TechPrecision Corporation

What they do

TechPrecision builds custom metal structural components and systems to customer drawings and specifications, covering fabrication, welding, heat treating, CNC machining, assembly, inspection, non-destructive evaluation and testing. Its Ranor subsidiary operates on roughly 65 acres in Westminster, Massachusetts in 145,000 square feet of facilities, producing welded and machined components up to 100 tons. Its Stadco subsidiary, acquired August 25, 2021, manufactures high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers. Ranor and Stadco are each reportable segments, and all operations and customers are in the United States.

Revenue drivers

• Ranor segment — Heavy fabrication and high-precision machining of components up to 100 tons, with in-house cutting, press and roll forming, welding, heat treating, assembly, blasting, painting, CNC machining and QC inspection. In the quarter ended June 30, 2026, Ranor revenue and gross profit rose 27% and 4% year over year on customer and project mix.
• Stadco segment — Manufacture of high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers. In the quarter ended June 30, 2026, Stadco revenue rose 22% and losses narrowed as cost of revenue was roughly flat versus the prior-year period.
• Funded backlog — Management cited funded backlog of $52.7 million as of June 30, 2026, plus approximately $22 million of additional unfunded purchase orders, expected to be delivered over the next one to three fiscal years.
• Defense and precision industrial end markets — Revenue comes from customer-designed components sold to defense and precision industrial customers, generated through individual purchase orders rather than long-term contracts.

Recent performance

For the three months ended June 30, 2026, consolidated revenue was $9.1 million, up 23% from $7.4 million a year earlier, and gross profit was $1.4 million, up 36% from $1.0 million. Operating loss narrowed to $45 thousand from $463 thousand, and net loss was $153 thousand, or $0.02 per share, versus a net loss of $597 thousand, or $0.06 per share, in the prior-year quarter. Fiscal 2026 full-year revenue was $31.6 million with a net loss of $1.7 million, compared with fiscal 2025 revenue of $34.0 million and a net loss of $2.7 million. Cash was $279 thousand at June 30, 2026, total debt was $5.0 million, and working capital was negative $46 thousand because all debt obligations are classified as current following covenant violations.

Strategy

Management says the Company is executing a strategic customer and project mix plan at both Ranor and Stadco aimed at gross margin improvement and increased utilization of Stadco's manufacturing capacity. It expects to deliver the $52.7 million funded backlog over the next one to three fiscal years with margin improvement through the period. For fiscal 2027, management reiterated guidance of revenue growth of about 10% to $35.0 million to $37.0 million and EBITDA growth of about 80% to $3.0 million to $4.0 million. The Company amended its Loan Agreement with Beacon Bank & Trust to extend the Revolver Loan maturity from May 15, 2026 to September 15, 2026.

Risks

• Going concern — The auditors have indicated substantial doubt about the Company's ability to continue as a going concern, and management states that without a waiver, noncompliance with loan covenants permits the lender to demand full repayment, which the Company could not satisfy from existing facilities or cash.
• Debt covenant noncompliance — The Company determined it was not in compliance with certain financial covenants under its Loan Agreement as of March 31, 2026, and management believes it is probable it will not be in compliance in future periods.
• Customer concentration and purchase-order revenue — The Company relies on individual purchase orders rather than long-term contracts and on a small number of customers for a significant percentage of its business.
• Capacity utilization at Stadco — Management states that satisfying future financial covenants requires efficiently increasing utilization of Stadco's manufacturing capacity and improving the manufacturing process so direct labor hours allow recovery of costs.

Outlook

Management said the Company remains on track for the remainder of fiscal 2027 to deliver double-digit revenue growth and resulting EBITDA, holding guidance of revenue growth of +10% to $35.0 million to $37.0 million and EBITDA growth of +80% to $3.0 million to $4.0 million. It expects to deliver the $52.7 million funded backlog over the next one to three fiscal years with gross margin improvement throughout the period. No assurance was given that these results will be achieved.