QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||||||||
☒ | Smaller reporting company | ||||||||||
Emerging growth company |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Net sales | $ | $ | |||||||||
Cost of goods sold | |||||||||||
Gross profit | |||||||||||
Selling, general and administrative expenses | |||||||||||
Amortization of intangible assets | |||||||||||
Gain on disposal of operating assets | ( | ||||||||||
Operating loss | ( | ( | |||||||||
Interest expense, net | |||||||||||
Foreign currency exchange loss (gain), net | ( | ||||||||||
Other expense, net | |||||||||||
Loss before income tax expense | ( | ( | |||||||||
Income tax expense | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Net loss per share | |||||||||||
Basic | $ | ( | $ | ( | |||||||
Diluted | $ | ( | $ | ( | |||||||
Weighted-average number of common shares (basic) | |||||||||||
Weighted-average number of common shares (diluted) |
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Net loss | $ | ( | $ | ( | |||||||
Other comprehensive loss: | |||||||||||
Foreign currency translation adjustment, net of tax | |||||||||||
Retirement plan liability adjustment, net of tax | |||||||||||
Other | |||||||||||
Comprehensive loss | $ | ( | $ | ( |
December 31, 2023 | September 30, 2023 | ||||||||||
(unaudited) | |||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Receivables, net of allowance for doubtful accounts of $ | |||||||||||
Contract assets | |||||||||||
Inventories, net | |||||||||||
Refundable income taxes | |||||||||||
Prepaid expenses and other current assets | |||||||||||
Total current assets | |||||||||||
Property, plant and equipment, net | |||||||||||
Operating lease right-of-use assets, net | |||||||||||
Intangible assets, net | |||||||||||
Goodwill | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Current maturities of long-term debt | $ | $ | |||||||||
Promissory note - related party | |||||||||||
Revolver | |||||||||||
Short-term operating lease liabilities | |||||||||||
Accounts payable | |||||||||||
Accrued liabilities | |||||||||||
Total current liabilities | |||||||||||
Long-term debt, net of current maturities, net of unamortized debt issuance costs | |||||||||||
Long-term operating lease liabilities, net of short-term | |||||||||||
Deferred income taxes, net | |||||||||||
Pension liability | |||||||||||
Other long-term liabilities | |||||||||||
Shareholders’ equity: | |||||||||||
Serial preferred shares, no par value, authorized | |||||||||||
Common shares, par value $ | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Total shareholders’ equity | |||||||||||
Total liabilities and shareholders’ equity | $ | $ |
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Adjustments to reconcile net loss to net cash (used for) provided by operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
Amortization of debt issuance costs | |||||||||||
Gain on disposal of operating assets | ( | ||||||||||
Loss on insurance proceeds received for non-property claim | |||||||||||
LIFO effect | |||||||||||
Share transactions under company stock plan, net | |||||||||||
Inventory valuation accounts | ( | ||||||||||
Other long-term liabilities | ( | ||||||||||
Deferred income taxes | ( | ||||||||||
Changes in operating assets and liabilities: | |||||||||||
Receivables | |||||||||||
Contract assets | ( | ( | |||||||||
Inventories | ( | ||||||||||
Prepaid expenses and other current assets | ( | ||||||||||
Other assets | ( | ||||||||||
Accounts payable | |||||||||||
Other accrued liabilities | ( | ||||||||||
Accrued income and other taxes | |||||||||||
Net cash (used for) provided by operating activities | ( | ||||||||||
Cash flows from investing activities: | |||||||||||
Proceeds from disposal of operating assets | |||||||||||
Capital expenditures | ( | ( | |||||||||
Net cash used for investing activities | ( | ( | |||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from long-term debt | |||||||||||
Payments on long-term debt | ( | ( | |||||||||
Proceeds from revolving credit agreement | |||||||||||
Repayments of revolving credit agreement | ( | ( | |||||||||
Payment of debt issuance costs | ( | ||||||||||
Proceeds from promissory note related party | |||||||||||
Short-term debt borrowings | |||||||||||
Short-term debt repayments | ( | ( | |||||||||
Net cash provided by financing activities | |||||||||||
Increase (decrease) in cash and cash equivalents | ( | ||||||||||
Cash and cash equivalents at the beginning of the period | |||||||||||
Effect of exchange rate changes on cash and cash equivalents | |||||||||||
Cash and cash equivalents at the end of the period | $ | $ | |||||||||
Supplemental disclosure of cash flow information of operations: | |||||||||||
Cash paid for interest | $ | ( | $ | ( | |||||||
Non-cash investing activities: | |||||||||||
Additions to property, plant & equipment - incurred but not yet paid | $ | $ | |||||||||
Non-cash financing activities: | |||||||||||
Debt issuance cost due at maturity - related party | $ | $ |
Three Months Ended December 31, 2023 | ||||||||||||||||||||||||||||||||||||||
Common | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Shareholders’ Equity | ||||||||||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||||||
Balance - September 30, 2023 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Comprehensive (loss) income | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||
Performance and restricted share expense | — | — | — | — | ||||||||||||||||||||||||||||||||||
Share transactions under equity-based plans | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Balance - December 31, 2023 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Three Months Ended December 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Common | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Shareholders’ Equity | ||||||||||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||||||
Balance - September 30, 2022 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Comprehensive (loss) income | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||
Performance and restricted share expense | — | — | — | — | ||||||||||||||||||||||||||||||||||
Share transactions under equity-based plans | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Balance - December 31, 2022 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Net loss | $ | ( | $ | ( | |||||||
Weighted-average common shares outstanding (basic and diluted) | |||||||||||
Net loss per share – basic and diluted | $ | ( | $ | ( | |||||||
Anti-dilutive weighted-average common shares excluded from calculation of diluted earnings per share |
December 31, 2023 | September 30, 2023 | ||||||||||
Raw materials and supplies | $ | $ | |||||||||
Work-in-process | |||||||||||
Finished goods | |||||||||||
Total inventories, net | $ | $ |
December 31, 2023 | September 30, 2023 | ||||||||||
Foreign currency translation adjustment | $ | ( | $ | ( | |||||||
Retirement plan liability adjustment, net of tax | ( | ( | |||||||||
Interest rate swap agreement, net of tax | |||||||||||
Total accumulated other comprehensive loss | $ | ( | $ | ( |
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Finance lease expense: | |||||||||||
Amortization of right-of use assets on finance leases | $ | $ | |||||||||
Interest on lease liabilities | |||||||||||
Operating lease expense | |||||||||||
Variable lease cost | |||||||||||
Total lease expense | $ | $ |
Classification in the consolidated condensed balance sheets | December 31, 2023 | September 30, 2023 | |||||||||||||||
Assets: | |||||||||||||||||
Finance lease assets | $ | $ | |||||||||||||||
Operating lease assets | Operating lease right-of-use assets, net | ||||||||||||||||
Total lease assets | $ | $ | |||||||||||||||
Current liabilities: | |||||||||||||||||
Finance lease liabilities | $ | $ | |||||||||||||||
Operating lease liabilities | Short-term operating lease liabilities | ||||||||||||||||
Non-current liabilities: | |||||||||||||||||
Finance lease liabilities | |||||||||||||||||
Operating lease liabilities | Long-term operating lease liabilities, net of short-term | ||||||||||||||||
Total lease liabilities | $ | $ |
December 31, 2023 | December 31, 2022 | ||||||||||
Other Information | |||||||||||
Cash paid for amounts included in measurement of liabilities: | |||||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Operating cash flows from finance leases | |||||||||||
Financing cash flows from finance leases | |||||||||||
December 31, 2023 | September 30, 2023 | ||||||||||
Weighted-average remaining lease term (years): | |||||||||||
Finance leases | |||||||||||
Operating leases | |||||||||||
Weighted-average discount rate: | |||||||||||
Finance leases | % | % | |||||||||
Operating leases | % | % |
Finance Leases | Operating Leases | |||||||
Year ending September 30, | ||||||||
2024 (excluding the three months ended December 31, 2023) | $ | $ | ||||||
2025 | ||||||||
2026 | ||||||||
2027 | ||||||||
2028 | ||||||||
Thereafter | ||||||||
Total lease payments | $ | $ | ||||||
Less: Imputed interest | ( | ( | ||||||
Present value of lease liabilities | $ | $ |
December 31, 2023 | September 30, 2023 | ||||||||||
Revolving credit agreement | $ | $ | |||||||||
Foreign subsidiary borrowings, net of unamortized debt issuance cost | |||||||||||
Promissory note - related party | |||||||||||
Finance lease obligations | |||||||||||
Less: unamortized debt issuance cost - ($ | ( | ||||||||||
Other, net of unamortized debt issuance costs $( | |||||||||||
Total debt | |||||||||||
Less – current maturities | ( | ( | |||||||||
Total long-term debt | $ | $ |
December 31, 2023 | September 30, 2023 | ||||||||||
Term loan, net of unamortized debt issuance cost $( | $ | $ | |||||||||
Short-term borrowings | |||||||||||
Factor | |||||||||||
Total debt | $ | $ | |||||||||
Less – current maturities | ( | ( | |||||||||
Total long-term debt | $ | $ | |||||||||
Receivables pledged as collateral | $ | $ |
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Service cost | $ | $ | |||||||||
Interest cost | |||||||||||
Expected return on plan assets | ( | ( | |||||||||
Amortization of net loss | |||||||||||
Net periodic pension cost (benefit) | $ | $ |
Three Months Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Commercial revenue | $ | $ | |||||||||
Military revenue | |||||||||||
Total | $ | $ |
Three Months Ended December 31, | |||||||||||
Net Sales | 2023 | 2022 | |||||||||
Aerospace components for: | |||||||||||
Fixed wing aircraft | $ | $ | |||||||||
Rotorcraft | |||||||||||
Energy components for power generation units | |||||||||||
Commercial product and other revenue | |||||||||||
Total | $ | $ |
Three Months Ended December 31, | |||||||||||
Net Sales | 2023 | 2022 | |||||||||
North America | $ | $ | |||||||||
Europe | |||||||||||
Total | $ | $ |
December 31, 2023 | December 31, 2022 | ||||||||||
Contract assets - Beginning balance | $ | $ | |||||||||
Additional revenue recognized over-time | |||||||||||
Less amounts billed to the customers | ( | ( | |||||||||
Contract assets - Ending balance | $ | $ |
December 31, 2023 | December 31, 2022 | ||||||||||
Contract liabilities (included within Accrued liabilities) - Beginning balance | $ | ( | $ | ( | |||||||
Payments received in advance of performance obligations | ( | ( | |||||||||
Performance obligations satisfied | |||||||||||
Contract liabilities (included within Accrued liabilities) - Ending balance | $ | ( | $ | ( |
(Dollars in millions) | Three Months Ended December 31, | Increase/ (Decrease) | |||||||||||||||
Net Sales | 2023 | 2022 | |||||||||||||||
Aerospace components for: | |||||||||||||||||
Fixed wing aircraft | $ | 9.9 | $ | 10.7 | $ | (0.8) | |||||||||||
Rotorcraft | 3.2 | 4.4 | (1.2) | ||||||||||||||
Energy components for power generation units | 6.2 | 4.6 | 1.6 | ||||||||||||||
Commercial product and other revenue | 1.8 | 1.6 | 0.2 | ||||||||||||||
Total | $ | 21.1 | $ | 21.3 | $ | (0.2) |
Weighted Average Interest Rate Three Months Ended December 31, | Weighted Average Outstanding Balance Three Months Ended December 31, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revolving credit agreement | 7.7 | % | 5.9 | % | $ 15.6 million | $ 11.2 million | |||||||||||||||||
Foreign term debt | 4.3 | % | 3.5 | % | $ 8.2 million | $ 7.3 million | |||||||||||||||||
Other debt | 1.0 | % | 1.7 | % | $ 0.3 million | $ 0.6 million |
Dollars in thousands | Three Months Ended | ||||||||||
December 31, | |||||||||||
2023 | 2022 | ||||||||||
Net loss | $ | (3,422) | $ | (2,589) | |||||||
Adjustments: | |||||||||||
Depreciation and amortization expense | 1,562 | 1,571 | |||||||||
Interest expense, net | 430 | 275 | |||||||||
Income tax expense | 50 | 66 | |||||||||
EBITDA | (1,380) | (677) | |||||||||
Adjustments: | |||||||||||
Foreign currency exchange loss (gain), net (1) | 4 | (3) | |||||||||
Other expense, net (2) | 54 | 72 | |||||||||
Gain on disposal of assets (3) | — | (11) | |||||||||
Equity compensation (4) | 86 | 122 | |||||||||
LIFO impact (5) | 293 | 262 | |||||||||
IT incident costs, net (6) | (1) | 110 | |||||||||
Strategic alternative expense (7) | 187 | — | |||||||||
Adjusted EBITDA | $ | (757) | $ | (125) |
Exhibit No. | Description | |||||||
2.1 | ||||||||
2.2 | ||||||||
3.1 | ||||||||
3.2 | ||||||||
9.1 | ||||||||
9.2 | ||||||||
9.3 | ||||||||
9.4 | ||||||||
9.5 | ||||||||
10.1 | ||||||||
10.2 |
10.3 | ||||||||
10.4 | ||||||||
10.5 | ||||||||
10.6 | ||||||||
10.7 | ||||||||
10.8 | ||||||||
10.9 | ||||||||
10.10 | ||||||||
10.11 | ||||||||
10.12 | ||||||||
10.13 | ||||||||
10.14 | ||||||||
10.15 | ||||||||
10.16 | ||||||||
10.17 | ||||||||
10.18 | ||||||||
10.19 | ||||||||
10.20 | ||||||||
10.21 | ||||||||
10.22 | ||||||||
10.23 |
10.24 | ||||||||
10.25 | ||||||||
10.26 | ||||||||
10.27 | ||||||||
10.28 | ||||||||
10.29 | ||||||||
10.30 | ||||||||
10.31 | ||||||||
10.32 | ||||||||
10.33 | ||||||||
10.34 | ||||||||
14.1 | ||||||||
*31.1 | ||||||||
*31.2 | ||||||||
*32.1 | ||||||||
*32.2 | ||||||||
*97.1 | ||||||||
*101 | The following financial information from SIFCO Industries, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2023 filed with the SEC on February 14, 2024, formatted in XBRL includes: (i) Consolidated Condensed Statements of Operations for the fiscal periods ended December 31, 2023 and 2022, (ii) Consolidated Condensed Statements of Comprehensive Income for the fiscal periods ended December 31, 2023 and 2022, (iii) Consolidated Condensed Balance Sheets at December 31, 2023 and September 30, 2023, (iv) Consolidated Condensed Statements of Cash Flow for the fiscal periods ended December 31, 2023 and 2022, (iv) Consolidated Condensed Statements of Shareholders' Equity for the periods December 31, 2023 and 2022, and (v) the Notes to the Consolidated Condensed Financial Statements. | |||||||
*104 | Cover Page Interactive Data File: the cover page XBRL tags are embedded within the Inline XBRL document and are contained with Exhibit 101 |
SIFCO Industries, Inc. | ||||||||
(Registrant) | ||||||||
Date: February 14, 2024 | /s/ Peter W. Knapper | |||||||
Peter W. Knapper | ||||||||
President and Chief Executive Officer | ||||||||
(Principal Executive Officer) | ||||||||
Date: February 14, 2024 | /s/ Thomas R. Kubera | |||||||
Thomas R. Kubera | ||||||||
Chief Financial Officer | ||||||||
(Principal Financial Officer) |
Date: February 14, 2024 | /s/ Peter W. Knapper | |||||||
Peter W. Knapper | ||||||||
President and Chief Executive Officer |
Date: February 14, 2024 | /s/ Thomas R. Kubera | |||||||
Thomas R. Kubera | ||||||||
Chief Financial Officer | ||||||||
Date: February 14, 2024 | /s/ Peter W. Knapper | |||||||
Peter W. Knapper | ||||||||
President and Chief Executive Officer |
Date: February 14, 2024 | /s/ Thomas R. Kubera | |||||||
Thomas R. Kubera | ||||||||
Chief Financial Officer | ||||||||
Consolidated Condensed Statements of Operations - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Income Statement [Abstract] | ||
Net sales | $ 21,052 | $ 21,299 |
Cost of goods sold | 20,316 | 20,038 |
Gross profit | 736 | 1,261 |
Selling, general and administrative expenses | 3,581 | 3,280 |
Amortization of intangible assets | 40 | 61 |
Gain on disposal of operating assets | 0 | (11) |
Operating loss | (2,885) | (2,069) |
Interest expense, net | 430 | 275 |
Foreign currency exchange loss (gain), net | 4 | (3) |
Other expense, net | 53 | 182 |
Loss before income tax expense | (3,372) | (2,523) |
Income tax expense | 50 | 66 |
Net loss | $ (3,422) | $ (2,589) |
Net loss per share | ||
Basic (in dollars per share) | $ (0.57) | $ (0.44) |
Diluted (in dollars per share) | $ (0.57) | $ (0.44) |
Weighted-average number of common shares (basic) (in shares) | 5,956 | 5,896 |
Weighted-average number of common shares (diluted) (in shares) | 5,956 | 5,896 |
Consolidated Condensed Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (3,422) | $ (2,589) |
Other comprehensive loss: | ||
Foreign currency translation adjustment, net of tax | 253 | 342 |
Retirement plan liability adjustment, net of tax | 43 | 78 |
Other | 0 | 1 |
Comprehensive loss | $ (3,126) | $ (2,168) |
Consolidated Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 121 | $ 242 |
Serial preferred shares, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred shares, shares issued (in shares) | 0 | 0 |
Preferred shares, shares outstanding (in shares) | 0 | 0 |
Common shares, par value (in dollars per share) | $ 1 | $ 1 |
Common shares, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Common shares, shares issued (in shares) | 6,160,000 | 6,105,000 |
Common shares, shares outstanding (in shares) | 6,160,000 | 6,105,000 |
Summary of Significant Accounting Policies |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies A. Principles of Consolidation The accompanying unaudited consolidated condensed financial statements include the accounts of SIFCO Industries, Inc. and its wholly-owned subsidiaries (collectively, the "Company"). All significant intercompany accounts and transactions have been eliminated in consolidation. The U.S. dollar is the functional currency for all of the Company’s operations in the United States ("U.S.") and its non-operating subsidiaries. For these operations, all gains and losses from completed currency transactions are included in income (loss). The functional currency for the Company's non-U.S. subsidiaries is the Euro. Assets and liabilities are translated into U.S. dollars at the rates of exchange at the end of the period, and revenues and expenses are translated using average rates of exchange for the period which approximate the rates in effect at the date of the transaction. Foreign currency translation adjustments are reported as a component of accumulated other comprehensive loss in the unaudited consolidated condensed financial statements. These unaudited consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s fiscal 2023 Annual Report on Form 10-K. The year-end consolidated condensed balance sheet contained in these financial statements was derived from the audited financial statements and disclosures required by accounting principles generally accepted in the U.S. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) and disclosures considered necessary for a fair presentation have been included. The results of operations for any interim period are not necessarily indicative of the results to be expected for other interim periods or the full year. B. Accounting Policies A summary of the Company’s significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company's Annual Report on Form 10-K for the year ended September 30, 2023. C. Net Loss per Share The Company’s net loss per basic share has been computed based on the weighted-average number of common shares outstanding. During a period of net loss, zero restricted and performance shares are included in the calculation of diluted earnings per share because the effect would be anti-dilutive. In a period of net income, the net income per diluted share reflects the effect of the Company's outstanding restricted shares and performance shares under the treasury stock method. The dilutive effect is as follows:
D. Going Concern In accordance with ASU 2014-15, "Presentation of Financial Statements—Going Concern (Subtopic 205-40) ("ASC 205-40")", the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that the financial statements are issued. This evaluation requires management to perform two steps. First, management must evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern. Second, if management concludes that substantial doubt is raised, management is required to consider whether its plans that are not yet fully implemented are probable of both being implemented and effective in alleviating that doubt. In the event substantial doubt is raised, disclosures in the notes to the consolidated condensed financial statements of management’s plans and management’s conclusion as to whether the substantial doubt exists or has been alleviated are required. The consolidated condensed financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets, or the amounts and classification of liabilities that may result from the outcome of this uncertainty. This step shall not take into consideration the potential mitigating effects of plans that have not been fully implemented as of the date the financial statements are issued. The Company has debt maturing in October 2024. As a result of this condition, there is substantial doubt about the Company’s ability to continue as a going concern. The Company continues to evaluate available financial alternatives, including obtaining acceptable alternative financing. The Company cannot provide assurances that it will be successful in restructuring the existing debt obligations, obtaining capital or entering into a strategic alternative transaction which provides sufficient funding for the refinancing of its outstanding indebtedness prior to the maturity date of its obligations under the Credit Agreements. See Note 7, Debt. E. Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" and subsequent updates. ASU 2016-13 changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The new guidance will replace the current incurred loss approach with an expected loss model. The new expected credit loss impairment model will apply to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt instruments, net investments in leases, loan commitments and standby letters of credit. Upon initial recognition of the exposure, the expected credit loss model requires entities to estimate the credit losses expected over the life of an exposure (or pool of exposures). The estimate of expected credit losses should consider historical information, current information and reasonable and supportable forecasts, including estimates of prepayments. Financial instruments with similar risk characteristics should be grouped together when estimating expected credit losses. ASU 2016-13 does not prescribe a specific method to make the estimate, so its application will require significant judgment. ASU 2016-13 is effective for public companies in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. However, in November 2019, the FASB issued ASU 2019-10, "Financial Instruments - Credit Loss (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)," which defers the effective date for public filers that qualify as a smaller reporting company ("SRC"), as defined by the Securities and Exchange Commission, to fiscal years after December 15, 2022, including interim periods within those fiscal years. Because SIFCO is considered a SRC, this ASU is effective for the Company beginning October 1, 2023. The effect of adopting this ASU did not have an impact to the Company's results within the consolidated condensed statements of operations and financial condition. F. Recent Accounting Standards Not Yet Adopted In July 2023, the FASB issued ASU 2023-03, "Presentation of Financial Statement (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718)", to amend various SEC paragraphs in the Accounting Standards Codification to reflect the issuance of SEC Staff Accounting Bulletin No. 120, among other things. The ASU does not provide any new guidance so there is no transition or effective date associated with it. The Company is currently assessing the impact of adopting ASU 2023-03 on the consolidated condensed financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", that would enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. ASC 280 requires a public entity to report for each reportable segment a measure of segment profit or loss that its chief operating decision maker ("CODM") uses to assess segment performance and to make decisions about resource allocations. The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more useful financial analyses. Currently, Topic 280 requires that a public entity disclose certain information about its reportable segments. For example, a public entity is required to report a measure of segment profit or loss that the CODM uses to assess segment performance and make decisions about allocating resources. ASC 280 also requires other specified segment items and amounts such as depreciation, amortization and depletion expense to be disclosed under certain circumstances. The amendments in ASU 2023-07 do not change or remove those disclosure requirements. The amendments in ASU 2023-07 also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-07 retrospectively to all prior periods presented in the financial statements. The Company is currently assessing the impact of adopting ASU 2023-07 on the consolidated condensed financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures". ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-09 prospectively to all annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of this standard on our consolidated condensed financial statements and related disclosures. G. Employee Retention Credit Under the Employee Retention Credit ("ERC") program, eligible businesses, both for-profit and not-for-profit, that experienced a full or partial government-ordered suspension of operations or a "significant" decline in gross receipts in any quarter (more than 50% decrease in 2020 from 2019, and more than 20% in 2021) could receive a quarterly refundable payroll tax credit. The Company, with reasonably assured qualification, submitted for refunds under the ERC program. As no authoritative guidance exists under U.S. GAAP for reporting ERCs, the Company adopted International Accounting Standards ("IAS") 20 – Accounting for Government Grants and Disclosure of Government Assistance which permits the recording and presentation of either the gross amount as other income or netting the credit against related expense. For the three months ended December 31, 2023 and 2022, there was no income or expense recorded.
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Inventories |
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Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories Inventories consist of:
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Long-lived Assets |
3 Months Ended |
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Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Long-lived Assets | Long-lived Assets The Company reviews the carrying value of its long-lived assets ("asset groups"), when events and circumstances indicate a triggering event has occurred. A triggering event is a change in circumstances that indicates the carrying value of the asset group may not be recoverable. This review is performed using estimates of future undiscounted cash flows, which include proceeds from disposal of assets. Under the Accounting Standard Codification ("ASC") 360 ("Topic 360"), if the carrying value of a long-lived asset is greater than the estimated undiscounted future cash flows, then the long-lived asset is considered impaired and an impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its fair value. The Company continuously monitors for indicators of impairment to determine if further testing is necessary. In the first quarter of fiscal 2024, the Company evaluated potential triggering events and did not identify any indicators that the asset groups might be impaired.
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Goodwill |
3 Months Ended |
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Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GoodwillThe Company tests its goodwill for impairment in the fourth fiscal quarter, and in interim periods if certain events occur indicating that the carrying amount of goodwill may be impaired. In the first quarter of fiscal 2024, the Company evaluated potential triggering events and determined interim testing was not required. |
Accumulated Other Comprehensive Loss |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss are as follows:
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases The components of lease expense were as follows:
The following table presents the impact of leasing on the consolidated condensed balance sheet.
Supplemental cash flow and other information related to leases were as follows:
Future minimum lease payments under non-cancellable leases at December 31, 2023 were as follows:
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Leases | Leases The components of lease expense were as follows:
The following table presents the impact of leasing on the consolidated condensed balance sheet.
Supplemental cash flow and other information related to leases were as follows:
Future minimum lease payments under non-cancellable leases at December 31, 2023 were as follows:
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Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Debt consists of:
Credit Agreement and Security Agreement On November 8, 2023, the Company entered into the Eighth Amendment to the Credit Agreement (the "Eighth Amendment") with its Lender. The Eighth Amendment, among other things, reduced the Reserves under the Borrowing Base in the Credit Agreement to $1,500, or such lesser amount, if any, as may be agreed upon in writing by the Lender in its sole discretion. The Company entered into the Ninth Amendment (the "Ninth Amendment") to the Credit Agreement and the Fourth Amendment (the "Fourth Amendment") to the Export Credit Agreement with its lender on December 21, 2023. The Ninth Amendment amends the Credit Agreement to, among other things, to: (i) reflect the incurrence by borrowers of the Subordinated Loan and the execution and delivery by borrowers, the Lender and Mark J. Silk (Mr. Silk is a member of the Board of Directors of the Company and considered a related party) of the Subordinated Loan Documents, and the receipt by borrowers of $3,000 in immediately available funds on the Ninth Amendment Effective Date; (ii) delay the maturity date from December 31, 2023 to October 4, 2024, or any earlier date on which the Revolving Commitment is reduced to zero or otherwise terminated pursuant to the terms of the Credit Agreement; (iii) reduce the Revolving Commitment to $19,000 from $23,000; (iv) modify the definition of Borrowing Base to mean, at any time, the sum of (a) 85% of Eligible Accounts at such time, plus (b) the lesser of (1) 70% of Eligible Inventory, valued at the lower of cost or market value, determined on a first-in-first-out basis, at such time and (2) the product of 85% multiplied by the NOLV Percentage identified in the most recent inventory appraisal ordered by the Lender multiplied by Eligible Inventory, valued at the lower of cost or market value, determined on a first-in-first-out basis, at such time, minus (c) Reserves of $1,500, increasing on the first day of each month by $250, commencing on May 1, 2024 and continuing until (and including) August 1, 2024, or such lesser amount, if any, as may be agreed upon in writing by the Lender in its sole discretion (which may be by email from the Lender), plus (d) the PP&E Component; (v) modify the Applicable Margin schedule to reflect the following applicable rates: 2.75% (CBFR REVSOFR30), 0.25% (CBFR Spread (CB Floating Rate)), 2.75% (SOFR Spread), and 0.50% (Commitment Fee Rate); and (vi) amend and restate subsection (l) of the Reporting Schedule to require, by the 17th day of every month, the delivery of a rolling 13 week cash flow forecast in form acceptable to Lender, which must include a projected to actual results comparison for the week then ended and on a cumulative basis from the beginning of the cash flow forecast. The Fourth Amendment of the Export Credit Agreement, to, among other things, to: (i) reflect the incurrence by borrowers of the Subordinated Loan and the execution and delivery by borrowers, the Lender and Silk of the Subordinated Loan Documents, and the receipt by borrowers of $3,000 in immediately available funds on the Ninth Amendment Effective Date; and (ii) delay the maturity date to October 4, 2024, or any earlier date on which the Revolving Commitment is reduced to zero or otherwise terminated pursuant to the terms thereof. The total collateral at December 31, 2023 and September 30, 2023 was $23,065 and $21,089, respectively, and the revolving commitment was $26,000 and $30,000, respectively. Total availability at December 31, 2023 and September 30, 2023 was $5,034 and $2,830, respectively, which exceeds both the collateral and total commitment threshold. The Credit Agreement contains affirmative and negative covenants and events of default. Since the availability exceeded the $1,500 reserve minimum as of December 31, 2023 and September 30, 2023, no covenant calculations were required. The Company has a letter of credit balance of $1,970 as of December 31, 2023 and September 30, 2023, respectively. The Credit Agreement under the Ninth Amendment has a maturity date of October 4, 2024. The revolving credit agreement (or "revolver"), as amended, has a rate based on SOFR plus a 2.75% spread, which was 8.2% at December 31, 2023 and a rate based on SOFR plus a 2.25% spread, which was 7.7% at September 30, 2023. The Export Credit Agreement as amended has a rate based on SOFR plus a 2.25% spread, which was 7.7% at December 31, 2023 and a rate based on SOFR plus a 1.75% spread, which was 7.2% at September 30, 2023. The Company also has a commitment fee of 0.50% under the Credit Agreement as amended to be incurred on the unused balance of the revolver. Debt issuance costs - revolver The Company incurred new debt issuance costs of $117 in the first quarter of fiscal 2024 as it pertains to the new amendments entered into, which are included in the consolidated condensed balance sheet as a deferred charge in other current assets, net of amortization of $0 at December 31, 2023. The Company previously had debt issuance costs of $86, which were included in the consolidated condensed balance sheets as a deferred charge in other current assets, net of amortization of $86 and $78 at December 31, 2023 and September 30, 2023, respectively. Subordinated Promissory Note and Guarantee The Company, in connection with the Ninth Amendment and the Fourth Amendment, incurred a secured subordinated loan from Garnet Holdings, Inc., a California corporation owned and controlled by Mark J. Silk ("GHI") (Mr. Silk is a member of the Board of Directors of the Company and considered a related party), in the original principal amount of $3,000 (the "Subordinated Loan") on the terms and subject to the conditions of a Subordinated Secured Promissory Note (the "Subordinated Promissory Note"). The obligations of borrowers under the Subordinated Loan mature on October 4, 2024. Interest accrues on the then-outstanding principal amount at a rate of 14% per annum and shall be paid in kind (and not in cash) by capitalization as additional principal ("PIK Interest") each six-month period after the date hereof in arrears. The Company agreed to pay to Mr. Silk a fully earned and non-refundable fee in an amount equal to $150, which fee shall be due and payable in full on, and subject to the occurrence of the Maturity Date or such earlier date on which the Company’s obligations under the Subordinated Promissory Note are accelerated pursuant to the terms thereof. Borrower’s obligations under the Subordinated Promissory Note are secured by a first priority lien, subject to any liens granted to Lender as described in the Subordination Agreement, on all of borrowers’ accounts, deposit accounts, contract rights, documents, equipment, general intangibles, instruments, inventory, investment property, commercial tort claims, all other goods and personal property whether tangible or intangible and wherever located, and all proceeds of the foregoing. The Subordinated Promissory note carrying value was $3,150 and $0 at December 31, 2023 and September 30, 2023, respectively. The Subordinated Promissory Note interest rate was 14% and 0% at December 31, 2023 and September 2023, respectively. The Ninth Amendment, was also subject to including, but not limited to, the execution and delivery by Mark. J. Silk, a member of the Board of Directors of the Company ("Silk"), of a Guaranty Agreement (the "Guaranty") in favor of Lender pursuant to which Silk guarantees the obligations of borrowers under the Credit Agreement and Export Credit Agreement. The Fee Letter requires the borrowers to pay Silk a fee (the "Guaranty Fee") in consideration for his agreement to execute and deliver the Guaranty in an amount equal to $760, which was included in the consolidated condensed balance sheets as a deferred charge in accrued liabilities. The Guaranty Fee becomes due and payable on the maturity date. Foreign subsidiary borrowings in USD Foreign debt consists of:
Interest rates on foreign borrowings are based on Euribor rates, which range from 0.5% to 8.0%. The Company's Maniago, Italy ("Maniago") location obtained borrowings from two separate lending sources in the first quarter of fiscal 2024. The first was a bond for $2,208 with repayment terms of seven years. Under the terms of the borrowing, repayments are made semi-annually in the amount of $200, beginning on June 29, 2024. The proceeds from this loan are shown within cash and cash equivalents on the consolidated condensed balance sheets and will be used for capital investment. A second loan with a with a term of 1 year, 6 months was obtained in the amount of $1,104. The proceeds from this loan will be for working capital purposes. The Company factors receivables from one of its customers. The Company accounts for the pledge of receivables under this agreement as short-term debt and continues to carry the receivables on its consolidated condensed balance sheets.
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Income Taxes |
3 Months Ended |
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Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For each interim reporting period, the Company makes an estimate of the effective tax rate it expects to be applicable for the full fiscal year for its operations. This estimated effective rate is used in providing for income taxes on a year-to-date basis. The Company’s effective tax rate through the first three months of fiscal 2024 was (1.5)%, compared with (2.6)% for the same period of fiscal 2023. The decrease in the effective rate was primarily attributable to changes in jurisdictional mix of income in fiscal 2024 compared with the same period of fiscal 2023. The effective tax rate differs from the U.S. federal statutory rate due primarily to the valuation allowance against the Company’s U.S. deferred tax assets and income in foreign jurisdictions that are taxed at different rates than the U.S. statutory tax rate. The Company is subject to income taxes in the U.S. federal jurisdiction, Ireland, Italy, and various state and local jurisdictions.
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Retirement Benefit Plans |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefit Plans | Retirement Benefit Plans The Company and certain of its subsidiaries sponsor defined benefit pension plans covering some of its employees. The components of the net periodic benefit cost of the Company’s defined benefit plans are as follows:
During the three months ended December 31, 2023 and 2022, the Company made $9 and $8 in cash contributions, and $86 and $0 in non-cash contributions utilizing carryover balance, respectively, to its defined benefit pension plans. The Company anticipates making $66 in cash contributions to fund its defined benefit pension plans for the balance of fiscal 2024, and will use carryover balances from previous periods that have been available for use as a credit to reduce the amount of cash contributions that the Company is required to make to certain defined benefit plans in fiscal 2024. The Company's ability to elect to use such carryover balance will be determined based on the actual funded status of each defined benefit pension plan relative to the plan's minimum regulatory funding requirements. The Company does not anticipate making cash contributions above the minimum funding requirement to fund its defined benefit pension plans during the balance of fiscal 2024.
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Stock-Based Compensation |
3 Months Ended |
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Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company has outstanding equity awards under the Company's 2007 Long-Term Incentive Plan (the "2007 Plan") and the Company's 2007 Long-Term Incentive Plan (Amended and Restated as of November 16, 2016) (as further amended, the "2016 Plan"), and awards performance and restricted shares under the 2016 Plan. In the first three months of fiscal 2024, the Company granted 120 shares under the 2016 Plan to certain key employees. The awards were split into two tranches, comprised of 46 performance-based shares and 74 time-based restricted shares, with a grant date fair value of $3.60 per share. The awards vest over three years. There were 8 shares forfeited during the three month period ended December 31, 2023. If all outstanding share awards are ultimately earned and vest at the target number of shares, there are approximately 308 shares that remain available for award at December 31, 2023. If any of the outstanding share awards are ultimately earned and vest at greater than the target number of shares, up to a maximum of 150% of such target, then a fewer number of shares would be available for award. Stock-based compensation under the 2016 Plan was $86 and $122 during the first three months of fiscal 2024 and 2023, respectively. As of December 31, 2023, there was $573 of total unrecognized compensation cost related to the performance shares and restricted shares awarded under the 2016 Plan. The Company expects to recognize this cost over the next 1.8 years.
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Revenue |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Revenue The Company produces forged components for (i) turbine engines that power commercial, business and regional aircraft as well as military aircraft and other military applications; (ii) airframe applications for a variety of aircraft; (iii) industrial gas and steam turbine engines for power generation units; and (iv) commercial space, semiconductor and other commercial applications. Revenue is recognized when performance obligations under the terms of the contract with a customer of the Company are satisfied. A portion of the Company's contracts are from purchase orders ("PO's"), which continue to be recognized as of a point in time when products are shipped from the Company's manufacturing facilities or at a later time when control of the products transfers to the customer. Under the revenue standard, the Company recognizes certain revenue over time as it satisfies the performance obligations because the conditions of transfer of control to the applicable customer are as follows: •Certain military contracts, which relate to the provisions of specialized or unique goods to the U.S. government with no alternative use, include provisions within the contract that are subject to the Federal Acquisition Regulation ("FAR"). The FAR provision allows the customer to unilaterally terminate the contract for convenience and requires the customer to pay the Company for costs incurred plus reasonable profit margin and take control of any work in process. •For certain commercial contracts involving customer-specific products with no alternative use, the contract may fall under the FAR clause provisions noted above for military contracts or may include certain provisions within their contract that the customer controls the work in process based on contractual termination clauses or restrictions of the Company's use of the product and the Company possesses a right to payment for work performed to date plus reasonable profit margin. As a result of control transferring over time for these products, revenue is recognized based on progress toward completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products to be provided. The Company elected to use the cost to cost input method of progress based on costs incurred for these contracts because it best depicts the transfer of goods to the customer based on incurring costs on the contracts. Under this method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred. The following table represents a breakout of total revenue by customer type:
The following table represents revenue by end market:
The following table represents revenue by geographic region based on the Company's selling operation locations:
In addition to the disaggregated revenue information provided above, approximately 41% and 54% of total net sales for the three months ended December 31, 2023 and 2022, respectively, was recognized on an over-time basis because of the continuous transfer of control to the customer, with the remainder recognized at a point in time. Contract Balances The following table contains a roll forward of contract assets and contract liabilities for the period ended December 31, 2023:
Accounts receivable were $16,515 and $15,308 at September 30, 2022 and December 31, 2022, respectively. There were no impairment losses recorded on contract assets as of December 31, 2023 and September 30, 2023. Remaining performance obligations As of December 31, 2023, the Company has $103,569 of remaining performance obligations, the majority of which are anticipated to be completed within the next twelve months.
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Commitments and Contingencies |
3 Months Ended |
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Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies On December 30, 2022, the Company became aware of a cyber security issue involving unauthorized access to the Company's system (the "Cyber Incident"). The Company immediately began an investigation and engaged cyber security experts to assist with the assessment of the incident and to help determine what data was impacted. The Company's investigation uncovered that the threat actor had gained access to certain areas of the Company's systems on or about December 27, 2022. With the assistance of outside cyber security experts, the Company located and closed the unauthorized access to our systems and identified compromised information, and notified those impacted in accordance with state and federal requirements. The Company undertook a number of other measures to demonstrate our continued support and commitment to data privacy and protection and coordinated with law enforcement. The Company maintains $3,000 of cybersecurity insurance coverage to limit our exposure to losses such as those related to the Cyber Incident. The Company recorded a benefit of $1 to selling, general, and administrative expenses in the three months ended December 31, 2023 and recorded costs of $110 to other expense (income), net related to loss on insurance recovery in the three months ended December 31, 2022. At December 31, 2023 and September 30, 2023, the Company recorded $827 and $965, respectively, related to the Cyber Incident in accounts payable on the consolidated condensed balance sheets. The Company has incurred, and may continue to incur, certain expenses related to this attack, including expenses associated with additional remediation measures. The Company will accrue these costs as incurred.
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Related Party Transactions |
3 Months Ended |
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Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions On December 21, 2023, the Company entered into the Ninth Amendment and Fourth Amendment with its lender incurring a secured subordinated loan from GHI, in the original principal amount of $3,000. GHI is controlled by Mr. Silk, a member of the Board of Directors of the Company and considered a related party. Additionally, Mr. Silk provided a Guaranty in favor of the Lender pursuant to which Mr. Silk guarantees the obligations of borrowers under the Credit Agreement and Export Credit Agreement. As part of the Guaranty and Promissory Note, the Company will pay GHI fees of $760 and $150, respectively, and has paid $30 of legal costs. The Company has accumulated a total of $940 deferred financing costs related to the Guaranty and Subordinated Promissory Note. See Note 7, Debt for further information.
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Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited consolidated condensed financial statements include the accounts of SIFCO Industries, Inc. and its wholly-owned subsidiaries (collectively, the "Company"). All significant intercompany accounts and transactions have been eliminated in consolidation. The U.S. dollar is the functional currency for all of the Company’s operations in the United States ("U.S.") and its non-operating subsidiaries. For these operations, all gains and losses from completed currency transactions are included in income (loss). The functional currency for the Company's non-U.S. subsidiaries is the Euro. Assets and liabilities are translated into U.S. dollars at the rates of exchange at the end of the period, and revenues and expenses are translated using average rates of exchange for the period which approximate the rates in effect at the date of the transaction. Foreign currency translation adjustments are reported as a component of accumulated other comprehensive loss in the unaudited consolidated condensed financial statements. These unaudited consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s fiscal 2023 Annual Report on Form 10-K. The year-end consolidated condensed balance sheet contained in these financial statements was derived from the audited financial statements and disclosures required by accounting principles generally accepted in the U.S. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) and disclosures considered necessary for a fair presentation have been included. The results of operations for any interim period are not necessarily indicative of the results to be expected for other interim periods or the full year.
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Net Loss per Share | Net Loss per ShareThe Company’s net loss per basic share has been computed based on the weighted-average number of common shares outstanding. |
Recent Accounting Standards Adopted/Not Yet Adopted | Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" and subsequent updates. ASU 2016-13 changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The new guidance will replace the current incurred loss approach with an expected loss model. The new expected credit loss impairment model will apply to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt instruments, net investments in leases, loan commitments and standby letters of credit. Upon initial recognition of the exposure, the expected credit loss model requires entities to estimate the credit losses expected over the life of an exposure (or pool of exposures). The estimate of expected credit losses should consider historical information, current information and reasonable and supportable forecasts, including estimates of prepayments. Financial instruments with similar risk characteristics should be grouped together when estimating expected credit losses. ASU 2016-13 does not prescribe a specific method to make the estimate, so its application will require significant judgment. ASU 2016-13 is effective for public companies in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. However, in November 2019, the FASB issued ASU 2019-10, "Financial Instruments - Credit Loss (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)," which defers the effective date for public filers that qualify as a smaller reporting company ("SRC"), as defined by the Securities and Exchange Commission, to fiscal years after December 15, 2022, including interim periods within those fiscal years. Because SIFCO is considered a SRC, this ASU is effective for the Company beginning October 1, 2023. The effect of adopting this ASU did not have an impact to the Company's results within the consolidated condensed statements of operations and financial condition. F. Recent Accounting Standards Not Yet Adopted In July 2023, the FASB issued ASU 2023-03, "Presentation of Financial Statement (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718)", to amend various SEC paragraphs in the Accounting Standards Codification to reflect the issuance of SEC Staff Accounting Bulletin No. 120, among other things. The ASU does not provide any new guidance so there is no transition or effective date associated with it. The Company is currently assessing the impact of adopting ASU 2023-03 on the consolidated condensed financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", that would enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. ASC 280 requires a public entity to report for each reportable segment a measure of segment profit or loss that its chief operating decision maker ("CODM") uses to assess segment performance and to make decisions about resource allocations. The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more useful financial analyses. Currently, Topic 280 requires that a public entity disclose certain information about its reportable segments. For example, a public entity is required to report a measure of segment profit or loss that the CODM uses to assess segment performance and make decisions about allocating resources. ASC 280 also requires other specified segment items and amounts such as depreciation, amortization and depletion expense to be disclosed under certain circumstances. The amendments in ASU 2023-07 do not change or remove those disclosure requirements. The amendments in ASU 2023-07 also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-07 retrospectively to all prior periods presented in the financial statements. The Company is currently assessing the impact of adopting ASU 2023-07 on the consolidated condensed financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures". ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-09 prospectively to all annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of this standard on our consolidated condensed financial statements and related disclosures.
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Employee Retention Credit | Employee Retention Credit Under the Employee Retention Credit ("ERC") program, eligible businesses, both for-profit and not-for-profit, that experienced a full or partial government-ordered suspension of operations or a "significant" decline in gross receipts in any quarter (more than 50% decrease in 2020 from 2019, and more than 20% in 2021) could receive a quarterly refundable payroll tax credit. The Company, with reasonably assured qualification, submitted for refunds under the ERC program. As no authoritative guidance exists under U.S. GAAP for reporting ERCs, the Company adopted International Accounting Standards ("IAS") 20 – Accounting for Government Grants and Disclosure of Government Assistance which permits the recording and presentation of either the gross amount as other income or netting the credit against related expense. For the three months ended December 31, 2023 and 2022, there was no income or expense recorded.
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Revenue | The Company produces forged components for (i) turbine engines that power commercial, business and regional aircraft as well as military aircraft and other military applications; (ii) airframe applications for a variety of aircraft; (iii) industrial gas and steam turbine engines for power generation units; and (iv) commercial space, semiconductor and other commercial applications. Revenue is recognized when performance obligations under the terms of the contract with a customer of the Company are satisfied. A portion of the Company's contracts are from purchase orders ("PO's"), which continue to be recognized as of a point in time when products are shipped from the Company's manufacturing facilities or at a later time when control of the products transfers to the customer. Under the revenue standard, the Company recognizes certain revenue over time as it satisfies the performance obligations because the conditions of transfer of control to the applicable customer are as follows: •Certain military contracts, which relate to the provisions of specialized or unique goods to the U.S. government with no alternative use, include provisions within the contract that are subject to the Federal Acquisition Regulation ("FAR"). The FAR provision allows the customer to unilaterally terminate the contract for convenience and requires the customer to pay the Company for costs incurred plus reasonable profit margin and take control of any work in process. •For certain commercial contracts involving customer-specific products with no alternative use, the contract may fall under the FAR clause provisions noted above for military contracts or may include certain provisions within their contract that the customer controls the work in process based on contractual termination clauses or restrictions of the Company's use of the product and the Company possesses a right to payment for work performed to date plus reasonable profit margin. As a result of control transferring over time for these products, revenue is recognized based on progress toward completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products to be provided. The Company elected to use the cost to cost input method of progress based on costs incurred for these contracts because it best depicts the transfer of goods to the customer based on incurring costs on the contracts. Under this method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.
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Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Dilutive Effect of Company's Restricted Shares and Performance Shares | The dilutive effect is as follows:
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Inventories (Tables) |
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Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventories | Inventories consist of:
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Accumulated Other Comprehensive Loss (Tables) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss are as follows:
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Leases (Tables) |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Lease Cost Components, Supplemental Cash Flow and Other information, and Weighted-Average Remaining Lease Term Schedules | The components of lease expense were as follows:
Supplemental cash flow and other information related to leases were as follows:
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Schedule of Supplemental Balance Sheet Information Schedule | The following table presents the impact of leasing on the consolidated condensed balance sheet.
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Schedule of Maturities of Finance Lease Liabilities by Fiscal Year Schedule | Future minimum lease payments under non-cancellable leases at December 31, 2023 were as follows:
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Schedule of Maturities of Operating Lease Liabilities by Fiscal Year Schedule | Future minimum lease payments under non-cancellable leases at December 31, 2023 were as follows:
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Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Debt consists of:
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Schedule of Foreign Debt | Foreign debt consists of:
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Retirement Benefit Plans (Tables) |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Net Periodic Benefit Cost | The components of the net periodic benefit cost of the Company’s defined benefit plans are as follows:
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Revenue (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | The following table represents a breakout of total revenue by customer type:
The following table represents revenue by end market:
The following table represents revenue by geographic region based on the Company's selling operation locations:
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Schedule of Contract Assets and Liabilities | The following table contains a roll forward of contract assets and contract liabilities for the period ended December 31, 2023:
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Summary of Significant Accounting Policies - Narrative (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee retention credit (income) expense | $ 0 | $ 0 |
Restricted shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted and performance shares (in shares) | 0 | |
Performance shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted and performance shares (in shares) | 0 |
Summary of Significant Accounting Policies - Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Accounting Policies [Abstract] | ||
Net loss | $ (3,422) | $ (2,589) |
Weighted-average common shares outstanding basic (in shares) | 5,956 | 5,896 |
Weighted-average common shares outstanding diluted (in shares) | 5,956 | 5,896 |
Net loss per share – basic (in dollars per share) | $ (0.57) | $ (0.44) |
Net loss per share – diluted (in dollars per share) | $ (0.57) | $ (0.44) |
Anti-dilutive weighted-average common shares excluded from calculation of diluted earnings per share (in shares) | 249 | 176 |
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 2,710 | $ 1,684 |
Work-in-process | 6,548 | 4,061 |
Finished goods | 3,172 | 3,108 |
Total inventories, net | $ 12,430 | $ 8,853 |
Inventories - Narrative (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Percentage of inventories determined using LIFO method | 32.00% | 19.00% |
Additional amount that would have been reported in inventory if FIFO method had been used | $ 9,927 | $ 9,634 |
Inventory valuation allowances | $ 3,534 | $ 4,049 |
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
---|---|---|---|---|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss | $ 31,247 | $ 34,335 | $ 38,573 | $ 40,690 |
Foreign currency translation adjustment | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss | (5,675) | (5,928) | ||
Retirement plan liability adjustment, net of tax | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss | (698) | (741) | ||
Interest rate swap agreement, net of tax | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss | 9 | 9 | ||
Total accumulated other comprehensive loss | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss | $ (6,364) | $ (6,660) | $ (8,272) | $ (8,693) |
Leases - Lease Cost Components Schedule (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Finance lease expense: | ||
Amortization of right-of use assets on finance leases | $ 18 | $ 12 |
Interest on lease liabilities | 2 | 1 |
Operating lease expense | 426 | 423 |
Variable lease cost | 20 | 25 |
Total lease expense | $ 466 | $ 461 |
Leases - Supplemental Balance Sheet Information Schedule (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Assets: | ||
Property, plant and equipment, net | $ 135 | $ 147 |
Operating lease right-of-use assets, net | 14,152 | 14,380 |
Total lease assets | 14,287 | 14,527 |
Current liabilities: | ||
Current maturities of long-term debt | 62 | 61 |
Short-term operating lease liabilities | 884 | 869 |
Non-current liabilities: | ||
Long-term debt, net of current maturities | 70 | 81 |
Long-term operating lease liabilities, net of short-term | 13,799 | 14,020 |
Total lease liabilities | $ 14,815 | $ 15,031 |
Finance lease, asset, statement of financial position [Extensible List] | Property, plant and equipment, net | Property, plant and equipment, net |
Current finance lease, liability, statement of financial position [Extensible List] | Current maturities of long-term debt | Current maturities of long-term debt |
Noncurrent finance lease, liability, statement of financial position [Extensible List] | Total long-term debt | Total long-term debt |
Leases - Supplemental Cash Flow Information and Non-Cash Activity Schedule (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Cash paid for amounts included in measurement of liabilities: | ||
Operating cash flows from operating leases | $ 424 | $ 422 |
Operating cash flows from finance leases | 2 | 1 |
Financing cash flows from finance leases | $ 16 | $ 12 |
Leases - Weighted-Average Remaining Lease Term and Discount Rate Schedule (Details) |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Weighted-average remaining lease term (years): | ||
Finance leases | 3 years 1 month 6 days | 2 years 10 months 24 days |
Operating leases | 12 years 3 months 18 days | 12 years 6 months |
Weighted-average discount rate: | ||
Finance leases | 5.00% | 5.10% |
Operating leases | 5.90% | 5.90% |
Leases - Maturities of Lease Liabilities by Fiscal Year Schedule (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Finance Leases | ||
2024 (excluding the three months ended December 31, 2023) | $ 51 | |
2025 | 38 | |
2026 | 30 | |
2027 | 22 | |
2028 | 0 | |
Thereafter | 0 | |
Total lease payments | 141 | |
Less: Imputed interest | (9) | |
Present value of lease liabilities | 132 | $ 142 |
Operating Leases | ||
2024 (excluding the three months ended December 31, 2023) | 1,276 | |
2025 | 1,698 | |
2026 | 1,695 | |
2027 | 1,703 | |
2028 | 1,557 | |
Thereafter | 12,741 | |
Total lease payments | 20,670 | |
Less: Imputed interest | (5,987) | |
Present value of lease liabilities | $ 14,683 |
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|
Debt Instrument [Line Items] | ||
Finance lease obligations | $ 132 | $ 142 |
Less: unamortized debt issuance cost - ($910 is related party) | (940) | 0 |
Total debt | 27,689 | 22,566 |
Less – current maturities | (23,296) | (20,109) |
Total long-term debt | 4,393 | 2,457 |
Subordinated note | Director | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 3,150 | 0 |
Less: unamortized debt issuance cost - ($910 is related party) | (910) | |
Other, net of unamortized debt issuance costs $(6) and $(9), respectively | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 311 | 364 |
Revolving credit agreement | Revolving credit agreement | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 16,061 | 16,289 |
Foreign subsidiary borrowings, net of unamortized debt issuance cost | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 8,975 | $ 5,771 |
Income Taxes (Details) |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Income Tax Disclosure [Abstract] | ||
Effective tax rate, percent | (1.50%) | (2.60%) |
Retirement Benefit Plans - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Retirement Benefits [Abstract] | ||
Service cost | $ 17 | $ 6 |
Interest cost | 271 | 274 |
Expected return on plan assets | (262) | (277) |
Amortization of net loss | 43 | 78 |
Net periodic pension cost (benefit) | $ 69 | $ 81 |
Retirement Benefit Plans - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Retirement Benefits [Abstract] | ||
Cash contribution | $ 9 | $ 8 |
Non-cash contribution | 86 | $ 0 |
Additional cash contributions planned for fiscal 2024 | $ 66 |
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 21,052 | $ 21,299 |
Revenue from Contract with Customer | Customer Concentration Risk | Transferred over Time | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk | 41.00% | 54.00% |
North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 15,474 | $ 17,294 |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 5,578 | 4,005 |
Fixed wing aircraft | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 9,939 | 10,726 |
Rotorcraft | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,150 | 4,380 |
Energy components for power generation units | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 6,191 | 4,624 |
Commercial product and other revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,772 | 1,569 |
Commercial revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 13,240 | 10,181 |
Military revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 7,812 | $ 11,118 |
Revenue - Contract Balances (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Change In Contract With Customer, Assets [Roll Forward] | ||||
Contract assets - Beginning balance | $ 10,091,000 | $ 10,172,000 | $ 10,172,000 | |
Additional revenue recognized over-time | 9,184,000 | 12,042,000 | ||
Less amounts billed to the customers | (8,326,000) | (10,692,000) | ||
Contract assets - Ending balance | 10,949,000 | 11,522,000 | 10,091,000 | |
Change In Contract With Customer, Liability [Roll Forward] | ||||
Contract liabilities (included within Accrued liabilities) - Beginning balance | (1,150,000) | (807,000) | (807,000) | |
Payments received in advance of performance obligations | (1,753,000) | (1,401,000) | ||
Performance obligations satisfied | 20,000 | 426,000 | ||
Contract liabilities (included within Accrued liabilities) - Ending balance | (2,883,000) | (1,782,000) | (1,150,000) | |
Accounts receivable | $ 15,308,000 | $ 16,515,000 | ||
Impairment loss on contract assets | $ 0 | $ 0 |
Revenue - Performance Obligation (Details) $ in Thousands |
Dec. 31, 2023
USD ($)
|
---|---|
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 103,569 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Timing of satisfaction, period | 12 months |
Commitments and Contingencies (Details) - Cybersecurity Insurance Claims - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
Loss Contingencies [Line Items] | ||
Insurance coverage | $ 3,000 | |
Liability for costs incurred related to attack | 827 | $ 965 |
Other Nonoperating Income (Expense) | ||
Loss Contingencies [Line Items] | ||
Loss contingency accrual, provision (benefit) | $ (1) | |
Selling, General and Administrative Expenses | ||
Loss Contingencies [Line Items] | ||
Loss contingency accrual, provision (benefit) | $ 110 |
Related Party Transactions (Details) - USD ($) |
Dec. 21, 2023 |
Dec. 31, 2023 |
Sep. 30, 2023 |
---|---|---|---|
Related Party Transaction [Line Items] | |||
Deferred financing costs | $ 940,000 | $ 0 | |
Subordinated note | Director | |||
Related Party Transaction [Line Items] | |||
Deferred financing costs | 910,000 | ||
Subordinated Promissory Note | Subordinated note | Director | |||
Related Party Transaction [Line Items] | |||
Face amount | $ 3,000,000 | ||
Guaranty fee | 760,000 | ||
Fully earned and non-refundable fee | 150,000 | ||
Legal costs | $ 30,000 | ||
Deferred financing costs | $ 940,000 |
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