10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

Form 10-Q

__________________

(Mark One)

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES

      EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2019

OR

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES

     EXCHANGE ACT OF 1934

For the transition period from    to

Commission File Number 0-23248

SIGMATRON INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

_________________

Delaware	36-3918470
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
2201 Landmeier Road
Elk Grove Village, Illinois	60007
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (847) 956-8000

__________________

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  ☐

SigmaTron International, Inc.

July 31, 2019

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, smaller reporting company, or an emerging growth company.  See the definitions of a “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 by Rule 12b-2 of the Exchange Act).  Yes  ☐   No  ☒

Indicate the number of shares outstanding of the registrant’s common stock, $0.01 par value, as of September 10, 2019:  4,242,508

2

SigmaTron International, Inc.

Index

PART 1.	FINANCIAL INFORMATION:		Page No.
	Item 1.	Condensed Consolidated Financial Statements
		Condensed Consolidated Balance Sheets – July 31, 2019 (Unaudited) and April 30, 2019	4
		Condensed Consolidated Statements of Operations – (Unaudited)
		Three Months Ended July 31, 2019 and 2018	6
		Condensed Consolidated Statements of Changes in Stockholders’
		Equity – Three Months Ended July 31, 2019 and 2018	7
		Condensed Consolidated Statements of Cash Flows – (Unaudited)
		Three Months Ended July 31, 2019 and 2018	8
		Notes to Condensed Consolidated Financial Statements – (Unaudited)	10
	Item 2.	Management’s Discussion and Analysis of Financial Condition and
		Results of Operations	22
	Item 3.	Quantitative and Qualitative Disclosures About Market Risks	29
	Item 4.	Controls and Procedures	29
PART II	OTHER INFORMATION:
	Item 1.	Legal Proceedings	29
	Item 1A.	Risk Factors	30
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
	Item 3.	Defaults Upon Senior Securities	30
	Item 4.	Mine Safety Disclosures	30
	Item 5.	Other Information	30
	Item 6.	Exhibits	31
		Signatures	32

3

SigmaTron International, Inc.

Condensed Consolidated Balance Sheets

		July 31,
		2019		April 30,
		(Unaudited)		2019
Current assets:
Cash and cash equivalents	$	1,487,730	$	1,005,810
Accounts receivable, less allowance for doubtful accounts of
$631,283 at July 31, 2019 and April 30, 2019		31,929,092		31,441,381
Inventories, net		74,255,011		85,579,575
Prepaid expenses and other assets		2,426,259		2,436,894
Refundable and prepaid income taxes		1,144,693		1,339,739
Other receivables		1,875,358		1,741,890
Total current assets		113,118,143		123,545,289
Property, machinery and equipment, net		32,681,869		33,232,769
Intangible assets, net		2,621,940		2,713,360
Deferred income taxes		384,022		384,022
Other assets		6,982,585		1,589,325
Total other long-term assets		9,988,547		4,686,707
Total assets	$	155,788,559	$	161,464,765
Liabilities and stockholders' equity:
Current liabilities:
Trade accounts payable	$	36,240,995	$	45,627,014
Accrued wages		5,192,603		4,680,399
Accrued expenses		2,722,534		2,410,311
Income taxes payable		41,831		60,921
Current portion of long-term debt		691,701		691,701
Current portion of finance lease obligations		1,821,341		1,939,374
Current portion of operating lease obligations		2,049,962		-
Contingent consideration		-		57,537
Current portion of deferred rent		-		139,509
Total current liabilities		48,760,967		55,606,766
Long-term debt, less current portion		40,503,158		42,710,954
Income taxes payable		452,619		500,263
Finance lease obligations, less current portion		2,368,517		2,862,784
Operating lease obligations, less current portion		3,692,295		-
Deferred rent, less current portion		-		179,059
Other long-term liabilities		1,191,665		1,155,907
Deferred income taxes		170,869		161,583
Total long-term liabilities		48,379,123		47,570,550
Total liabilities		97,140,090		103,177,316

4

Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 500,000 shares
authorized, none issued or outstanding		-		-
Common stock, $.01 par value; 12,000,000 shares
authorized, 4,242,508 and 4,240,008 shares issued and
outstanding at July 31, 2019 and April 30, 2019, respectively		42,146		42,146
Capital in excess of par value		23,474,379		23,474,379
Retained earnings		35,131,944		34,770,924
Total stockholders' equity		58,648,469		58,287,449
Total liabilities and stockholders' equity	$	155,788,559	$	161,464,765
The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.

5

SigmaTron International, Inc.

Condensed Consolidated Statements of Operations

		Three Months		Three Months
		Ended		Ended
		July 31,		July 31,
		2019		2018
		(Unaudited)		(Unaudited)
Net sales	$	74,009,981	$	71,414,057
Cost of products sold		67,049,649		65,625,001
Gross profit		6,960,332		5,789,056
Selling and administrative expenses		5,827,326		5,934,116
Operating income (loss)		1,133,006		(145,060)
Other (income) expense		(66,362)		25,063
Interest expense		591,228		553,490
Income (loss) before income tax expense		608,140		(723,613)
Income tax expense (benefit)		247,115		(197,006)
Net income (loss)	$	361,025	$	(526,607)
Earnings (loss) per share – basic	$	0.09	$	(0.12)
Earnings (loss) per share – diluted	$	0.09	$	(0.12)
Weighted average shares of common stock outstanding
Basic		4,241,883		4,223,657
Weighted average shares of common stock outstanding
Diluted		4,241,883		4,223,657
The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.

6

SigmaTron International, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

	For the three months ended July 31, 2019
						Capital in				Total
		Preferred		Common		excess of par		Retained		stockholders’
		stock		stock		value		earnings		equity
Balance at April 30, 2019	$	-	$	42,146	$	23,474,379	$	34,770,924	$	58,287,449
Cumulative-effect adjustment for the adoption of Topic 842		-		-		-		(5)		(5)
Net income		-		-		-		361,025		361,025
Balance at July 31, 2019	$	-	$	42,146	$	23,474,379	$	35,131,944	$	58,648,469

	For the three months ended July 31, 2018
						Capital in				Total
		Preferred		Common		excess of par		Retained		stockholders’
		stock		stock		value		earnings		equity
Balance at April 30, 2018	$	-	$	41,896	$	23,132,017	$	35,636,038	$	58,809,951
Net loss		-		-		-		(526,607)		(526,607)
Balance at July 31, 2018	$	-	$	41,896	$	23,132,017	$	35,109,431	$	58,283,344

7

SigmaTron International, Inc.

Condensed Consolidated Statements of Cash Flows

		Three		Three
		Months Ended		Months Ended
		July 31,		July 31,
		2019		2018 (As Revised)
		(Unaudited)		(Unaudited)
Cash flows from operating activities
Net income (loss)	$	361,025	$	(526,607)
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Depreciation and amortization		1,235,516		1,267,528
Amortization of right-of-use operating leased assets		532,418		-
Deferred income tax expense (benefit)		9,286		(251,158)
Amortization of intangible assets		91,420		94,105
Amortization of financing fees		26,614		20,704
Fair value adjustment of contingent consideration		-		17,529
Loss from disposal or sale of machinery and equipment		51		34
Changes in operating assets and liabilities
Accounts receivable		(487,711)		(4,522,665)
Inventories		11,324,564		(1,083,002)
Prepaid expenses and other assets		57,808		263,923
Refundable and prepaid income taxes		195,046		(86,267)
Income taxes payable		(66,734)		(43,281)
Trade accounts payable		(9,386,019)		1,422,738
Deferred rent		-		(68,242)
Operating lease liabilities		(586,079)		-
Accrued expenses and wages		763,629		53,565
Net cash provided by (used in) operating activities		4,070,834		(3,441,096)
Cash flows from investing activities
Purchases of machinery and equipment		(684,667)		(706,808)
Net cash used in investing activities		(684,667)		(706,808)
Cash flows from financing activities
Proceeds under equipment notes		-		182,557
Payments of contingent consideration		(57,537)		(55,075)
Payments under finance lease and sale leaseback agreements		(612,300)		(643,290)
Payments under equipment notes		(102,925)		(93,798)
Payments under building notes payable		(70,000)		(70,000)
Borrowings under revolving line of credit		82,796,750		82,479,011
Payments under revolving line of credit		(84,852,276)		(77,556,902)
Payments of debt financing costs		(5,959)		(11,100)
Net cash (used in) provided by financing activities		(2,904,247)		4,231,403
Change in cash and cash equivalents		481,920		83,499
Cash and cash equivalents at beginning of period		1,005,810		1,721,599

8

Cash and cash equivalents at end of period	$	1,487,730	$	1,805,098
Supplementary disclosures of cash flow information
Cash paid for interest	$	564,188	$	504,897
Cash paid for income taxes		162,276		160,239
Financing of insurance policy		96,556		67,675

9

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note A - Description of the Business

SigmaTron International, Inc., its subsidiaries, foreign enterprises and international procurement office (collectively, the “Company”) operates in one business segment as an independent provider of electronic manufacturing services (“EMS”), which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies. 

Note B - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of SigmaTron International, Inc. (“SigmaTron”), SigmaTron’s wholly-owned subsidiaries Standard Components de Mexico S.A., AbleMex, S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd. and wholly-owned foreign enterprises Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd. (“SigmaTron China”) and international procurement office SigmaTron Taiwan branch (collectively, the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.

Accordingly, the condensed consolidated financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.  In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.  Operating results for the three month period ended July 31, 2019 is not necessarily indicative of the results that may be expected for the year ending April 30, 2020.  The condensed consolidated balance sheet at April 30, 2019, was derived from audited annual financial statements but does not contain all of the footnotes disclosures from the annual financial statements.  For further information, refer to the condensed consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended April 30, 2019. 

10

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note C - Inventories, net

The components of inventory consist of the following:

	July 31,		April 30,
	2019		2019
Finished products	$	22,414,687	$	20,682,669
Work-in-process		2,955,440		3,037,810
Raw materials		50,192,856		63,203,068
		75,562,983		86,923,547
Less excess and obsolescence reserve		(1,307,972)		(1,343,972)
	$	74,255,011	$	85,579,575

Note D - Earnings Per Share and Stockholders’ Equity

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	Three Months Ended
	July 31,
	2019		2018
Net income (loss)	$	361,025	$	(526,607)
Weighted-average shares
Basic		4,241,883		4,223,657
Effect of dilutive stock options		-		-
Diluted		4,241,883		4,223,657
Basic earnings (loss) per share	$	0.09	$	(0.12)
Diluted earnings (loss) per share	$	0.09	$	(0.12)

Options to purchase 465,232 and 347,318 shares of common stock were outstanding at July 31, 2019 and 2018, respectively.  There were no options granted during the three month periods ended July 31, 2019 and 2018, respectively.  There was no stock option expense recognized for the three month periods ended July 31, 2019 and 2018, respectively.  There was no balance of unrecognized compensation expense related to the Company’s stock option plans at July 31, 2019 and 2018.  For the three month period ended July 31, 2019 and 2018, 424,484 and 0 shares, respectively, were not included in the diluted weighted average common shares outstanding calculation as they were anti-dilutive.

11

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note E - Long-term Debt

Debt and capital lease obligations consisted of the following at July 31, 2019 and April 30, 2019:

		July 31,		April 30,
		2019		2019
Debt:
Notes Payable - Banks	$	33,671,686	$	35,727,212
Notes Payable - Buildings		6,580,000		6,650,000
Notes Payable - Equipment		1,225,828		1,328,753
Unamortized deferred financing costs		(282,655)		(303,310)
Total debt		41,194,859		43,402,655
Less current maturities		691,701		691,701
Long-term debt	$	40,503,158	$	42,710,954
Finance lease and sale leaseback obligations	$	4,189,858	$	4,802,158
Less current maturities		1,821,341		1,939,374
Total finance lease obligations, less current portion	$	2,368,517	$	2,862,784

Notes Payable – Banks

On March 31, 2017, the Company entered into a $35,000,000 senior secured credit facility with U.S. Bank, which expires on March 31, 2022.  The credit facility is collateralized by substantially all of the Company’s domestically located assets. The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of five percent or LIBOR plus one and one half percent (effectively 3.81% at July 31, 2019).  Interest is due monthly. 

On July 16, 2018, the Company and U.S. Bank entered into an amendment of the revolving line of credit under the senior secured credit facility.  The amended revolving credit facility allows the Company to borrow up to the lesser of (i) $45,000,000 (the“Revolving Line Cap”) less reserves or (ii) the Borrowing Base, but no more than 90% of the Company’s Revolving Line Cap, except that the 90% limitation will expire if (i) the Company’s actual revolving loans for 90 consecutive days after the amendment’s effective date are less than 80% of the Company’s Borrowing Base and (ii) the Company maintains a Fixed Charge Coverage Ratio of 1.2 to 1.0 for four consecutive quarters.  The amendment also imposes sublimits on categories of inventory equal to $10,500,000 on raw materials, $10,000,000 on finished goods and $28,000,000 on all eligible inventory. 

On December 13, 2018, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment provides an exception to otherwise ineligible foreign receivables for up to $3,000,000 of receivables paid by certain enumerated account debtors outside of the U.S. and Canada.

12

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note E - Long-term Debt - Continued

On March 22, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until August 1, 2019 and 90% on and after August 1, 2019.

On August 26, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until February 26, 2020 and 90% on and after February 26, 2020. 

As of July 31, 2019, there was $33,671,686 outstanding and $8,993,594 of unused availability under the U.S. Bank facility compared to an outstanding balance of $35,727,212 and $6,645,730 of unused availability at April 30, 2019.  At July 31, 2019, the Company was in compliance with its financial covenant and other restrictive covenants under the credit facility.  Deferred financing costs of $5,959 were capitalized during the three month period ended July  31, 2019, which are amortized over the term of the agreement.  As of July  31, 2019 and April 30, 2019, the unamortized amount offset against outstanding debt was $196,675 and $209,162, respectively.

On March 15, 2019, the Company’s wholly-owned subsidiary, SigmaTron Electronic Technology Co., Ltd., entered into a credit facility with China Construction Bank.  Under the agreement SigmaTron Electronic Technology Co., Ltd. can borrow up to 5,000,000 Renminbi, approximately $726,000 as of July  31, 2019, and the facility is collateralized by Wujiang SigmaTron Electronics Co., Ltd.’s manufacturing building.  Interest is payable monthly and the facility bears a fixed interest rate of 6.09%.  The term of the facility extends to March 14, 2024.  There was no outstanding balance under the facility at July  31, 2019 and April 30, 2019.

The Company is in compliance with its financial covenant and other restrictive covenants and anticipates that its credit facilities, expected future cash flows from operations and leasing resources are adequate to meet its working capital requirements, and fund capital expenditures for the next 12 months.  In addition, if customers delay orders, future payments are not made timely, the Company desires to expand its operations, its business grows more rapidly than expected, or the current economic climate deteriorates, additional financing resources may be necessary. There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

Notes Payable – Buildings

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $5,200,000, with U.S. Bank to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility in Elk Grove Village, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $17,333, bears interest at a fixed rate of 4.0% per year and is payable over a fifty-one month period.  Deferred financing costs of $74,066 were capitalized in fiscal year 2018 which are amortized over the term of the agreement.  As

13

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note E - Long-term Debt - Continued

of July 31, 2019 and April 30, 2019, the unamortized amount included as a reduction to long-term debt was $45,746 and $49,852, respectively.  A final payment of approximately $4,347,778 is due on or before March 31, 2022.  The outstanding balance was $4,888,000 and $4,940,000 at July, 31 2019 and April 30, 2019, respectively.

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $1,800,000, with U.S. Bank to refinance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $6,000, bears interest at a fixed rate of 4.0% per year and is payable over a  fifty-one month period.  Deferred financing costs of $65,381 were capitalized in the fiscal year 2018 which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019, the unamortized amount included as a reduction to long-term debt was $40,234 and $44,006, respectively.  A final payment of approximately $1,505,000 is due on or before March 31, 2022.  The outstanding balance was $1,692,000 and $1,710,000 at July, 31 2019 and April 30, 2019, respectively. 

Notes Payable – Equipment

The Company routinely enters into secured note agreements with Engencap Fin S.A. DE C.V. to finance the purchase of equipment. The terms of these secured note agreements extend to November 2021 through May 2023, with quarterly installment payments ranging from $11,045 to $37,941 and a fixed interest rate ranging from 6.65% to 8.00%.

Annual maturities of the Company’s debt, net of deferred financing fees for the remaining periods as of July  31, 2019, are as follows:

Fiscal Year	Bank		Building		Equipment		Total
2020	$	-	$	210,000	$	308,775	$	518,775
2021		-		280,000		411,701		691,701
2022		33,475,011		6,004,020		381,852		39,860,883
2023		-		-		114,372		114,372
2024		-		-		9,128		9,128
	$	33,475,011	$	6,494,020	$	1,225,828	$	41,194,859

14

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note E - Long-term Debt - Continued

Finance Lease and Sales Leaseback Obligations

The Company enters into various finance lease and sales leaseback agreements.  The terms of the lease agreements mature through January 2023, with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 8.00%.  

Note F - Income Tax

The income tax expense was $247,115 for the three month period ended July 31, 2019 compared to an income tax benefit of $197,006 for the same period in the prior fiscal year.  The Company’s effective tax rate was 40.63% and 27.22% for the quarters ended July 31, 2019 and 2018, respectively.  The increase in income tax expense for the three month period ended July 31, 2019 compared to the benefit recognized for the same period in the previous year is due to operating income recognized in the current period as opposed to a loss recognized in the same period in the previous year. The increase in effective tax rate is due primarily to the operating loss recognized in China and Vietnam in the current period for which no tax benefit is recorded due to a full valuation allowance. 

Note G - Commitments and Contingencies

From time to time the Company is involved in legal proceedings, claims or investigations that are incidental to the conduct of the Company’s business. In future periods, the Company could be subjected to cash cost or non-cash charges to earnings if any of these matters are resolved on unfavorable terms. However, although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of any particular claim, the Company does not expect that these legal proceedings or claims will have any material adverse impact on its future consolidated financial position, results of operations or cash flows.

15

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note H - Critical Accounting Policies

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

Revenue Recognition - The following table presents the Company’s revenue disaggregated by the principal end-user markets it serves:

	Three Months Ended July 31,	Three Months Ended July 31,
Net trade sales by end-market	2019	2018
Industrial Electronics	42,848,712	38,135,102
Consumer Electronics	26,659,187	29,200,913
Medical / Life Sciences	4,502,082	4,078,042
Total Net Trade Sales	74,009,981	71,414,057

During the three month period ending July 31, 2019, no revenues were recognized from performance obligations satisfied or partially satisfied in previous periods and no amounts were allocated to performance obligations that remain unsatisfied or partially unsatisfied at July 31, 2019.  The Company is electing not to disclose the value of the remaining unsatisfied performance obligation with a duration of one year or less as permitted by the practical expedient in ASU 2014-09, “Revenue from Contracts with Customers.”  The Company had no material remaining unsatisfied performance obligations as of July 31, 2019, with an expected duration of greater than one year.

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

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial

16

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note H - Critical Accounting Policies - Continued

operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistentwith the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.The Company’s valuation allowance was $1,349,098 and $1,294,605 as of July 31, 2019 and April 30, 2019, respectively.

Revisions - Previously reported cash flows from financing activities for the three-month period ended July 31, 2018 have been revised to reflect the classification of payments and borrowings under the Company’s revolving line of credit presented in the condensed consolidated statement of cash flows. The revision had no impact to total cash flows from financing activities, net loss or net loss per share, or the condensed consolidated balance sheets or statements of operations or stockholders’ equity. See Note B, “Summary of Significant Accounting Policies” in the Company’s 2019 10-K for additional information on these revisions.

New Accounting Standards:

In February 2016, the FASB issued ASU 2016-02, as amended, Leases (Topic 842), which requires a lessee to record a right-of-use asset and a lease liability for all leases with a term greater than twelve months regardless of whether the lease is classified as an operating lease or a financing lease.

Effective May 1, 2019, the Company adopted the new standard under the modified retrospective approach, applying the current-period adjustment method.  Under the transition guidance of the modified retrospective approach there are a number of optional practical expedients made available to simplify the transition of the new standard. The Company has elected the following:

· The condensed consolidated balance sheets for reporting periods beginning on or after May 1, 2019 are presented under the new guidance, while prior period amounts are not adjusted and continue to be reported in accordance with ASC Topic 840, Leases. The Company recognized a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption of $5. 

· The Company has elected to utilize the package of practical expedients permitted under the transition guidance in the standard, which allowed the Company to not reassess (i) whether any expired or existing contracts contain leases, (ii) historical lease classification, and (iii) initial direct costs.

· The Company has elected to combine lease and non-lease components as a single component for all asset classes.

· The Company has elected to not assess whether existing or expired land easements that were not previously accounted for as leases under Topic 840 are or contain a lease under this Topic.

· The Company has elected to keep leases with an initial term of 12 months or less off of the balance sheet.

17

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note H - Critical Accounting Policies - Continued

Upon adoption, the Company recorded Right-of-use ("ROU") assets and lease liabilities relating to operating leases of $6,017,771 and $6,290,289, respectively. The changes did not have a material impact on our results of operations or cash flows. The discount rates used to calculate the ROU assets and lease liabilities as of the effective date were based on the remaining lease terms as of the effective date. See Note J - Leases, for the impact on the financial statements and related disclosures from the adoption of this standard.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13, as amended by ASU 2019-04 and ASU 2019-05, introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts.  This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this ASU may have on its consolidated financial statements.

Note I - Related Parties

In March, 2015, two of the Company’s executive officers invested in a start-up customer, Petzila, Inc. (“Petzila”).  The executive officers’ investments constituted less than 2% (individually and in aggregate) of the outstanding beneficial ownership of Petzila, according to information provided by Petzila to the executive officers.  

On April 30, 2018, the Company foreclosed on its security interest and held a public sale of the assets in accordance with the requirements of Article 9 of the California Uniform Commercial Code.  The Company acquired all of the assets of Petzila as the winning bidder at the public sale by a credit bid of $3,500,000, the aggregate amount of Petzila’s liability to the company. Concurrent with the foreclosure sale, the Company entered into an Asset Purchase Agreement with Wagz, Inc. (“Wagz”), “an unrelated party,” whereby the Company sold the assets to Wagz for $350,000 cash, 600,000 shares of Wagz common stock and an earn-out based on sales by Wagz generated from use of the assets through July 31, 2022.  The earn-out is $6.00 per unit of a product specified in the asset purchase agreement and any upgrade to such product.

The fair value of the non-cash consideration consisted of $600,000 for the 600,000 shares of Wagz common stock which is recorded within other assets.  The Company determined the fair value of the equity using the price per common share received by Wagz in a recent financing transaction, a level 3 input.  The Company did not assign any value to the earn-out because any receipts from the earn-out are highly uncertain and contingent upon Wagz selling the product specified in the asset purchase agreement between the Company and Wagz.

18

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note J - Leases

The Company leases office and storage space, vehicles and other equipment under non-cancellable operating leases with initial terms typically ranging from 1 to5 years.  At contract inception, the Company reviews the facts and circumstances of the arrangement to determine if the contract is or contains a lease.  The Company follows the guidance in Topic 842 to evaluate whether the contract has an identified asset; if the Company has the right to obtain substantially all economic benefits from the asset; and if the Company has the right to direct the use of the underlying asset.  When determining if a contract has an identified asset, the Company considers both explicit and implicit assets, and whether the supplier has the right to substitute the asset.  When determining if the Company has the right to direct the use of an underlying asset, the Company considers if they have the right to direct how and for what purpose the asset is used throughout the period of use and if they control the decision-making rights over the asset.

The Company’s lease terms may include options to extend or terminate the lease.  The Company exercises judgment to determine the term of those leases when extension or termination options are present and include such options in the calculation of the lease term when it is reasonably certain that it will exercise those options.

The Company has elected to include both lease and non-lease components in the determination of lease payments. Payments made to a lessor for items such as taxes, insurance, common area maintenance, or other costs commonly referred to as executory costs, are also included in lease payments if they are fixed. The fixed portion of these payments are included in the calculation of the lease liability, while any variable portion would be recognized as variable lease expenses, when incurred. Variable payments made to third parties for these, or similar costs, such as utilities, are not included in the calculation of lease payments.

At commencement, lease-related assets and liabilities are measured at the present value of future lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company exercises judgment in determining the incremental borrowing rate based on the information available at when the lease commences to measure the present value of future payments.

Operating lease expense is recognized on a straight-line basis over the lease term. Finance lease cost includes amortization, which is recognized on a straight-line basis over the expected life of the leased asset, and interest expense, which is recognized following an effective interest rate method.

Operating leases are included in other assets, current operating lease obligations, and operating lease obligations (less current portion) on the Company’s consolidated balance sheet. Finance leases are included in property, plant and equipment and current and long-term portion of finance lease obligations on the Company’s consolidated balance sheet. Short term leases with an initial term of 12 months or less are not presented on the balance sheet with expense recognized as incurred.

19

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note J - Leases - Continued

The following table presents lease assets and liabilities and their balance sheet classification:

			July 31,
	Classification		2019
Operating Leases:
Right-of-use Assets	Other assets	$	5,485,353
Operating lease current liabilities	Current portion of operating lease obligations		2,049,962
Operating lease noncurrent liabilities	Operating lease obligations, less current portion		3,692,295
Finance Leases:
Right-of-use Assets	Property, plant and equipment		10,506,242
Finance lease current liabilities	Current portion of finance lease obligations		1,821,341
Finance lease noncurrent liabilities	Finance lease obligations, less current portion		2,368,517

The components of lease expense for the three month period ended July 31, 2019, are as follows:

		Three Months
		Ended
		July 31,
	Classification	2019
Operating Leases:
Operating lease cost	Operating expenses	594,494
Variable lease cost	Operating expenses	73,897
Short term lease cost	Operating expenses	1,350
Finance Leases:
Amortization of right-of-use assets	Operating expenses	347,375
Interest expense	Interest expense	67,786
Total		1,084,902

The weighted average lease term and discount rates are as follows:

	July 31,
	2019
Operating Leases:
Weighted average remaining lease term (months)	41.10
Weighted average discount rate	3.8%
Finance Leases:
Weighted average remaining lease term (months)	28.63
Weighted average discount rate	5.9%

20

SigmaTron International, Inc.

July 31, 2019

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note J - Leases - Continued

Future payments due under leases reconciled to lease liabilities are as follows:

		Finance Leases		Operating Leases
For the remaining 9 months of the fiscal year ending April 30:
2020	$	1,535,763	$	1,847,153
For the fiscal years ending April 30:
2021		1,792,747		2,243,547
2022		1,049,198		1,289,278
2023		133,819		1,136,290
2024		-		698,778
Thereafter		-		180,288
Total undiscounted lease payments		4,511,527		7,395,334
Present value discount, less interest		321,669		1,653,077
Lease liability	$	4,189,858	$	5,742,257

Supplemental disclosures of cash flow information related to leases are as follows:

	Three Months
	Ended
	July 31,
Other Information	2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	67,786
Operating cash flows from operating leases	62,155
Financing cash flows from finance leases	612,300
Supplemental non-cash information on lease labilities arising from obtaining right-of-use assets:
Right-of-use assets obtained in exchange for new finance lease liabilities	-
Right-of-use assets obtained in exchange for operating lease liabilities	-

21

SigmaTron International, Inc.

July 31, 2019

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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

22

SigmaTron International, Inc.

July 31, 2019

Overview:

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

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

Sales can be a misleading indicator of the Company’s financial performance.  Sales levels can vary considerably among customers and products depending on the type of services (turnkey versus consignment) rendered by the Company and the demand by customers.  Consignment orders require the Company to perform manufacturing services on components and other materials supplied by a customer, and the Company charges only for its labor, overhead and manufacturing costs, plus a profit.  In the case of turnkey orders, the Company provides, in addition to manufacturing services, the components and other materials used in assembly.  Turnkey contracts, in general, have a higher dollar volume of sales for each given assembly, owing to inclusion of the cost of components and other materials in net sales and cost of goods sold.  Variations in the number of turnkey orders compared to consignment orders can lead to significant fluctuations in the Company’s revenue and gross margin levels.  Consignment orders accounted for less than 1% of the Company’s revenues for the three month periods ended July 31, 2019 and July 31, 2018, respectively. 

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

The Company reported profitable results for its first quarter of fiscal year 2020.  This follows its profitable fourth quarter of fiscal year 2019. The Company’s positive financial results are primarily driven by an increased revenue level combined with improved pricing and productivity. Based on the Company’s current backlog, it expects this trend to continue going into the second quarter of fiscal year 2020.  However, uncertainty and volatility continue in the Company’s industry.  While there are many factors driving this uncertainty, the trade wars remain the primary factor and the trade war with China the primary driver.  The Company continues to closely manage inventory levels with a focus on accuracy of customers’ forecasts and lead-times for components. The Company’s projection for current customer sales remains positive which it believes will result in continued growth.  Additionally, the Company is launching products with new customers during its second quarter. All of these are positive developments. However, conditions can change quickly and currently are difficult to forecast.

23

SigmaTron International, Inc.

July 31, 2019

Issues remain in the component marketplace, including component availability, lead times, deliveries and price increases, but they are fewer and farther between. In fact, for some component classes lead times have shortened.

Results of Operations:

The following table sets forth selective financial data as a percentage of net sales for the periods indicated.

	Three Months	Three Months
	Ended	Ended
	July 31,	July 31,
	2019	2018
	(Unaudited)	(Unaudited)
Net sales	100.0%	100.0%
Operating expenses:
Cost of products sold	90.6	91.9
Selling and administrative expenses	7.9	8.3
Total operating expenses	98.5	100.2
Operating income (loss)	1.5%	(0.2%)

Net Sales

Net sales increased for the three month period ended July 31, 2019, to $74,009,981 from $71,414,057for the three month period ended July 31, 2018.  The Company’s sales increased for the three month period ended July 31, 2019, as compared to the prior year in the industrial electronics and medical/life science marketplaces.  The increase in sales dollars for these marketplaces was partially offset by a decrease in sales dollars in the consumer electronics marketplace.  Revenues started an upward trend during the first quarter of fiscal year 2020.

Gross Profit

Gross profit dollars increased during the three month period ended July 31, 2019, to $6,960,332or 9.4% of net sales compared to $5,789,056 or 8.1% of net sales for the same period in the prior fiscal year.    The increase in gross profit for the three month period ended July 31, 2019, was primarily the result of increased sales in the majority of the marketplaces the Company serves compared to the same period in the prior year. 

Selling and Administrative Expenses

Selling and administrative expenses decreased to $5,827,326 or 7.9% of net sales for the three month period ended July 31, 2019, compared to $5,934,116 or 8.3% of net sales for the same period in the prior fiscal year.  The net decrease in selling and administrative expenses for the three month period ended July 31, 2019, was attributable to sales salaries, financing fees and legal professional fees.  The decrease in the foregoing selling and administrative expenses was partially offset by an increase in general insurance, accounting professional fees and bonus expense.

24

SigmaTron International, Inc.

July 31, 2019

Interest Expense

Interest expense increased to $591,228 for the three month period ended July 31, 2019, compared to $553,490 for the same period in the prior fiscal year.  The increase in interest expense for the three month period ended July 31, 2019, was due to higher interest rates compared to the same period in the prior year.  Interest expense for future quarters may fluctuate depending on interest rates and borrowings levels.

Income Tax Expense

The income tax expense was $247,115 for the three month period ended July 31, 2019, compared to an income tax benefit of $197,006 for the same period in the prior fiscal year.  The Company’s effective tax rate was 40.63% and 27.22% for the quarters ended July 31, 2019 and 2018, respectively.  The increase in income tax expense for the three month period ended July 31, 2019, compared to the benefit recognized for the same period in the previous year is due to operating income recognized in the current period as opposed to a loss recognized in the same period in the previous year. The increase in effective tax rate is due primarily to the operating loss recognized in Vietnam in the current period for which no tax benefit is recorded due to a full valuation allowance.

Net Income

Net income increased to $361,025 for the three month period ended July 31, 2019, compared to net loss of $526,607 for the same period in the prior fiscal year.  Basic and diluted earnings per share for the first quarter of fiscal year 2020 were $0.09, compared to basic and diluted loss per share of $0.12 for the same period in the prior fiscal year.  The increase in net income and earnings per share are due to the results of operations described above, mainly from an increase in gross profit.

Liquidity and Capital Resources:

Operating Activities.

Cash flow provided by operating activities was $4,070,834 for the three months ended July 31, 2019. During the first three months of fiscal year 2020, cash flow provided by operating activities was primarily the result of net income, a  decrease in inventory of $11,324,564 andan increase in accrued expenses and wages.The decrease in inventory is primarily the result of increased sales and the implementation of an inventory reduction program.  Cash flow provided by operating activities was partially offset by the result of a decrease in accounts payable of $9,386,019.

Cash flow used in operating activities was $3,441,096for the three months ended July 31, 2018.  During the first three months of fiscal year 2019, cash flow used in operating activities was primarily the result of an increase in accounts receivable in the amount of $4,522,665, an increase in inventory of $1,083,002 and the reported net loss.  The increase in accounts receivable is the result of increased sales.  The increase in inventory is the result of an increase in customer orders and in some cases orders being pushed out.  Further, capacity issues in the component industry made it difficult to obtain some components to complete assemblies for shipping.  Cash flow used in operating activities was partially offset by the result of an increase in accounts payable, decrease in prepaid expenses and other assets and the non-cash effects of depreciation and amortization.

25

SigmaTron International, Inc.

July 31, 2019

Investing Activities.

During the first three months of fiscal year 2020, the Company purchased $684,667 in machinery and equipment to be used in the ordinary course of business.  The Company has received forecasts from current customers for increased business that would require additional investment in capital equipment and facilities.  To the extent that these forecasts come to fruition, the Company anticipates that it will make additional machinery and equipment purchases in fiscal year 2020.  The Company anticipates purchases will be funded by lease transactions.

During the first three months of fiscal year 2019, the Company purchased $706,808in machinery and equipment used in the ordinary course of business.  The Company made additional machinery and equipment purchases of $1,654,821 during the balance of fiscal year 2019.

Financing Activities.

Cash used in financing activities of $2,904,247 for the three months ended July 31, 2019, was primarily the result of net payments under the line of credit.

Cash provided by financing activities of $4,231,403 for the three months ended July 31, 2018, was primarily the result of net borrowings under the line of credit.

Financing Summary.

Notes Payable – Banks

On March 31, 2017, the Company entered into a $35,000,000 senior secured credit facility with U.S. Bank, which expires on March 31, 2022.  The credit facility is collateralized by substantially all of the Company’s domestically located assets. The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of five percent or LIBOR plus one and one half percent (effectively 3.81% at July 31, 2019).  Interest is due monthly. 

On July 16, 2018, the Company and U.S. Bank entered into an amendment of the revolving line of credit under the senior secured credit facility.  The amended revolving credit facility allows the Company to borrow up to the lesser of (i) $45,000,000 (the“Revolving Line Cap”) less reserves or (ii) the Borrowing Base, but no more than 90% of the Company’s Revolving Line Cap, except that the 90% limitation will expire if (i) the Company’s actual revolving loans for 90 consecutive days after the amendment’s effective date are less than 80% of the Company’s Borrowing Base and (ii) the Company maintains a Fixed Charge Coverage Ratio of 1.2 to 1.0 for four consecutive quarters.  The amendment also imposes sublimits on categories of inventory equal to $10,500,000 on raw materials, $10,000,000 on finished goods and $28,000,000 on all eligible inventory. 

On December 13, 2018, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment provides an exception to otherwise ineligible foreign receivables for up to $3,000,000 of receivables paid by certain enumerated account debtors outside of the U.S. and Canada.

On March 22, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until August 1, 2019 and 90% on and after August 1, 2019.

26

SigmaTron International, Inc.

July 31, 2019

On August 26, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until February 26, 2020 and 90% on and after February 26, 2020. 

As of July 31, 2019, there was $33,671,686 outstanding and $8,993,594 of unused availability under the U.S. Bank facility compared to an outstanding balance of $35,727,212 and $6,645,730 of unused availability at April 30, 2019.  At July 31, 2019, the Company was in compliance with its financial covenant and other restrictive covenants under the credit facility.  Deferred financing costs of $5,959 were capitalized during the three month period ended July 31, 2019, which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019, the unamortized amount offset against outstanding debt was $196,675 and $209,162, respectively.

On March 15, 2019, the Company’s wholly-owned subsidiary, SigmaTron Electronic Technology Co., Ltd., entered into a credit facility with China Construction Bank.  Under the agreement SigmaTron Electronic Technology Co., Ltd. can borrow up to 5,000,000 Renminbi, approximately $726,000 as of July 31, 2019, and the facility is collateralized by Wujiang SigmaTron Electronics Co., Ltd.’s manufacturing building.  Interest is payable monthly and the facility bears a fixed interest rate of 6.09%.  The term of the facility extends to March 14, 2024.  There was no outstanding balance under the facility at July 31, 2019 and April 30, 2019.

Notes Payable – Buildings

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $5,200,000, with U.S. Bank to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility in Elk Grove Village, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $17,333, bears interest at a fixed rate of 4.0% per year and is payable over a fifty-one month period.  Deferred financing costs of $74,066 were capitalized in fiscal year 2018 which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019, the unamortized amount included as a reduction to long-term debt was $45,746 and $49,852, respectively.  A final payment of approximately $4,347,778 is due on or before March 31, 2022.  The outstanding balance was $4,888,000 and $4,940,000 at July, 31 2019 and April 30, 2019, respectively.

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $1,800,000, with U.S. Bank to refinance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $6,000, bears interest at a fixed rate of 4.0% per year and is payable over a  fifty-one month period.  Deferred financing costs of $65,381 were capitalized in the fiscal year 2018 which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019 the unamortized amount included as a reduction to long-term debt was $40,234 and $44,006, respectively.  A final payment of approximately $1,505,000 is due on or before March 31, 2022.  The outstanding balance was $1,692,000 and $1,710,000 at July, 31 2019 and April 30, 2019, respectively. 

Notes Payable – Equipment

The Company routinely enters into secured note agreements with Engencap Fin S.A. DE C.V. to finance the purchase of equipment. The terms of these secured note agreements extend to November 2021 through May 2023, with quarterly installment payments ranging from $11,045 to $37,941 and a fixed interest rate ranging from 6.65% to 8.00%.

27

SigmaTron International, Inc.

July 31, 2019

Finance Lease and Sales Leaseback Obligations

The Company enters into various finance lease and sales leaseback agreements.  The terms of the lease agreements mature through January 2023, with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 8.00%.

Other

The Company provides funds for salaries, wages, overhead and capital expenditure items as necessary to operate its wholly-owned Mexican, Vietnam and Chinese subsidiaries and the Taiwan international procurement office.  The Company provides funding, as needed, in U.S. dollars, which are exchanged for Pesos, Dong, Renminbi, and New Taiwan dollars.  The fluctuation of currencies from time to time, without an equal or greater increase in inflation, could have a material impact on the financial results of the Company.The impact of currency fluctuation for the three month period ended July 31, 2019 resulted in a foreign currency transaction loss of $109,252 compared to a foreign currency transaction loss of approximately $299,177 for the same period in the prior year.  Foreign currency gains or losses are recorded in the cost of products sold.  During the first three months of fiscal year 2020, the Company’s U.S. operations paid approximately $12,720,000 to its foreign subsidiaries for services provided.

Except for the impact of the Tax Act, the Company has not changed its plans to indefinitely reinvest the earnings of the Company’s foreign subsidiaries.  The cumulative amount of unremitted earnings for which U.S. income taxes have not been recorded is $9,195,000 as of July 31, 2019. 

The Company anticipates that its credit facilities, expected future cash flow from operations and leasing resources are adequate to meet its working capital requirements and fund capital expenditures for the next 12 months. However, in the event customers continue to delay orders or future payments are not made timely, the Company desires to expand its operations, its business grows more rapidly than expected, or the current economic climate deteriorates, additional financing resources may be necessary. There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

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

Off-balance Sheet Transactions:

The Company has no off-balance sheet transactions.

28

SigmaTron International, Inc.

July 31, 2019

Tabular Disclosure of Contractual Obligations:

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

Item 3.Quantitative and Qualitative Disclosures About Market Risks.

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

Item 4.Controls and Procedures.

Disclosure Controls:

The Company’s management, including its President and Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of its disclosure controls and procedures (as defined under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), Rules 13a-15(e) and 15(d)-15(e)) as of July 31, 2019.  The Company’s disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and its President and Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at the reasonable assurance level as of July 31, 2019.

Internal Controls:

There has been no change in the Company’s internal control over financial reporting during the three months ended July 31, 2019, that has materially affected or is reasonably likely to materially affect, its internal control over financial reporting.  The Company’s internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with U.S. GAAP.

On May 14, 2013, the Committee of Sponsoring Organizations of the Treasury Commission (“COSO”) issued an updated version of its Internal Control - Integrated Framework (the “2013 Framework”) which officially superseded COSO’s earlier Internal Control-Integrated Framework (1992) (the “1992 Framework”) on December 15, 2014. Originally issued in 1992, the framework helps organizations design, implement and evaluate the effectiveness of internal control concepts and simplify their use and application.  Based on the Company’s evaluation, management concluded that its internal controls over financial reporting were effective at the reasonable assurance level as of July 31, 2019.

PART II – OTHER INFORMATION

Item 1.              Legal Proceedings.

From time to time the Company is involved in legal proceedings, claims, or investigations that are incidental to the Company’s business. In future periods, the Company could be subjected to cash cost or non-cash charges to earnings if any of these matters are resolved on unfavorable terms. However, although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of any particular claim, the Company does not expect these legal proceedings or claims will have any material adverse impact on its future consolidated financial position, results of operations or cash flows.

29

SigmaTron International, Inc.

July 31, 2019

Item 1A.            Risk Factors.

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

Item2.              Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3.              Defaults Upon Senior Securities.

None.

Item 4.              Mine Safety Disclosures.

Not applicable.

Item 5.              Other Information.

None.

30

SigmaTron International, Inc.

July 31, 2019

Item 6.Exhibits.

31.1	Certification of Principal Executive Officer of the Company Pursuant to Rule 13a-14(a) under the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
31.2	Certification of Principal Financial Officer of the Company Pursuant to Rule 13a-14(a) under the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
32.1	Certification by the Principal Executive Officer of SigmaTron International, Inc. Pursuant to Rule 13a-14(b) under the Exchange Act and Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
32.2	Certification by the Principal Financial Officer of SigmaTron International, Inc. Pursuant to Rule 13a-14(b) under the Exchange Act and Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Scheme Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

31

SigmaTron International, Inc.

July 31, 2019

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.

SIGMATRON INTERNATIONAL, INC.

/s/ Gary R. Fairhead	September  12, 2019
Gary R. Fairhead	Date
President and CEO (Principal Executive Officer)
/s/ Linda K. Frauendorfer	September  12, 2019
Linda K. Frauendorfer	Date
Chief Financial Officer, Secretary and Treasurer
(Principal Financial Officer and Principal
Accounting Officer)

32

EX-31.1

SigmaTron International, Inc.

July31, 2019

EXHIBIT 31.1

Certification of Principal Executive Officer of

SigmaTron International, Inc.

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

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

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

1.I have reviewed the Quarterly Report on Form 10-Q of SigmaTron International, Inc. for the quarter ended July 31, 2019 (this “report”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

SigmaTron International, Inc.

July31, 2019

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  September  12, 2019
	/s/ Gary R. Fairhead
	Gary R. Fairhead
	President and Chief Executive Officer of
	SigmaTron International, Inc.

EX-31.2

SigmaTron International, Inc.

July 31, 2019

EXHIBIT 31.2

Certification of Principal Financial Officer of

SigmaTron International, Inc.

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

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

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

1.I have reviewed the Quarterly Report on Form 10-Q of SigmaTron International, Inc. for the quarter ended July 31, 2019 (this “report”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

SigmaTron International, Inc.

July 31, 2019

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  September 12, 2019
	/s/ Linda K. Frauendorfer
	Linda K. Frauendorfer
	Chief Financial Officer, Secretary and
	Treasurer of SigmaTron International, Inc.

EX-32.1

SigmaTron International, Inc.

July 31, 2019

EXHIBIT 32.1

Certification by the Principal Executive Officer of

SigmaTron International, Inc.

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

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

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

This certification is being furnished pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Company’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2019(the “Report”).

I hereby certify that to the best of my knowledge:

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

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

Date:  September  12, 2019
	/s/ Gary R. Fairhead
	Gary R. Fairhead
	President and Chief Executive Officer of
	SigmaTron International, Inc.

EX-32.2

SigmaTron International, Inc.

July 31, 2019

EXHIBIT 32.2

Certification by the Principal Financial Officer of

SigmaTron International, Inc.

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

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

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

This certification is being furnished pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Company’s Quarterly Report on Form 10-Q for the quarter endedJuly 31, 2019(the “Report”).

I hereby certify that to the best of my knowledge:

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

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

Date:  September12, 2019
	/s/ Linda K. Frauendorfer
	Linda K. Frauendorfer
	Chief Financial Officer, Secretary and
	Treasurer of SigmaTron International, Inc.

XML

Income Tax

3 Months Ended

Jul. 31, 2019

Income Tax [Abstract]

Income Tax

Note F - Income Tax

The income tax expense was $247,115 for the three month period ended July 31, 2019 compared to an income tax benefit of $197,006 for the same period in the prior fiscal year.  The Company’s effective tax rate was 40.63% and 27.22% for the quarters ended July 31, 2019 and 2018, respectively.  The increase in income tax expense for the three month period ended July 31, 2019 compared to the benefit recognized for the same period in the previous year is due to operating income recognized in the current period as opposed to a loss recognized in the same period in the previous year. The increase in effective tax rate is due primarily to the operating loss recognized in China and Vietnam in the current period for which no tax benefit is recorded due to a full valuation allowance. 

XML

Leases

3 Months Ended

Jul. 31, 2019

Leases [Abstract]

Leases

Note J - Leases

The Company leases office and storage space, vehicles and other equipment under non-cancellable operating leases with initial terms typically ranging from 1 to5 years.  At contract inception, the Company reviews the facts and circumstances of the arrangement to determine if the contract is or contains a lease.  The Company follows the guidance in Topic 842 to evaluate whether the contract has an identified asset; if the Company has the right to obtain substantially all economic benefits from the asset; and if the Company has the right to direct the use of the underlying asset.  When determining if a contract has an identified asset, the Company considers both explicit and implicit assets, and whether the supplier has the right to substitute the asset.  When determining if the Company has the right to direct the use of an underlying asset, the Company considers if they have the right to direct how and for what purpose the asset is used throughout the period of use and if they control the decision-making rights over the asset.

The Company’s lease terms may include options to extend or terminate the lease.  The Company exercises judgment to determine the term of those leases when extension or termination options are present and include such options in the calculation of the lease term when it is reasonably certain that it will exercise those options.

The Company has elected to include both lease and non-lease components in the determination of lease payments. Payments made to a lessor for items such as taxes, insurance, common area maintenance, or other costs commonly referred to as executory costs, are also included in lease payments if they are fixed. The fixed portion of these payments are included in the calculation of the lease liability, while any variable portion would be recognized as variable lease expenses, when incurred. Variable payments made to third parties for these, or similar costs, such as utilities, are not included in the calculation of lease payments.

At commencement, lease-related assets and liabilities are measured at the present value of future lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company exercises judgment in determining the incremental borrowing rate based on the information available at when the lease commences to measure the present value of future payments.

Operating lease expense is recognized on a straight-line basis over the lease term. Finance lease cost includes amortization, which is recognized on a straight-line basis over the expected life of the leased asset, and interest expense, which is recognized following an effective interest rate method.

Operating leases are included in other assets, current operating lease obligations, and operating lease obligations (less current portion) on the Company’s consolidated balance sheet. Finance leases are included in property, plant and equipment and current and long-term portion of finance lease obligations on the Company’s consolidated balance sheet. Short term leases with an initial term of 12 months or less are not presented on the balance sheet with expense recognized as incurred.

Note J - Leases - Continued

The following table presents lease assets and liabilities and their balance sheet classification:

			July 31,
	Classification		2019
Operating Leases:
Right-of-use Assets	Other assets	$	5,485,353
Operating lease current liabilities	Current portion of operating lease obligations		2,049,962
Operating lease noncurrent liabilities	Operating lease obligations, less current portion		3,692,295
Finance Leases:
Right-of-use Assets	Property, plant and equipment		10,506,242
Finance lease current liabilities	Current portion of finance lease obligations		1,821,341
Finance lease noncurrent liabilities	Finance lease obligations, less current portion		2,368,517

The components of lease expense for the three month period ended July 31, 2019, are as follows:

		Three Months
		Ended
		July 31,
	Classification	2019
Operating Leases:
Operating lease cost	Operating expenses	594,494
Variable lease cost	Operating expenses	73,897
Short term lease cost	Operating expenses	1,350
Finance Leases:
Amortization of right-of-use assets	Operating expenses	347,375
Interest expense	Interest expense	67,786
Total		1,084,902

The weighted average lease term and discount rates are as follows:

	July 31,
	2019
Operating Leases:
Weighted average remaining lease term (months)	41.10
Weighted average discount rate	3.8%
Finance Leases:
Weighted average remaining lease term (months)	28.63
Weighted average discount rate	5.9%

Note J - Leases - Continued

Future payments due under leases reconciled to lease liabilities are as follows:

		Finance Leases		Operating Leases
For the remaining 9 months of the fiscal year ending April 30:
2020	$	1,535,763	$	1,847,153
For the fiscal years ending April 30:
2021		1,792,747		2,243,547
2022		1,049,198		1,289,278
2023		133,819		1,136,290
2024		-		698,778
Thereafter		-		180,288
Total undiscounted lease payments		4,511,527		7,395,334
Present value discount, less interest		321,669		1,653,077
Lease liability	$	4,189,858	$	5,742,257

Supplemental disclosures of cash flow information related to leases are as follows:

	Three Months
	Ended
	July 31,
Other Information	2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	67,786
Operating cash flows from operating leases	62,155
Financing cash flows from finance leases	612,300
Supplemental non-cash information on lease labilities arising from obtaining right-of-use assets:
Right-of-use assets obtained in exchange for new finance lease liabilities	-
Right-of-use assets obtained in exchange for operating lease liabilities	-

XML

Leases (Lease Assets And Liabilities Related To Balance Sheet Classification) (Details) - USD ($)	Jul. 31, 2019	May 01, 2019	Apr. 30, 2019
Leases [Abstract]
Operating Leases: Right-of-use Assets	$ 5,485,353	$ 6,017,771
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssetsNoncurrent
Operating lease current liabilities	$ 2,049,962
Operating lease noncurrent liabilities	3,692,295
Finance Leases: Right-of-use Assets	$ 10,506,242
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:PropertyPlantAndEquipmentNet
Finance lease current liabilities	$ 1,821,341		$ 1,939,374
Finance lease noncurrent liabilities	$ 2,368,517		$ 2,862,784

XML

Critical Accounting Policies (Narrative) (Details) - USD ($)	Jul. 31, 2019	May 01, 2019	Apr. 30, 2019
Critical Accounting Policies [Abstract]
Performance obligations remain unsatisfied or partially unsatisfied	$ 0
Valuation allowances	1,349,098		$ 1,294,605
Cumulative effect adjustment for the adoption of Topic 842	5
ROU operating lease assets	5,485,353	$ 6,017,771
ROU operating lease liabilities	$ 5,742,257	$ 6,290,289

XML

Leases (Supplemental Cash Flow Information Related To Leases) (Details)	3 Months Ended
	Jul. 31, 2019 USD ($)
Leases [Abstract]
Operating cash flows from finance leases	$ 67,786
Operating cash flows from operating leases	62,155
Financing cash flows from finance leases	612,300
Right-of-use assets obtained in exchange for new finance lease liabilities
Right-of-use assets obtained in exchange for operating lease liabilities

XML

Long-Term Debt (Schedule of Debt and Capital Lease Obligations) (Details) - USD ($)	Jul. 31, 2019	Apr. 30, 2019
Debt Instrument [Line Items]
Unamortized deferred financing costs	$ (282,655)	$ (303,310)
Total debt	41,194,859	43,402,655
Less current maturities	691,701	691,701
Long-term debt	40,503,158	42,710,954
Finance lease and sale leaseback obligations	4,189,858	4,802,158
Less current maturities	1,821,341	1,939,374
Total finance lease obligations, less current portion	2,368,517	2,862,784
Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Debt	33,671,686	35,727,212
Total debt	33,475,011
Notes Payable - Buildings [Member]
Debt Instrument [Line Items]
Debt	6,580,000	6,650,000
Total debt	6,494,020
Notes Payable - Equipment [Member]
Debt Instrument [Line Items]
Debt	1,225,828	$ 1,328,753
Total debt	$ 1,225,828

XML

Long-Term Debt (Tables)

3 Months Ended

Jul. 31, 2019

Long-Term Debt [Abstract]

Schedule of Debt and Capital Lease Obligations

		July 31,		April 30,
		2019		2019
Debt:
Notes Payable - Banks	$	33,671,686	$	35,727,212
Notes Payable - Buildings		6,580,000		6,650,000
Notes Payable - Equipment		1,225,828		1,328,753
Unamortized deferred financing costs		(282,655)		(303,310)
Total debt		41,194,859		43,402,655
Less current maturities		691,701		691,701
Long-term debt	$	40,503,158	$	42,710,954
Finance lease and sale leaseback obligations	$	4,189,858	$	4,802,158
Less current maturities		1,821,341		1,939,374
Total finance lease obligations, less current portion	$	2,368,517	$	2,862,784

Aggregate Amount of Debt, Net Deferred Financing Fees

Fiscal Year	Bank		Building		Equipment		Total
2020	$	-	$	210,000	$	308,775	$	518,775
2021		-		280,000		411,701		691,701
2022		33,475,011		6,004,020		381,852		39,860,883
2023		-		-		114,372		114,372
2024		-		-		9,128		9,128
	$	33,475,011	$	6,494,020	$	1,225,828	$	41,194,859

XML

Inventories, Net (Components Of Inventory) (Details) - USD ($)	Jul. 31, 2019	Apr. 30, 2019
Inventories, Net [Abstract]
Finished products	$ 22,414,687	$ 20,682,669
Work-in-process	2,955,440	3,037,810
Raw materials	50,192,856	63,203,068
Total inventory, gross	75,562,983	86,923,547
Less excess and obsolescence reserve	(1,307,972)	(1,343,972)
Total inventory, net	$ 74,255,011	$ 85,579,575

XML

Description Of The Business

3 Months Ended

Jul. 31, 2019

Description Of The Business [Abstract]

Description Of The Business

Note A - Description of the Business

SigmaTron International, Inc., its subsidiaries, foreign enterprises and international procurement office (collectively, the “Company”) operates in one business segment as an independent provider of electronic manufacturing services (“EMS”), which includes printed circuit board assemblies and completely assembled (box-build) electronic products.  In connection with the production of assembled products, the Company also provides services to its customers, including (1) automatic and manual assembly and testing of products; (2) material sourcing and procurement; (3) manufacturing and test engineering support; (4) design services; (5) warehousing and distribution services; and (6) assistance in obtaining product approval from governmental and other regulatory bodies. 

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Jul. 31, 2019	Apr. 30, 2019
Condensed Consolidated Balance Sheets [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 631,283	$ 631,283
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	12,000,000	12,000,000
Common stock, shares issued	4,242,508	4,240,008
Common stock, shares outstanding	4,242,508	4,240,008

XML

Critical Accounting Policies (Tables)

3 Months Ended

Jul. 31, 2019

Critical Accounting Policies [Abstract]

Revenue Disaggregated By Principal End-User Markets

	Three Months Ended July 31,	Three Months Ended July 31,
Net trade sales by end-market	2019	2018
Industrial Electronics	42,848,712	38,135,102
Consumer Electronics	26,659,187	29,200,913
Medical / Life Sciences	4,502,082	4,078,042
Total Net Trade Sales	74,009,981	71,414,057

XML

Earnings Per Share And Stockholders' Equity (Narrative) (Details) - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Earnings Per Share And Stockholders' Equity [Abstract]
Common stock shares were outstanding	465,232	347,318
Options granted	0	0
Stock option expense	$ 0	$ 0
Balance of unrecognized compensation expense related to stock options plans	$ 0	$ 0
Anti-dilutive common stock outstanding excluded from the calculation of diluted earnings per share	424,484	0

XML

Long-Term Debt (Aggregate Amount of Debt, Net Deferred Financing Fees) (Details) - USD ($)	Jul. 31, 2019	Apr. 30, 2019
2020	$ 518,775
2021	691,701
2022	39,860,883
2023	114,372
2024	9,128
Total debt	41,194,859	$ 43,402,655
Notes Payable - Banks [Member]
2022	33,475,011
Total debt	33,475,011
Notes Payable - Buildings [Member]
2020	210,000
2021	280,000
2022	6,004,020
Total debt	6,494,020
Notes Payable - Equipment [Member]
2020	308,775
2021	411,701
2022	381,852
2023	114,372
2024	9,128
Total debt	$ 1,225,828

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Condensed Consolidated Statements Of Cash Flows - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Cash flows from operating activities
Net income (loss)	$ 361,025	$ (526,607)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	1,235,516	1,267,528
Amortization of right-of-use operating leased assets	532,418
Deferred income tax expense (benefit)	9,286	(251,158)
Amortization of intangible assets	91,420	94,105
Amortization of financing fees	26,614	20,704
Fair value adjustment of contingent consideration		17,529
Loss from disposal or sale of machinery and equipment	51	34
Changes in operating assets and liabilities
Accounts receivable	(487,711)	(4,522,665)
Inventories	11,324,564	(1,083,002)
Prepaid expenses and other assets	57,808	263,923
Refundable and prepaid income taxes	195,046	(86,267)
Income taxes payable	(66,734)	(43,281)
Trade accounts payable	(9,386,019)	1,422,738
Deferred rent		(68,242)
Operating lease liabilities	(586,079)
Accrued expenses and wages	763,629	53,565
Net cash provided by (used in) operating activities	4,070,834	(3,441,096)
Cash flows from investing activities
Purchases of machinery and equipment	(684,667)	(706,808)
Net cash used in investing activities	(684,667)	(706,808)
Cash flows from financing activities
Proceeds under equipment note		182,557
Payments of contingent consideration	(57,537)	(55,075)
Payments under finance lease and sale leaseback agreements	(612,300)	(643,290)
Payments under equipment notes	(102,925)	(93,798)
Payments under building notes payable	(70,000)	(70,000)
Borrowings under revolving line of credit	82,796,750	82,479,011
Payments under revolving line of credit	(84,852,276)	(77,556,902)
Payments of debt financing costs	(5,959)	(11,100)
Net cash (used in) provided by financing activities	(2,904,247)	4,231,403
Change in cash and cash equivalents	481,920	83,499
Cash and cash equivalents at beginning of period	1,005,810	1,721,599
Cash and cash equivalents at end of period	1,487,730	1,805,098
Supplementary disclosures of cash flow information
Cash paid for interest	564,188	504,897
Cash paid for income taxes	162,276	160,239
Financing of insurance policy	$ 96,556	$ 67,675

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Condensed Consolidated Balance Sheets - USD ($)	Jul. 31, 2019	Apr. 30, 2019
Current assets:
Cash and cash equivalents	$ 1,487,730	$ 1,005,810
Accounts receivable, less allowance for doubtful accounts of $631,283 at July 31, 2019 and April 30, 2019	31,929,092	31,441,381
Inventories, net	74,255,011	85,579,575
Prepaid expenses and other assets	2,426,259	2,436,894
Refundable and prepaid income taxes	1,144,693	1,339,739
Other receivables	1,875,358	1,741,890
Total current assets	113,118,143	123,545,289
Property, machinery and equipment, net	32,681,869	33,232,769
Intangible assets, net	2,621,940	2,713,360
Deferred income taxes	384,022	384,022
Other assets	6,982,585	1,589,325
Total other long-term assets	9,988,547	4,686,707
Total assets	155,788,559	161,464,765
Current liabilities:
Trade accounts payable	36,240,995	45,627,014
Accrued wages	5,192,603	4,680,399
Accrued expenses	2,722,534	2,410,311
Income taxes payable	41,831	60,921
Current portion of long-term debt	691,701	691,701
Current portion of finance lease obligations	1,821,341	1,939,374
Current portion of operating lease obligations	2,049,962
Contingent consideration		57,537
Current portion of deferred rent		139,509
Total current liabilities	48,760,967	55,606,766
Long-term debt, less current portion	40,503,158	42,710,954
Income taxes payable	452,619	500,263
Finance lease obligations, less current portion	2,368,517	2,862,784
Operating lease obligations, less current portion	3,692,295
Deferred rent, less current portion		179,059
Other long-term liabilities	1,191,665	1,155,907
Deferred income taxes	170,869	161,583
Total long-term liabilities	48,379,123	47,570,550
Total liabilities	97,140,090	103,177,316
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 500,000 shares authorized, none issued or outstanding
Common stock, $.01 par value; 12,000,000 shares authorized, 4,242,508 and 4,240,008 shares issued and outstanding at July 31, 2019 and April 30, 2019, respectively	42,146	42,146
Capital in excess of par value	23,474,379	23,474,379
Retained earnings	35,131,944	34,770,924
Total stockholders' equity	58,648,469	58,287,449
Total liabilities and stockholders' equity	$ 155,788,559	$ 161,464,765

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Commitments And Contingencies

3 Months Ended

Jul. 31, 2019

Commitments And Contingencies [Abstract]

Commitments And Contingencies

Note G - Commitments and Contingencies

From time to time the Company is involved in legal proceedings, claims or investigations that are incidental to the conduct of the Company’s business. In future periods, the Company could be subjected to cash cost or non-cash charges to earnings if any of these matters are resolved on unfavorable terms. However, although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of any particular claim, the Company does not expect that these legal proceedings or claims will have any material adverse impact on its future consolidated financial position, results of operations or cash flows.

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Critical Accounting Policies (Policy)

3 Months Ended

Jul. 31, 2019

Critical Accounting Policies [Abstract]

Management Estimates And Uncertainties

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

Revenue Recognition

Revenue Recognition - The following table presents the Company’s revenue disaggregated by the principal end-user markets it serves:

	Three Months Ended July 31,	Three Months Ended July 31,
Net trade sales by end-market	2019	2018
Industrial Electronics	42,848,712	38,135,102
Consumer Electronics	26,659,187	29,200,913
Medical / Life Sciences	4,502,082	4,078,042
Total Net Trade Sales	74,009,981	71,414,057

During the three month period ending July 31, 2019, no revenues were recognized from performance obligations satisfied or partially satisfied in previous periods and no amounts were allocated to performance obligations that remain unsatisfied or partially unsatisfied at July 31, 2019.  The Company is electing not to disclose the value of the remaining unsatisfied performance obligation with a duration of one year or less as permitted by the practical expedient in ASU 2014-09, “Revenue from Contracts with Customers.”  The Company had no material remaining unsatisfied performance obligations as of July 31, 2019, with an expected duration of greater than one year.

Income Tax

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

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial

Note H - Critical Accounting Policies - Continued

operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistentwith the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.The Company’s valuation allowance was $1,349,098 and $1,294,605 as of July 31, 2019 and April 30, 2019, respectively.

Revisions

Revisions - Previously reported cash flows from financing activities for the three-month period ended July 31, 2018 have been revised to reflect the classification of payments and borrowings under the Company’s revolving line of credit presented in the condensed consolidated statement of cash flows. The revision had no impact to total cash flows from financing activities, net loss or net loss per share, or the condensed consolidated balance sheets or statements of operations or stockholders’ equity. See Note B, “Summary of Significant Accounting Policies” in the Company’s 2019 10-K for additional information on these revisions.

New Accounting Standards

New Accounting Standards:

In February 2016, the FASB issued ASU 2016-02, as amended, Leases (Topic 842), which requires a lessee to record a right-of-use asset and a lease liability for all leases with a term greater than twelve months regardless of whether the lease is classified as an operating lease or a financing lease.

Effective May 1, 2019, the Company adopted the new standard under the modified retrospective approach, applying the current-period adjustment method.  Under the transition guidance of the modified retrospective approach there are a number of optional practical expedients made available to simplify the transition of the new standard. The Company has elected the following:

· The condensed consolidated balance sheets for reporting periods beginning on or after May 1, 2019 are presented under the new guidance, while prior period amounts are not adjusted and continue to be reported in accordance with ASC Topic 840, Leases. The Company recognized a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption of $5. 

· The Company has elected to utilize the package of practical expedients permitted under the transition guidance in the standard, which allowed the Company to not reassess (i) whether any expired or existing contracts contain leases, (ii) historical lease classification, and (iii) initial direct costs.

· The Company has elected to combine lease and non-lease components as a single component for all asset classes.

· The Company has elected to not assess whether existing or expired land easements that were not previously accounted for as leases under Topic 840 are or contain a lease under this Topic.

· The Company has elected to keep leases with an initial term of 12 months or less off of the balance sheet.

Note H - Critical Accounting Policies - Continued

Upon adoption, the Company recorded Right-of-use ("ROU") assets and lease liabilities relating to operating leases of $6,017,771 and $6,290,289, respectively. The changes did not have a material impact on our results of operations or cash flows. The discount rates used to calculate the ROU assets and lease liabilities as of the effective date were based on the remaining lease terms as of the effective date. See Note J - Leases, for the impact on the financial statements and related disclosures from the adoption of this standard.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13, as amended by ASU 2019-04 and ASU 2019-05, introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts.  This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this ASU may have on its consolidated financial statements.

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Leases (Future Payments Due Under Finance And Operating Leases) (Details) - USD ($)	Jul. 31, 2019	May 01, 2019	Apr. 30, 2019
Finance Leases
For the remaining 9 months of the fiscal year ending April 30: 2020	$ 1,535,763
For the fiscal year ending April 30: 2021	1,792,747
For the fiscal year ending April 30: 2022	1,049,198
For the fiscal year ending April 30: 2023	133,819
For the fiscal year ending April 30: 2024
Thereafter
Total undiscounted lease payments	4,511,527
Present value discount, less interest	321,669
Lease liability	4,189,858		$ 4,802,158
Operating Leases
For the remaining 9 months of the fiscal year ending April 30: 2020	1,847,153
For the fiscal year ending April 30: 2021	2,243,547
For the fiscal year ending April 30: 2022	1,289,278
For the fiscal year ending April 30: 2023	1,136,290
For the fiscal year ending April 30: 2024	698,778
Thereafter	180,288
Total undiscounted lease payments	7,395,334
Present value discount, less interest	1,653,077
Lease liability	$ 5,742,257	$ 6,290,289

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Leases (Narratives) (Details)	Jul. 31, 2019
Minimum [Member]
Lessee, Lease, Description [Line Items]
Operating leases, term	1 year
Maximum [Member]
Lessee, Lease, Description [Line Items]
Operating leases, term	5 years

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Income Tax (Narrative) (Details) - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Income Tax [Line Items]
Income tax expense (benefit)	$ 247,115	$ (197,006)
Effective income tax rate	40.63%	27.22%
Foreign [Member]
Income Tax [Line Items]
Operating loss carryforwards, valuation allowance	$ 0

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Description Of The Business (Narrative) (Details)	3 Months Ended
	Jul. 31, 2019 segment
Description Of Business [Abstract]
Number of business segments as an independent provider of electronic manufacturing services	1

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Long-Term Debt (Narrative) (Details)							1 Months Ended	3 Months Ended
	Aug. 26, 2019	Mar. 22, 2019	Jul. 16, 2018 USD ($)	Dec. 21, 2017 USD ($)	Jul. 16, 2017 USD ($)	Mar. 31, 2017 USD ($)	Mar. 31, 2017 USD ($)	Jul. 31, 2019 USD ($)	Apr. 30, 2019 USD ($)	Mar. 15, 2019 CNY (¥)	Dec. 13, 2018 USD ($)	Apr. 30, 2018 USD ($)
U.S. Bank [Member] | Notes Payable - Banks [Member] | Corporate Headquarters And Manufacturing Facility [Member]
Debt Instrument [Line Items]
Mortgage agreement, outstanding amount								$ 4,888,000	$ 4,940,000
U.S. Bank [Member] | Notes Payable - Buildings [Member] | Corporate Headquarters And Manufacturing Facility [Member]
Debt Instrument [Line Items]
Deferred financing costs												$ 74,066
Unamortized amount offset against outstanding debt								45,746	49,852
Mortgage agreement, amount				$ 5,200,000
Mortgage agreement, interest rate				4.00%
Mortgage agreement, final payment								$ 4,347,778
Mortgage agreement, maturity date								Mar. 31, 2022
Mortgage agreement, monthly principal payment				$ 17,333
Mortgage agreement, payable period				51 months
U.S. Bank [Member] | Notes Payable - Buildings [Member] | Engineering And Design Center [Member]
Debt Instrument [Line Items]
Deferred financing costs												$ 65,381
Unamortized amount offset against outstanding debt								$ 40,234	44,006
Mortgage agreement, amount				$ 1,800,000
Mortgage agreement, interest rate				4.00%
Mortgage agreement, final payment								1,505,000
Mortgage agreement, outstanding amount								$ 1,692,000	1,710,000
Mortgage agreement, maturity date								Mar. 31, 2022
Mortgage agreement, monthly principal payment				$ 6,000
Mortgage agreement, payable period				51 months
U.S. Bank [Member] | Senior Secured Credit Facility [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Credit facility credit limit						$ 35,000,000	$ 35,000,000
Expiration date							Mar. 31, 2022
Fixed interest rate						5.00%	5.00%
Effective interest rate								3.81%
Deferred financing costs								$ 5,959
Unamortized amount offset against outstanding debt								196,675	209,162
Outstanding balance under the credit facility								33,671,686	35,727,212
Unused availability under the credit facility								$ 8,993,594	6,645,730
U.S. Bank [Member] | Senior Secured Credit Facility [Member] | LIBOR [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Variable interest rate						1.50%
U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Credit facility credit limit			$ 45,000,000
Borrowing base percentage			90.00%
Number of days in measuring borrowing base requirements			90 days
Borrowing base minimum requirement			80.00%
Sublimits on raw materials					$ 10,500,000
Sublimits on finished goods			$ 10,000,000
Sublimits on all eligible inventory			$ 28,000,000
U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member] | Revolving Line Cap Until August 1, 2019 [Member]
Debt Instrument [Line Items]
Borrowing base percentage		95.00%
U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member] | Revolving Line Cap On And After August 1, 2019 [Member]
Debt Instrument [Line Items]
Borrowing base minimum requirement		90.00%
U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member] | Revolving Line Cap Until February 26, 2020 [Member]
Debt Instrument [Line Items]
Borrowing base percentage	95.00%
U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member] | Revolving Line Cap On And After February 26, 2020 [Member]
Debt Instrument [Line Items]
Borrowing base minimum requirement	90.00%
Minimum [Member] | Finance Lease And Sales Leaseback Agreements [Member]
Debt Instrument [Line Items]
Fixed interest rate								3.75%
Installment payments under secured note agreements								$ 1,455
Minimum [Member] | U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Fixed charge coverage ratio					1.00%
Minimum [Member] | Engencap Fin S.A. DE C.V. [Member] | Notes Payable - Equipment [Member] | Equipment [Member]
Debt Instrument [Line Items]
Fixed interest rate								6.65%
Term extended agreement date								Nov. 01, 2021
Installment payments under secured note agreements								$ 11,045
Maximum [Member] | Finance Lease And Sales Leaseback Agreements [Member]
Debt Instrument [Line Items]
Fixed interest rate								8.00%
Term extended agreement date								Jan. 01, 2023
Installment payments under secured note agreements								$ 40,173
Maximum [Member] | U.S. Bank [Member] | Revolving Line Cap [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Fixed charge coverage ratio			1.20%
Maximum [Member] | Engencap Fin S.A. DE C.V. [Member] | Notes Payable - Equipment [Member] | Equipment [Member]
Debt Instrument [Line Items]
Fixed interest rate								8.00%
Term extended agreement date								May 01, 2023
Installment payments under secured note agreements								$ 37,941
Foreign Subsidiaries [Member] | Maximum [Member] | U.S. Bank [Member] | Credit Facility [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Credit facility credit limit											$ 3,000,000
SigmaTron Electronic Technology Co [Member] | China Construction Bank [Member] | Credit Facility [Member] | Notes Payable - Banks [Member]
Debt Instrument [Line Items]
Credit facility credit limit								$ 726,000		¥ 5,000,000
Fixed interest rate								6.09%
Outstanding balance under the credit facility								$ 0	$ 0
Term extended agreement date								Mar. 14, 2024

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Basis Of Presentation

3 Months Ended

Jul. 31, 2019

Basis Of Presentation [Abstract]

Basis Of Presentation

Note B - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of SigmaTron International, Inc. (“SigmaTron”), SigmaTron’s wholly-owned subsidiaries Standard Components de Mexico S.A., AbleMex, S.A. de C.V., Digital Appliance Controls de Mexico, S.A. de C.V., Spitfire Controls (Vietnam) Co. Ltd., Spitfire Controls (Cayman) Co. Ltd. and wholly-owned foreign enterprises Wujiang SigmaTron Electronics Co., Ltd. and SigmaTron Electronic Technology Co., Ltd. (“SigmaTron China”) and international procurement office SigmaTron Taiwan branch (collectively, the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.

Accordingly, the condensed consolidated financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.  In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.  Operating results for the three month period ended July 31, 2019 is not necessarily indicative of the results that may be expected for the year ending April 30, 2020.  The condensed consolidated balance sheet at April 30, 2019, was derived from audited annual financial statements but does not contain all of the footnotes disclosures from the annual financial statements.  For further information, refer to the condensed consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended April 30, 2019. 

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Condensed Consolidated Statements Of Operations - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Condensed Consolidated Statements Of Operations [Abstract]
Net sales	$ 74,009,981	$ 71,414,057
Cost of products sold	67,049,649	65,625,001
Gross profit	6,960,332	5,789,056
Selling and administrative expenses	5,827,326	5,934,116
Operating income (loss)	1,133,006	(145,060)
Other (income) expense	(66,362)	25,063
Interest expense	591,228	553,490
Income (loss) before income tax expense	608,140	(723,613)
Income tax expense (benefit)	247,115	(197,006)
Net income (loss)	$ 361,025	$ (526,607)
Earning (loss) per share - basic	$ 0.09	$ (0.12)
Earning (loss) per share - diluted	$ 0.09	$ (0.12)
Weighted average shares of common stock outstanding - Basic	4,241,883	4,223,657
Weighted average shares of common stock outstanding - Diluted	4,241,883	4,223,657

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Leases (Components Of Lease Expense) (Details)	3 Months Ended
	Jul. 31, 2019 USD ($)
Total	$ 1,084,902
Operating Expense [Member]
Operating lease cost	594,494
Variable lease cost	73,897
Short term lease cost	1,350
Amortization of right-of-use assets	347,375
Interest Expense [Member]
Interest expense	$ 67,786

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Critical Accounting Policies (Revenue Disaggregated By Principal End-User Markets) (Details) - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Disaggregation of Revenue [Line Items]
Total Net Trade Sales	$ 74,009,981	$ 71,414,057
Industrial Electronics [Member]
Disaggregation of Revenue [Line Items]
Total Net Trade Sales	42,848,712	38,135,102
Consumer Electronics [Member]
Disaggregation of Revenue [Line Items]
Total Net Trade Sales	26,659,187	29,200,913
Medical / Life Sciences [Member]
Disaggregation of Revenue [Line Items]
Total Net Trade Sales	$ 4,502,082	$ 4,078,042

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Earnings Per Share And Stockholders' Equity (Tables)

3 Months Ended

Jul. 31, 2019

Earnings Per Share And Stockholders' Equity [Abstract]

Computation Of Basic And Diluted Earnings (Loss) Per Share

	Three Months Ended
	July 31,
	2019		2018
Net income (loss)	$	361,025	$	(526,607)
Weighted-average shares
Basic		4,241,883		4,223,657
Effect of dilutive stock options		-		-
Diluted		4,241,883		4,223,657
Basic earnings (loss) per share	$	0.09	$	(0.12)
Diluted earnings (loss) per share	$	0.09	$	(0.12)

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Long-Term Debt

3 Months Ended

Jul. 31, 2019

Long-Term Debt [Abstract]

Long-Term Debt

Note E - Long-term Debt

Debt and capital lease obligations consisted of the following at July 31, 2019 and April 30, 2019:

		July 31,		April 30,
		2019		2019
Debt:
Notes Payable - Banks	$	33,671,686	$	35,727,212
Notes Payable - Buildings		6,580,000		6,650,000
Notes Payable - Equipment		1,225,828		1,328,753
Unamortized deferred financing costs		(282,655)		(303,310)
Total debt		41,194,859		43,402,655
Less current maturities		691,701		691,701
Long-term debt	$	40,503,158	$	42,710,954
Finance lease and sale leaseback obligations	$	4,189,858	$	4,802,158
Less current maturities		1,821,341		1,939,374
Total finance lease obligations, less current portion	$	2,368,517	$	2,862,784

Notes Payable – Banks

On March 31, 2017, the Company entered into a $35,000,000 senior secured credit facility with U.S. Bank, which expires on March 31, 2022.  The credit facility is collateralized by substantially all of the Company’s domestically located assets. The facility allows the Company to choose among interest rates at which it may borrow funds:  the bank fixed rate of five percent or LIBOR plus one and one half percent (effectively 3.81% at July 31, 2019).  Interest is due monthly. 

On July 16, 2018, the Company and U.S. Bank entered into an amendment of the revolving line of credit under the senior secured credit facility.  The amended revolving credit facility allows the Company to borrow up to the lesser of (i) $45,000,000 (the“Revolving Line Cap”) less reserves or (ii) the Borrowing Base, but no more than 90% of the Company’s Revolving Line Cap, except that the 90% limitation will expire if (i) the Company’s actual revolving loans for 90 consecutive days after the amendment’s effective date are less than 80% of the Company’s Borrowing Base and (ii) the Company maintains a Fixed Charge Coverage Ratio of 1.2 to 1.0 for four consecutive quarters.  The amendment also imposes sublimits on categories of inventory equal to $10,500,000 on raw materials, $10,000,000 on finished goods and $28,000,000 on all eligible inventory. 

On December 13, 2018, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment provides an exception to otherwise ineligible foreign receivables for up to $3,000,000 of receivables paid by certain enumerated account debtors outside of the U.S. and Canada.

Note E - Long-term Debt - Continued

On March 22, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until August 1, 2019 and 90% on and after August 1, 2019.

On August 26, 2019, the Company and U.S. Bank entered into an amendment of the revolving credit facility.  The amendment allows the Company to borrow up to the lesser of (i) theRevolving Line Cap less reserves or (ii) the Borrowing Base, but no more than 95% of the Company’s Revolving Line Cap until February 26, 2020 and 90% on and after February 26, 2020. 

As of July 31, 2019, there was $33,671,686 outstanding and $8,993,594 of unused availability under the U.S. Bank facility compared to an outstanding balance of $35,727,212 and $6,645,730 of unused availability at April 30, 2019.  At July 31, 2019, the Company was in compliance with its financial covenant and other restrictive covenants under the credit facility.  Deferred financing costs of $5,959 were capitalized during the three month period ended July 31, 2019, which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019, the unamortized amount offset against outstanding debt was $196,675 and $209,162, respectively. 

On March 15, 2019, the Company’s wholly-owned subsidiary, SigmaTron Electronic Technology Co., Ltd., entered into a credit facility with China Construction Bank.  Under the agreement SigmaTron Electronic Technology Co., Ltd. can borrow up to 5,000,000 Renminbi, approximately $726,000 as of July 31, 2019, and the facility is collateralized by Wujiang SigmaTron Electronics Co., Ltd.’s manufacturing building.  Interest is payable monthly and the facility bears a fixed interest rate of 6.09%.  The term of the facility extends to March 14, 2024.  There was no outstanding balance under the facility at July 31, 2019 and April 30, 2019.

The Company is in compliance with its financial covenant and other restrictive covenants and anticipates that its credit facilities, expected future cash flows from operations and leasing resources are adequate to meet its working capital requirements, and fund capital expenditures for the next 12 months.  In addition, if customers delay orders, future payments are not made timely, the Company desires to expand its operations, its business grows more rapidly than expected, or the current economic climate deteriorates, additional financing resources may be necessary. There is no assurance that the Company will be able to obtain equity or debt financing at acceptable terms, or at all, in the future.  There is no assurance that the Company will be able to retain or renew its credit agreements in the future, or that any retention or renewal will be on the same terms as currently exist.

Notes Payable – Buildings

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $5,200,000, with U.S. Bank to refinance the property that serves as the Company’s corporate headquarters and its Illinois manufacturing facility in Elk Grove Village, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $17,333, bears interest at a fixed rate of 4.0% per year and is payable over a fifty-one month period.  Deferred financing costs of $74,066 were capitalized in fiscal year 2018 which are amortized over the term of the agreement.  As

Note E - Long-term Debt - Continued

of July 31, 2019 and April 30, 2019, the unamortized amount included as a reduction to long-term debt was $45,746 and $49,852, respectively.  A final payment of approximately $4,347,778 is due on or before March 31, 2022.  The outstanding balance was $4,888,000 and $4,940,000 at July, 31 2019 and April 30, 2019, respectively.

The Company entered into a mortgage agreement on December 21, 2017, in the amount of $1,800,000, with U.S. Bank to refinance the property that serves as the Company’s engineering and design center in Elgin, Illinois.  The note requires the Company to pay monthly principal payments in the amount of $6,000, bears interest at a fixed rate of 4.0% per year and is payable over a  fifty-one month period.  Deferred financing costs of $65,381 were capitalized in the fiscal year 2018 which are amortized over the term of the agreement.  As of July 31, 2019 and April 30, 2019,  the unamortized amount included as a reduction to long-term debt was $40,234 and $44,006, respectively.  A final payment of approximately $1,505,000 is due on or before March 31, 2022.  The outstanding balance was $1,692,000 and $1,710,000 at July, 31 2019 and April 30, 2019, respectively. 

Notes Payable – Equipment

The Company routinely enters into secured note agreements with Engencap Fin S.A. DE C.V. to finance the purchase of equipment. The terms of these secured note agreements extend to November 2021 through May 2023, with quarterly installment payments ranging from $11,045 to $37,941 and a fixed interest rate ranging from 6.65% to 8.00%.

Annual maturities of the Company’s debt, net of deferred financing fees for the remaining periods as of July 31, 2019, are as follows:

Fiscal Year	Bank		Building		Equipment		Total
2020	$	-	$	210,000	$	308,775	$	518,775
2021		-		280,000		411,701		691,701
2022		33,475,011		6,004,020		381,852		39,860,883
2023		-		-		114,372		114,372
2024		-		-		9,128		9,128
	$	33,475,011	$	6,494,020	$	1,225,828	$	41,194,859

Note E - Long-term Debt - Continued

Finance Lease and Sales Leaseback Obligations

The Company enters into various finance lease and sales leaseback agreements.  The terms of the lease agreements mature through January 2023, with monthly installment payments ranging from $1,455 to $40,173 and a fixed interest rate ranging from 3.75% to 8.00%.  

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Related Parties

3 Months Ended

Jul. 31, 2019

Related Parties [Abstract]

Related Parties

Note I - Related Parties

In March, 2015, two of the Company’s executive officers invested in a start-up customer, Petzila, Inc. (“Petzila”).  The executive officers’ investments constituted less than 2% (individually and in aggregate) of the outstanding beneficial ownership of Petzila, according to information provided by Petzila to the executive officers.  

On April 30, 2018, the Company foreclosed on its security interest and held a public sale of the assets in accordance with the requirements of Article 9 of the California Uniform Commercial Code.  The Company acquired all of the assets of Petzila as the winning bidder at the public sale by a credit bid of $3,500,000, the aggregate amount of Petzila’s liability to the company. Concurrent with the foreclosure sale, the Company entered into an Asset Purchase Agreement with Wagz, Inc. (“Wagz”), “an unrelated party,” whereby the Company sold the assets to Wagz for $350,000 cash, 600,000 shares of Wagz common stock and an earn-out based on sales by Wagz generated from use of the assets through July 31, 2022.  The earn-out is $6.00 per unit of a product specified in the asset purchase agreement and any upgrade to such product.

The fair value of the non-cash consideration consisted of $600,000 for the 600,000 shares of Wagz common stock which is recorded within other assets.  The Company determined the fair value of the equity using the price per common share received by Wagz in a recent financing transaction, a level 3 input.  The Company did not assign any value to the earn-out because any receipts from the earn-out are highly uncertain and contingent upon Wagz selling the product specified in the asset purchase agreement between the Company and Wagz.

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Leases (Weighted Average Lease Term And Discount Rate) (Details)	Jul. 31, 2019
Leases [Abstract]
Operating Leases: Weighted average remaining lease term (months)	41 months 3 days
Operating Leases: Weighted average discount rate	3.80%
Finance Leases: Weighted average remaining lease term (months)	28 months 19 days
Finance Leases: Weighted average discount rate	5.90%

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Related Parties (Narrative) (Details)	Apr. 30, 2018 USD ($) $ / shares shares	Jul. 31, 2019 USD ($)	Mar. 31, 2015 employee
Related Party Transaction [Line Items]
Amount owed by Petzila	$ 3,500,000
Cash from sold assets to Wagz	$ 350,000
Fair value of non-cash consideration		$ 600,000
Executive [Member]
Related Party Transaction [Line Items]
Number of executive officers invested in a start-up customer | employee			2
Maximum [Member] | Executive [Member]
Related Party Transaction [Line Items]
Executive officers' investment holding, percentage			2.00%
Wagz [Member]
Related Party Transaction [Line Items]
Asset Purchase Agreement end date	Jul. 31, 2022
Asset Purchase Agreement earn-out | $ / shares	$ 6.00
Common Class C [Member] | Wagz [Member]
Related Party Transaction [Line Items]
Shares acquired from Asset Purchase Agreement | shares	600,000

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Earnings Per Share And Stockholders' Equity

3 Months Ended

Jul. 31, 2019

Earnings Per Share And Stockholders' Equity [Abstract]

Earnings Per Share And Stockholders' Equity

Note D - Earnings Per Share and Stockholders’ Equity

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	Three Months Ended
	July 31,
	2019		2018
Net income (loss)	$	361,025	$	(526,607)
Weighted-average shares
Basic		4,241,883		4,223,657
Effect of dilutive stock options		-		-
Diluted		4,241,883		4,223,657
Basic earnings (loss) per share	$	0.09	$	(0.12)
Diluted earnings (loss) per share	$	0.09	$	(0.12)

Options to purchase 465,232 and 347,318 shares of common stock were outstanding at July 31, 2019 and 2018, respectively.  There were no options granted during the three month periods ended July 31, 2019 and 2018, respectively.  There was no stock option expense recognized for the three month periods ended July 31, 2019 and 2018, respectively.  There was no balance of unrecognized compensation expense related to the Company’s stock option plans at July 31, 2019 and 2018.  For the three month period ended July 31, 2019 and 2018, 424,484 and 0 shares, respectively, were not included in the diluted weighted average common shares outstanding calculation as they were anti-dilutive. 

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Critical Accounting Policies

3 Months Ended

Jul. 31, 2019

Critical Accounting Policies [Abstract]

Critical Accounting Policies

Note H - Critical Accounting Policies

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

Revenue Recognition-  The following table presents the Company’s revenue disaggregated by the principal end-user markets it serves:

	Three Months Ended July 31,	Three Months Ended July 31,
Net trade sales by end-market	2019	2018
Industrial Electronics	42,848,712	38,135,102
Consumer Electronics	26,659,187	29,200,913
Medical / Life Sciences	4,502,082	4,078,042
Total Net Trade Sales	74,009,981	71,414,057

During the three month period ending July 31, 2019, no revenues were recognized from performance obligations satisfied or partially satisfied in previous periods and no amounts were allocated to performance obligations that remain unsatisfied or partially unsatisfied at July 31, 2019.  The Company is electing not to disclose the value of the remaining unsatisfied performance obligation with a duration of one year or less as permitted by the practical expedient in ASU 2014-09, “Revenue from Contracts with Customers.”  The Company had no material remaining unsatisfied performance obligations as of July 31, 2019, with an expected duration of greater than one year.

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

Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.  In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial

Note H - Critical Accounting Policies - Continued

operations.  In projecting future taxable income, the Company begins with historical results and changes in accounting policies, and incorporates assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.  These assumptions require significant judgment and estimates by management about the forecasts of future taxable income and are consistentwith the plans and estimates the Company uses to manage the underlying businesses.  In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income and/or loss.  Valuation allowances are established when necessary to reduce deferred income tax assets to an amount more likely than not to be realized.The Company’s valuation allowance was $1,349,098 and $1,294,605 as of July 31, 2019 and April 30, 2019, respectively.

Revisions - Previously reported cash flows from financing activities for the three-month period ended July 31, 2018 have been revised to reflect the classification of payments and borrowings under the Company’s revolving line of credit presented in the condensed consolidated statement of cash flows. The revision had no impact to total cash flows from financing activities, net loss or net loss per share, or the condensed consolidated balance sheets or statements of operations or stockholders’ equity. See Note B, “Summary of Significant Accounting Policies” in the Company’s 2019 10-K for additional information on these revisions.

New Accounting Standards:

In February 2016, the FASB issued ASU 2016-02, as amended, Leases (Topic 842), which requires a lessee to record a right-of-use asset and a lease liability for all leases with a term greater than twelve months regardless of whether the lease is classified as an operating lease or a financing lease.

Effective May 1, 2019, the Company adopted the new standard under the modified retrospective approach, applying the current-period adjustment method.  Under the transition guidance of the modified retrospective approach there are a number of optional practical expedients made available to simplify the transition of the new standard. The Company has elected the following:

· The condensed consolidated balance sheets for reporting periods beginning on or after May 1, 2019 are presented under the new guidance, while prior period amounts are not adjusted and continue to be reported in accordance with ASC Topic 840, Leases. The Company recognized a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption of $5. 

· The Company has elected to utilize the package of practical expedients permitted under the transition guidance in the standard, which allowed the Company to not reassess (i) whether any expired or existing contracts contain leases, (ii) historical lease classification, and (iii) initial direct costs.

· The Company has elected to combine lease and non-lease components as a single component for all asset classes.

· The Company has elected to not assess whether existing or expired land easements that were not previously accounted for as leases under Topic 840 are or contain a lease under this Topic.

· The Company has elected to keep leases with an initial term of 12 months or less off of the balance sheet.

Note H - Critical Accounting Policies - Continued

Upon adoption, the Company recorded Right-of-use ("ROU") assets and lease liabilities relating to operating leases of $6,017,771 and $6,290,289, respectively. The changes did not have a material impact on our results of operations or cash flows. The discount rates used to calculate the ROU assets and lease liabilities as of the effective date were based on the remaining lease terms as of the effective date. See Note J - Leases, for the impact on the financial statements and related disclosures from the adoption of this standard.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13, as amended by ASU 2019-04 and ASU 2019-05, introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts.  This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. For public business entities, ASU 2016-13 is effective for annual and interim reporting periods beginning after December 15, 2019, and the guidance is to be applied using the modified-retrospective approach. Earlier adoption is permitted for annual and interim reporting periods beginning after December 15, 2018. The Company is currently evaluating the new guidance and has not determined the impact this ASU may have on its consolidated financial statements.

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Inventories, Net (Tables)

3 Months Ended

Jul. 31, 2019

Inventories, Net [Abstract]

Components Of Inventory

	July 31,		April 30,
	2019		2019
Finished products	$	22,414,687	$	20,682,669
Work-in-process		2,955,440		3,037,810
Raw materials		50,192,856		63,203,068
		75,562,983		86,923,547
Less excess and obsolescence reserve		(1,307,972)		(1,343,972)
	$	74,255,011	$	85,579,575

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Lease (Tables)

3 Months Ended

Jul. 31, 2019

Leases [Abstract]

Lease Assets And Liabilities Related To Balance Sheet Classification

			July 31,
	Classification		2019
Operating Leases:
Right-of-use Assets	Other assets	$	5,485,353
Operating lease current liabilities	Current portion of operating lease obligations		2,049,962
Operating lease noncurrent liabilities	Operating lease obligations, less current portion		3,692,295
Finance Leases:
Right-of-use Assets	Property, plant and equipment		10,506,242
Finance lease current liabilities	Current portion of finance lease obligations		1,821,341
Finance lease noncurrent liabilities	Finance lease obligations, less current portion		2,368,517

Components Of Lease Expense

		Three Months
		Ended
		July 31,
	Classification	2019
Operating Leases:
Operating lease cost	Operating expenses	594,494
Variable lease cost	Operating expenses	73,897
Short term lease cost	Operating expenses	1,350
Finance Leases:
Amortization of right-of-use assets	Operating expenses	347,375
Interest expense	Interest expense	67,786
Total		1,084,902

Weighted Average Lease Term And Discount Rate

	July 31,
	2019
Operating Leases:
Weighted average remaining lease term (months)	41.10
Weighted average discount rate	3.8%
Finance Leases:
Weighted average remaining lease term (months)	28.63
Weighted average discount rate	5.9%

Future Payments Due Under Finance And Operating Leases

		Finance Leases		Operating Leases
For the remaining 9 months of the fiscal year ending April 30:
2020	$	1,535,763	$	1,847,153
For the fiscal years ending April 30:
2021		1,792,747		2,243,547
2022		1,049,198		1,289,278
2023		133,819		1,136,290
2024		-		698,778
Thereafter		-		180,288
Total undiscounted lease payments		4,511,527		7,395,334
Present value discount, less interest		321,669		1,653,077
Lease liability	$	4,189,858	$	5,742,257

Supplemental Cash Flow Information Related To Leases

	Three Months
	Ended
	July 31,
Other Information	2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	67,786
Operating cash flows from operating leases	62,155
Financing cash flows from finance leases	612,300
Supplemental non-cash information on lease labilities arising from obtaining right-of-use assets:
Right-of-use assets obtained in exchange for new finance lease liabilities	-
Right-of-use assets obtained in exchange for operating lease liabilities	-

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Earnings Per Share And Stockholders' Equity (Computation Of Basic And Diluted Earnings (Loss) Per Share) (Details) - USD ($)	3 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Earnings Per Share And Stockholders' Equity [Abstract]
Net income (loss)	$ 361,025	$ (526,607)
Weighted-average shares, Basic	4,241,883	4,223,657
Weighted-average shares, Diluted	4,241,883	4,223,657
Basic loss per share	$ 0.09	$ (0.12)
Diluted loss per share	$ 0.09	$ (0.12)

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Condensed Consolidated Statements Of Changes In Stockholders' Equity - USD ($)	Preferred Stock [Member]	Common Stock [Member]	Capital In Excess Of Par Value [Member]	Retained Earnings [Member]	Total
Balance at Apr. 30, 2018		$ 41,896	$ 23,132,017	$ 35,636,038	$ 58,809,951
Net income (loss)				526,607	526,607
Balance at Jul. 31, 2018		41,896	23,132,017	35,109,431	58,283,344
Balance at Apr. 30, 2019		42,146	23,474,379	34,770,924	58,287,449
Net income (loss)				(361,025)	(361,025)
Balance at Jul. 31, 2019		42,146	23,474,379	35,131,944	58,648,469
Cumulative-effect adjustment for the adoption of Topic 842				$ (5)	$ (5)

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Document And Entity Information - shares	3 Months Ended
	Jul. 31, 2019	Sep. 10, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2019
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Registrant Name	SIGMATRON INTERNATIONAL INC
Entity Central Index Key	0000915358
Current Fiscal Year End Date	--04-30
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		4,242,508

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Inventories, Net

3 Months Ended

Jul. 31, 2019

Inventories, Net [Abstract]

Inventories, Net

Note C - Inventories, net

The components of inventory consist of the following:

	July 31,		April 30,
	2019		2019
Finished products	$	22,414,687	$	20,682,669
Work-in-process		2,955,440		3,037,810
Raw materials		50,192,856		63,203,068
		75,562,983		86,923,547
Less excess and obsolescence reserve		(1,307,972)		(1,343,972)
	$	74,255,011	$	85,579,575