Fri, Mar 28, 7:04 PM (29 days ago)
**Chicago Rivet & Machine Co. (CVR) 2024 Annual Report Summary** **Financial Performance:** - **Revenue:** $26,986,627 (down 14% from $31,507,722 in 2023). - **Net Income:** Net loss of $5,615,614 (or $5.81 per share), compared to a net loss of $4,401,584 (or $4.56 per share) in 2023. - **Operating Expenses:** $6,224,234 (up 19% from $5,237,656 in 2023). - **Earnings per Share:** Basic and diluted loss of $5.81, compared to a loss of $4.56 in 2023. **Strategic Overview:** - **Segments:** Operates in two segments: fastener and assembly equipment. - **Market:** Primarily serves the North American automotive industry. - **Challenges:** Faces intense competition, dependency on major customers, and risks related to export sales and raw material costs. **Future Outlook:** - **Strategic Actions:** Implementing measures to improve liquidity, increase operating efficiency, and ensure business continuity. - **2025 Outlook:** Economic environment remains challenging, but the company is positioned to manage uncertainty and drive improved operating results. **Risk Factors:** - **Financial Condition:** Substantial doubt about the ability to continue as a going concern due to recurring operating losses and negative cash flows. - **Market Risks:** Dependency on the automotive industry, intense competition, and risks related to export sales and raw material costs. - **Operational Risks:** Supply chain disruptions, labor shortages, and potential product liability claims. **Financial Condition:** - **Liquidity:** Working capital decreased by $3,605,649, with a decline in net accounts receivable and inventory. - **Cash Flow:** Negative cash flows from operations, with strategic actions aimed at improving liquidity. - **Debt:** Entered into a new credit agreement with restrictive covenants. **Market Position Changes:** - **Customer Concentration:** Sales to top three customers accounted for approximately 35% of consolidated revenues in 2024. - **Export Sales:** Increased export sales, subject to risks related to tariffs and foreign currency exchange rate fluctuations. **Key Financial Data:** - **Cash and Cash Equivalents:** $1,922,679 at the end of 2024. - **Total Assets:** $23,370,174 (down from $27,830,905 in 2023). - **Total Liabilities:** $3,337,722 (up from $1,864,016 in 2023). - **Shareholders' Equity:** $20,032,452 (down from $25,966,889 in 2023). **Dividends:** - Paid four regular quarterly dividends in 2024 totaling $0.33 per share. - Declared a regular quarterly dividend of $0.03 per share for the first quarter of 2025. **Capital Expenditures:** - Total capital expenditures in 2024 were $651,398, with investments in fastener and assembly equipment segments. **Property and Leases:** - Relocated headquarters to Warrenville, Illinois, with a new lease agreement starting March 1, 2025. - Sold Albia, Iowa facility, generating net cash proceeds of approximately $678,000. **Cybersecurity:** - Established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats. **Internal Control:** - Identified a material weakness in internal control over financial reporting related to inventory valuation. - Implementing remediation plans to address the weakness. **Governance:** - Board of Directors and executive officers information included in the 2025 Proxy Statement. - Code of ethics adopted for principal executive and financial officers. **Conclusion:** Chicago Rivet & Machine Co. faces significant financial challenges but is implementing strategic actions to improve liquidity, increase operating efficiency, and ensure business continuity. The company's future outlook depends on its ability to navigate market uncertainties and execute its strategic plans.