Outstanding amount under capital lease	2,599,820				2,599,820				2,732,713
Net book value of capital leased assets	3,224,661				3,224,661				2,938,211
CIT Finance LLC [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Total equipment purchased under the capital lease							$ 2,512,051
Outstanding amount under capital lease	1,886,069				1,886,069				1,577,950
Net book value of capital leased assets	2,155,363				2,155,363				1,661,473
Wells Fargo Bank [Member]
Debt Instrument [Line Items]
Mortgage agreement, amount			$ 1,275,000
Wells Fargo Bank [Member] | Mortgage Agreement [Member]
Debt Instrument [Line Items]
Mortgage agreement, amount				$ 2,500,000
Mortgage agreement, interest rate				6.42%
Mortgage agreement, amortization period				60 months
Mortgage agreement, final payment		$ 2,289,500		$ 2,000,000
Mortgage agreement, maturity date		Nov. 08, 2019		Jan. 08, 2015
Mortgage agreement, monthly principal payment		$ 9,500
Mortgage agreement, payable period		60 months
Mortgage agreement, outstanding amount	2,688,500				2,688,500				2,802,500
Wells Fargo Bank [Member] | Mortgage Agreement 2 [Member]
Debt Instrument [Line Items]
Mortgage agreement, interest rate			4.50%
Mortgage agreement, final payment			$ 1,030,000
Mortgage agreement, maturity date			Oct. 24, 2018
Mortgage agreement, monthly principal payment			$ 4,250
Mortgage agreement, payable period			60 months
Mortgage agreement, outstanding amount	$ 1,147,500				$ 1,147,500				1,198,500
Wells Fargo Bank [Member] | LIBOR [Member] | Mortgage Agreement [Member]
Debt Instrument [Line Items]
Mortgage agreement, interest rate					2.25%
Mortgage agreement, effective interest rate	3.00%
Wells Fargo Bank [Member] | Senior Secured Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility credit limit	$ 30,000,000				$ 30,000,000
Expiration date					Oct. 31, 2018
Equity ownership in foreign entities pledged as collateral, percentage	65.00%				65.00%
Fixed interest rate	2.25%				2.25%
Effective interest rate	3.25%				3.25%
Variable interest rate					1.00%
Receivable and inventory borrowing base, percentage					50.00%
Bank fee	$ 23,333				$ 23,333
Outstanding balance under the credit facility	20,014,069				20,014,069				27,416,793
Unused availability under the credit facility	$ 3,630,035				$ 3,630,035				2,583,207
Wells Fargo Bank [Member] | Senior Secured Credit Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Effective interest rate	2.875%				2.875%
Variable interest rate					2.25%
Minimum [Member] | Wells Fargo Equipment Finance [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period						Jul. 01, 2016
Monthly installment payments under capital lease						$ 3,627
Fixed interest rate under capital lease						4.41%
Minimum [Member] | Associated Bank, National Association [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period								Sep. 01, 2018
Monthly installment payments under capital lease								$ 1,455
Fixed interest rate under capital lease								3.75%
Minimum [Member] | CIT Finance LLC [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period							Mar. 01, 2019
Monthly installment payments under capital lease							$ 1,931
Fixed interest rate under capital lease							5.65%
Maximum [Member] | Wells Fargo Equipment Finance [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period						Oct. 01, 2016
Monthly installment payments under capital lease						$ 13,207
Fixed interest rate under capital lease						4.99%
Maximum [Member] | Associated Bank, National Association [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period								Nov. 01, 2020
Monthly installment payments under capital lease								$ 40,173
Fixed interest rate under capital lease								4.14%
Maximum [Member] | CIT Finance LLC [Member] | Capital Lease [Member]
Debt Instrument [Line Items]
Lease financing agreement period							Jul. 01, 2020
Monthly installment payments under capital lease							$ 12,764
Fixed interest rate under capital lease							6.50%
Foreign subsidiaries
Debt Instrument [Line Items]
Other long-term liabilities	$ 800,067				$ 800,067				$ 467,221

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Long-Term Debt (Aggregate Amount of Debt Maturing) (Details)	Apr. 30, 2016 USD ($)
Long-Term Debt [Abstract]
2017	$ 165,000
2018	165,000
2019	21,173,569
2020	2,346,500
Total	$ 23,850,069

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Accrued Expenses And Wages (Schedule of Accrued Expenses) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Accrued Expenses And Wages [Abstract]
Interest	$ 61,350	$ 74,395
Commissions	80,819	57,681
Professional fees	397,375	304,864
Other	170,922	95,755
Accrued expenses, total	$ 710,466	$ 532,695

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Accrued Expenses And Wages (Schedule of Accrued Wages) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Accrued Expenses And Wages [Abstract]
Wages	$ 1,706,141	$ 1,544,959
Bonuses	920,563	409,549
Foreign wages	1,572,443	1,689,934
Foreign benefits	2,061,835	1,496,409
Accrued wages, total	$ 6,260,982	$ 5,140,851

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Income Tax (Narrative) (Detail) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Income Tax [Abstract]
Net operating loss carryforwards	$ 1,071,000
Net operating loss carryforwards expire date	Apr. 30, 2024
Cumulative amount of unremitted earnings	$ 12,588,000
Unrecognized tax benefits	0	$ 0
Other tax expense	$ 0	$ 0

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Income Tax (Income (Loss) before Income Tax Expense) (Detail) - USD ($)	3 Months Ended								12 Months Ended
	Apr. 30, 2016	Jan. 31, 2016	Oct. 31, 2015	Jul. 31, 2015	Apr. 30, 2015	Jan. 31, 2015	Oct. 31, 2014	Jul. 31, 2014	Apr. 30, 2016	Apr. 30, 2015
Income Tax [Abstract]
Domestic									$ 2,224,802	$ (2,481,049)
Foreign									1,260,394	4,185,510
Income before income tax expense	$ 288,238	$ 377,599	$ 1,857,036	$ 962,323	$ 403,518	$ 562,123	$ 723,254	$ 15,566	$ 3,485,196	$ 1,704,461

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Income Tax (Income Tax Provision) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
Current
Federal	$ 279,043	$ 2,963
State	29,217	29,613
Foreign	318,800	1,020,820
Total Current	627,060	1,053,396
Deferred
Federal	577,149	(138,335)
State	65,451	(154,208)
Foreign	132,877	40,196
Total Deferred	775,477	(252,347)
Provision (benefit) for income taxes	$ 1,402,537	$ 801,049

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Income Tax (Reconciliation of Income Taxes) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
U.S. Federal Provision:
At statutory rate	$ 1,184,967	$ 579,516
State taxes	117,922	(86,377)
Change in valuation allowance	(46,615)	46,615
Foreign tax differential	(94,124)	(256,343)
Impact of state tax rate change	(8,826)	(42,471)
Foreign valuation allowance	(48,680)	(53,011)
Foreign profit sharing		32,912
Foreign dividends		643,708
Other	42,850	22,996
Foreign currency exchange gain/loss	311,867	136,299
Impact of foreign permanent items	(20,056)	(123,987)
Foreign inflation adjustment	(36,768)	(98,808)
Provision (benefit) for income taxes	$ 1,402,537	$ 801,049

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Income Tax (Deferred Tax Assets and Liabilities) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Deferred Tax Assets
Federal & State NOL carryforwards	$ 85,288	$ 449,325
Research & Other Credits		78,100
Reserves and accruals	615,431	795,721
Stock based compensation	244,199	133,744
Inventory	1,074,546	1,154,335
Other intangibles	203,789	207,044
Deferred rent	240,439	263,703
Allowance for doubtful accounts	38,150	72,271
Other DTA	8,902	19,083
Federal Benefit of State	25,228	3,895
Total Gross Deferred Tax Assets	2,535,972	3,177,221
Less: Valuation allowance		(95,295)
Net Deferred Tax Assets	2,535,972	3,081,926
Deferred Tax Liabilities
Other assets	(113,665)	(272,409)
Property, machinery & equipment	(3,273,902)	(3,180,575)
Prepaids	(270,968)
Total Deferred Tax Liabilities	(3,658,535)	(3,452,984)
Net Deferred Tax Liability	$ (1,122,563)	$ (371,058)

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401(k) Retirement Savings Plan (Narrative) (Details) - USD ($)	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015
401(k) Retirement Savings Plan [Abstract]
Annual contribution to be matched by employer	$ 300
Amount contributed towards retirement plans	75,448	$ 114,207
Plan administration incurred total expenses	$ 13,460	$ 8,500

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Major Customers and Concentration of Credit Risk (Narrative) (Details)	12 Months Ended
	Apr. 30, 2016 USD ($) customer	Apr. 30, 2015 customer	May 01, 2015 USD ($)
Concentration Risk [Line Items]
Number of customers accounted for net sales and account receivable | customer	2	2
China [Member]
Concentration Risk [Line Items]
Cash	$ 3,940,197
Cash insured amount from deposit insurance program			$ 81,000
Major Customer One [Member] | Sales Revenue, Net [Member]
Concentration Risk [Line Items]
Concentration risk from major customer, percentage	35.20%	36.80%
Major Customer One [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Concentration risk from major customer, percentage	6.50%	9.60%
Major Customer Two [Member] | Sales Revenue, Net [Member]
Concentration Risk [Line Items]
Concentration risk from major customer, percentage	10.60%	9.90%
Major Customer Two [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Concentration risk from major customer, percentage	2.40%	5.50%

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Leases (Narrative) (Details)		1 Months Ended	12 Months Ended
	May 31, 2012 ft²	Sep. 30, 2010 USD ($) ft²	Apr. 30, 2016 USD ($)	Apr. 30, 2015 USD ($)
Leases Disclosure [Line Items]
Rent expense under operating leases			$ 2,258,359	$ 2,102,312
Union City, CA [Member]
Leases Disclosure [Line Items]
Number of square feet of manufacturing and office space | ft²		116,993
Extended lease agreement period		Mar. 01, 2021
Deferred rent income			51,509	33,950
Incentives related to lease		$ 418,000
Tijuana, MX [Member]
Leases Disclosure [Line Items]
Number of square feet of manufacturing and office space | ft²	112,000
Extended lease agreement period	Nov. 01, 2018
Deferred rent income			$ 115,837	$ 8,353

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Leases (Future Minimum Lease Payments under Leases) (Details) - USD ($)	Apr. 30, 2016	Apr. 30, 2015
Capital Leases
2017	$ 1,562,593
2018	1,454,538
2019	1,211,612
2020	597,028
2021	173,925
Total future minimum lease payments	4,999,696
Less amounts representing interest	407,040
Capital lease obligation	4,592,656
Less Current Portion	1,374,898	$ 1,245,632
Long Term Portion	3,217,758	$ 3,401,913
Operating Leases
2017	2,009,228
2018	2,043,424
2019	1,740,801
2020	1,033,798
2021	674,506
Total future minimum lease payments	$ 7,501,757

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Stock Compensation And Equity Transactions (Narrative) (Details)				12 Months Ended
	Oct. 01, 2015 shares	May 01, 2015 USD ($) item $ / shares shares	Oct. 01, 2014 shares	Apr. 30, 2016 USD ($) shares	Apr. 30, 2015 USD ($) shares	Apr. 30, 2014 shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Maximum term of options granted				10 years
Options granted | shares				285,000
Aggregate intrinsic value of options exercised | $				$ 5,100	$ 51,520
Aggregate intrinsic value of options outstanding | $				198,715	365,245
Value of shares issued under employee stock purchase plan | $				52,266	126,814
Number of shares sold to investors in a private offering | shares		74,000
Number of investors | item		3
Price per share, private offering | $ / shares		$ 7.00
Proceeds from the sale of restricted stock | $		$ 518,000
2014 Awards [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options granted | shares						25,000
Recognized stock-based compensation | $				18,100	$ 18,100
Balance of unrecognized compensation expense related to stock options plans | $				$ 3,500
2016 Awards [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options granted | shares				285,000
Recognized stock-based compensation | $				$ 556,400
Balance of unrecognized compensation expense related to stock options plans | $				$ 409,300
Employee Stock Purchase Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of options eligible to purchase under the plan | shares				500,000
Price of common stock as a percent of the average fair market value				85.00%
Maximum individual purchase amount per year | $				$ 25,000
Maximum number of shares of common stock purchasable in total by all participants in the ESPP | shares				500,000
Number of shares released for issuance each fiscal year | shares				25,000
Shares issued under employee stock purchase plan | shares				9,670	18,118
Value of shares issued under employee stock purchase plan | $				$ 13,728	$ 27,747
Employee Stock Purchase Plan [Member] | Minimum [Member] | Tranche One [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Payroll deduction percentage				1.00%
Employee Stock Purchase Plan [Member] | Maximum [Member] | Tranche One [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Payroll deduction percentage				15.00%
Employees Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares available for future issuance | shares				117,914
Non Employee Director Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares available for future issuance | shares				0
Non Employee Director Plan [Member] | Restricted Stock [Member] | October 1, 2015 [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Recognized stock-based compensation | $				$ 69,400
Balance of unrecognized compensation expense related to stock options plans | $				0
Vesting period	6 months
Restricted stock issued | shares	2,000
Shares of restricted stock granted | shares	10,000
Non Employee Director Plan [Member] | Restricted Stock [Member] | October 1, 2014 [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Recognized stock-based compensation | $					$ 60,200
Vesting period			6 months
Restricted stock issued | shares			1,750
Shares of restricted stock granted | shares			8,750
Balance of unrecognized compensation expense related to restricted stock award | $				$ 0

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Stock Compensation And Equity Transactions (Summarized Option Activity) (Details) - $ / shares	12 Months Ended
	Apr. 30, 2016	Apr. 30, 2015	Apr. 30, 2014
Number of securities to be issued upon exercise of outstanding options
Outstanding, beginning balance	85,954	101,554
Options granted	285,000
Options exercised	(2,000)	(13,600)
Options expired	(991)	(2,000)
Outstanding, ending balance	367,963	85,954	101,554
Weighted-average exercise price
Outstanding, Weighted-average exercise price, beginning balance	$ 3.81	$ 3.88
Options granted, Weighted-average exercise price	6.45
Options exercised, Weighted-average exercise price	3.60	4.26
Options expired, Weighted-average exercise price	9.17	4.24
Outstanding, Weighted-average exercise price, ending balance	$ 5.84	$ 3.81	$ 3.88
Outstanding, Number of options exercisable at end of year	172,513	76,954	48,304

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Stock Compensation And Equity Transactions (Stock Options Outstanding, Exercisable, and Non-vested) (Details)	12 Months Ended
	Apr. 30, 2016 $ / shares shares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number options outstanding | shares	367,963
Weighted-average exercise price, outstanding	$ 5.84
Number options outstanding and exercisable | shares	172,513
Weighted-average exercise price, outstanding and exercisable	$ 5.21
Number options non-vested | shares	195,450
Weighted-average exercise price, non-vested	$ 6.40
$3.60 - 6.45 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise prices, lower	3.60
Range of exercise prices, upper	$ 6.45
Number options outstanding | shares	367,963
Weighted-average remaining contract life, outstanding	7 years 5 months 19 days
Weighted-average exercise price, outstanding	$ 5.84
Number options outstanding and exercisable | shares	172,513
Weighted-average remaining contract life, outstanding and exercisable	7 years 5 months 19 days
Weighted-average exercise price, outstanding and exercisable	$ 5.21
$4.24 - 6.45 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise prices, lower	4.24
Range of exercise prices, upper	$ 6.45
Number options non-vested | shares	195,450
Weighted-average remaining contract life, non-vested	8 years 2 months 23 days
Weighted-average exercise price, non-vested	$ 6.40

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Selected Quarterly Financial Data (Unaudited) (Summary Of Quarterly Financial Data) (Details) - USD ($)	3 Months Ended								12 Months Ended
	Apr. 30, 2016	Jan. 31, 2016	Oct. 31, 2015	Jul. 31, 2015	Apr. 30, 2015	Jan. 31, 2015	Oct. 31, 2014	Jul. 31, 2014	Apr. 30, 2016	Apr. 30, 2015
Selected Quarterly Financial Data (Unaudited) [Abstract]
Net sales	$ 60,753,363	$ 59,206,344	$ 69,723,493	$ 64,220,946	$ 60,053,552	$ 53,702,613	$ 61,533,519	$ 54,947,477	$ 253,904,146	$ 230,237,161
Gross profit	5,983,148	5,708,096	7,597,013	6,230,274					25,518,531	22,068,838
Income before income tax expense	288,238	377,599	1,857,036	962,323	403,518	562,123	723,254	15,566	3,485,196	1,704,461
Net income	$ 48,827	$ 218,728	$ 1,156,298	$ 658,806	$ 176,093	$ 564,080	$ 146,429	$ 16,810	$ 2,082,659	$ 903,412
Earnings per share, Basic	$ 0.01	$ 0.05	$ 0.28	$ 0.16	$ 0.04	$ 0.14	$ 0.04	$ 0.00	$ 0.50	$ 0.22
Earnings per share, Diluted	$ 0.01	$ 0.05	$ 0.27	$ 0.16	$ 0.04	$ 0.14	$ 0.04	$ 0.00	$ 0.49	$ 0.22
Total shares- Basic	4,174,251	4,170,193	4,166,758	4,148,285	4,061,504	4,054,146	4,044,240	4,028,535	4,164,815	4,046,988
Total shares-Diluted	4,208,184	4,229,378	4,214,317	4,193,657	4,117,600	4,116,015	4,120,178	4,105,627	4,224,030	4,116,424

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Litigation (Narrative) (Details) - Maria Gracia [Member] - USD ($)		1 Months Ended	12 Months Ended
	Sep. 17, 2015	Dec. 31, 2014	Apr. 30, 2016
Loss Contingencies [Line Items]
Lawsuit filing date			October 25, 2011
Judicial Ruling [Member]
Loss Contingencies [Line Items]
Damages awarded		$ 307,000	$ 374,478
Damages awarded, reduced		$ 300,000
Accrued amount for damages awarded			$ 375,000
Judicial Ruling [Member] | Equitable Relief [Member]
Loss Contingencies [Line Items]
Damages awarded	$ 74,478