Keytronic Corp. Files 2024 Annual Report

TL;DR

Keytronic Corp. filed its 2024 10-K, total assets $10.76M. Check financials.

AI Summary

Keytronic Corp. filed its 10-K for the fiscal year ending June 29, 2024, reporting total assets of $10,761,871. The company, incorporated in Washington, operates in the Printed Circuit Boards industry. This filing provides a comprehensive overview of its financial performance and business operations for the past fiscal year.

Why It Matters

This 10-K filing provides investors and stakeholders with a detailed look at Keytronic Corp.'s financial health and operational performance for the fiscal year ending June 29, 2024.

Risk Assessment

Risk Level: low — This filing is a standard annual report and does not contain immediate red flags or significant negative news.

Key Numbers

• $10,761,871 — Total Assets (Reported for the fiscal year ending June 29, 2024.)

Key Players & Entities

• KEY TRONIC CORP (company) — Filer
• 0000719733 (company) — Central Index Key
• WA (location) — State of Incorporation
• SPOKANE (location) — Business Address City
• 20240629 (date) — Fiscal Year End

FAQ

Key Financial Figures

• $249.6 m — er backlog was valued at approximatel y $249.6 million, compared to approximately $343.0
• $343.0 million — 49.6 million, compared to approximately $343.0 million on July 1, 2023. The amount of backlog

Filing Documents

• ktcc-20240629.htm (10-K) — 1800KB
• keytronic-2024rsugrant.htm (EX-10.2) — 183KB
• gatesconsultantagreementfi.htm (EX-10.8) — 50KB
• larsenemploymentagreement.htm (EX-10.9) — 53KB
• voorheesemploymentagreement.htm (EX-10.10) — 38KB
• q42024exhibit21ng.htm (EX-21.1) — 8KB
• q42024exhibit231.htm (EX-23.1) — 2KB
• q42024exhibit311ng.htm (EX-31.1) — 10KB
• q42024exhibit312.htm (EX-31.2) — 10KB
• q42024exhibit321ng.htm (EX-32.1) — 5KB
• q42024exhibit322ng.htm (EX-32.2) — 5KB
• ktcc-clawbackpolicyfinal11.htm (EX-97.1) — 33KB
• 0000719733-24-000113.txt ( ) — 11060KB
• ktcc-20240629.xsd (EX-101.SCH) — 49KB
• ktcc-20240629_cal.xml (EX-101.CAL) — 95KB
• ktcc-20240629_def.xml (EX-101.DEF) — 254KB
• ktcc-20240629_lab.xml (EX-101.LAB) — 700KB
• ktcc-20240629_pre.xml (EX-101.PRE) — 537KB
• ktcc-20240629_htm.xml (XML) — 1973KB

Risk Factors

Item 1A. Risk Factors 9

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 17

Cybersecurity

Item 1C. Cybersecurity 16

Properties

Item 2. Properties 19

Legal Proceedings

Item 3. Legal Proceedings 20

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 20 PART II Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities 20

[Reserved]

Item 6. [Reserved] 21

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures about Market Risk

Item 7A. Quantitative and Qualitative Disclosures about Market Risk 31

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 32

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 64

Controls and Procedures

Item 9A. Controls and Procedures 64

Other Information

Item 9B. Other Information 66 PART III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 66

Executive Compensation

Item 11. Executive Compensation 66

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 66

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 67

Principal Accounting Fees and Services

Item 14. Principal Accounting Fees and Services 67 PART IV

Exhibits and Financial Statement Schedule

Item 15. Exhibits and Financial Statement Schedule 67

Form 10-K Summary

Item 16. Form 10-K Summary 70

Signatures

Signatures 71 3 EXPLANATORY NOTE In connection with the preparation of this Annual Report on Form 10-K, Key Tronic Corporation (the "Company") concluded that cost recovery of material price variances was not being consistently recorded across its facilities. Material price variance occurs when the price the Company pays for materials exceeds the price quoted to customers, and the Company typically recovers the excess cost from customers through a sales price adjustment. Per Company policy, this cost recovery should be recorded as revenue when inventory enters the production process, however, certain of the Company's facilities were recording the cost recovery as a reduction to cost of goods sold. These errors resulted in an understatement of both revenue and cost of goods sold in fiscal 2024 and prior periods. On October 9, 2024, the Company's Audit Committee of the Board of Directors, after discussion with Company management and the Company's independent registered public accounting firm, concluded that the following previously issued financial statements of the Company should no longer be relied upon because of the errors related to the recording of cost recovery: (1) the consolidated financial statements as of and for the years ended July 1, 2023 and July 2, 2022 included in the Company's Annual Report on Form 10-K for the fiscal year ended July 1, 2023 and (2) the unaudited consolidated statements of operations for the quarters ended March 30, 2024, December 30, 2023, September 30, 2023, April 1, 2023, December 31, 2022, October 1, 2022, April 2, 2022, January 1, 2022, and October 2, 2021 included in the Company's Quarterly Reports on Form 10-Q for such periods. Also in connection with preparing this Annual Report on Form 10-K, the Company concluded that it had not recorded an adjustment related to its adoption on July 2, 2023 of ASU 2016-13 Financial Instruments - Credit Losses (ASU 326): Measurement of Credit Losses on Financial Instruments. As of Jul

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS References in this report to "the Company," "Key Tronic," "we," "our," or "us" mean Key Tronic Corporation together with its subsidiaries, except where the context otherwise requires. This Annual Report on Form 10-K contains forward-looking statements in addition to historical information. Forward-looking statements include, but are not limited to those including such words as aims, anticipates, believes, continues, could, estimates, expects, hopes, intends, plans, predicts, projects, targets, or will, similar verbs, or nouns corresponding to such verbs, which may be forward looking. Forward-looking statements also include other passages that are relevant to expected future events, performances, and actions or that can only be fully evaluated by events that will occur in the future. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Risks and uncertainties that might cause such differences include, but are not limited to those outlined in "Management's Discussion and Analysis of Financial Condition and Results of Operations—Risks and Uncertainties that May Affect Future Results" and in "Risk Factors." Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management's opinions only as of the date hereof. The Company undertakes no obligation to update forward-looking statements to reflect developments or information obtained after the date hereof and disclaims any obligation to do so. Readers should carefully review the risk factors described in periodic reports the Company 4 files from time to time with the Securities and Exchange Commission, including Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. PART I

BUSINESS

Item 1. BUSINESS Background Key Tronic Corporation was organized in 1969, as a Washington corporation that locally manufactured computer keyboards. The ability to design, build and deliver a quality product led us to become a leading independent manufacturer of keyboards for computers in the United States. Our fully integrated design, tooling, and automated manufacturing capabilities enabled us to rapidly respond to customers' needs for keyboards in production quantities worldwide. We supported our sales growth through the development and purchase of international manufacturing facilities. As the computer keyboard market matured with increasing competition from other international providers, we determined that our business could no longer solely rely on keyboard sales. After assessing market conditions and our strengths and capabilities, we shifted our focus from keyboard manufacturing to contract manufacturing for a wide range of products. Our unique strategic attributes are based on our core strengths of innovative design and engineering expertise in electronics, mechanical engineering, sheet metal fabrication and stamping, and precision plastics combined with high-quality, low cost production, and assembly on an international basis while providing exceptional customer service. These strengths have made our company a strong competitor in the contract manufacturing market. Our Industry and Strategy The expansion of the contract manufacturing industry and our acquisitions have allowed us to continue to expand our customer base and the industries that we serve. The increase in new programs represents a growing portion of our revenue and a promising foundation for our future. In keeping with our long-term strategic objectives, we have been successfully building a more diversified customer portfolio, spanning a wider range of industries. We currently offer our customers the following services: integrated electronic and mechanical engineering, precision plastic mo

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