PRO DEX INC Files 2024 Annual Report

TL;DR

PRO DEX INC's 2024 10-K is in. Check financials for surgical instruments co.

AI Summary

PRO DEX INC filed its 10-K for the fiscal year ending June 30, 2024, reporting on its operations in the surgical and medical instruments sector. The company, formerly known as PRO-DEX, INC., is headquartered in Irvine, California. The filing covers financial data and business operations for the fiscal year 2024.

Why It Matters

This 10-K filing provides investors and stakeholders with a comprehensive overview of PRO DEX INC's financial health and strategic direction for the fiscal year 2024.

Risk Assessment

Risk Level: medium — This is a standard annual report filing with no immediate red flags or significant positive news.

Key Numbers

• FY 2024 — Fiscal Year (Reporting period for the 10-K)
• 0630 — Fiscal Year End (Indicates the end of the reporting period)

Key Players & Entities

• PRO DEX INC (company) — Filer of the 10-K
• 2024-06-30 (date) — Fiscal year end
• Irvine, CA (location) — Company headquarters
• PRO-DEX, INC. (company) — Former company name

FAQ

Key Financial Figures

• $19.8 million — At June 30, 2024, we had a backlog of $19.8 million compared with a backlog of $41.6 millio
• $41.6 million — 19.8 million compared with a backlog of $41.6 million at June 30, 2023. Our backlog represent
• $10.2 million — ecline in future revenue. Additionally, $10.2 million of our backlog at June 30, 2023 related
• $3.2 million — h and development expenses amounting to $3.2 million and $2.8 million, respectively, which c
• $2.8 m — expenses amounting to $3.2 million and $2.8 million, respectively, which costs exclud
• $224,000 — r and related expenses of approximately $224,000 and $724,000 in fiscal 2024 and 2023, r
• $724,000 — expenses of approximately $224,000 and $724,000 in fiscal 2024 and 2023, respectively,

Filing Documents

• pdex_10k-063024.htm (10-K) — 1170KB
• ex4x1.htm (EX-4.1) — 6KB
• ex21.htm (EX-21) — 1KB
• ex23.htm (EX-23) — 2KB
• ex31x1.htm (EX-31.1) — 8KB
• ex31x2.htm (EX-31.2) — 8KB
• ex32.htm (EX-32) — 4KB
• ex97.htm (EX-97) — 16KB
• 0001553350-24-000079.txt ( ) — 6437KB
• pdex-20240630.xsd (EX-101.SCH) — 55KB
• pdex-20240630_cal.xml (EX-101.CAL) — 79KB
• pdex-20240630_def.xml (EX-101.DEF) — 153KB
• pdex-20240630_lab.xml (EX-101.LAB) — 430KB
• pdex-20240630_pre.xml (EX-101.PRE) — 349KB
• pdex_10k-063024_htm.xml (XML) — 942KB

of this report

Part III of this report incorporates by reference certain information from the registrant's definitive proxy statement (the "Proxy Statement") for its 2024 Annual Meeting of Shareholders. The Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. PRO-DEX, INC. FORM 10-K FOR THE FISCAL YEAR ENDED JUNE 30, 2024 TABLE OF CONTENTS PAGE PART I ITEM 1.

BUSINESS

BUSINESS 1 ITEM 1A.

RISK FACTORS

RISK FACTORS 6 ITEM 1B. UNRESOLVED STAFF COMMENTS 13 ITEM 1C. CYBERSECURITY 13 ITEM 2.

PROPERTIES

PROPERTIES 14 ITEM 3.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 14 ITEM 4. MINE SAFETY DISCLOSURES 14 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY,RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 15 ITEM 6. RESERVED 16 ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 17 ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 25 ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 26 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 53 ITEM 9A.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 53 ITEM 9B. OTHER INFORMATION 54 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 54 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 55 ITEM 11.

EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION 55 ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 55 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 55 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 55 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 56 ITEM 16. FORM 10–K SUMMARY 59

SIGNATURES

SIGNATURES 60 i PART I CAUTIONARY NOTE REGARDING FORWARD-LOOKING This report contains forward-looking the Company's expectations, estimates or projections concerning future results or events. These statements generally can be identified by the use of forward-looking words or phrases such as "believe," "expect," "anticipate," "may," "could," "intend," "intent," "belief," "estimate," "project," "forecast," "plan," "likely," "will," "should" or similar words or phrases. These statements are not guarantees of performance and are inherently subject to known and unknown risks, uncertainties, and assumptions that are difficult to predict and could cause actual results, performance, or achievements to differ materially from those expressed or indicated by those statements. The Company cannot assure you that any of its expectations, estimates or projections will be achieved.

Forward-looking statements

Forward-looking statements included in this report are only made as of the date of this report and the Company disclaims any obligation to publicly update any forward-looking Numerous factors could cause the Company's actual results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation: loss of a significant customer, entry of new and stronger competitors, capital availability, unexpected costs, compliance with contractual obligations, failure to capitalize upon access to new customers, the ramifications of industry consolidation of medical products manufacturers, dealers and distributors, managed health care, failure to mitigate supply chain issues, market acceptance and support of new products, cancellation of existing contracts, customer "in house" production of products previously designed by and/or acquired from the Company, invalidity or unenforceability of the Company's patents and other intellectual property, maintaining favorable supplier relationships, the Company's ability to engage qualified human resources as needed, regulatory compliance, general economic conditions, and other factors described under Item 1A (Risk Factors) of this report. This list of factors is illustrative, but by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

BUSINESS

ITEM 1. BUSINESS Company Overview Pro-Dex, Inc. ("Company," "Pro-Dex," "we," "our," "us") specializes in the design, development, and manufacture of autoclavable, battery-powered and electric, multi-function surgical drivers and shavers used primarily in the orthopedic, thoracic, and craniomaxillofacial ("CMF") markets. We have patented adaptive torque-limiting technology and proprietary sealing solutions which appeal to our customers, primarily medical device distributors. We also manufacture and sell rotary air motors to a wide range of industries. Our patented adaptive torque-limiting software has been very well received in the CMF and thoracic markets and we have continued investment in this area with research and development focused on applying this technology to other surgical applications. In November 2020, we purchased an approximate 25,000 square foot industrial building in Tustin, California (the "Franklin Property"). This building is located approximately four miles from our Irvine, California headquarters and was acquired to provide us additional capacity for our expected continued future growth. We substantially completed the build-out of the property during fiscal 2022 and concluded various verification and validation activities during fiscal 2023. We moved our entire assembly and repairs operations to the new facility in the fourth quarter of fiscal 2023 and we are now fully operational in the new facility. We believe the new facility will create additional capacity for our expected continued growth over the next several years. 1 O ur principal headquarters are located at 2361 McGaw Avenue, Irvine, California 92614 and our phone number is 949-769-3200. Our Internet address is www.pro-dex.com . Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports, and certain other Securities and Exchange Commission ("SEC") filings, are available free of charge through our website as soon as r

RISK FACTORS

ITEM 1A. RISK FACTORS Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors, as well as the other information contained in this report, before deciding whether to invest in shares of our common stock. If any of the following risks actually occur, our business, financial condition, operating results, and prospects would suffer. In that case, the trading price of our common stock would likely decline and you might lose all or part of your investment in our common stock. The risks described below are not the only ones we face. Additional risks that we currently do not know about or that we currently believe to be immaterial may also impair our operations and business results. Risks Related to Our Business and the Industry in Which We Operate A substantial portion of our revenue is derived from a few customers. If we were to lose a key customer, it would have a material adverse effect on our business, financial condition, and results of operations. In fiscal 2024, our top three customers accounted for 88% of our sales, with our current largest customer accounting for 71% of our sales. This customer has made purchase commitments to us through a supply agreement to purchase surgical handpieces through calendar 2025, but there can be no assurance that this customer will extend purchase commitments to us beyond that date. The loss of, or a material reduction in purchases from, this customer or any of our significant customers would severely impact us, including having a material adverse effect on our business, financial condition, cash flows, revenue, and results of operations. A substantial portion of our business is derived from our core business area that, if not serviced properly, may result in a material adverse impact upon our business, financial condition, and results of operations. In fiscal 2024, we derived 99% of our revenue from sales of our medical device products and related services. We

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View this 10-K filing on SEC EDGAR