8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported): June 11, 2020

TECHPRECISION CORPORATION

(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 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 June 11, 2020, TechPrecision Corporation issued a press release announcing its financial results for the fourth quarter and fiscal year ended March 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
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Exhibit<br><br> <br>Number	Description
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99.1	Press Release dated June 11, 2020

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: June 11, 2020	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

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TechPrecision Corporation Reports Fiscal2020 Financial Results

Improved profit margins expectedin Fiscal 2021

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Westminster, MA – June 11, 2020 – 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, energy and precision industrial sectors, today reported financial results for the fourth quarter and full year ended March 31, 2020.

Fiscal 2020 full year sales were $16.0 million compared to $16.7 million in fiscal 2019. Fourth quarter fiscal 2020 net sales were $4.9 million compared to $4.7 million for the fourth quarter of fiscal 2019. The Company recorded a net loss of $342,000 in fiscal 2020, compared to net income of $1.1 million in fiscal 2019. Fourth quarter fiscal 2020 net income was $48,000 compared to net income of $538,000 in the same quarter a year ago.

“As we discussed at the end of the previous quarter, increased loss provisions of $1.0 million due to learning-curve challenges on a limited number of new projects had an unfavorable impact on fiscal 2020 results,” stated Alexander Shen, TechPrecision’s Chief Executive Officer. “A number of these units have now been completed, and we expect improved margins going forward as the remaining of these projects approach completion, their costs stabilize, and additional profitable projects come on-line during FY 2021.”

“In addition, we recorded a $495,000 loss provision in March 2020 for a settlement with former employees in connection with a civil action to recover lost wages under a paid time-off program,” added Mr. Shen. “We agreed to settle the claims to avoid the expense and uncertainty of future litigation. The Company will be released from all claims raised in this litigation once the court approves the settlement.”

“The Company’s sales order backlog was $16.8 million on March 31, 2020 compared to $12.6 million the year prior, as approximately $20.1 million of additional orders were booked over the full year of fiscal 2020,” stated Mr. Shen. “We continue to replenish backlog and we believe this will provide for a steady revenue stream and profitable margins in fiscal 2021.”

Financial Position

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At March 31, 2020, TechPrecision had $931,000 in cash and cash equivalents. Working capital was $5.6 million compared to working capital of $6.3 million at March 31, 2019. In addition, the Company has accessed additional capital to bolster liquidity as the company manages through the effects of the pandemic.

On April 3, 2020 we drew down $1.0 million under an existing revolver loan with Berkshire Bank. In addition, on May 8, 2020, the Company issued a promissory note evidencing an unsecured loan in the amount of $1.3 million under the Paycheck Protection Program, or the PPP. The PPP was established under the Coronavirus Aid, Relief, and Economic Security Act and is administered by the U.S. Small Business Administration. The loan was made through Berkshire Bank, and the Company received $1.3 million of proceeds on May 11, 2020.

Fourth Quarter of Fiscal 2020 FinancialResults

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·	Net<br> sales were $4.9 million or 5% higher when compared to $4.7 million in the same quarter<br> a year ago.
·	Cost<br> of sales were 12% higher than the prior year, impacted by a $178,000 charge for loss<br> contracts.
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·	Gross<br> profit was $1.3 million, down from $1.5 million in the same quarter last year.
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·	We<br> accrued a charge for $495,000 to settle outstanding claims for lost wages with former<br> employees.
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·	Operating<br> income was $166,000, down from $832,000 in the same period a year ago.
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Fiscal 2020 Financial Results

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·	Net<br> sales were $16.0 million or 4% lower when compared to $16.7 million in the same period<br> a year ago.
·	Cost<br> of sales were 6% higher than the prior year, impacted by a charge for loss contracts<br> this fiscal year.
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·	Gross<br> profit was $3.1 million, down 32% when compared to the same period last year.
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·	We<br> accrued a charge for $495,000 to settle outstanding claims for lost wages with former<br> employees.
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·	Operating<br> loss was $141,000 compared to operating income of $1.8 million in the same period a year<br> ago.
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·	Net<br> loss was $342,000 for fiscal 2020, compared to net income of $1.1 million for fiscal<br> 2019.
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·	EBITDA,<br> a non-GAAP financial measure, was $599,000 for fiscal 2020, compared to $2.6 million<br> in fiscal 2019.
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COVID-19 Update

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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 fourth quarter of fiscal 2020 as the Company was designated an “Essential Service.” However, the pandemic has negatively affected the Company’s customers, suppliers and labor force, and with the changing conditions as a result of the COVID-19 outbreak, the impact on our operations and fiscal year 2021 financial results remains uncertain.

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Teleconference Information

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The Company will hold a conference call at 4:30 p.m. Eastern (U.S.) time on June 11, 2020. To participate in the live conference call, please dial 1-844-407-9500 five to 10 minutes prior to the scheduled conference call time. International callers should dial 1-862-298-0850. When prompted, reference TechPrecision.

A replay will be available until June 25, 2020. To access the replay, dial 1-877-481-4010 or 1-919-882-2331. When prompted, enter Conference Passcode 34627. The call will also be available over the Internet and accessible at https://www.webcaster4.com/Webcast/Page/2198/34627.

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 revenuesand effectively 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; 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.

-- Tables Follow --

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TECHPRECISION CORPORATION

CONSOLIDATED BALANCE SHEETS

		March 31,<br> <br>2019
ASSETS
Current assets:
Cash and cash equivalents	930,856	$	2,036,646
Accounts receivable, net	990,300		1,010,443
Contract assets	4,504,621		4,390,832
Inventories	1,217,613		1,240,315
Other current assets	606,151		498,059
Total current assets	8,249,541		9,176,295
Property, plant and equipment, net	4,182,861		4,860,609
Deferred income taxes	2,115,480		2,004,346
Other noncurrent assets, net	32,600		6,233
Total assets	14,580,482	$	16,047,483
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	185,065	$	609,082
Accrued expenses	1,554,524		753,499
Contract liabilities	805,049		740,947
Current portion of long-term debt	109,829		822,105
Total current liabilities	2,654,467		2,925,633
Long-term debt, including finance lease	2,456,560		3,410,542
Commitments and contingent liabilities (see Note 14)
Stockholders’ Equity:
Common stock - par value .0001 per share, 90,000,000<br> shares authorized, 29,354,594 and 29,234,594 shares issued and outstanding at March 31, 2020 and 2019	2,935		2,923
Additional paid in capital	8,793,062		8,693,106
Accumulated other comprehensive income	21,688		21,940
Retained earnings	651,770		993,339
Total stockholders’ equity	9,469,455		9,711,308
Total liabilities and stockholders’ equity	14,580,482	$	16,047,483

All values are in US Dollars.

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TECHPRECISION CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

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	Three<br> Months Ended <br>March 31,						Twelve<br> Months Ended <br>March 31,
	2020			2019			2020			2019
Net sales	$	4,931,669		$	4,712,154		$	16,007,288		$	16,702,558
Cost of sales		3,629,799			3,246,640			12,868,086			12,118,190
Gross profit		1,301,870			1,465,514			3,139,202			4,584,368
Selling, general and administrative		640,431			633,258			2,785,486			2,746,543
Provision for claims settlement		495,000			--			495,000			--
Income (loss) from operations		166,439			832,256			(141,284	)		1,837,825
Other income		1,686			32,428			22,750			41,033
Interest expense		(77,628	)		(80,877	)		(296,076	)		(354,825	)
Total other expense, net		(75,942	)		(48,449	)		(273,326	)		(313,792	)
Income (loss) before income taxes		90,497			783,807			(414,610	)		1,524,033
Income tax expense (benefit)		42,052			246,252			(73,041	)		423,357
Net income (loss)	$	48,445		$	537,555		$	(341,569	)	$	1,100,676
Net income (loss) per share basic	$	0.00		$	0.02		$	(0.01	)	$	0.04
Net income (loss) per share diluted	$	0.00		$	0.02		$	(0.01	)	$	0.04
Weighted average number of shares outstanding: basic		29,258,966			29,009,630			29,258,692			28,878,780
Weighted average number of shares outstanding: basic diluted		29,681,194			30,666,447			29,258,692			30,293,670

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TECHPRECISION CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended<br> March 31,
	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(341,569	)	$	1,100,676
Adjustments to reconcile net (loss) income to net cash provided by operating<br> activities:
Depreciation		717,579			749,755
Amortization of debt issue costs		59,502			55,247
Loss on disposal of equipment		--			3,428
Stock based compensation expense		90,917			137,352
Change in contract loss provision		227,688			(143,105	)
Deferred income taxes		(73,041	)		423,357
Provision for claims settlement		495,000			--
Changes in operating assets and liabilities:
Accounts receivable		20,143			436,539
Contract assets		(113,789	)		(2,334,418	)
Inventories		22,702			(263,622	)
Other current assets		(146,185	)		13,322
Other noncurrent assets		--			(7,245	)
Accounts payable		(424,017	)		263,377
Accrued expenses		77,747			246,501
Contract liabilities		64,102			(149,855	)
Net cash provided by operating activities		676,779			531,309
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment		(39,831	)		(446,652	)
Proceeds from disposition of equipment		--			35,309
Net cash used in investing activities		(39,831	)		(411,343	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from stock transactions		9,051			182,400
Common stock repurchased		--			(188,600	)
Deferred loan costs		(41,628	)		--
Repayment of finance lease obligation		(10,951	)		(14,002	)
Repayment of long-term debt		(1,699,549	)		(752,352	)
Net cash used in financing activities		(1,743,077	)		(772,554	)
Effect of exchange rate on cash and cash equivalents		339			124
Net decrease in cash and cash equivalents		(1,105,790	)		(652,464	)
Cash and cash equivalents, beginning of period		2,036,646			2,689,110
Cash and cash equivalents, end of period	$	930,856		$	2,036,646

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TECHPRECISION CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of EBITDA to Net Income

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

(dollars in thousands)	March 31,<br> <br>2020			March 31,<br> <br>2019		Change<br> <br>Amount
Net (loss) income	$	(342	)	$	1,101	$	(1,443	)
Income tax (benefit) expense		(73	)		423		(496	)
Interest expense (1)		296			355		(59	)
Depreciation		718			750		(32	)
EBITDA	$	599		$	2,629	$	(2,030	)
(1)	Includes amortization of debt issue costs.
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