[10-Q] National Presto Industries, Inc. Quarterly Earnings Report

Rhea-AI Filing Summary

National Presto Industries, Inc. reported strong top-line growth driven by its Defense segment for the quarter and first six months ended June 29, 2025. Consolidated net sales rose 42% to $120.449 million in the quarter and 39% to $224.088 million for six months, while consolidated gross profit grew 26% to $18.546 million for the quarter and 28% to $36.657 million for six months. Quarterly net earnings were $5.152 million ($0.72 per share), down 15% from a year earlier; six-month net earnings were $12.762 million ($1.79 per share), up 1% year-over-year.

The Defense segment led the improvement: quarterly Defense sales rose 51% to $99.813 million with segment gross profit of $19.2 million, and contract backlog increased to $1,370.91 million from $1,085.612 million, expected to be fulfilled over 18–42 months. Offsetting items included a $2.701 million impairment of a vendor deposit in Housewares/Small Appliances related to a vendor bankruptcy, a material decline in cash and cash equivalents to $1.757 million from $17.663 million, significant capital expenditures of $25.449 million, and a new unsecured line of credit with a $12.636 million outstanding balance at period end.

Positive

• Defense revenue growth: Defense net sales rose 51% in the quarter to $99.813M and 49% for six months to $180.751M
• Large contract backlog: Defense backlog increased to $1,370,910,000 from $1,085,612,000, expected to be fulfilled in 18–42 months
• Six-month net earnings increased slightly to $12.762M (1% year-over-year)
• Material investment in operations: Property, plant and equipment additions of $25.449M support capacity for Defense awards

Negative

• Housewares margin pressure: Housewares gross profit fell materially (quarter down to $0.48M) due to tariffs and higher material costs
• Vendor deposit impairment: A full $2.701M impairment recorded related to a vendor bankruptcy impacting Housewares/Small Appliances
• Cash decline: Cash and cash equivalents fell to $1.757M from $17.663M, reflecting capex and working capital build
• Line of credit drawn: Unsecured line of credit increased to $12.636M outstanding at period end
• Reduced other income: Interest income on marketable securities declined, lowering other income by $968K (quarter) and $2.305M (six months)

Insights

Financial Analyst

TL;DR: Mixed corporate picture—robust Defense growth offsets Housewares headwinds and near-term cash pressure.

Consolidated revenue and gross profit expanded materially, driven by Defense segment shipments from backlog, which rose to $1.371 billion. However, quarterly net income declined 15% to $5.152 million as the Housewares segment absorbed tariffs and a $2.701 million vendor deposit impairment. Working capital shifted with inventories and a large $25.449 million PP&E spend that contributed to cash falling to $1.757 million. The company drew $12.636 million on its unsecured credit line and incurred modest interest expense ($75,000), supporting operations and capex. Overall, operational momentum in Defense is positive but liquidity and Housewares margin pressure warrant monitoring.

Defense Industry Specialist

TL;DR: Very strong Defense performance with sizable backlog growth signals sustained revenue visibility over the next 18–42 months.

Defense segment sales jumped 51% sequentially year-over-year to $99.813 million for the quarter and contributed $19.2 million of gross profit. The reported Defense backlog increased to $1.37091 billion, an important indicator of multi-year demand and production cadence; the subsequent event notes an additional $101.1 million option award to AMTEC, reinforcing future revenue. Given Defense contracts are primarily fixed-price work for the U.S. DoD, the backlog expansion materially improves revenue visibility, making the Defense segment a key value driver for the company.

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UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549 

______________________________

 

 

FORM 10-Q 

 ______________________________

 

 

☒   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED June 29, 2025

 

☐   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 1-2451 

______________________________

 

 

NATIONAL PRESTO INDUSTRIES, INC. 

(Exact name of registrant as specified in its charter)

Wisconsin	39-0494170
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

3925 North Hastings Way
Eau Claire,  Wisconsin	54703-3703
(Address of principal executive offices)	(Zip Code)

 

(Registrant’s telephone number, including area code) 715-839-2121

______________________________

 

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1 par value	NPK	NYSE

 

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

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

 

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


Large accelerated filer	☐	Accelerated filer	☒	Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

 

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

 

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

 

There were 7,149,529 shares of the Issuer’s Common Stock outstanding as of August 8, 2025.

Table of Contents

TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION	3
Item 1 – Financial Statements	3
Condensed Consolidated Balance Sheets	3
Consolidated Statements of Comprehensive Income	5
Consolidated Statements of Cash Flows	6
Consolidated Statements of Stockholders’ Equity	7
Notes to Condensed Consolidated Financial Statements	8
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3 – Quantitative and Qualitative Disclosures About Market Risk	14
Item 4 – Controls and Procedures	15

PART II – OTHER INFORMATION	16
Item 1 – Legal Proceedings	16
Item 5 – Other Information	16
Item 6 – Exhibits	16

SIGNATURES	17

CERTIFICATIONS	19

 

 

2

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PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES 

CONDENSED CONSOLIDATED BALANCE SHEETS 

June 29, 2025 and December 31, 2024

(Dollars in thousands)

		June 29, 2025 (Unaudited)								December 31, 2024
ASSETS
CURRENT ASSETS:
Cash and cash equivalents						$	1,757							$	17,663
Marketable securities							2,998								5,010
Accounts receivable, net							54,363								62,289
Inventories:
Finished goods		$	29,562							$	38,351
Work in process		247,171									219,154
Raw materials			22,221				298,954				20,494				277,999
Income tax receivable							1,914								-
Notes receivable, current							206								600
Other current assets							4,866								3,100
Total current assets							365,058								366,661
PROPERTY, PLANT AND EQUIPMENT		$	137,256							$	114,534
Less allowance for depreciation			72,972				64,284				71,297				43,237
GOODWILL							19,433								19,433
INTANGIBLE ASSETS, net							3,019								3,777
RIGHT-OF-USE LEASE ASSETS							9,731								9,962
DEFERRED INCOME TAXES							10,333								10,327
						$	471,858							$	453,397

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

3

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

June 29, 2025 and December 31, 2024

(Dollars in thousands)

 

		June 29, 2025 (Unaudited)								December 31, 2024
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT LIABILITIES:
Accounts payable						$	42,831							$	44,625
Line of Credit							12,636								-
Federal and state income taxes							-								4,680
Lease liabilities							574								564
Accrued liabilities							30,658								24,567
Total current liabilities							86,699								74,436
LEASE LIABILITIES - NON-CURRENT							9,157								9,397
FEDERAL AND STATE INCOME TAXES - NON-CURRENT							1,937								1,937
Total liabilities							97,793								85,770
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, $1 par value:
Authorized: 12,000,000 shares
Issued: 7,440,518 shares		$	7,441							$	7,441
Paid-in capital			17,815								17,298
Retained earnings			359,279								353,659
Accumulated other comprehensive income			13								35
			384,548								378,433
Treasury stock, at cost			10,483								10,806
Total stockholders' equity							374,065								367,627
						$	471,858							$	453,397

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

4

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three and Six Months Ended June 29, 2025 and June 30, 2024

(Unaudited) 

(In thousands except per share data) 

		Three Months Ended								Six Months Ended
		2025				2024				2025				2024
Net sales		$	120,449			$	85,060			$	224,088			$	161,713
Cost of sales			101,903				70,361				187,431				133,161
Gross profit			18,546				14,699				36,657				28,552
Selling and general expenses			9,370				7,959				18,032				15,156
Impairment of vendor deposit			2,701				-				2,701				-
Intangibles amortization			379				379				758				758
Operating profit			6,096				6,361				15,166				12,638
Other income			517				1,485				1,255				3,560
Earnings before provision for income taxes			6,613				7,846				16,421				16,198
Provision for income taxes			1,461				1,769				3,659				3,553
Net earnings		$	5,152			$	6,077			$	12,762			$	12,645
Weighted average shares outstanding:
Basic and diluted			7,147				7,128				7,144				7,122
Net Earnings per share:
Basic and diluted		$	0.72			$	0.85			$	1.79			$	1.78
Comprehensive income:
Net earnings		$	5,152			$	6,077			$	12,762			$	12,645
Other comprehensive income, net of tax:
Unrealized loss on available-for-sale securities			9				7				23				7
Comprehensive income		$	5,143			$	6,070			$	12,739			$	12,638
Cash dividends declared and paid per common share		$	0.00			$	0.00			$	1.00			$	4.50

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

5

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

Six Months Ended June 29, 2025 and June 30, 2024

(Unaudited) 

(Dollars in thousands) 

		2025				2024
Cash flows from operating activities:
Net earnings		$	12,762			$	12,645
Adjustments to reconcile net earnings to net cash provided by operating activities:
Provision for depreciation			1,702				1,926
Intangibles amortization			758				758
Benefit from doubtful accounts			-				(285	)
Non-cash retirement plan expense			512				464
Impairment of vendor deposit			2,701				-
Other			260				284
Changes in operating accounts:
Accounts receivable, net			7,926				(2,987	)
Inventories			(20,955	)			(37,655	)
Other assets and current assets			(1,765	)			540
Accounts payable and accrued liabilities			6,572				112
Federal and state income taxes			(8,931	)			(4,130	)
Net cash provided by (used in) operating activities			1,542				(28,328	)
Cash flows from investing activities:
Marketable securities purchased			-				(5,432	)
Marketable securities - maturities and sales			1,983				11,008
Proceeds from note receivable			404				230
Purchase of property, plant and equipment			(25,449	)			(1,048	)
Net (used in) provided by investing activities			(23,062	)			4,758
Cash flows from financing activities:
Proceeds from line of credit			58,198				-
Payments on line of credit			(45,562	)			-
Dividends paid			(7,142	)			(32,029	)
Proceeds from sale of treasury stock			120				513
Net cash provided by (used in) financing activities			5,614				(31,516	)
Net decrease in cash and cash equivalents			(15,906	)			(55,086	)
Cash and cash equivalents at beginning of period			17,663				87,657
Cash and cash equivalents at end of period		$	1,757			$	32,571
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest		$	75			$	-

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Three and Six Months Ended June 29, 2025 and June 30, 2024

(Unaudited) 

(In thousands except per share data) 

 

		Shares of Common Stock Outstanding Net of Treasury Shares				Common Stock				Paid-in Capital				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Treasury Stock				Total
Balance at March 31, 2024			7,098			$	7,441				16,496			$	318,766			$	21			$	(11,086	)		$	331,638
Net earnings															6,077												6,077
Unrealized loss on available-for-sale securities, net of tax																			(7	)							(7	)
Other			2								259				18								100				377
Balance June 30, 2024			7,100			$	7,441			$	16,755			$	324,861			$	14			$	(10,986	)		$	338,085
Balance March 30, 2025			7,103			$	7,441			$	17,550			$	354,127			$	22			$	(10,555	)		$	368,585
Net earnings															5,152												5,152
Unrealized loss on available-for-sale securities, net of tax																			(9	)							(9	)
Other			-								265				-				-				72				337
Balance June 29, 2025			7,103			$	7,441			$	17,815			$	359,279			$	13			$	(10,483	)		$	374,065



		Shares of Common Stock Outstanding Net of Treasury Shares				Common Stock				Paid-in Capital				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Treasury Stock				Total
Balance December 31, 2023			7,082			$	7,441				16,031			$	344,245			$	22			$	(11,483	)		$	356,256
Net earnings															12,645												12,645
Unrealized loss on available-for-sale securities, net of tax																			(7	)							(7	)
Dividends paid March 15, $1.00 per share regular, $3.50 per share extra															(32,029	)											(32,029	)
Other			18								724				-				(1	)			497				1,220
Balance June 30, 2024			7,100			$	7,441			$	16,755			$	324,861			$	14			$	(10,986	)		$	338,085
Balance December 31, 2024			7,103			$	7,441			$	17,298			$	353,659			$	35			$	(10,806	)		$	367,627
Net earnings															12,762												12,762
Unrealized loss on available-for-sale securities, net of tax																			(23	)							(23	)
Dividends paid March 17, $1.00 per share regular															(7,142	)											(7,142	)
Other			0								517				-				1				323				841
Balance June 29, 2025			7,103			$	7,441			$	17,815			$	359,279			$	13			$	(10,483	)		$	374,065

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

NOTE A – BASIS OF PRESENTATION 

The condensed consolidated interim financial statements included herein are unaudited and have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management of the Company, the consolidated interim financial statements reflect all of the adjustments which were of a normal recurring nature necessary for a fair presentation of the results of the interim periods.  The condensed consolidated balance sheet as of  December 31, 2024 is summarized from audited consolidated financial statements, but does not include all the disclosures contained therein and should be read in conjunction with the 2024 Annual Report on Form 10-K.  Interim results for the period are not indicative of those for the year.

 

NOTE B – REVENUES

The Company’s revenues are derived from contracts and programs that are typically completed within 3 to 42 months and are recognized in accordance with Financial Accounting Standard Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. The Company’s contracts generally contain one or more performance obligations: the physical delivery of distinct ordered product or products.  The Company provides an assurance type product warranty on its products to the original owner.  In addition, for the Housewares/Small Appliances segment, the Company estimates returns of seasonal products and returns of newly introduced products sold with a return privilege.  Stand-alone selling prices are set forth in each contract and are used to allocate revenue to the corresponding performance obligations.  For the Housewares/Small Appliances segment, contracts include variable consideration, as the prices are subject to customer allowances, which principally consist of allowances for cooperative advertising, defective product, and trade discounts.  Customer allowances are generally allocated to the performance obligations based on budgeted rates agreed upon with customers, as well as historical experience, and yield the Company’s best estimate of the expected value for the variable consideration.

 

The Company's contracts in the Defense segment are primarily with the U.S. Department of Defense (DOD) and DOD prime contractors. As a consequence, this segment's business essentially depends on the product needs and governmental funding of the DOD. Substantially all of the work performed by the Defense segment directly or indirectly for the DOD is performed on a fixed-price basis. Under fixed-price contracts, the price paid to the contractor is usually awarded based on competition at the outset of the contract and therefore, with the exception of limited escalation provisions on specific materials, is generally not subject to any adjustments reflecting the actual costs incurred by the contractor.

 

For the Housewares/Small Appliance segment, revenue is generally recognized as the completed, ordered product is shipped to the customer from the Company’s warehouses.  For the relatively few situations in which revenue should be recognized when product is received by the customer, the Company adjusts revenue accordingly.  For the Defense segment, revenue is primarily recognized when the customer has legal title and formally documents that it has accepted the products.    In some situations, the customer may obtain legal title and accept the products at the Company’s facilities, arranging for transportation at a later date, typically in one to four weeks.  The Company does not consider the short-term storage of the customer owned products to be a material performance obligation, and no part of the transaction price is allocated to it. There are also certain termination clauses in Defense segment contracts that may give rise to an over-time pattern of recognition of revenue in the absence of alternative use of the product.

The timing of revenue recognition, billings, and cash collections results in billed accounts receivable, and customer advances and deposits (contract liabilities) on the Company’s Condensed Consolidated Balance Sheets. For the Defense segment, the Company occasionally receives advances or deposits from certain customers before revenue is recognized, resulting in contract liabilities.  These advances or deposits do not represent a significant financing component.  As of June 29, 2025 and December 31, 2024, $13,832,000 and $7,345,000 respectively, of contract liabilities were included in Accrued Liabilities on the Company’s Condensed Consolidated Balance Sheets.  The Company recognized revenue of $7,110,000 during the six month period ended June 29, 2025 that was included in the Defense segment contract liability at the beginning of that period. The Company monitors its estimates of variable consideration, which includes customer allowances for cooperative advertising, defective product, trade discounts, and returns of seasonal and newly introduced product, which primarily pertain to the Housewares/Small Appliances segment, and periodically makes cumulative adjustments to the carrying amounts of these contract liabilities as appropriate.  There were no material adjustments to the aforementioned estimates during the three and six month periods ended  June 29, 2025 and June 30, 2024.  There were no amounts of revenue recognized during the same periods related to performance obligations satisfied in a previous period.  The portion of contract transaction prices allocated to unsatisfied performance obligations, also known as the contract backlog, in the Company’s Defense segment was $1,370,910,000 and $1,085,612,000 as of June 29, 2025 and December 31, 2024, respectively.  The Company anticipates that the unsatisfied performance obligations (contract backlog) will be fulfilled in an 18 to 42-month period.  The performance obligations in the Housewares/Small Appliances segment have original expected durations of less than one year.

 

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NOTE C – EARNINGS PER SHARE 

Basic earnings per share is based on the weighted average number of common shares and participating securities outstanding during the period.  Diluted earnings per share also includes the dilutive effect of additional potential common shares issuable.  Unvested stock awards, which contain non-forfeitable rights to dividends whether paid or unpaid (“participating securities”), are included in the number of shares outstanding for both basic and diluted earnings per share calculations. 

 

NOTE D – BUSINESS SEGMENTS 

The Company operates in three business segments. The Company identifies its segments based on the Company's organization structure, which is primarily by principal products and is the way in which the Company’s Chief Operating Decision Maker (CODM), the Company’s CEO, makes operating decisions, assesses financial performance, and allocates resources. The principal product groups are Housewares/Small Appliance, Defense, and Safety. Sales for all segments are primarily to customers in North America.

The Housewares/Small Appliance segment designs, markets, and distributes housewares and small appliances. The housewares/small appliance products are sold primarily in the United States and Canada directly to retail outlets and also through independent distributors. The Company primarily sources its Housewares/Small Appliance products from non-affiliated suppliers located in the Orient. Sales are seasonal, with the normal peak sales period occurring in the fourth quarter of the year prior to the holiday season.

The Defense segment was started in 2001 with the acquisition of AMTEC Corporation, which manufactures precision mechanical and electromechanical assemblies for the U.S. Government and prime contractors. During 2005, and again during 2010, AMTEC Corporation was one of two prime contractors selected by the Army to supply all requirements for the 40mm family of practice and tactical ammunition cartridges for a period of five years. In 2016, AMTEC was awarded a one-year contract, and in 2017 and 2022, it was awarded third and fourth five-year contracts, respectively as the sole prime contractor. AMTEC's manufacturing plant is located in Janesville, Wisconsin. Since the inception of the Defense segment in 2001, the Company has expanded the segment by making several strategic business acquisitions, and has additional facilities located in East Camden, Arkansas; Antigo, Wisconsin; Clear Lake, South Dakota, and Marshall, Texas. During 2003, the segment was expanded with the acquisition of Spectra Technologies, LLC of East Camden, Arkansas. This facility performs Load, Assemble, and Pack (LAP) operations on ordnance-related products for the U.S. Government and prime contractors. During 2006, the segment was expanded again with the acquisition of certain assets of Amron, LLC of Antigo, Wisconsin, which primarily manufactures cartridge cases used in medium caliber (20-50mm) ammunition. During 2014, the Company continued the expansion of the Defense segment with the purchase of substantially all of the assets of Chemring Energetic Devices, Inc. located in Clear Lake, South Dakota, and all of the real property owned by Technical Ordnance Realty, LLC. The Clear Lake facility manufactures detonators, booster pellets, release cartridges, lead azide, and other military energetic devices and materials. During 2022, the Company again expanded the Defense segment by acquiring the equity interests of Woodlawn Manufacturing, Ltd. Woodlawn Manufacturing, Ltd, is a high volume manufacturer of precision metal parts and assemblies primarily for the defense and aerospace industry. The Defense segment’s collection of facilities enables the Company to deliver in virtually all aspects of the manufacture of medium caliber training and tactical rounds. Those aspects include the fuze, the detonator, the metal parts (including the cartridge case), and load, assemble and pack of the final round.

The Safety segment was started in 2019 with the acquisition of OneEvent Technologies, Inc., which focuses on protection for buildings, homes, assets, and occupants. The company is located in Mount Horeb, Wisconsin and was established in 2014. OneEvent's cloud-based learning and analytics engine utilizes a series of sensing devices integrated with a cellular gateway to predict, alert, and prevent. Sensors measure a variety of environmental data including temperature, smoke, carbon monoxide, motion, humidity, water, and more. On purchase, it was combined with Rusoh, Inc. which designed and marketed fire extinguishers. Previous to 2019, Rusoh Inc. had been in included in the Company’s Housewares/Small Appliance segment. The Company divested Rusoh, Inc. on November 14, 2023. On July 29, 2022, certain assets were purchased and certain liabilities were assumed of Knox Safety, Inc., a company formed in 2019 with operations in Illinois and North Carolina. Knox Safety is a startup company that designs and sells carbon monoxide detectors for residential use. Subsequent to the acquisition, the company legally adopted the corporate name Rely Innovations, Inc.

The Company manages and assesses the performance of its reportable segments by their gross profit and operating profit. As part of the CODM’s review of segment level performance, the CODM reviews these measures of income of each reportable segment, which drives the evaluation of the performance of the Company’s reportable segments and allocation of resources to those segments. The significant segment expense categories included in the table below augment the Company’s understanding of operating results.

In the following summary, operating profit represents earnings before other income and income taxes. The Company's segments operate discretely from each other with no shared owned or leased manufacturing facilities. Costs associated with corporate activities (such as cash and marketable securities management) and the assets associated with such activities are included within the Housewares/Small Appliance segment for all periods presented.

		(in thousands)
		Housewares / Small Appliances				Defense				Safety				Total
Three months ended June 29, 2025
External net sales		$	20,346			$	99,813			$	290			$	120,449
Cost of sales			19,866				80,613				1,424				101,903
Gross profit (loss)			480				19,200				(1,134	)			18,546
Selling and general expenses (1)			3,706				3,684				1,120				8,510
Depreciation and amortization			235				961				43				1,239
Operating profit (loss)			(6,162	)			14,555				(2,297	)			6,096
Total assets			102,964				361,978				6,916				471,858
Depreciation and amortization			235				961				43				1,239
Capital expenditures			1,507				923				138				2,568
Three months ended June 30, 2024
External net sales		$	18,667			$	66,126			$	267			$	85,060
Cost of sales			15,206				53,347				1,808				70,361
Gross profit (loss)			3,461				12,779				(1,541	)			14,699
Selling and general expenses (1)			3,052				2,824				1,254				7,130
Depreciation and amortization			252				917				39				1,208
Operating profit (loss)			157				9,038				(2,834	)			6,361
Total assets			127,110				284,670				6,318				418,098
Depreciation and amortization			252				917				39				1,208
Capital expenditures			46				642				73				761

		(in thousands)
		Housewares / Small Appliances				Defense				Safety				Total
Six Months Ended June 29, 2025
External net sales		$	42,272			$	180,751			$	1,065			$	224,088
Cost of sales			40,332				143,921				3,178				187,431
Gross profit (loss)			1,940				36,830				(2,113	)			36,657
Selling and general expenses (1)			6,872				7,174				2,284				16,330
Depreciation and amortization			465				1,912				83				2,460
Operating profit (loss)			(8,098	)			27,744				(4,480	)			15,166
Total assets			102,964				361,978				6,916				471,858
Capital expenditures			23,782				1,631				36				25,449
Six Months Ended June 30, 2024
External net sales		$	39,934			$	121,166			$	613			$	161,713
Cost of sales			33,365				96,463				3,333				133,161
Gross profit (loss)			6,569				24,703				(2,720	)			28,552
Selling and general expenses (1)			5,470				5,238				2,522				13,230
Depreciation and amortization			493				2,112				79				2,684
Operating profit (loss)			606				17,353				(5,321	)			12,638
Total assets			127,110				284,670				6,318				418,098
Capital expenditures			79				946				23				1,048
(1) Excludes depreciation and amortization

NOTE E - FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company utilizes the methods of fair value as described in FASB ASC 820, Fair Value Measurements and Disclosures, to value its financial assets and liabilities. ASC 820 utilizes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

 

The carrying amounts for cash and cash equivalents, accounts receivable, notes receivable, accounts payable, line of credit, and accrued liabilities approximate fair value due to the immediate or short-term maturity of these financial instruments.  See Note F for fair value information on marketable securities.

 

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NOTE F - CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES 

The Company considers all highly liquid marketable securities with an original maturity of three months or less to be cash equivalents.  Cash equivalents include money market funds.  The Company deposits its cash in high quality financial institutions.  The balances, at times, may exceed federally insured limits.  Money market funds are reported at fair value determined using quoted prices in active markets for identical securities (Level 1, as defined by FASB ASC 820). The Company has classified all marketable securities as available-for-sale which requires the securities to be reported at estimated fair value, with unrealized gains and losses, net of tax, reported as a separate component of stockholders' equity. 

  

At June 29, 2025 and December 31, 2024, cost for marketable securities was determined using the specific identification method.  A summary of the amortized costs and fair values of the Company’s marketable securities at the end of the periods presented is shown in the following table.  All of the Company’s marketable securities are classified as Level 2, as defined by FASB ASC 820, with fair values determined using significant other observable inputs, which include quoted prices in markets that are not active, quoted prices of similar securities, recently executed transactions, broker quotations, and other inputs that are observable.

 

		(In Thousands)
		MARKETABLE SECURITIES
		Amortized Cost				Fair Value				Gross Unrealized Gains				Gross Unrealized Losses
June 29, 2025
Certificates of Deposit		$	2,982				2,998			$	16			$	-
Total Marketable Securities		$	2,982			$	2,998			$	16			$	-
December 31, 2024
Certificates of Deposit			4,965				5,010				45				-
Total Marketable Securities		$	4,965			$	5,010			$	45			$	-

 

Proceeds from maturities and sales of available-for-sale securities totaled $1,486,000 and $6,003,000 for the three month periods ended June 29, 2025 and June 30, 2024, respectively, and totaled $1,983,000 and $11,008,000 for the six month periods then ended, respectively.  There were no gross gains or losses related to sales of marketable securities during the same periods.  Net unrealized losses included in other comprehensive income were $12,000 and $9,000 before taxes for the three month periods ended June 29, 2025 and June 30, 2024, and were $29,000 and $9,000 for the six month periods then ended, respectively. No unrealized gains or losses were reclassified out of accumulated other comprehensive income during the same periods.

 

The contractual maturities of the marketable securities held at June 29, 2025 are as follows: $2,484,000 within one year; $498,000 beyond one year to five years. 

 

NOTE G – OTHER ASSETS

Other Assets includes prepayments and deposits that are made from time to time by the Company for certain materials used in the manufacturing process in the Housewares/Small Appliances and Safety segments.  As of June 29, 2025 and December 31, 2024, $3,146,000 and $2,929,000 of such prepayments, respectively, remained unused and outstanding and were included in Other Current Assets, representing the Company’s best estimate of the expected utilization of the prepayments and related materials during the twelve-month period following those dates.

 

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NOTE H – LEASES

The Company accounts for leases under ASC Topic 842, Leases.  The Company’s leasing activities include roles as both lessee and lessor.  As lessee, the Company’s primary leasing activities include buildings and structures to support its manufacturing operations at one location in its Defense segment, buildings and structures to support its Safety segment, and warehouse space and equipment to support its distribution center operations in its Housewares/Small Appliances segment.  As lessor, the Company’s primary leasing activity is comprised of manufacturing and office space located adjacent to its corporate offices.  All of the Company’s leases are classified as operating leases.

 

The Company’s leases as lessee in its Defense segment provide for variable lease payments that are based on changes in the Consumer Price Index.  As lessor, the Company’s primary lease also provides for variable lease payments that are based on changes in the Consumer Price Index, as well as on increases in costs of insurance, real estate taxes, and utilities related to the leased space. Generally, all of the Company’s lease contracts include options for extensions and early terminations.  The majority of lease terms of the Company’s lease contracts recognized on the balance sheet reflect extension options, while none reflect early termination options.

 

The Company has determined that the rates implicit in its leases are not readily determinable and therefore, estimates its incremental borrowing rates utilizing quotes from financial institutions for real estate and equipment, as applicable, over periods of time similar to the terms of its leases. The Company has entered into various short-term (12 months or less) leases as lessee and has elected a non-recognition accounting policy, as permitted by ASC Topic 842.

		Three Months Ended				Three Months Ended				Six Months Ended				Six Months Ended
Summary of Lease Cost (in thousands)		June 29, 2025				June 30, 2024				June 29, 2025				June 30, 2024
Operating lease cost		$	316			$	305			$	613			$	610
Short-term and variable lease cost			62				79				158				139
Total lease cost		$	378			$	384			$	771			$	749

Operating cash used for operating leases was $378,000 and $384,000 for the three months ended  June 29, 2025 and June 30, 2024, respectively, and $771,000 and $749,000 for the six months then ended, respectively.  The weighted-average remaining lease term was 18.6 years, and the weighted-average discount rate was 4.6% as of June 29, 2025.

 

Maturities of operating lease liabilities are as follows:

Years ending December 31:		(In thousands)
2025 (remaining six months)		$	488
2026			812
2027			806
2028			812
2029			757
Thereafter			11,879
Total lease payments		$	15,554
Less: future interest expense			5,823
Lease liabilities		$	9,731

 

 

Lease income from operating lease payments was $583,000 and $569,000 for the quarters ended June 29, 2025 and June 30, 2024, respectively, and $1,166,000 and $1,120,000 for the six months then ended, respectively.  Undiscounted cash flows provided by lease payments are expected as follows:



Years ending December 31:		(In thousands)
2025 (remaining six months)		$	1,167
2026			2,314
2027			2,314
2028			2,314
2029			2,314
Thereafter			16,198
Total lease payments		$	26,621

 

The Company considers risk associated with the residual value of its leased real property to be low, given the nature of the long-term lease agreement, the Company’s ability to control the maintenance of the property, and the creditworthiness of the lessee.  The residual value risk is further mitigated by the long-lived nature of the property, and the propensity of such assets to hold their value or, in some cases, appreciate in value.

 

 

NOTE I – COMMITMENTS AND CONTINGENCIES

The Company is involved in largely routine litigation incidental to its business.  Management believes the ultimate outcome of the litigation will not have a material effect on the Company's consolidated financial position, liquidity, or results of operations. 



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NOTE J – LINE OF CREDIT

The Company has maintained an unsecured line of credit for short term operating cash needs of $50,000,000 and $10,000,000 as of June 29, 2025 and December 31, 2024, respectively. The line of credit expires on September 30, 2025. The outstanding balance as of June 29, 2025 and December 31, 2024 was $12,636,000 and $0, respectively. The interest rate on the current line of credit resets monthly to the 30-day Secured Overnight Financing Rate (SOFR) plus one-and-one-quarter percent. The interest rate on the previous line of credit reset monthly to the 30-day SOFR plus one percent.  Additionally, the Company had no issued commercial letters of credit as of  June 29, 2025 and December 31, 2024.

NOTE K – IMPAIRMENT OF VENDOR DEPOSIT 

During the quarter ended March 30, 2025, the Company made deposits totaling $2,701,000 with a vendor in its Housewares/Small Appliances segment.  On May 29, 2025, the vendor filed for protection in the U.S. Bankruptcy Court in the Northern District of Texas.  As recovery of the deposit is deemed unlikely, the Company recorded an impairment of the full deposit during the quarter ended June 29, 2025.  The deposit had been carried in Property, Plant and Equipment on the Company’s balance sheet.

NOTE L – RECENTLY ISSUED OR ADOPTED ACCOUNTING PRONOUNCEMENTS

The Company assesses the impacts of adopting recently issued accounting standards by the Financial Accounting Standards Board on the Company's financial statements, and updates previous assessments, as necessary, from the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 30, 2025. 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a company’s effective tax rate reconciliation and provision for income taxes, as well as information on income taxes paid. ASU 2023-09 is effective for public business entities for annual periods beginning after December 15, 2024. As this update relates to disclosures only, the Company does not expect ASU 2023-09 will have an impact on its consolidated results of operations and financial condition.

NOTE M - SUBSEQUENT EVENT

The Company evaluates events that occur through the financial statement filing date and discloses any material or significant events or transactions. 

On July 29, 2025, the U.S. Army awarded AMTEC Corporation, the Company’s wholly owned subsidiary, an option award totaling $101.1 million under year four (Government Fiscal Year (FY) 2025) of AMTEC’s current five-year 40mm systems contract. Deliveries under the option award are scheduled to commence in mid-2027 and continue through early 2028.

On July 31, 2025, the Company sold certain assets of its wholly owned subsidiary, OneEvent Technologies, Inc. for $279,000, plus contingent consideration of $275,000 to be paid through 2029. The important intellectual property of the business has been retained. To focus direction of the business, certain assets and liabilities of the refrigeration/freezer monitoring portion of the business have been divested.

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ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS    

 

Forward-looking statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, elsewhere in this Form 10-Q, in the Company’s 2024 Annual Report to Stockholders, in the Proxy Statement for the annual meeting held on May 20, 2025, and in the Company’s press releases and oral statements made with the approval of an authorized executive officer are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. There are certain important factors that could cause results to differ materially from those anticipated by some of the statements made herein.  Investors are cautioned that all forward-looking statements involve risks and uncertainty. In addition to the factors discussed herein and in the Notes to Consolidated Financial Statements, among the other factors that could cause actual results to differ materially are the following: consumer spending and debt levels; interest rates; continuity of relationships with and purchases by major customers; product mix; the benefit and risk of business acquisitions; competitive pressure on sales and pricing; development and market acceptance of new products; increases in material, freight/shipping, tariffs, or production cost which cannot be recouped in product pricing; delays or interruptions in shipping or production; shipment of defective product which could result in product liability claims or recalls; work or labor disruptions stemming from a unionized work force; changes in government requirements, military spending, and funding of government contracts, which could result in, among other things, the modification or termination of existing contracts; dependence on subcontractors or vendors to perform as required by contract; the ability of startup businesses to ultimately have the potential to be successful; the efficient start-up and utilization of capital equipment investments; political actions of federal and state governments which could have an impact on everything from the value of the U.S dollar vis-à-vis other currencies to the availability of affordable labor and energy; and security breaches and disruptions to the Company’s information technology systems.  Additional information concerning these and other factors is contained in the Company's Securities and Exchange Commission filings.

Comparison of Second Quarter 2025 and 2024

 

Readers are directed to Note D to the Consolidated Financial Statements, “Business Segments,” for data on the financial results of the Company’s three business segments for the quarters ended June 29, 2025 and June 30, 2024.

 

On a consolidated basis, net sales increased by $35,389,000 (42%), gross profit increased by $3,847,000 (26%), selling and general expenses increased by $1,411,000 (18%), impairment of vendor deposit increased $2,701,000, and amortization was consistent.  Other income decreased by $968,000 (65%), earnings before provision for income taxes decreased by $1,233,000 (16%), and net earnings decreased by $925,000 (15%).  Details concerning these changes can be found in the comments by segment below.

 

Housewares/Small Appliance net sales increased by $1,679,000 from $18,667,000 to $20,346,000, or 9%, 72% of which was attributable to an increase in units shipped, with the balance of the increase related to increases in pricing.  Defense net sales increased by $33,687,000 from $66,126,000 to $99,813,000 or 51%, primarily reflecting an increase in shipments from the segment's backlog.   



Notwithstanding the increase in sales mentioned above, Housewares/Small Appliance gross profit decreased $2,981,000 from $3,461,000 to $480,000, primarily reflecting the Trump administration's tariffs that went into effect on goods deemed to have been shipped from the Orient after January 31, 2025. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. To a lesser degree, increases in the cost of materials had a negative effect on the segment’s gross profit, which were mainly offset by lower repair costs at its main facility.  Defense gross profit increased $6,421,000 from $12,779,000 to $19,200,000, primarily reflecting the increase in sales mentioned above. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years. 

 

Selling and general expenses for the Housewares/Small Appliance segment increased $637,000, primarily due to an increase in self-insurance accruals of $628,000.  Selling and general expenses for the Defense segment increased $904,000, primarily attributed to the increases in personnel costs of $722,000, and repairs and maintenance of $91,000. Selling and general expenses for the Safety segment were relatively flat.

During the first quarter of 2025, the Company made deposits totaling $2,701,000 with a vendor in its Housewares/Small Appliances segment.  On May 29, 2025, the vendor filed for protection in the U.S. Bankruptcy Court in the Northern District of Texas.  As recovery of the deposit is deemed unlikely, the Company recorded an impairment of the full deposit during the second quarter of 2025.

The above items were responsible for the change in operating profit.

The $968,000 decrease in other income was primarily attributable to a decrease in interest income on marketable securities largely stemming from a lower average daily investment as a result of larger investments in inventory required to support augmented Defense segment awards.

Earnings before provision for income taxes decreased $1,233,000 from $7,846,000 to $6,613,000.  The provision for income taxes decreased from $1,769,000 to $1,461,000, which resulted in an effective income tax rate of 22% and 23% for the quarters ended June 29, 2025 and June 30, 2024, respectively.  Net earnings decreased $925,000 from $6,077,000 to $5,152,000, or 15%.

Comparison of First Six Months 2025 and 2024

 

Readers are directed to Note D to the Consolidated Financial Statements, “Business Segments,” for data on the financial results of the Company’s three business segments for the first six months ended June 29, 2025 and June 30, 2024.

 

On a consolidated basis, net sales increased by $62,375,000 (39%), gross profit increased by $8,105,000 (28%), selling and general expenses increased by $2,876,000 (19%), impairment of vendor deposit increased $2,701,000, and amortization was consistent.  Other income decreased by $2,305,000 (65%), earnings before provision for income taxes increased by $223,000 (1%), and net earnings increased by $117,000 (1%).  Details concerning these changes can be found in the comments by segment below.

 

Housewares/Small Appliance net sales increased by $2,338,000 from $39,934,000 to $42,272,000, or 6%, 86% of which was attributable to an increase in units shipped, with the balance of the increase related to increases in pricing.  Defense net sales increased by $59,585,000 from $121,166,000 to $180,751,000 or 49%, primarily reflecting an increase in shipments from the segment's backlog.   

 

Notwithstanding the increase in sales mentioned above, Housewares/Small Appliance gross profit decreased $4,629,000 from $6,569,000 to $1,940,000, primarily reflecting the Trump administration's tariffs that went into effect on goods deemed to have been shipped from the Orient after January 31, 2025. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. To a lesser degree, increases in the cost of materials and a less favorable product mix had a negative effect on the segment’s gross profit, which were partially offset by lower repair costs at its main facility. Defense gross profit increased $12,127,000 from $24,703,000 to $36,830,000, primarily reflecting the increase in sales mentioned above. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years. 

 

Selling and general expenses for the Housewares/Small Appliance segment increased $1,374,000, primarily due to an increase in self-insurance accruals of $756,000, an increase in legal and professional costs of $253,000, and the absence of the favorable adjustment to the reserve for bad debts of $285,000 that occurred in the prior year.  Selling and general expenses for the Defense segment increased $1,664,000, primarily attributed to the increases in personnel costs of $1,334,000, repairs and maintenance of $192,000, and legal and professional costs of $139,000. Selling and general expenses for the Safety segment decreased $162,000, primarily reflecting reduced personnel costs of $126,000 and travel expenses of $112,000.

During the first quarter of 2025, the Company made deposits totaling $2,701,000 with a vendor in its Housewares/Small Appliances segment.  On May 29, 2025, the vendor filed for protection in the U.S. Bankruptcy Court in the Northern District of Texas.  As recovery of the deposit is deemed unlikely, the Company recorded an impairment of the full deposit during the second quarter of 2025.

The above items were responsible for the change in operating profit.

The $2,305,000 decrease in other income was primarily attributable to a decrease in interest income on marketable securities largely stemming from a lower average daily investment as a result of larger investments in inventory required to support augmented Defense segment awards.

Earnings before provision for income taxes increased $223,000 from $16,198,000 to $16,421,000.  The provision for income taxes increased from $3,553,000 to $3,659,000, which resulted in an effective income tax rate of 22% for both the first six months ended June 29, 2025 and June 30, 2024.  Net earnings increased $117,000 from $12,645,000 to $12,762,000, or 1%.

Liquidity and Capital Resources

 

Net cash provided by operating activities was $1,542,000 during the first six months of 2025 as compared to $28,328,000 cash used during the first six months of 2024.  The principal factors contributing to the change can be found in the changes in the components of working capital within the Consolidated Statements of Cash Flows. Of particular note during the first six months of 2025 were net earnings of $12,762,000, which included the non-cash impairment of a vendor deposit of $2,701,000 and depreciation and amortization expenses of $2,460,000. Contributing to the cash provided was a decrease in accounts receivable levels stemming from cash collections on customer sales. These were partially offset by a decrease in payable and accrual levels and increases in inventory levels and deposits made to vendors included in other current assets.  Of particular note during the first six months of 2024 were net earnings of $12,645,000, which included non-cash depreciation and amortization expenses of $2,684,000. Contributing to the cash used were increases in accounts receivable and inventory levels, as well as a decrease in federal and state taxes due.

Net cash used in investing activities was $23,062,000 for the first six months of 2025, and net cash provided by investing activities was $4,758,000 for the first six months of 2024.  Significant factors contributing to the change were net maturities and sales of marketable securities of $1,983,000 in 2025, and $5,576,000 in 2024; and purchases of property, plant and equipment of $25,449,000 in 2025, as opposed to $1,048,000 in 2024. 

 

Net cash provided by financing activities was $5,614,000 for the first six months of 2025, and net cash used in financing activities was $31,516,000 for the first six months of 2024. The change primarily relates to the annual dividend payments.  There was no extra dividend payment during 2025. In 2024, the extra dividend was $3.50 per share. Also contributing to the change were net proceeds from the Company’s line of credit of $12,636,000 in 2025. Cash flows for both six month periods also reflected the proceeds from the sale of treasury stock to a Company sponsored retirement plan. During 2025, the Company incurred interest expense of $75,000 related to its line of credit.



Working capital decreased by $13,866,000 during the first six months of 2025 to $278,359,000 at June 29, 2025 for the reasons stated above.  The Company's current ratio was 4.2 to 1.0 and 4.9 to 1.0 at June 29, 2025 and December 31, 2024, respectively.

 

The Company expects to continue to evaluate acquisition opportunities that align with its business segments and will make further acquisitions, as well as continue to make capital investments in its business segments per existing authorized projects and for additional projects, if the appropriate return on investment is projected.

 

The Company has sufficient liquidity in the form of operating activities cash flows and a credit facility to meet all of its anticipated capital requirements, to make dividend payments, and to fund future growth through acquisitions and other means.  

 

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Critical Accounting Estimates

 

The Company's discussion and analysis of financial condition and results of operations are based upon its Consolidated Financial Statements.  The preparation of the Company's Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States requires management to make certain estimates and assumptions that affect the amount of reported assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Consolidated Financial Statements and revenues and expenses during the periods reported.  The estimates are based on experience and other assumptions that the Company believes are reasonable under the circumstances, and these estimates are evaluated on an ongoing basis.  Actual results may differ from those estimates.  

The Company's critical accounting policies are those that materially affect its Consolidated Financial Statements and involve difficult, subjective, or complex judgments by management. The Company reviewed the development and selection of the critical accounting policies and believes the following is the most critical accounting policy that could have an effect on the Company's reported results as it involves the use of significant estimates and assumptions as described above.  This critical accounting policy and estimate has been reviewed with the Audit Committee of the Board of Directors.  See Note A - Summary of Significant Accounting Policies to the Consolidated Financial Statements included in Part II, Item 8 of the Annual Report on Form 10-K for the year-ended December 31, 2024 filed on March 14, 2025 for more detailed information regarding the Company's critical accounting policies. 

 

Impairment and Valuation of Long-lived Assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Long-lived assets consist of property, plant and equipment and intangible assets, including the value of contracts/customer relationships, trademarks and safety certifications, trade secrets, and technology software. Determining whether an impairment has occurred typically requires various estimates and assumptions, including determining which cash flows are directly related to the potentially impaired asset, the useful life over which cash flows will occur, the amounts of the cash flows and the asset’s residual value, if any. In turn, measurement of an impairment loss requires a determination of fair value, which is based on the best information available. The Company uses internal discounted cash flows estimates, quoted market prices when available, and independent appraisals, as appropriate, to determine fair value. The Company derives the required cash flow estimates from its historical experience and its internal business plans. 

The Company recognizes the excess cost of acquired entities over the net amount assigned to the fair value of assets acquired and liabilities assumed as goodwill.  Goodwill is tested for impairment on an annual basis at the start of the fourth quarter and between annual tests whenever an impairment is indicated.  The impairment test for goodwill requires the determination of fair value of the reporting unit.  The Company uses multiples of earnings before interest, taxes, depreciation, and amortization ("EBITDA"), sales, and discounted cash flow models, which are described above, to determine the reporting unit's fair value, as appropriate. The Company also uses qualitative analysis to assess goodwill impairment. 

 

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

The Company's interest income on cash equivalents and marketable securities is affected by changes in interest rates in the United States.  Cash equivalents primarily consist of money market funds.  The balance of the Company’s investments is held primarily in certificates of deposits and other fixed rate securities, with a weighted average life of 0.5 years.  Accordingly, changes in interest rates have not had a material effect on the Company, and the Company does not anticipate that future exposure to interest rate market risk will be material.  The Company uses sensitivity analysis to determine its exposure to changes in interest rates. 

 

The Company has no history of, and does not anticipate in the future, investing in derivative financial instruments.  Most transactions with international customers are entered into in U.S. dollars, precluding the need for foreign currency cash flow hedges. As the majority of the Housewares/Small Appliance segment’s suppliers are located in China, periodic changes in the U.S. dollar and Chinese Renminbi (RMB) exchange rates do have an impact on that segment’s product costs. It is anticipated that any potential material impact from fluctuations in the exchange rate will be to the cost of products secured via purchase orders issued subsequent to the revaluation.

 

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ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures 

 

The Company’s management, including the Chief Executive Officer and Treasurer (principal financial officer), conducted an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934 (the “1934 Act”) as of June 29, 2025. Based on that evaluation, the Company’s Chief Executive Officer and Treasurer (principal financial officer) concluded that the Company’s disclosure controls and procedures were effective as of that date.

 

There were no changes to internal controls over financial reporting during the quarter ended June 29, 2025 that have materially affected or are reasonably likely to materially affect, the Company's internal control over financial reporting.  

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PART II - OTHER INFORMATION

 

Item 1.  Legal Proceedings

 

See Note I to the Consolidated Financial Statements set forth under Part I - Item 1 above. 

Item  5. Other Information

Insider Trading Arrangement

No officers or directors, as defined in Rule 16a-1(f), adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Regulation S-K Item 408, during the fiscal quarter ended June 29, 2025.

Item 6.  Exhibits

 

Exhibit 3(i)	Restated Articles of Incorporation - incorporated by reference from Exhibit 3 (i) of the Company's annual report on Form 10-K for the year ended December 31, 2005
Exhibit 3(ii)	By-Laws - incorporated by reference from Exhibit 3 (ii) of the Company's current report on Form 8-K dated July 6, 2007
Exhibit 9.1	Voting Trust Agreement  - incorporated by reference from Exhibit 9 of the Company's quarterly report on Form 10-Q for the quarter ended July 6, 1997
Exhibit 9.2	Voting Trust Agreement Amendment - incorporated by reference from Exhibit 9.2 of the Company's annual report on Form 10-K for the year ended December 31, 2008
Exhibit 9.3	Voting Trust Agreement Amendment - incorporated by reference from Exhibit 9.3 of the Company's annual report on Form 10-K for the year ended December 31, 2024
Exhibit 31.1	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2	Certification of the Treasurer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2	Certification of the Treasurer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101.INS	eXtensible Business Reporting Language (XBRL) Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
Exhibit 101.SCH	Inline XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL	Inline XBRL Taxonomy Calculation Linkbase Document
Exhibit 101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 104	The cover page from this Quarterly Report on Form 10-Q for the quarter ended June 29, 2025, formatted in Inline XBRL and contained in Exhibit 101.INS

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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.

 


	NATIONAL PRESTO INDUSTRIES, INC.


	/s/ Maryjo Cohen
	Maryjo Cohen, Chair of the Board,
	President, Chief Executive Officer
	(Principal Executive Officer), Director


	/s/ David J. Peuse
	David J. Peuse,  Director of Financial Reporting and Treasurer, (Principal
	Financial Officer)


	Date: August 8, 2025



17

FAQ

What were NPK's consolidated net sales for the quarter and six months?

Consolidated net sales were $120.449 million for the quarter and $224.088 million for the six months ended June 29, 2025.

How did the Defense segment perform and what is the backlog for NPK?

Defense net sales were $99.813 million in the quarter and backlog was $1,370,910,000, expected to be fulfilled in 18–42 months.

Did NPK record any impairments this quarter?

Yes. The Company recorded a $2.701 million impairment of a vendor deposit in the Housewares/Small Appliances segment due to the vendor filing for bankruptcy.

How much cash did NPK have at quarter end and what significant cash uses occurred?

Cash and cash equivalents were $1.757 million at June 29, 2025; significant uses included $25.449 million of property, plant and equipment purchases.

Does NPK have debt or credit availability?

The Company had an unsecured line of credit of $50.0 million (expiring Sept. 30, 2025) with $12.636 million outstanding at June 29, 2025.