Air Industries (AIRI) - 2024 Q4 - Annual Report

Financial Performance - Net sales for fiscal 2024 were $55,108,000, an increase of$3,592,000 or 7.0% compared to $51,516,000 in 2023[140] - Gross profit for fiscal 2024 was$8,932,000, up from $7,428,000 in 2023, with a gross profit margin increase to 16.2$8,473,000, representing 15.4% of net sales, compared to 15.0% in 2023[144] - The company reported a net loss of $1,366,000 for fiscal 2024, a reduction from a net loss of$2,131,000 in 2023, marking a 35.9% improvement[146] - The company achieved an EBITDA of $3,640,000 for the twelve months ending December 31, 2024, exceeding the required$2,800,000[148] Cash Flow and Investments - Cash increased by 117.63% to $753,000 as of December 31, 2024, compared to$346,000 in 2023[139] - For the fiscal year ended December 31, 2024, the company generated cash flows from operations of $324,000, a significant decrease from$4,862,000 in fiscal 2023[159] - Cash used in investing activities was $2,285,000 in 2024, compared to$2,112,000 in 2023, primarily for new property and equipment[160] - Cash provided by financing activities for the year ended December 31, 2024, was $2,368,000, with a net increase in borrowings under the Current Credit Facility of$2,238,000[162] - The company expects to invest approximately $1,600,000 in 2025 for new or upgraded equipment to enhance competitiveness[161] - The company is obligated to pay$43,500 as an Excess Cash Flow payment for the fiscal year ended December 31, 2024[153] Customer and Sales Breakdown - Major customers in 2024 included RTX (29.3%), Lockheed Martin (25.1%), and Northrop (18.3%), with Northrop's contribution significantly increasing from 3.6% in 2023[141] - The E-2 Hawkeye and UH-60 Black Hawk Helicopter platforms accounted for 24.0% and 23.1% of net sales, respectively, in 2024[142] Contractual Obligations and Amendments - As of December 31, 2024, total unfilled contract values amounted to $271.3 million, including a backlog of$117.9 million[137] - The company entered into a Fifth Amendment on August 4, 2023, waiving a default related to the Fixed Coverage Charge Ratio and increasing the purchase money secured debt limit to $2,000,000[151] - The Sixth Amendment on November 20, 2023, revised the Fixed Charge Coverage Ratio requirements to 1.10x for Q1 2024, 1.20x for Q2 2024, and 1.25x for subsequent quarters, while allowing capital expenditures up to$2,500,000 annually[151] - The Seventh Amendment on May 31, 2024, set EBITDA requirements of $740,000 for the six months ending June 30, 2024,$1,500,000 for the nine months ending September 30, 2024, and $2,800,000 for the twelve months ending December 31, 2024[151] - As of December 31, 2024, the company has a borrowing capacity of approximately$7,095,000 under the Revolving Loan[152] Operational Efficiency - The company operates two state-of-the-art manufacturing centers in the U.S. to enhance production efficiency and quality control[134] - The company plans to engage in discussions with lenders in 2025 to explore potential extensions or refinancing of obligations[156]