8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) ofthe Securities and Exchange Act of 1934

Date of Report (Date of earliest event reported): February 11, 2021

TECHPRECISIONCORPORATION

(Exact Name of Registrant as Specified in Charter)

Delaware	000-51378	51-0539828
(State or Other Jurisdiction<br><br> <br>of Incorporation or Organization)	(Commission File Number)	(IRS Employer Identification<br><br>No.)

1 Bella Drive

Westminster, MA 01473

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (978) 874-0591

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ¨

Item 2.02	Results of Operations and Financial Condition.

On February 11, 2021, TechPrecision Corporation issued a press release announcing its financial results for the third quarter ended December 31, 2020. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. The information in this Item 2.02 of Form 8-K and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference.

Item 9.01	Financial Statements and Exhibits.

(d)            Exhibits

Exhibit<br><br> <br>Number	Description
99.1	Press Release dated February 11, 2021

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 hereunto duly authorized.

	TECHPRECISION CORPORATION
Date: February 11, 2021	By:	/s/ Thomas Sammons
	Name:	Thomas Sammons
	Title:	Chief Financial Officer

Exhibit 99.1

Company Contact:	Investor Relations Contact:
Mr. Thomas Sammons	Hayden IR
Chief Financial Officer	Brett Maas
TechPrecision Corporation	Phone: 646-536-7331
Phone: 978-883-5109	Email: brett@haydenir.com
Email: sammonst@ranor.com	Website: www.haydenir.com
Website:  www.techprecision.com

FOR IMMEDIATE RELEASE

TechPrecision Corporation Reports ThirdQuarter Fiscal 2021 Financial Results

Fiscal Q3 Gross Margin More than DoublesCompared to Prior Year Period Reflecting Favorable Project Mix

Westminster, MA – February 11, 2021 – TechPrecision Corporation (OTCQB: TPCS) (“TechPrecision” or “the Company”), an industry-leading manufacturer of precision, large-scale fabricated and machined metal components and tested systems with customers in the defense and precision industrial sectors, today reported financial results for the third quarter ended December 31, 2020. Third quarter sales were $3.6 million compared to $3.7 million last year. Gross profit was $705,000, an over 100% increase when compared to gross profit of $314,000 for the third quarter of fiscal 2020, reflecting more favorable project mix.

“Our results for the third quarter were highlighted by a more favorable project mix which drove improved gross margins when compared to the same period a year ago,” stated Alexander Shen, TechPrecision’s Chief Executive Officer. “We have also realized manufacturing improvements on the remaining components which negatively impacted our prior year results with learning-curve related costs.”

“This outcome resulted in an overall improvement in reported financial results for the first nine months of fiscal 2021 when compared to the same period in the prior year,” added Mr. Shen. “We expect to carry these improvements in revenues and margins into the last quarter of fiscal 2021 and beyond.”

The Company’s sales order backlog was $18.4 million on December 31, 2020, up from $16.8 million at March 31, 2020.

Third Quarter of Fiscal 2021 FinancialResults

·	Net sales were $3.6 million or 3% lower when compared to $3.7 million in the same quarter a year<br>ago.
·	Gross profit was $705,000, an increase of more than100% compared to $314,000 in the same quarter<br>last year.
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·	Gross margin was 19.8%, up from 8.6% in the third quarter of fiscal 2020 due to favorable project<br>mix. Additionally, Q3 fiscal 2020 was negatively impacted by learning-curve related costs on a limited number of new projects.
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·	SG&A increased by $54,000 or 8% primarily due to an increase in advisory fees, including $85,000<br>for the proposed acquisition of Stadco.
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·	Operating loss was $11,000, compared to operating loss of $348,000 in the same period a year ago.
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·	Net loss was $48,000, compared to net loss of $320,000 for the same period a year ago.
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·	EBITDA, a non-GAAP financial measure, was $171,000, an increase of $352,000 when compared to the<br>same period a year ago.
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Nine Months of Fiscal 2021 FinancialResults

·	Net sales were $11.6 million or 4% higher when compared to $11.1 million in the same period a year<br>ago.
·	Gross profit was $0.7 million higher when compared to the same period last year, primarily due<br>to the absence of any significant learning-curve related costs that were evident in the same period a year ago.
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·	SG&A was $2.2 million, or 3% higher than the same period last year, due to increases in compensation<br>and office costs that more than offset a decrease in travel expenses.
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·	Operating income was $326,000 compared to operating loss of $308,000 in the same period a year<br>ago.
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·	Net income was $106,000, compared to net loss of $390,000 a year ago.
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·	EBITDA was $848,000 compared to $261,000 in the same period a year ago.
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Financial Position

At December 31, 2020, TechPrecision had $1.3 million in cash and cash equivalents, an increase of $0.3 million since March 31, 2020.

Working capital was $4.2 million at December 31, 2020 compared to $5.6 million at March 31, 2020. The decline in working capital was due to the upcoming Berkshire Bank term loan maturity in December 2021, and therefore that loan being classified as current at December 31, 2020. Approximately $3.1 million of long-term debt is due in less than twelve months. We fully expect to renew the term loan at maturity. We also have access to additional capital via the existing revolver loan should management determine it needs to bolster liquidity as the Company manages through the effects of the pandemic.

Acquisition of Stadco

On October 16, 2020, TechPrecision Corporation entered into a stock purchase agreement to acquire all of the issued and outstanding capital stock of Stadco, a California corporation in the business of manufacturing high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers. As consideration, the Company will issue 1,000,000 shares of the Company’s common stock if the transaction closes. The Company and Stadco are working with creditors of Stadco to substantially reduce the approximately $14 million of Stadco liabilities that would otherwise be added to the consolidated balance of the combined company after closing. As recently reported, we have already reached an agreement with one of Stadco’s major creditors. Reaching agreements with the remainder of these creditors to the satisfaction of the Company is required for the closing of the deal to occur. The Company expects that a percentage of these liabilities will be satisfied in part or full through the issuance of additional shares of the Company’s common stock.

On February 2, 2021, the Company entered into an amendment to the stock purchase agreement described above. Under the terms of the original stock purchase agreement with Stadco, if the acquisition was not closed by December 31, 2020, either the Company or Stadco could have terminated the agreement. The amendment effected a change to this provision by extending until February 28, 2021 the date after which the parties may terminate if the acquisition has not closed. The amendment also effected certain other minor changes to the stock purchase agreement with Stadco.

As due diligence and negotiations are currently on-going, at this time the Company will not make any further comments regarding Stadco.

COVID-19 Update

At the end of March of 2020, the outbreak of coronavirus (COVID-19) had spread worldwide as a pandemic. The full extent of the outbreak, related business and travel restrictions and changes to social behavior intended to reduce its spread remain uncertain as the health crisis continues to evolve in the U.S. and abroad. The directives imposed by federal, state and local governments did not impair our ability to maintain operations during the third quarter of fiscal 2021 as the Company was designated an “Essential Service.” However, the pandemic has negatively affected the Company’s customers, suppliers and labor force, resulting in a number of inspection and approval delays for certain projects caused by new or enhanced mandated safety precautions. Accordingly, as conditions continue to change as a result of the COVID-19 outbreak, the impact on our operations and financial results for the remainder of calendar year 2021 remains uncertain.

Teleconference Information

The Company will hold a conference call at 4:30 p.m. Eastern (U.S.) time on February 11, 2021. To participate in the live conference call, please dial 1-888-506-0062 five to 10 minutes prior to the scheduled conference call time. International callers should dial 1-973-528-0011. When prompted, reference TechPrecision. A replay will be available until February 25, 2021. To access the replay, dial 1-877-481-4010 or 1-919-882-2331. When prompted, enter Conference Passcode 39847.

The call will also be available over the Internet and accessible at: https://www.webcaster4.com/Webcast/Page/2198/39847.

About TechPrecision Corporation

TechPrecision Corporation, through its wholly owned subsidiary, Ranor, Inc., manufactures large-scale, metal fabricated and machined precision components and equipment. These products are used in a variety of markets including: defense, aerospace, nuclear, industrial, and medical. TechPrecision’s goal is to be an end-to-end service provider to its customers by furnishing customized solutions for completed products requiring custom fabrication and machining, assembly, inspection and testing. To learn more about the Company, please visit the corporate website at http://www.techprecision.com. Information on the Company’s website or any other website does not constitute a part of this press release.

Safe Harbor Statement

This release contains certain “forward-lookingstatements” relating to the business of the Company and its subsidiary companies. All statements other than statements ofcurrent or historical fact contained in this press release, including statements that express our intentions, plans, objectives,beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future eventsor conditions are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will,” “should,” “would” and similar expressions,as they relate to us, are intended to identify forward-looking statements. These statements are based on current expectations,estimates and projections made by management about our business, our industry and other conditions affecting our financial condition,results of operations or business prospects. These statements are not guarantees of future performance and involve risks, uncertaintiesand assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressedor forecasted in, or implied by, the forward-looking statements due to numerous risks and uncertainties. Factors that could causesuch outcomes and results to differ include, but are not limited to, risks and uncertainties arising from: our reliance on individualpurchase orders, rather than long-term contracts, to generate revenue; our ability to balance the composition of our revenues andeffectively control operating expenses; external factors, including the COVID-19 pandemic, that may be outside of our control;the impacts of the COVID-19 pandemic and government-imposed lockdowns in response thereto; the availability of appropriate financingfacilities impacting our operations, financial condition and/or liquidity; our ability to receive contract awards through competitivebidding processes; our ability to maintain standards to enable us to manufacture products to exacting specifications; our abilityto enter new markets for our services; our reliance on a small number of customers for a significant percentage of our business;competitive pressures in the markets we serve; changes in the availability or cost of raw materials and energy for our productionfacilities; operating in a single geographic location; restrictions in our ability to operate our business due to our outstandingindebtedness; government regulations and requirements; pricing and business development difficulties; changes in government spendingon national defense; our ability to make acquisitions and successfully integrate those acquisitions with our business; generalindustry and market conditions and growth rates; general economic conditions; the risk that the proposed acquisition of Stado maynot be completed in a timely manner or at all, which may adversely affect the Company’s business and the price of Company’scommon stock; the failure of either party to satisfy any of the conditions to the consummation of the proposed acquisition of Stadcoand uncertainties as to the timing of the consummation of the proposed acquisition; the occurrence of any event, change or othercircumstance that could give rise to the termination of the securities purchase agreement governing the acquisition; the effectof the announcement or pendency of the proposed acquisition on the Company’s business relationships, operating results andbusiness generally; risks related to diverting management’s attention from the Company’s ongoing business operations;unexpected costs, charges or expenses resulting from the proposed acquisition; and other risks discussed in the Company’speriodic reports that are filed with the Securities and Exchange Commission and available on its website (www.sec.gov). Any forward-lookingstatements speak only as of the date on which they are made, and we undertake no obligation to publicly update or revise any forward-lookingstatements to reflect events or circumstances that may arise after the date of this press release, except as required by applicablelaw. Investors should evaluate any statements made by us in light of these important factors.

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TECHPRECISION CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

		March 31,<br> <br>2020
ASSETS
Current assets:
Cash and cash equivalents	1,255,320	$	930,856
Accounts receivable, net	1,173,376		990,300
Contract assets	5,314,653		4,504,621
Raw materials	503,636		561,572
Work-in-process	694,848		656,041
Other current assets	442,024		606,151
Total current assets	9,383,857		8,249,541
Property, plant and equipment, net	4,208,329		4,182,861
Deferred income taxes	2,016,816		2,115,480
Other noncurrent assets, net	16,086		32,600
Total assets	15,625,088	$	14,580,482
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	510,434	$	185,065
Accrued expenses	1,306,109		1,554,524
Contract liabilities	308,358		805,049
Current portion of long-term debt	3,088,553		109,829
Total current liabilities	5,213,454		2,654,467
Long-term debt	717,559		2,456,560
Stockholders’ Equity:
Common stock - par value .0001 per share, 90,000,000 shares authorized, 29,498,662 and 29,354,594 shares issued and outstanding, at December 31, 2020 and March 31, 2020	2,949		2,935
Additional paid in capital	8,911,160		8,793,062
Accumulated other comprehensive income	21,838		21,688
Retained earnings	758,128		651,770
Total stockholders’ equity	9,694,075		9,469,455
Total liabilities and stockholders’ equity	15,625,088	$	14,580,482

All values are in US Dollars.

TECHPRECISION CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OFOPERATIONS

AND COMPREHENSIVE (LOSS) INCOME

(unaudited)

	Three Months Ended <br>December 31,						Nine Months Ended <br>December 31,
	2020			2019			2020			2019
Net sales	$	3,569,718		$	3,667,276		$	11,566,176		$	11,075,620
Cost of sales		2,864,274			3,352,962			9,034,858			9,238,287
Gross profit		705,444			314,314			2,531,318			1,837,333
Selling, general and administrative		716,361			662,675			2,205,739			2,145,055
(Loss) income from operations		(10,917	)		(348,361	)		325,579			(307,722	)
Other (expense) income		(219	)		185			1,237			21,063
Interest expense		(50,405	)		(69,328	)		(159,885	)		(218,447	)
Total other expense, net		(50,624	)		(69,143	)		(158,648	)		(197,384	)
(Loss) income before income taxes		(61,541	)		(417,504	)		166,931			(505,106	)
Income tax (benefit) expense		(13,369	)		(97,734	)		60,573			(115,092	)
Net (loss) income	$	(48,172	)	$	(319,770	)	$	106,358		$	(390,014	)
Other comprehensive income (loss), before tax:
Foreign currency translation adjustments	$	1,252		$	9		$	151		$	(329	)
Other comprehensive income (loss), net of tax	$	1,252		$	9		$	151		$	(329	)
Comprehensive (loss) income	$	(46,920	)	$	(319,761	)	$	106,509		$	(390,343	)
Net (loss) income per share basic	$	(0.00	)	$	(0.01	)	$	0.00		$	(0.01	)
Net (loss) income per share diluted	$	(0.00	)	$	(0.01	)	$	0.00		$	(0.01	)
Weighted average number of shares outstanding: Basic		29,498,662			29,254,594			29,430,206			29,254,230
Diluted		29,498,662			29,254,594			31,021,384			29,254,230

TECHPRECISION CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OFCASH FLOWS

(unaudited)

	Nine Months Ended December 31,
	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	106,358		$	(390,014	)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation		521,422			548,038
Amortization of debt issue costs		45,099			31,280
Stock based compensation expense		146,417			81,667
Change in contract loss provision		(175,365	)		216,039
Deferred income taxes		60,573			(115,092	)
Changes in operating assets and liabilities:
Accounts receivable		(183,076	)		257,459
Contract assets		(810,032	)		(271,767	)
Inventories		19,129			589,904
Other current assets		164,127			(296,328	)
Other noncurrent assets		38,092			(9,419	)
Accounts payable		325,369			(138,463	)
Accrued expenses		(101,028	)		18,282
Contract liabilities		(496,691	)		87,815
Net cash (used in) provided by operating activities		(339,606	)		609,401
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment		(546,890	)		(35,225	)
Net cash used in investing activities		(546,890	)		(35,225	)
CASH FLOWS FROM FINANCING ACTIVITIES
Debt issue costs		(24,610	)		(32,209	)
Proceeds from payroll protection program loan		1,317,100			--
Proceeds from revolver loan		1,000,000			--
Repayment of revolver loan		(1,000,000	)		--
Repayment of long-term debt		(81,352	)		(610,515	)
Net cash provided by (used in) financing activities		1,211,138			(642,724	)
Effect of exchange rate on cash and cash equivalents		(178	)		307
Net increase (decrease) in cash and cash equivalents		324,464			(68,241	)
Cash and cash equivalents, beginning of period		930,856			2,036,646
Cash and cash equivalents, end of period	$	1,255,320		$	1,968,405

TECHPRECISION CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of EBITDA to Net (Loss)Income

The following table provides a reconciliation of EBITDA to net (loss) income, the most directly comparable U.S. GAAP measure reported in our condensed consolidated financial statements:

	Three Months ended December 31,									Nine Months ended December 31,
(dollars in thousands)	2020			2019			Change			2020		2019			Change
Net (loss) income	$	(48	)	$	(320	)	$	272		$	106	$	(390	)	$	496
Income tax (benefit) expense		(13	)		(98	)		85			61		(115	)		176
Interest expense (1)		50			69			(19	)		160		218			(58	)
Depreciation		182			168			14			521		548			(27	)
EBITDA	$	171		$	(181	)	$	352		$	848	$	261		$	587
(1)	Includes amortization of debt issue costs.
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