Definitive agreement to sell SDC business
Entered into a definitive agreement to sell SDC to Atlas Copco Group for approximately $16.9 million in cash (subject to adjustments). Management expects net cash proceeds after transaction expenses and taxes to be approximately $15 million with $900,000 held in escrow; transaction expected to close in Q2 2026. Saugerties facility will be leased to Atlas Copco for an initial 2-year term.
Planned cost reductions and transformation initiatives
Launched a transformation strategy including transitioning to outsourced fabrication for certain components, revising sales approach to leverage distributors/external reps, and completing a workforce reduction in the CVD Equipment division expected to reduce annual operating costs by approximately $1.8 million in 2026.
Full-year gross profit and margin improvement
Consolidated gross profit for fiscal 2025 was $7.3 million (28.3% gross margin) compared with $6.1 million (22.5% gross margin) in fiscal 2024 — an increase in gross margin of 5.8 percentage points, driven primarily by improved CVD Equipment margins and absence of a prior-year $1.6 million inventory write-down.
Reduction in full-year operating and net loss
Operating loss improved to $1.9 million in fiscal 2025 from $2.4 million in fiscal 2024. Net loss improved to $1.6 million ($0.23 per diluted share) in fiscal 2025 from $1.9 million ($0.28 per diluted share) in fiscal 2024.
Quarterly order activity and customer wins
Fourth-quarter orders totaled $3.5 million, driven primarily by demand in the SDC segment for gas delivery equipment and two orders from Stony Brook University for two PVT150 units, showing pockets of ongoing demand in target markets.
SDC segment sequential and year-over-year quarter improvement
SDC revenue in Q4 2025 was $2.2 million, up from $1.7 million in Q3 2025 and $1.9 million in Q4 2024, indicating sequential and year-over-year quarterly growth within the SDC segment prior to the announced sale.
Liquidity planning and 12-month runway confidence
Management reported cash and cash equivalents of $8.7 million at year-end and believes current cash plus projected cash flows (and expected proceeds from the SDC sale) will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months. Proceeds are intended to be initially invested in U.S. Treasury securities.