Based on the provided financial report article, the title of the article is likely: "10-K: IIIN, Inc. (0000764401) (Filer)" This title indicates that the article is a 10-K filing with the Securities and Exchange Commission (SEC) for IIIN, Inc., a company with the ticker symbol 0000764401.
Based on the provided financial report article, the title of the article is likely: "10-K: IIIN, Inc. (0000764401) (Filer)" This title indicates that the article is a 10-K filing with the Securities and Exchange Commission (SEC) for IIIN, Inc., a company with the ticker symbol 0000764401.
The report presents the financial statements of IIIN, Inc. for the fiscal year ended September 27, 2025. The company reported net sales of $182 million, an increase of 103% from the previous year. Gross profit was $219 million, with a gross margin of 28%. Operating expenses increased by 18% to $103 million, driven by higher research and development costs. The company reported a net loss of $182 million, primarily due to non-cash impairment charges and one-time expenses. As of September 27, 2025, IIIN had cash and cash equivalents of $103 million and total debt of $219 million. The company’s equity was $182 million, with a book value per share of $1.50. IIIN also reported significant events, including the purchase commitment for equipment, non-cancelable purchase commitment for raw materials, and the retirement savings plan. Additionally, the company disclosed its fair value measurements, including the use of Level 1 and Level 2 inputs, and its non-financial assets, such as patents, trade names, and non-compete agreements.
Summary and Analysis of Financial Report
Overview of Financial Performance
Net Sales and Profitability
- Net sales increased 22.4% to $647.7 million in fiscal 2025 from $529.2 million in fiscal 2024. This was driven by a 14.8% increase in shipments and a 6.7% rise in average selling prices.
- Gross profit increased 88.3% to $93.4 million, or 14.4% of net sales, in fiscal 2025 from $49.6 million, or 9.4% of net sales, in fiscal 2024. This was primarily due to higher spreads between selling prices and raw material costs.
- Selling, general and administrative (SG&A) expenses increased 31.8% to $39.0 million, or 6.0% of net sales, in fiscal 2025 from $29.6 million, or 5.6% of net sales, in fiscal 2024. This was mainly driven by higher compensation and amortization expenses.
- Net earnings increased to $41.0 million ($2.10 per diluted share) in fiscal 2025 from $19.3 million ($0.99 per share) in fiscal 2024, primarily due to the increase in gross profit.
Liquidity and Capital Resources
- As of September 27, 2025, the company had $38.6 million in cash and cash equivalents, compared to $111.5 million as of September 28, 2024.
- Operating activities provided $27.2 million of cash in fiscal 2025, down from $58.2 million in fiscal 2024, due to an increase in working capital requirements.
- Investing activities used $75.7 million of cash in fiscal 2025, primarily for the EWP and OWP acquisitions and capital expenditures.
- Financing activities used $24.4 million of cash in fiscal 2025, mainly for dividend payments and stock repurchases.
- The company has a $100 million revolving credit facility, with $98.7 million of available borrowing capacity as of September 27, 2025.
Revenue and Profit Trends
The company experienced strong revenue and profitability growth in fiscal 2025 compared to the prior year:
- Net sales increased 22.4%, driven by a 14.8% increase in shipments and a 6.7% rise in average selling prices. The higher shipments were due to incremental volume from recent acquisitions and improved demand in construction markets.
- Gross profit margin expanded significantly, from 9.4% in fiscal 2024 to 14.4% in fiscal 2025. This was primarily attributable to higher spreads between selling prices and raw material costs.
- SG&A expenses increased as a percentage of sales, from 5.6% in fiscal 2024 to 6.0% in fiscal 2025, due to higher compensation, amortization, and employee benefit costs.
- Net earnings more than doubled, from $19.3 million in fiscal 2024 to $41.0 million in fiscal 2025, driven by the improvement in gross profit.
The company was able to successfully pass through raw material cost increases to customers through pricing actions, which helped drive the strong profitability in fiscal 2025. However, SG&A expenses grew at a faster pace than sales, which could be an area of focus going forward.
Strengths and Weaknesses
Strengths:
- Ability to raise prices to offset raw material cost inflation
- Successful integration of recent acquisitions, which expanded shipment volumes and market share
- Strong liquidity position, with $38.6 million in cash and $98.7 million of available credit facility capacity
- Flexible capital structure and focus on cost management and productivity improvements
Weaknesses:
- Increase in SG&A expenses outpacing revenue growth
- Reliance on a single major financial institution for cash management
- Exposure to fluctuations in raw material (wire rod) prices, which can impact profitability if not fully recovered through pricing
Outlook
The company enters fiscal 2026 with momentum, supported by operational improvements, recovering raw material availability, and contributions from recent acquisitions. Key points about the outlook:
- Market conditions remain generally strong, with public nonresidential construction expected to remain elevated due to federal infrastructure investment.
- The company is closely monitoring broader macroeconomic conditions that could impact customer demand in the near term.
- The company remains focused on disciplined expense management, capturing synergies from acquisitions, and driving continuous operational improvements.
- The company will continue to evaluate acquisition opportunities that enhance its presence in current markets or expand its geographic footprint.
Overall, the company appears well-positioned to navigate potential near-term market challenges and continue executing on its long-term growth strategy.