Sono-Tek Corporation Reports 10% Net Sales Growth, Increased Profitability in First Half of Fiscal 2025

Sono-Tek Corporation reported its financial results for the six months ended August 31, 2024, showing a notable increase in net sales and profitability compared to the same period in the previous fiscal year. Net sales reached $10.2 million, a 10% increase from $9.2 million in the prior year. The growth was primarily driven by strong performance in the Alternative Energy and Electronics markets, with sales in these segments increasing by 80% and 30%, respectively.

Gross profit for the six-month period was $4.97 million, up from $4.58 million, reflecting a 9% increase. However, the gross profit margin slightly decreased to 48.8% from 49.5%, attributed to changes in product mix and labor expense reallocations. Operating income for the first half of fiscal 2025 rose to $524,000, compared to $474,000 in the same period last year.

In contrast, the company experienced a decline in net income for the three months ended August 31, 2024, which totaled $341,000, down from $541,000 in the same quarter of the previous year. This decrease was primarily due to a drop in gross profit, which fell to $2.52 million from $2.80 million, reflecting an 8% decrease in sales for the quarter.

Total current assets as of August 31, 2024, were reported at $18.5 million, slightly down from $18.7 million in February 2024. Cash and cash equivalents saw a significant increase, rising to $5.85 million from $2.13 million, while total liabilities decreased to $5.87 million from $6.85 million, resulting in total stockholders’ equity increasing to $17.05 million from $16.28 million.

The company’s strategic focus remains on the clean energy sector, with a notable backlog of $11.47 million in equipment orders as of August 31, 2024, reflecting a 7% increase year-over-year. This backlog is attributed to growing orders from the clean energy market, including significant contracts scheduled for delivery in the upcoming fiscal year.

Sono-Tek's operational expenses increased, with total operating expenses for the six months reaching $4.45 million, up from $4.10 million in the previous year. The increase was driven by higher marketing and selling expenses, which rose due to increased commissions linked to higher sales from external distributors.

Overall, Sono-Tek Corporation's financial performance for the first half of fiscal 2025 indicates a positive trajectory in sales and profitability, despite challenges in specific product lines and market conditions.