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Table of Contents



 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q

 

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

For the quarterly period ended March 31, 2025

 

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 No. 001-41391


mtronnotag-logosmall.jpg

M-tron Industries, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Delaware

46-0457944

(State or Other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

  

2525 Shader Rd., Orlando, Florida

32804

(Address of principal executive offices)

(Zip Code)

 

(407) 298-2000

(Registrants telephone number, including area code)

 

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

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $0.01

 

MPTI

 

NYSE American

Warrants to Purchases Shares of Common Stock, Expiring on or before April 25, 2028 MPTI WS NYSE American

 

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

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

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

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

Emerging growth company

   

 

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

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

As of April 30, 2025, the registrant had 2,917,329 shares of common stock, $0.01 par value per share, outstanding.

 



 

 

M-TRON INDUSTRIES, INC.

Form 10-Q for the Period Ended March 31, 2025

 

INDEX

 

              Page

PART I.

 

FINANCIAL INFORMATION

   

Item 1.

 

Financial Statements (Unaudited)

  2
      Condensed Consolidated Statements of Operations   2
      Condensed Consolidated Balance Sheets   3
      Condensed Consolidated Statements of Equity   4
      Condensed Consolidated Statements of Cash Flows   5
      Notes to Condensed Consolidated Financial Statements   6
        1. Background and Description of Business   6
        2. Summary of Significant Accounting Policies   6
        3. Segment Information   8
        4. Related Party Transactions   9
        5. Income Taxes   10
        6. Revolving Credit Agreement   10
        7. Stock-Based Compensation   11
        8. Stockholders' Equity   12
        9. Earnings per Share ("EPS")   12
        10. Commitments and Contingencies   12
        11. Other Financial Statement Information   13
        12. Domestic and Foreign Revenues   13
        13. Subsequent Events   13
               

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

14

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

18

Item 4.

 

Controls and Procedures

 

18

               

PART II.

 

OTHER INFORMATION

   

Item 1.

 

Legal Proceedings

 

19

Item 5.   Other Information   19

Item 6.

 

Exhibits

 

19

               
    Signatures    

    

 

 

 

Cautionary Note Concerning Forward-Looking Statements

 

Certain statements contained in this Quarterly Report on Form 10-Q of M-tron Industries, Inc. ("Mtron" or the "Company") and the Company's other communications and statements, other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company intends for all such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act, as applicable by law. Such statements include, in particular, statements about the Company's beliefs, plans, objectives, goals, expectations, estimates, projections and intentions. These statements are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond the Company's control. The words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan," "target," "goal," and similar expressions are intended to identify forward-looking statements. All forward-looking statements, by their nature, are subject to risks and uncertainties. Therefore, such statements are not intended to be a guarantee of the Company's performance in future periods. The Company's actual future results may differ materially from those set forth in the Company's forward-looking statements. For information concerning these factors and related matters, see "Risk Factors" in the Company’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission ("SEC") on March 27, 2025. However, other factors besides those referenced could adversely affect the Company's results, and you should not consider any such list of factors to be a complete set of all potential risks or uncertainties. Any forward-looking statements made by the Company herein speak as of the date of this Quarterly Report on Form 10-Q. The Company does not undertake to update any forward-looking statement, except as required by law. As a result, you should not place undue reliance on these forward-looking statements.

 

 

 

1

 

PART I

 

FINANCIAL INFORMATION

 

Item 1.

Financial Statements

 

M-tron Industries, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

 

  

Three Months Ended March 31,

(in thousands, except share data)

 

2025

 

2024

Revenues

 $12,732  $11,185 

Costs and expenses:

        

Manufacturing cost of sales

  7,326   6,406 

Engineering, selling and administrative

  3,393   2,990 

Total costs and expenses

  10,719   9,396 

Operating income

  2,013   1,789 

Other income:

        

Interest income, net

  111   32 

Other (expense) income, net

  (10)  42 

Total other income, net

  101   74 

Income before income taxes

  2,114   1,863 

Income tax expense

  484   377 

Net income

 $1,630  $1,486 
         

Income per common share:

        

Basic

 $0.57  $0.55 

Diluted

 $0.56  $0.53 
         

Weighted average shares outstanding:

        

Basic

  2,841,357   2,716,202 

Diluted

  2,906,144   2,784,960 

 

See accompanying Notes to the Condensed Consolidated Financial Statements.

 

 

2

 

M-tron Industries, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

 

(in thousands, except share data)

 

March 31, 2025

 

December 31, 2024

Assets:

        

Current assets:

        

Cash and cash equivalents

 $13,662  $12,641 

Accounts receivable, net of reserves of $201 and $182, respectively

  6,718   6,842 

Inventories, net

  9,365   9,509 

Prepaid expenses and other current assets

  694   760 

Total current assets

  30,439   29,752 

Property, plant and equipment, net

  5,397   5,061 

Right-of-use lease asset

  238   9 

Intangible assets, net

  40   40 

Deferred income tax asset

  1,650   1,623 

Other assets

  1   3 

Total assets

 $37,765  $36,488 
         

Liabilities:

        

Current liabilities:

        

Accounts payable

 $2,010  $1,423 

Accrued compensation and commissions

  1,415   3,235 

Other accrued expenses

  890   500 

Income taxes payable

  258   58 

Total current liabilities

  4,573   5,216 

Long-term lease liability

  41    

Total liabilities

  4,614   5,216 
         

Commitments and Contingencies (Note 10)

          
         

Stockholders' equity:

        

Preferred stock ($0.01 par value; 5,000,000 shares authorized, none issued)

      

Common stock ($0.01 par value; 25,000,000 shares authorized; 2,913,979 and 2,911,165 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively)

  28   28 

Additional paid-in capital

  20,156   19,907 

Retained earnings

  12,967   11,337 

Total stockholders' equity

  33,151   31,272 

Total liabilities and stockholders' equity

 $37,765  $36,488 

 

See accompanying Notes to the Condensed Consolidated Financial Statements.

 

 

3

 

M-tron Industries, Inc.

Condensed Consolidated Statements of Equity

(Unaudited)

 

(in thousands)

 

Preferred Stock

 

Common Stock

 

Additional Paid-in Capital

 

Retained Earnings

 

Total Equity

Balance at December 31, 2024

  $     $ 28     $ 19,907     $ 11,337     $ 31,272  

Net income

                      1,630       1,630  

Stock-based compensation expense

                249             249  

Exercise of stock options

                             

Balance at March 31, 2025

  $     $ 28     $ 20,156     $ 12,967     $ 33,151  

 

 

(in thousands)

 

Preferred Stock

 

Common Stock

 

Additional Paid-in Capital

 

Retained Earnings

 

Total Equity

Balance at December 31, 2023

  $     $ 27     $ 16,167     $ 3,701     $ 19,895  

Net income

                      1,486       1,486  

Stock-based compensation expense

                207             207  

Exercise of stock options

                127             127  

Balance at March 31, 2024

  $     $ 27     $ 16,501     $ 5,187     $ 21,715  

 

See accompanying Notes to the Condensed Consolidated Financial Statements.

 

 

4

 

M-tron Industries, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

   

Three Months Ended March 31,

(in thousands, except share data)

  2025   2024

Cash flows from operating activities:

               

Net income

  $ 1,630     $ 1,486  

Adjustments to reconcile net income to net cash provided by operating activities:

               

Noncash revenues, expenses, gains and losses included in income:

               

Depreciation

    250       219  

Amortization of finite-lived intangible assets

          5  

Stock-based compensation expense

    249       207  

Deferred income tax provision

    (27 )     (61 )

Changes in operating assets and liabilities:

               

Increase in accounts receivable, net

    124       (792 )

Increase in inventories, net

    144       (277 )

Decrease in prepaid expenses and other assets

    68       36  

Increase in accounts payable, accrued compensation and commissions expense and other

    (831 )     673  

Total adjustments

    (23 )     10  

Net cash provided by operating activities

    1,607       1,496  

Cash flows from investing activities:

               

Capital expenditures

    (586 )     (122 )

Net cash used in investing activities

    (586 )     (122 )

Cash flows from financing activities:

               

Proceeds from stock option exercise

          127  

Net cash provided by financing activities

          127  

Increase in cash and cash equivalents

    1,021       1,501  

Cash and cash equivalents at beginning of period

    12,641       3,913  

Cash and cash equivalents at end of period

  $ 13,662     $ 5,414  
                 

Supplemental Disclosure:

               

Cash paid for interest

  $ 2     $ 4  

Cash paid for income taxes

  $ 23     $ 29  

 

See accompanying Notes to the Condensed Consolidated Financial Statements.

 

 

 

5

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)

 

1.     Background and Description of Business

 

Originally founded in 1965, M-tron Industries, Inc. (the "Company," "Mtron," "we," "us," or "our") is engaged in the designing, manufacturing and marketing of highly engineered, high reliability frequency and spectrum control products used to control the frequency or timing of signals in electronic circuits in various applications. Mtron's primary markets are defense, aerospace, space, and avionics.

 

Our component-level devices and modules are used extensively in electronic systems for applications in commercial and military defense, aerospace, satellites, down-hole drilling, medical devices, instrumentation, industrial devices and in infrastructure equipment for the telecommunications and network equipment industries. As an engineering-centric company, Mtron provides close support to the customer throughout its products' entire life cycle, including product design, prototyping, production and subsequent product upgrades and maintenance. This collaborative approach has resulted in the development and growth of long-standing business relationships with its blue-chip customer base.

 

The Company offers a wide range of precision frequency control and spectrum control solutions including: radio frequency, microwave and millimeter wave filters; cavity, crystal, ceramic, lumped element and switched filters; high performance and high frequency oven-controlled crystal oscillators ("OCXO"), integrated phase-locked loops OCXOs, temperature-compensated crystal oscillators, voltage-controlled crystal oscillators, low jitter and harsh environment oscillators; crystal resonators, Integrated Microwave Assemblies ("IMA"); and state-of-the-art solid state power amplifier products.

 

The Company has manufacturing facilities in Orlando, Florida; Yankton, South Dakota; and Noida, India. The Company also has a sales office in Hong Kong. All of Mtron’s production facilities are International Organization for Standardization ("ISO") 9001:2015 certified (the international standard for creating a quality management system) and Restriction of Hazardous Substances ("RoHS") compliant. In addition, its U.S. production facilities in Orlando and Yankton are International Traffic in Arms Regulations ("ITAR") registered and International Aerospace Quality Group AS9100 Rev D certified and our Yankton production facility is Military Standard ("MIL-STD")-790 certified.

 

We maintain our executive offices at 2525 Shader Road, Orlando, Florida 32804. Our telephone number is (407) 298-2000. Our Internet address is www.mtron.com. Our common stock and warrants are traded on the NYSE American under the symbols "MPTI" and "MPTI WS," respectively.

 

 

2.     Summary of Significant Accounting Policies

 

During the three months ended March 31, 2025, there were no material changes to our significant accounting policies included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Annual Report") filed with the Securities and Exchange Commission (the "SEC") on March 27, 2025. For additional information, refer to Note 2 to the audited Consolidated Financial Statements in the 2024 Annual Report.

 

Basis of Presentation

 

These unaudited Condensed Consolidated Financial Statements do not include all disclosures that are normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and should be read in conjunction with the audited Consolidated and Combined Financial Statements and the related notes included in the 2024 Annual Report. The consolidated financial information as of  December 31, 2024 included herein has been derived from the audited Consolidated Financial Statements in the 2024 Annual Report.

 

In the opinion of management, these Condensed Consolidated Financial Statements contain all adjustments (consisting of normal recurring adjustments, including eliminations of material intercompany accounts and transactions) considered necessary for a fair statement of the results presented herein. Operating results for the three months ended  March 31, 2025 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2025.

 

Use of Estimates

 

The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

Research and Development Costs

 

Research and development costs are charged to operations as incurred. For the three months ended  March 31, 2025 and 2024, such costs were approximately $722 and $633, respectively. Such costs are included within Engineering, selling and administrative expenses on the Condensed Consolidated Statements of Operations.

 

 

6

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)

 

Concentration Risks

 

For the three months ended  March 31, 2025, the Company's largest and second largest customers accounted for $4,249, or 33.4%, and $1,336, or 10.5%, of the Company's total revenues, respectively. For the three months ended March 31, 2024, the Company's largest and second largest customers accounted for $4,875, or 43.6%, and $2,203, or 19.7%, of the Company’s total revenues, respectively. 

 

A significant portion of the Company's accounts receivable is concentrated with a relatively small number of customers. As of March 31, 2025, the Company's four largest customers accounted for approximately $3,971, or 57.4%, of gross accounts receivable. As of December 31, 2024, four of the Company's largest customers accounted for approximately $4,648, or 66.2%, of gross accounts receivable. The Company carefully evaluates the creditworthiness of its customers in deciding to extend credit. As a result, the Company has experienced very low historical bad debt expense and believes the related risk to be minimal.

 

Impairments of Long-Lived Assets

 

Long-lived assets, including intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Long-lived assets are grouped with other assets to the lowest level to which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Management assesses the recoverability of the carrying cost of the assets based on a review of projected undiscounted cash flows. If an asset is held for sale, management reviews its estimated fair value less cost to sell. Fair value is determined using pertinent market information, including appraisals or broker's estimates, and/or projected discounted cash flows. In the event an impairment loss is identified, it is recognized based on the amount by which the carrying value exceeds the estimated fair value of the long-lived asset.

 

We performed an assessment to determine if there were any indicators of impairment as of  March 31, 2025 and December 31, 2024.We concluded that, while there were events and circumstances in the macro-environment that did impact us, we did not experience any entity-specific indicators of asset impairment and no triggering events occurred.

 

Accounting Standards Adopted

 

Segment Reporting

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, "Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures" ("ASU 2023-07"), to address improvements to reportable segment disclosures. The standard primarily requires the following disclosure on an annual and interim basis: (i) significant segment expenses that are regularly provided to chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss; and (ii) other segment items and description of its composition. The standard also requires current annual disclosures about a reportable segment's profits or losses and assets to be disclosed in interim periods and the title and position of the CODM with an explanation of how the CODM uses the report measure(s) of segment profits or losses in assessing segment performance. The provisions of the standard are effective for public companies for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The standard is applied retrospectively to all prior periods presented. The Company adopted ASU 2023-07 in December 2024. Refer to Note 3 - Segment Information for further information.

 

Future Application of Accounting Standards

 

Disaggregation of Income Statement Expenses

In  November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)" ("ASU 2024-03"). The standard requires certain details for expenses presented on the face of the Consolidated Statements of Operations as well as selling expenses to be presented in the notes to the financial statements on an interim and annual basis. The provisions of the standard are effective for public companies for fiscal years beginning after  December 15, 2026, and interim periods within fiscal years beginning after  December 31, 2027. The amendment can be applied either prospectively or retrospectively, with early adoption permitted.  The Company is currently assessing the impact of this standard.

 

Income Taxes

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740) - Improvements to Income Tax Disclosures" ("ASU 2023-09"). The standard requires disaggregated information about a company's effective tax rate reconciliation as well as information on income taxes paid. The provisions of the standard are effective for public companies for fiscal years beginning after December 15, 2024, with early adoption permitted. This standard applies prospectively; however, retrospective application is permitted. The Company is currently assessing the impact of this standard.

 

 

7

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)
 

3.     Segment Information

 

Chief Operating Decision Maker

 

The Company's chief operating decision maker ("CODM") is the Chief Executive Officer.

 

Reportable Segments

 

We report our results of operations consistent with the manner in which the CODM reviews the business to assess performance and allocate resources. As such, we report our results in a single reporting segment: Electronic Components.

 

The Electronic Components segment derives revenues from sales to customers of wide range of precision frequency control and spectrum control solutions, including, but not limited to, the following:

 

filters;

 

oscillators;

 

crystal resonators; and

 

integrated microwave assemblies.

 

Measure of Segment Profit or Loss and Segment Assets

 

The accounting policies of the Electronic Components segment are the same as those described in Note 2 – Summary of Significant Accounting Policies.

 

The CODM assesses the performance of and decides how to allocate resources to the Electronic Components segment based on Segment gross profit (loss) as well as Net income, which is also reported on the Consolidated Statements of Operations as consolidated Net income. The CODM uses Segment gross profit to evaluate to evaluate the manufacturing costs of the Electronic Components segment’s products and to ensure those products are priced appropriately. The CODM uses Segment net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the Electronic Components segment or into other parts of the entity, such as for capital expenditures or acquisitions. Additionally, the CODM uses net income to monitor budget versus actual results as well as in competitive analysis to Mtron's peers. The budget versus actuals and competitive analysis are used in assessing the performance of the Electronic Components segment.

 

The measure of segment assets is reported on the Consolidated Balance Sheets as consolidated Total assets.

 

The following table presents Mtron's operations for the Electronic Components segment for the three months ended March 31, 2025 and 2024:

  

Three Months Ended March 31,

  

2025

 

2024

Revenues

 $12,732  $11,185 
         

Less:

        

Cost of goods sold

  5,221   5,276 

Manufacturing expenses

  2,105   1,130 

Segment gross profit

 $5,406  $4,779 
         

Less:

        

Research and development costs

  722   633 

Selling and commissions

  975   784 

General and administrative expenses

  1,670   1,547 

Income tax expense

  484   377 

Other segment items (a)

  (75)  (48)

Segment net income

 $1,630  $1,486 
         

Reconciliation of Segment gross profit to Consolidated net income

 

Segment operating expenses, net

  (3,393)  (2,990)

Other income

  101   74 

Income tax expense

  (484)  (377)

Consolidated net income

 $1,630  $1,486 
         

Reconciliation of Segment net income to Consolidated net income

 

Adjustments and reconciling items

      

Consolidated net income

 $1,630  $1,486 

(a)

Other segment items includes the following:

 

Interest income

 

Income received under the Amended and Restated Transitional Administrative and Management Services Agreement with LGL Group

 

Foreign currency gains and losses

 

Expense reimbursements paid to / received from LGL Group

 

8

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)

 

Other Segment Disclosures

 

The following tables present other segment information for the Electronic Components segment as of  March 31, 2025 and  December 31, 2024 and for the three months ended March 31, 2025 and 2024:

  

Three Months Ended March 31,

  

2025

 

2024

Interest income

 $115  $36 

Interest expense

  (4)  (4)

Depreciation

  250   219 

Amortization

     5 

Other significant non-cash items

        

Stock-based compensation

  249   207 
         

Capital expenditures

  (586)  (122)

 

  

March 31, 2025

 

December 31, 2024

Total assets

 $37,765  $36,488 

 

 

4.     Related Party Transactions

 

In the normal course of business, the Company enters into various transactions with affiliated companies. Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party in making financial or operating decisions.

 

The following table summarizes income and expenses from transactions with related parties for the three months ended March 31, 2025 and 2024:

  

Three Months Ended March 31,

  

2025

 

2024

  

Income

 

Expense

 

Income

 

Expense

GAMCO Investors, Inc.

 $114  $  $34  $ 

The LGL Group, Inc.

  12   26   12   26 

Total

 $126  $26  $46  $26 

 

The following table summarizes assets and liabilities with related parties as of  March 31, 2025 and December 31, 2024:

  

March 31, 2025

 

December 31, 2024

  

Assets

 

Liabilities

 

Assets

 

Liabilities

GAMCO Investors, Inc.

 $12,029  $  $10,415  $ 

The LGL Group, Inc.

  68      59    

Total

 $12,097  $  $10,474  $ 

 

The material agreements whereby the Company generates revenues and expenses with affiliated entities are discussed below:

 

Investment Activity with GAMCO Investors, Inc.

 

Certain balances are held and invested in U.S. Treasury funds managed or advised by GAMCO Investors, Inc. or one of its subsidiaries (collectively, "GAMCO" or the "Fund Manager"), which is related to the Company through certain of our shareholders. For the three months ended March 31, 2025 and 2024, the Company paid the Fund Manager a fund management fee of approximately 8 basis points annually of the asset balances under management, which are not paid directly by the Company and are deducted prior to the fund striking its net asset value ("NAV").

 

As of  March 31, 2025 and December 31, 2024, the balance with the Fund Manager was $12,029 and $10,415, respectively, all of which was classified within Cash and cash equivalents on the Condensed Consolidated Balance Sheets.

 

For the three months ended March 31, 2025 and 2024, the Company earned income on its investments with the Fund Manager totaling $114 and $34, respectively, all of which was included in Interest income on the Condensed Consolidated Statements of Operations.

 

 

9

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)

 

Transactions with The LGL Group, Inc.

 

Transitional Administrative and Management Services Agreement

On October 7, 2022, the separation of the Mtron business from The LGL Group, Inc. ("LGL Group") was completed (the "Separation") and the Company became an independent, publicly traded company trading on the NYSE American under the stock symbol "MPTI." The Separation was completed through LGL Group's distribution (the "Distribution") of 100% of the shares of the Company's common stock to holders of LGL Group's common stock as of the close of business on September 30, 2022, the record date for the Distribution. 

 

Mtron and The LGL Group, Inc. ("LGL Group") entered into an Amended and Restated Transitional Administrative and Management Services Agreement ("Mtron TSA"), which sets out the terms for services to be provided between the two companies post Separation. The current terms result in a net monthly payment of $4 per month from LGL Group to Mtron.

 

For the three months ended March 31, 2025 and 2024, LGL Group paid the Company $12 under the terms of the Mtron TSA, which were recorded in Other income (expense), net on the Condensed Consolidated Statements of Operations.

 

Tax Indemnity and Sharing Agreement

Mtron and LGL Group entered into a Tax Indemnity and Sharing Agreement ("Mtron Tax Agreement"), which sets out the terms for which party would be responsible for taxes imposed on LGL Group if the Distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction under Internal Revenue Code ("IRC") Sections 355 and 368(a)(1)(D) if such failure were the result of actions taken after the Distribution by Mtron or LGL Group.

 

For the three months ended March 31, 2025 and 2024, no taxes related to the Distribution have been recorded in the Condensed Consolidated Financial Statements.

 

Other Transactions

Mtron and LGL Group agreed to share the salaries and benefits related to certain employees incurred by LGL Group. For the three months ended March 31, 2025 and 2024, the Company reimbursed LGL Group $26 of the salaries and benefits of certain employees, respectively, which represents 50% of those costs and were recorded in Engineering, selling and administrative on the Condensed Consolidated Statements of Operations.

 

 

5.     Income Taxes

 

The Company’s quarterly provision for income taxes is measured using an annual effective tax rate, adjusted for discrete items within the period presented. To determine the annual effective tax rate, the Company estimates both the total income (loss) before income taxes for the full year and the jurisdictions in which that income (loss) is subject to tax. The actual effective tax rate for the full year may differ from these estimates if income (loss) before income taxes is greater than or less than what was estimated or if the allocation of income (loss) to jurisdictions in which it is taxed is different from the estimated allocations.

 

The effective tax rate for the three months ended March 31, 2025 and 2024 was 22.9% and 20.2%, respectively. Differences between the Company's effective income tax rate and the U.S. federal statutory rate are primarily the impact of research and development credits, permanent differences, and state taxes.

 

 

6.     Revolving Credit Agreement

 

On June 15, 2022, Mtron entered into a loan agreement (the "Loan Agreement") for a revolving line of credit with Fifth Third Bank, National Association ("Fifth Third Bank"), for up to $5,000 bearing interest at the Secured Overnight Financing Rate ("SOFR") plus a margin of 2.25%, with a SOFR floor of 0.00%. The Loan Agreement has a maturity date of June 15, 2025 and contains various affirmative and negative covenants that are customary for lines of credit and transactions of this type, including limitations on the incurrence of debt and liabilities, as well as financial reporting requirements. The Loan Agreement also imposes certain financial covenants based on Debt Service Coverage Ratio, Current Ratio, and the Ratio of Total Liabilities to Total Net Worth (as such terms are defined in the Loan Agreement). All loans pursuant to the Loan Agreement will be secured by a continuing and unconditional first priority security interest in and to any and all property of the Company.

 

As of  March 31, 2025 and December 31, 2024, there were no outstanding borrowings under the revolving line of credit with Fifth Third Bank.

 

 

10

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)
 

7.     Stock-Based Compensation

 

Under the Company's Amended and Restated 2022 Incentive Plan (the "2022 Plan"), stock-based compensation may be awarded to employees, advisors and members of the Board. As of  March 31, 2025252,416 shares remained available for future issuance under the 2022 Plan.

 

The following table summarizes stock-based compensation expense, which includes expenses related to awards granted under the 2022 Plan, for the periods indicated:

  

For the Three Months Ended

  

2025

 

2024

Restricted stock awards

 $249  $207 

Total

 $249  $207 

 

Restricted Stock Awards

 

The following table summarizes restricted stock awards activity for the three months ended March 31, 2025:

  

Number of Shares

 

Weighted Average Grant Date Fair Value

 

Aggregate Grant Date Fair Value

Balance as of December 31, 2024

  70,124  $22.90  $1,606 

Granted

  2,814   37.39   105 

Vested

  (2,814)  (37.39)  (105)

Canceled

         

Balance as of March 31, 2025

  70,124  $22.90  $1,606 

 

As of March 31, 2025, there was $1,227 of total unrecognized compensation cost related to unvested shares granted. The cost is expected to be recognized over a weighted-average period of 1.7 years.

 

Stock Options

 

The following table provides a rollforward of stock option activity for the three months ended March 31, 2025:

  

Number of Options Outstanding

 

Weighted Average Exercise Price

 

Weighted Average Grant Date Fair Value

 

Weighted Average Remaining Term (in years)

 

Aggregate Intrinsic Value

Outstanding and exercisable as of December 31, 2024

  98,014  $36.06  $10.98   2.0  $1,212 

Granted

                 

Exercised

                 

Forfeited

                 

Outstanding and exercisable as of March 31, 2025

  98,014  $36.06  $10.98   1.7  $831 

 

 

11

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)
 

8.     Stockholders' Equity

 

Shares Outstanding

 

The following table presents a rollforward of outstanding shares for the periods indicated:

  

Three Months Ended March 31, 2025

 

Year Ended December 31, 2024

  

Common Stock Issued

 

Held in Treasury

 

Common Stock Outstanding

 

Common Stock Issued

 

Held in Treasury

 

Common Stock Outstanding

Shares, beginning of period

  2,911,165      2,911,165   2,786,321      2,786,321 

Stock-based compensation

  2,814      2,814   32,548      32,548 

Exercise of stock options

           92,296      92,296 

Shares, end of period

  2,913,979      2,913,979   2,911,165      2,911,165 

 

 

9.     Earnings per Share ("EPS")

 

The following table presents a reconciliation of Net income and shares used in calculating basic and diluted net income per common share for the periods indicated:

  

Three Months Ended March 31,

(in thousands, except share data)

 

2025

 

2024

Numerator for EPS:

        

Net income

 $1,630  $1,486 
         

Denominator for EPS:

        

Weighted average shares outstanding - basic

  2,841,357   2,716,202 

Dilutive effects:

        

Stock options

  23,563   7,581 

Restricted stock

  41,224   61,177 

Weighted average shares outstanding - diluted

  2,906,144   2,784,960 
         

Income per common share:

        

Basic

 $0.57  $0.55 

Diluted

 $0.56  $0.53 

 

 

10.     Commitments and Contingencies

 

In the ordinary course of business, the Company and its subsidiaries may become defendants in certain product liability, patent infringement, worker claims and other litigation. The Company records a liability when it is probable that a loss has been incurred and the amount is reasonably estimable. The Company has no legal accrual for contingencies as of March 31, 2025 and December 31, 2024.

 

 

12

M-tron Industries, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
(Dollar amounts in thousands, unless otherwise stated)
 

11.     Other Financial Statement Information

 

Inventories, Net

 

Inventories are valued at the lower of cost or net realizable value using the first-in, first-out ("FIFO") method. The Company reduces the value of its inventories to net realizable value when the net realizable value is believed to be less than the cost of the item.

 

The components of inventory as of  March 31, 2025 and  December 31, 2024 are summarized below:

  

March 31, 2025

 

December 31, 2024

Raw materials

 $4,340  $4,349 

Work in process

  4,715   4,876 

Finished goods

  1,844   1,720 

Total gross inventory

  10,899   10,945 

Reserve for excess and obsolete inventory

  (1,534)  (1,436)

Total Inventories, net

 $9,365  $9,509 

 

Property, Plant and Equipment, Net

 

The components of property, plant and equipment as of  March 31, 2025 and  December 31, 2024 are summarized below:

  

March 31, 2025

 

December 31, 2024

Land

 $536  $536 

Buildings and improvements

  5,496   5,496 

Machinery and equipment

  22,250   21,664 

Gross property, plant and equipment

  28,282   27,696 

Less: Accumulated depreciation

  (22,885)  (22,635)

Property, plant and equipment, net

 $5,397  $5,061 

 

 

12.     Domestic and Foreign Revenues

     

Significant foreign revenues from operations (10% or more of foreign sales) for the three months ended March 31, 2025 and 2024 were as follows:

  

Three Months Ended March 31,

  

2025

 

2024

Malaysia

 $1,259  $882 

Greece

  245   388 

Australia

  63   774 

All other foreign countries

  822   626 

Total foreign revenues

 $2,389  $2,670 

Total domestic revenues

 $10,343  $8,515 

 

The Company allocates its foreign revenue based on the customer's ship-to location.

 

 

13.    Subsequent Events

 

The Company has evaluated events and transactions that occurred after the balance sheet date through the date that the consolidated financial statements were issued. Based upon this review, the Company did not identify any subsequent events, except as noted below, that would have required adjustment or disclosure in the consolidated financial statements.

 

Warrant Dividend

 

On February 27, 2025, Mtron's Board of Directors declared a warrant dividend to shareholders of record as of March 10, 2025. On April 25, 2025, 2,911,165 warrants were distributed to shareholders. The warrants are listed on the NYSE American under the ticker "MPTI WS." Five (5) warrants will entitle their holder to purchase one (1) share of Mtron common stock at an exercise price of $47.50 per share. The warrants are exercisable beginning at the earlier of (i) thirty (30) prior to  April 25, 2028, the calendar expiration date, or (ii) the date on which the average volume weighted average price ("VWAP") for Mtron common stock is greater than or equal to $52.00 per share for the prior thirty (30) consecutive trading period (the "Trigger"). The warrants expire on the earlier of (i) April 25, 2028 or (ii) thirty (30) days immediately after the Company's public announcement that the Trigger has occurred. Additionally, warrant holders exercising their full allotment of warrants can apply to subscribe for any or all share of common stock issuable pursuant to any outstanding but unexercised warrants.

 

Assuming that all warrants are exercised, the net proceeds from the exercise of the warrants will be $27.5 million. The Company intends to use the net proceeds from the exercise of the warrants for general corporate purposes.

 
 

 

 
13

 

Item 2.

Managements Discussion and Analysis of Financial Condition and Results of Operations

 

The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the accompanying unaudited Condensed Consolidated Financial Statements, the notes thereto and the other unaudited financial data included in this Quarterly Report on Form 10-Q. The following discussion should also be read in conjunction with the audited Consolidated and Combined Financial Statements and the notes thereto, and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (the "SEC") on March 27, 2025. The terms the "Company,", "Mtron," "MPTI," "we," "our," or "us" refer to M-tron Industries, Inc. and unless otherwise defined herein, capitalized terms used herein shall have the same meanings as set forth in our Condensed Consolidated Financial Statements and the notes thereto.

 

Unless otherwise stated, all dollar amounts are in thousands.

 

In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Actual results may differ materially from those discussed in the forward-looking statements as a result of various factors. See the Cautionary Note Concerning Forward-Looking Statements included in this Quarterly Report on Form 10-Q.

 

Overview

 

Mtron is engaged in the designing, manufacturing and marketing of highly-engineered, high reliability frequency and spectrum control products used to control the frequency or timing of signals in electronic circuits in various applications. Mtron's primary markets are defense, aerospace, space, and avionics.

 

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all of its majority-owned subsidiaries.

 

Trends and Uncertainties

 

We are not aware of any material trends or uncertainties, other than national economic conditions affecting our industry generally, that may reasonably be expected to have a material impact, favorable or unfavorable, on our revenues or income other than the one listed below and the risk factors disclosed in our Annual Report on Form 10-K, as filed with the SEC on March 27, 2025.

 

Tariffs

 

The current U.S. federal administration has imposed tariffs on certain products and materials entering the United States imported from other countries. Additionally, foreign governments have imposed retaliatory tariffs on products and materials exported from the United States. The increase in tariffs could have an adverse impact on Manufacturing cost of sales as these tariffs could increase our costs at a higher rate than our revenues, the extent of which is unknown as the Company is pursuing various avenues to reduce the potential impact. To date, we have seen no impact from tariffs on demand for our products.

 

 

14

 

Results of Operations

 

The following table presents our Condensed Consolidated Statements of Operations for the periods indicated:

   

Three Months Ended March 31,

               

(in thousands)

 

2025

 

2024

 

$ Change

 

% Change

Revenues

  $ 12,732     $ 11,185     $ 1,547       13.8 %

Costs and expenses:

                               

Manufacturing cost of sales

    7,326       6,406       920       14.4 %

Engineering, selling and administrative

    3,393       2,990       403       13.5 %

Total costs and expenses

    10,719       9,396       1,323       14.1 %

Operating income

    2,013       1,789       224       12.5 %

Other income:

                               

Interest income, net

    111       32       79       246.9 %

Other (expense) income, net

    (10 )     42       (52 )     -123.8 %

Total other income, net

    101       74       27       36.5 %

Income before income taxes

    2,114       1,863       251       13.5 %

Income tax expense

    484       377       107       28.4 %

Net income

  $ 1,630     $ 1,486     $ 144       9.7 %

 

Three months ended March 31, 2025 compared to three months ended March 31, 2024

 

Total Revenues

Total revenues increased $1,547, or 13.8%, from $11,185 for the three months ended March 31, 2024 to $12,732 for the three months ended March 31, 2025 primarily due to strong defense product shipments.

 

Total Costs and Expenses

Total expenses increased $1,323, or 14.1%, from $9,396 for the three months ended March 31, 2024 to $10,719 for the three months ended March 31, 2025. The increase is primarily due to the following:

 

a $920, or 14.4%, increase in Manufacturing cost of sales from $6,406 for the three months ended March 31, 2024 to $7,326 for the three months ended March 31, 2025 driven by higher revenues and the introduction of new products; and

 

a $403, or 13.5%, increase in Engineering, selling and administrative from $2,990 for the three months ended March 31, 2024 to $3,393 for the three months ended March 31, 2025 from higher research and development costs, higher sales commissions related to an increase in revenues, and an increase in corporate expenses consistent with the overall growth in the business.

 

Gross Margin

Gross margin (Revenues less Manufacturing cost of sales as a percentage of Revenues) decreased 27 basis points from 42.7% for the three months ended March 31, 2024 to 42.5% for the three months ended March 31, 2025 reflecting higher revenues and the increase in production of several new products, which resulted in higher initial manufacturing costs.

 

Total Other Income, Net

Total Other income, net increased $27, or 36.5%, from $74 for the three months ended March 31, 2024 to $101 for the three months ended March 31, 2025. The increase is primarily due to a $79, or 246.9%, increase in Interest income, net from $32 for the three months ended March 31, 2024 to $111 for the three months ended March 31, 2025 primarily due to higher balances invested in money market mutual funds.

 

The increase was partially offset by a $52, or 123.8%, decrease in Other income (expense), net from $42 for the three months ended March 31, 2024 to ($10) for the three months ended March 31, 2025 primarily due to unfavorable currency movements related to our India production facility.

 

Income Tax Expense

Income tax expense increased $107, or 28.4%, from $377 for the three months ended March 31, 2024 to $484 for the three months ended March 31, 2025 primarily due to the increase in Income before income taxes driven by the increase in revenues discussed above.

 

Backlog

 

As of March 31, 2025, our order backlog was $55,501, an increase of $8,262, or 17.5%, from $47,239 as of December 31, 2024 and an increase of $9,371, or 20.3%, from $46,130 as of March 31, 2024. The increase in backlog from December 31, 2024 is primarily due to several large orderes received during the quarter. The nature of a program centric business model materially affects backlog based on the timing and size of the orders.

 

 

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Non-GAAP Financial Measures

 

To supplement our Condensed Consolidated Financial Statements presented on a GAAP basis, the Company presents its financial condition and results of operations in the way it believes will be most meaningful and representative of its business results. Some of the measurements the Company uses are "Non-GAAP financial measures" under SEC rules and regulations. The non-GAAP financial measures the Company presents are listed below and may not be comparable to similarly-named measures reported by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net earnings or diluted earnings per share prepared in accordance with GAAP.

 

The Company uses the following operating performance measure because the Company believes it provides both management and investors with a more complete understanding of the underlying operational results and trends and our marketplace performance as well as a more accurate view of the Company's ability to generate cash profits:

 

Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization ("EBITDA") is derived by excluding the items set forth below from Income before income taxes. Excluded items include the following:

 

Interest income

 

Interest expense

 

Depreciation

 

Amortization

 

Non-cash stock-based compensation

 

Other discrete items that might have a significant impact on comparable GAAP measures and could distort the evaluation of our normal operating performance.

 

Reconciliation of GAAP Income Before Income Taxes to Non-GAAP Adjusted EBITDA

 

The following table presents a reconciliation of income before income taxes to Adjusted EBITDA, a non-GAAP measure:

   

Three Months Ended March 31,

(in thousands, except share data)

 

2025

 

2024

Income before income taxes

  $ 2,114     $ 1,863  

Adjustments:

               

Interest income

    (111 )     (32 )

Depreciation

    250       219  

Amortization

          5  

Total adjustments

    139       192  

EBITDA

    2,253       2,055  

Non-cash stock compensation

    249       207  

Adjusted EBITDA

  $ 2,502     $ 2,262  

 

Three months ended March 31, 2025 compared to three months ended March 31, 2024

Adjusted EBITDA increased $240 from $2,262 for the three months ended March 31, 2024 to $2,502 for the three months ended March 31, 2025 primarily due to higher revenues and continued containment of operating expenses partially offset by higher interest income.

 

 

16

 

Liquidity and Capital Resources

 

Overview

 

Liquidity refers to our ability to access sufficient sources of cash to meet the requirements of our operating, investing and financing activities.

 

Capital refers to our long-term financial resources available to support business operations and future growth.

 

Our ability to generate and maintain sufficient liquidity and capital depends on the profitability of the business, timing of cash flows, general economic conditions and access to the capital markets and the other sources of liquidity and capital described herein.

 

As of March 31, 2025 and December 31, 2024, Cash and cash equivalents were $13,662 and $12,641, respectively.

 

Cash Flow Activity

 

The following table presents the cash flow activity for the periods indicated:

   

As of March 31,

(in thousands)

 

2025

 

2024

Cash and cash equivalents, beginning of period

  $ 12,641     $ 3,913  

Cash provided by operating activities

    1,607       1,496  

Cash used in investing activities

    (586 )     (122 )

Cash provided by financing activities

          127  

Net change in cash and cash equivalents

    1,021       1,501  

Cash and cash equivalents, end of period

  $ 13,662     $ 5,414  

 

Operating Activities

Cash provided by operating activities was $1,607 for the three months ended March 31, 2025 compared to cash provided by operating activities of $1,496 for the three months ended March 31, 2024, an increase of $111, primarily due to the following:

 

Net income increased $144 from $1,486 for the three months ended March 31, 2024 to $1,630 for the three months ended March 31, 2025.

 

Stock-based compensation increased $42 from $207 for the three months ended March 31, 2024 to $249 for the three months ended March 31, 2025.

 

The increase was partially offset by:

 

Net change in operating assets and liabilities decreased $135 from ($360) for the three months ended March 31, 2024 to ($495) for the three months ended March 31, 2025.

 

Our working capital metrics and ratios were as follows:

(in thousands)

 

March 31, 2025

 

December 31, 2024

Current assets

  $ 30,439     $ 29,752  

Less: Current liabilities

    4,573       5,216  

Working capital

  $ 25,866     $ 24,536  
                 

Current ratio

    6.7       5.7  

 

Management continues to focus on efficiently managing working capital requirements to match operating activity levels and will seek to deploy the Company’s working capital where it will generate the greatest returns.

 

Investing Activities

Cash used in investing activities was $586 for the three months ended March 31, 2025 compared to cash used in investing activities of $122 for the three months ended March 31, 2024, an increase of $464, primarily due to the timing of purchases of equipment.

 

Financing Activities

Cash provided by financing activities was $0 for the three months ended March 31, 2025 compared to cash provided by financing activities of $127 for the three months ended March 31, 2024, a decrease of $127, primarily due to the exercise of stock options by an executive officer in 2024.

 

 

17

 

Capital Resources

 

We believe that existing cash and cash equivalents, marketable securities and cash generated from operations will provide sufficient liquidity to meet our ongoing working capital and capital expenditure requirements for the next 12 months from the date of this filing. At various times throughout the year and as of March 31, 2025 and December 31, 2024, some deposits held at financial institutions were in excess of federally insured limits. The Company has not experienced any losses related to these balances.

 

Our Board of Directors has adhered to a practice of not paying cash dividends. This policy takes into account our long-term growth objectives, including our anticipated investments for organic growth, potential acquisitions and stockholders' desire for capital appreciation of their holdings.

 

Revolving Line of Credit

 

On June 15, 2022, the Company entered into a loan agreement (the “Loan Agreement”) for a revolving line of credit with Fifth Third Bank, National Association ("Fifth Third Bank"), for up to $5,000 bearing interest at the Secured Overnight Financing Rate ("SOFR") plus a margin of 2.25%, with a SOFR floor of 0.00%. The Loan Agreement has a maturity date of June 15, 2025 and contains various affirmative and negative covenants that are customary for lines of credit and transactions of this type, including limitations on the incurrence of debt and liabilities, as well as financial reporting requirements. The Loan Agreement also imposes certain financial covenants based on Debt Service Coverage Ratio, Current Ratio, and the Ratio of Total Liabilities to Total Net Worth (as such terms are defined in the Loan Agreement). All loans pursuant to the Loan Agreement are secured by a continuing and unconditional first priority security interest in and to any and all property of the Company.

 

As of March 31, 2025 and December 31, 2024, there were no outstanding borrowings under the revolving line of credit with Fifth Third Bank.

 

Critical Accounting Estimates

 

The preparation of financial statements in conformity with U.S. GAAP requires management to adopt accounting policies related to estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period, as well as the related disclosure of contingent assets and liabilities at the date of the financial statements. On an ongoing basis, management evaluates its accounting policies, estimates and judgments, including those related to income taxes and inventories. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

 

There have been no material changes to the critical accounting estimates disclosed in our Annual Report on Form 10-K, as filed with the SEC on March 27, 2025.

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

Not applicable.

 

Item 4.

Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures 

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported within the time periods specified in the rules and forms, and that such information is accumulated and communicated to us, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, an evaluation as of March 31, 2025 was conducted under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures, as of March 31, 2025, were effective.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

 

18

 

PART II

 

OTHER INFORMATION

 

Item 1.

Legal Proceedings

 

In the ordinary course of business, we may become subject to litigation or claims. We are not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which we or any of our subsidiaries are a party or to which our or their properties are subject.

 

Item 5.

Other Information

 

During the three months ended March 31, 2025, none of our directors or officers, as defined in Section 16 of the Exchange Act, adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408 of Regulation S-K of the Exchange Act.

 

Item 6.

Exhibits

 

The following exhibits are included, or incorporated by reference, in this Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025 (and are numbered in accordance with Item 601 of Regulation S-K):

 

        Incorporated by Reference    

Exhibit No.

 

Description

  Form   File No.   Exhibit   Filing Date  

Filed Herewith

                         
2.   Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession.                    
2.1   Amended and Restated Separation and Distribution Agreement by and between The LGL Group, Inc. and M-tron Industries, Inc., dated August 19, 2022.   10   001-41391   2.1   August 19, 2022    
                         
3.   Articles of Incorporation and Bylaws.                    
3.1   Amended and Restated Certificate of Incorporation of M-tron Industries, Inc.   10   001-41391   3.1   August 3, 2022    
3.2   Amended and Restated Bylaws of M-tron Industries, Inc.   10   001-41391   3.2   August 3, 2022    
                         
4.   Instruments Defining the Rights of Security Holders.                    
4.1   Warrant Agreement, dated as of April 25, 2025, by and among M-tron Industries, Inc., Computershare Inc., and Computershare Trust Company, N.A.                   X
                         
31.1   Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   X
31.2   Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   X
                         
32.1   Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*                   X
32.2   Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*                   X
                         

101.INS

 

Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

                  X
101.SCH   Inline XBRL Taxonomy Extension Schema Document                   X
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document                   X
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document                   X
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document                   X
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document                   X
                         
104   The cover page for the Company’s Quarterly Report on Form 10-Q has been formatted in Inline XBRL and contained in Exhibit 101                   X

*

Furnished herewith. In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

 

19

 

SIGNATURES

 

Pursuant to the requirements 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.

 

   

M-TRON INDUSTRIES, INC.

    (Registrant)
     

Date:          May 13, 2025

 

By:

/s/ Cameron Pforr

     

Cameron Pforr

     

Interim Chief Executive Officer and Chief Financial Officer

(Principal Executive Officer and Principal Financial Officer)

       
       

Date:          May 13, 2025    

 

By:

/s/ Linda M. Biles

     

Linda M. Biles

     

Executive Vice President - Finance

(Principal Accounting Officer)

 

 

 

20