Revenue Performance - Third Quarter revenue slightly declined to $82,620,000 from $84,252,000 in the same quarter last year, while revenue for the first nine months grew 5.0% to $237,774,000[2] - Net sales for the three months ended October 31, 2024, were $82,620,000, a decrease of 1.9% compared to $84,252,000 for the same period in 2023[27] - For the nine months ended October 31, 2024, net sales increased to $237,774,000, up 4.9% from $226,516,000 in the prior year[29] Profitability Metrics - Gross Profit for the Third Quarter decreased 4.0% to $36,678,000, with a Gross Margin of 44.4%, compared to 45.4% in the prior year[3] - Gross profit for the three months ended October 31, 2024, was $36,678,000, down from $38,211,000, reflecting a gross margin decrease[27] - Gross profit for the nine months ended October 31, 2024, was $107,243,000, an increase from $99,991,000, indicating improved profitability[29] Operating Income - Operating Income for the Third Quarter declined to $11,113,000, or 13.5% of sales, while it increased 3.8% to $35,978,000 for the first nine months[5] - Operating income for the three months ended October 31, 2024, was $11,113,000, a decline of 24.0% from $14,706,000 in the prior year[27] - Operating income for the nine months ended October 31, 2024, rose to $35,978,000, compared to $34,648,000 in the previous year, showing a growth of 3.8%[29] Net Income - Net income for the Third Quarter was $8,401,000, down from $10,160,000 in the same period last year, but up to $27,374,000 for the first nine months from $24,252,000[7] - Net income for the three months ended October 31, 2024, was $8,401,000, compared to $10,160,000 for the same period in 2023, representing a decrease of 17.3%[27] - Net income for the nine months ended October 31, 2024, was $27,374,000, an increase of 8.8% from $24,252,000 in the same period last year[29] Expenses - Selling, General, and Administrative Expenses (SG&A) increased 8.8% to $25,565,000, representing 30.9% of revenue, primarily due to higher freight and installation costs[4] Cash and Equity - As of October 31, 2024, the Company had $38,858,000 in cash and was not utilizing any of its available credit under its seasonal revolver[9] - Stockholder's Equity increased 23.5% to $115,859,000 from $93,789,000 at the same period last year[13] Dividends - The Company declared a quarterly dividend of $0.025 per share, payable on January 10, 2025[14] - Cash dividends declared per common share for the three months ended October 31, 2024, were $0.025, while for the nine months, it was $0.065[27][29] Inventory and Receivables - Inventories decreased 16.9% to $48,948,000 compared to $58,931,000 at the end of last year's Third Quarter[11] - Accounts Receivable declined 14.7% to $28,168,000, reflecting faster collections on higher annual revenue[12] Earnings Per Share - Basic net income per common share for the three months ended October 31, 2024, was $0.52, down from $0.62 in the prior year[27]

Revenue and Orders - The Company recognized approximately $9 million in additional revenue from disaster recovery orders in Q1 2024 compared to Q1 2023, with further orders of $4 million and $6 million delivered in Q2 and Q3, respectively [89]. - For the three-month period ended October 31, 2024, the Company experienced a 13% decrease in orders compared to the same period last year, but a 2% increase in orders for the nine-month period [90]. - The sales order backlog decreased to approximately $25 million at October 31, 2024, down from $42.6 million in the prior year [91]. Financial Performance - Net income for the three months ended October 31, 2024, was $8.4 million on sales of $82.6 million, compared to net income of $10.2 million on sales of $84.3 million in the prior year [97]. - Sales for the nine-month period ended October 31, 2024, increased by approximately $11.3 million or 5.0% compared to the same period in the prior year, driven by increased volume and product mix [102]. - Gross margin for the first nine months ended October 31, 2024, was 45.1%, up from 44.1% in the prior year, due to increased production levels and stable raw material costs [103]. - Selling, general and administrative expenses for the nine months ended October 31, 2024, increased to 30.0% of sales from 28.9% in the prior year, attributed to higher variable selling and service expenses [104]. Cash and Tax - The Company had $38.9 million in cash and no borrowings under its line of credit as of October 31, 2024, compared to $4.9 million in cash and approximately $3.7 million in borrowings at the same date in 2023 [92]. - The effective income tax rate for the nine months ended October 31, 2024, was 24.4%, compared to 24.0% in the prior year [106]. Lease and Assets - The Company executed a 5-year lease renewal for its facility in Torrance, CA, resulting in an increase in ROU Assets of approximately $33 million [93].

Core Viewpoint - Virco Manufacturing reported a revenue increase of 1% in 2Q25, which is a surprise given a 14% decline in backlog compared to the previous year, indicating potential inefficiencies and challenges ahead for the company [1][2][5] Revenue Performance - The company experienced a revenue surprise, with a 1% year-over-year increase, contrasting sharply with previous growth rates of up to 40% [2] - The backlog from 1Q25 was down 14% compared to 1Q24, leading to concerns about future sales performance [2][5] - Management noted improved efficiency in order processing, suggesting that backlogs may not accurately reflect business volume [2] Future Trends - Management acknowledged that future trends are becoming more challenging, with indications that the post-pandemic recovery may be slowing [2][3] - The removal of the non-GAAP 'Shipments plus backlog' figure from earnings releases raises concerns about the company's future outlook [3] External Factors - The ESSER program, which provided $200 billion for school infrastructure, has significantly influenced demand, but the remaining funds are minimal, impacting future growth [4] - Shipping costs have surged, with the China container index up 100% and the Shanghai index up 150% compared to December 2023, which may disadvantage Virco's competitors who rely on imports [4] Valuation - Virco's stock is currently valued at a P/E of 8.8x, with a market cap of $240 million, but this valuation may not reflect the company's long-term growth potential [5] - Future earnings may stabilize around $14 million, yielding 5.8%, which is only slightly above Treasury yields, indicating limited investment appeal [5]

Economic Overview - Major indexes have experienced volatility, with soft economic data raising concerns about the economy's health [1][3] - The August jobs data showed private payrolls increased by only 142,000, below the expected 161,000, leading to worries about a cooling labor market [3] - The manufacturing sector continues to struggle, with the ISM manufacturing index declining for the fifth consecutive month [4] Market Performance - The S&P 500 declined 4.3% for the week, marking its worst week since March 2023, while the Nasdaq fell 5.8%, its worst weekly performance since 2022 [4] - September is historically one of the worst months for stocks, with the S&P 500 showing poor performance since 1950 due to portfolio adjustments by investors returning from summer vacations [7][6] Federal Reserve Actions - The Federal Reserve is expected to initiate rate cuts, with a 25 basis point cut anticipated in the upcoming FOMC meeting [5] - There is uncertainty regarding the extent of the rate cuts, especially with the Presidential election approaching [6] Dividend-Paying Stocks - In light of market volatility, investing in dividend-paying stocks is recommended for steady income and capital preservation [2][8] - Companies highlighted for their dividend performance include: - **Virco Mfg. Corporation (VIRC)**: Dividend of $0.03 per share, 0.61% yield, payout ratio of 5% [10] - **Brady Corporation (BRC)**: Dividend of $0.24 per share, 1.29% yield, payout ratio of 22% [12] - **Broadcom Inc. (AVGO)**: Dividend of $0.53 per share, 1.49% yield, payout ratio of 56% [15] - **Verizon Communications Inc. (VZ)**: Dividend of $0.68 per share, 6.23% yield, payout ratio of 58% [17]

Core Viewpoint - Virco Manufacturing Corporation (VIRC) reported mixed results for the second quarter of fiscal 2024, with earnings exceeding expectations while sales fell short, leading to a 9.3% decline in share price following the announcement [1]. Financial Performance - Adjusted earnings were reported at $1.04 per share, surpassing the Zacks Consensus Estimate of $1.00 by 4%, and increased from 95 cents per share in the previous quarter [5]. - Net sales reached $108.4 million, missing the consensus estimate of $115.9 million by 6.5%, but grew 1% year-over-year [5]. - Gross profit increased by 3.4% year-over-year to $50.2 million, with gross margin expanding by 100 basis points to 46.3% [6]. - Operating profit was reported at $21.9 million, compared to $21.2 million in the prior-year quarter [7]. Operational Highlights - The increase in earnings and sales was driven by higher factory output, improved operating efficiencies, and a significant counter-seasonal disaster recovery order [2]. - Although order rates slightly declined during summer, shipments and backlog remained higher than the previous year, indicating confidence in adapting to market changes [3]. Strategic Outlook - The company plans to pursue potential acquisition opportunities to enhance its business capabilities and aims to add shareholder value through quarterly dividends and share repurchases [4]. - Virco's strong financial position supports ongoing investments in new manufacturing equipment and service expansions, positioning the company to capitalize on unexpected opportunities in the post-pandemic market [3]. Financial Position - As of the end of the fiscal second quarter, cash stood at $0.8 million, down from $5.3 million at the end of fiscal 2023, while long-term debt slightly decreased to $4 million [8]. - Inventory at the end of the second quarter was $58.6 million, a slight increase from $58.4 million in the year-ago period [8].

Financial Performance - Net sales for the three months ended July 31, 2024, increased to $108,419,000, compared to $107,321,000 for the same period in 2023, representing a growth of 1.02%[10]. - Gross profit for the three months ended July 31, 2024, was $50,218,000, up from $48,578,000 in the prior year, indicating an increase of 3.38%[10]. - Net income for the three months ended July 31, 2024, reached $16,833,000, compared to $15,534,000 for the same period in 2023, reflecting a growth of 8.35%[10]. - Operating income for the six months ended July 31, 2024, was $24,865,000, compared to $19,942,000 for the same period in 2023, marking an increase of 24.4%[11]. - Net income for the six months ended July 31, 2024, was $18,973,000, compared to $14,092,000 for the same period in 2023, representing a 34.1% increase[17]. - The company reported a net comprehensive income of $16,814,000 for the three months ended July 31, 2024, compared to $15,534,000 in the prior year, an increase of 8.2%[13]. - Basic net income per share increased to $1.04 for the three months ended July 31, 2024, from $0.95 for the same period in 2023, reflecting a growth of 9.5%[50]. - The Company experienced a 9.1% increase in sales for the six-month period ended July 31, 2024, totaling $155.2 million compared to $142.3 million in the prior year[71]. Assets and Liabilities - Total current assets as of July 31, 2024, were $125,331,000, an increase from $89,026,000 as of January 31, 2024, showing a significant rise of 40.5%[6]. - Total liabilities decreased to $55,506,000 as of July 31, 2024, from $91,063,000 as of July 31, 2023, a reduction of 39.0%[8]. - The current portion of long-term debt decreased to $253,000 as of July 31, 2024, from $32,256,000 as of July 31, 2023, a significant decline of 99.2%[8]. - Total stockholders' equity rose to $107,812,000 as of July 31, 2024, up from $82,295,000 as of July 31, 2023, representing an increase of 31.2%[8]. - Total stockholders' equity increased to $107,812,000 as of July 31, 2024, up from $82,295,000 a year earlier, reflecting a 30.9% growth[19]. - The Company’s long-term debt stood at $4,261,000 as of July 31, 2024, a decrease from $46,517,000 reported on July 31, 2023[40]. Cash Flow and Dividends - Net cash provided by operating activities was $7,963,000 for the six months ended July 31, 2024, compared to a net cash used of $(21,150,000) in the prior year[17]. - Cash at the end of the period was $7,771,000, significantly higher than $1,600,000 at the end of July 2023[17]. - Cash dividends declared per common share increased to $0.04 for the six months ended July 31, 2024, compared to no dividends declared in the same period last year[11]. - The company’s cash dividends paid during the six months ended July 31, 2024, totaled $653,000, compared to no dividends paid in the same period of 2023[17]. - The Company declared a cash dividend of $0.025 per share for the third fiscal quarter, payable on October 11, 2024[15]. Operational Metrics - The Company reported a decrease in trade accounts receivable by $32,934,000 for the six months ended July 31, 2024, compared to a decrease of $(50,187,000) in the same period of 2023[17]. - Accounts receivable decreased by $12.5 million at July 31, 2024, due to improved collections and earlier shipments[73]. - The sales order backlog declined to approximately $61.3 million at July 31, 2024, down from $74.0 million in the prior year[66]. - Selling, general and administrative expenses increased by approximately $3.9 million for the six months ended July 31, 2024, primarily due to increased variable selling and service expenses[72]. Lease and Debt Management - The Company has a remaining balance of lease payments totaling $53,356,000 as of July 31, 2024[39]. - The Company’s incremental borrowing rate for leases is estimated at 9.78% as of July 31, 2024, compared to 6.36% in the previous year[37]. - The Company has a minimum future lease payment of $3,232,000 for the year ending January 31, 2025[39]. - A 5-year lease renewal for the Company's facility in Torrance, CA resulted in an increase in ROU Assets of approximately $33.0 million[68]. - The Company incurred $2,886,000 in purchases of property, plant, and equipment during the six months ended July 31, 2024[17]. - Long-term debt borrowing amounted to $23,165,000, while repayment of long-term debt was $23,288,000 during the same period[17]. - The Company had no borrowings under its line of credit as of July 31, 2024, a first in its 74-year history, compared to $42.0 million borrowed at the same date in 2023[67]. Compliance and Governance - The Company is in compliance with its debt covenants as of July 31, 2024[44]. - The Company does not expect the recently issued accounting standards to have a material impact on its consolidated financial statements and disclosures[28]. Miscellaneous - Approximately 50% of annual sales occur in June, July, and August, indicating a highly seasonal sales cycle[63]. - The effective income tax rate for the three months ended July 31, 2024, was 23.7%, slightly higher than 23.6% for the same period in 2023[49]. - The Company recognized total stock-based compensation expense of $98,000 for the three months ended July 31, 2024, down from $149,000 in the same period of 2023[53]. - The Company had a valuation allowance of $218,000 for deferred tax assets as of July 31, 2024, indicating a need to reduce the carrying amount of deferred tax assets[48]. - Shipping and classroom delivery costs for the three months ended July 31, 2024, were approximately $10.1 million, compared to $10.0 million for the same period in 2023[60]. - The Company has authorized a repurchase program of up to $5.0 million for its common stock, announced on December 8, 2023[86]. - As of July 31, 2024, the maximum number of shares that may yet be purchased under the program is 3,501,551[86]. - No shares were purchased in May, June, or July 2024 under the repurchase program[86].

Exhibit 99.1 Virco Reports Improved Financial Position Following Record Second Quarter and First Half Results • EPS Improves 9.5% in Quarter, 33.3% YTD to Record $1.16 per Share • Operating Income reaches 20.2% in Second Quarter; 16.0% YTD • Company is Effectively Debt Free; Growth is being Financed by Cash Flow from Operations • Company Increases Quarterly Dividend to $0.025 per share, Payable October 11 to Shareholders of Record as of September 20 • Order Rates Remain Strong but Recent Trends Suggest Post ...

Virco Manufacturing Corporation (VIRC) came out with quarterly earnings of $1.04 per share, beating the Zacks Consensus Estimate of $1 per share. This compares to earnings of $0.95 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 4%. A quarter ago, it was expected that this company would post a loss of $0.13 per share when it actually produced earnings of $0.13, delivering a surprise of 200%. Over the last four quarters, the c ...

EPS Improves 9.5% in Quarter, 33.3% YTD to Record $1.16 per Share Operating Income reaches 20.2% in Second Quarter; 16.0% YTD Company is Effectively Debt Free; Growth is being Financed by Cash Flow from Operations Company Increases Quarterly Dividend to $0.025 per share, Payable October 11 to Shareholders of Record as of September 20 Order Rates Remain Strong but Recent Trends Suggest Post-Pandemic Recovery May Be Slowing TORRANCE, Calif., Sept. 09, 2024 (GLOBE NEWSWIRE) -- Virco Mfg. Corporation (NASDAQ: V ...

Virco Mfg. Corporation (VIRC) is expected to have generated stronger performance in second-quarter fiscal 2025. In the last reported quarter, VIRC's earnings per share (EPS) and net sales surpassed the Zacks Consensus Estimate by 200% and 24%, respectively. On a year-over-year basis, revenues increased 33.7% and EPS expanded 244.4%. The company's bottom line topped the consensus mark in seven of the trailing eight quarters. Trend in Estimate Revision The Zacks Consensus Estimate for the to-be-reported quart ...