Graham Corporation (NYSE: GHM) (“GHM” or the “Company”), a global leader in the design and manufacture of mission-critical fluid, power, heat transfer and vacuum technologies for the defense, space, energy and process industries, today reported financial results for its first quarter ended June 30, 2023 (“first quarter fiscal 2024”).
Daniel J. Thoren, President and Chief Executive Officer, commented, “We had a better-than-expected start to the year with strong first-quarter results. We had improved execution, utilized our expanded capacity and are timely delivering to customer requirements, even as schedules may shift. We also benefited in the quarter from an unusually better mix of business and the timing of projects flowing through production. Importantly, we continue to strengthen our relationships with our defense customers, advance opportunities in the space industry and are positioning the business to serve the new energy markets with cryogenic solutions. The investments we made to meet defense customers’ delivery requirements have proven to be effective and was validated by the $13.5 million strategic investment we received to expand our capabilities and be ready to support future opportunities, if selected. We have earned the position of being a key strategic supplier to support the Naval Nuclear Propulsion Program.”
Separately, the Company announced today that it had received a strategic investment by a customer to expand production capabilities at its Batavia, New York facility.
He added, “While we delivered in the quarter, there is still much work to do to get where we need to be as an organization. We are making investments in infrastructure, information systems and people. We are evolving the culture of the Company as well. I have been excited to see how our teams are questioning and challenging each other. Everyone is stepping up to own our future. While we have made measurable progress these last two years, we will continue to drive to advance our operations to deliver on our goals to exceed $200 million in revenue and achieve low to mid-teen adjusted EBITDA margins by fiscal 2027.”
First Quarter Fiscal 2024 Performance Review(All comparisons are with the same prior-year period unless noted otherwise.)
($ in millions except per share data)
*Graham believes that adjusted EBITDA (defined as consolidated net income before net interest expense, income taxes, depreciation, amortization, other acquisition related expenses (income), and other unusual/nonrecurring expenses), and adjusted EBITDA margin (adjusted EBITDA as a percentage of net sales), which are non-GAAP measures, help in the understanding of its operating performance. Moreover, Graham’s credit facility also contains ratios based on adjusted EBITDA as defined in the lending agreement.Graham also believes that adjusted net income and adjusted diluted net income per share, which excludes intangible amortization, other costs related to the acquisition, and other unusual/nonrecurring (income) expenses, provides a better representation of the cash earnings of the Company.See the attached tables and other information on pages 10 and 11 for important disclosures regarding Graham’s use of adjusted EBITDA, adjusted EBITDA margin, adjusted net income, and adjusted diluted net income (loss) per share, as well as the reconciliation of net income to adjusted EBITDA, adjusted net income, and adjusted diluted net income per share.
Net sales of $47.6 million increased 32%, or $11.5 million. Growth in the defense market, as well as improvements in the commercial aftermarket, more than offset softness in the refining industry and declines in the space market. Aftermarket sales to the refining and petrochemical markets were $9.2 million, up 49%. See supplemental data for a further breakdown of sales by market and region.
Compared with the prior year period, the 63% increase in gross profit and 440 basis point expansion of gross margin reflected higher margin projects, improved pricing, timing of material receipts and improving execution.
Selling, general and administrative expense (“SG&A”), inclusive of amortization, in the first quarter of fiscal 2024 was $7.3 million, or 15% of sales, up $1.5 million over the prior-year period. Approximately $0.9 million of the increase was attributable to higher performance-based compensation expense, including $0.8 million related to the supplemental performance bonus payout to Barber Nichols employees in connection with the 2021 acquisition.
Net income nearly tripled to $2.6 million, or $0.25 per diluted share. On a non-GAAP basis, adjusted net income* and net income per diluted share* were $3.6 million and $0.33, respectively, compared with $1.3 million and $0.12 during the same period a year ago.
Cash Management and Balance Sheet
Cash generated from operations in the first quarter was $8.6 million. Cash and cash equivalents on June 30, 2023, were $24.7 million up from $18.3 million on March 31, 2023. Capital expenditures for the first quarter of fiscal 2024 were $1.5 million.
Debt at quarter end was down $0.4 million to $11.3 million compared with March 31, 2023. As of June 30, 2023, the Company was in compliance with its lending agreement with a leverage ratio as calculated in accordance with the terms of the credit facility of 1.6x. At June 30, 2023, the amount available under the revolving credit facility was approximately $26 million to support organic growth initiatives.
Orders and Backlog
Orders for the three-month period ended June 30, 2023, were up $27.6 million, or 69%, to $67.9 million compared with $40.3 million for the same period of fiscal 2023. Included in orders and backlog is the $13.5 million strategic investment from a major defense customer which the Company announced separately today. The purpose of the investment is to expand its Batavia production capabilities for complex defense components including delivering on $8.5 million follow on orders received from that customer.
Aftermarket orders for the refining and petrochemical markets were $7.9 million in the first quarter fiscal 2024, down from $10.1 million in the first quarter fiscal 2023 and lower than the $9.3 million in orders received in the fourth quarter of fiscal 2023.
Backlog for the quarter was $322.0 million, up 24% compared with the prior-year period and up 7% compared with the end of the trailing fourth quarter of fiscal 2023. Approximately 50% of orders currently in backlog are expected to be converted to sales in the next twelve months and another 25% to 30% is expected to convert to sales over the following year. The majority of orders expected to convert beyond twelve months are for the defense industry, specifically the U.S. Navy.
Christopher J. Thome, Vice President and Chief Financial Officer, noted, “The strategic investment we received from our defense customer is recorded in backlog and represents pre-payment on current and potential future orders. The cash investment will be used to expand our capabilities and positions us to meet our customer’s requirements and support the U.S. Navy’s shipbuilding schedule.”
Join Batavian Tony Johnson on Saturday, August 12 at 10 a.m. in the Reading Room at Richmond Memorial Library for a book talk and signing.
Tony will discuss his epic fantasy series, "The Story of Evil." The event will include a talk, Q&A, and book signing. There will be book giveaways, cookies made by Simply Scrumptious, customized bookmarks, and more!
Books in the series include "Heroes of the Siege," "Escape from Celestial," "Three Visions," "The Cursed King," and "Battle for the Kingdom." Tony published the first volume in the series in 2013.
Copies of the book will be available to purchase and will also be available to check out from Richmond Memorial Library.
Tony Johnson is the author of "The Story of Evil," a five-part epic fantasy saga. Tony is an avid reader who enjoys fantasy, classics, and Christian literature. He is a fan of movies, video games, and football, and loves being a husband and father.
This event is free to attend and all are welcome.
Richmond Memorial Library is located at 19 Ross St., Batavia. For more information about the library, visit batavialibrary.org.
Photo of It’s A Me Mario courtesy of Ken Weingartner.
The most anticipated division of New York Sire Stake horses will be at Batavia Downs on Tuesday (August 8). That’s when the 3-year-old pacing colts and geldings will assemble for one, $119,800 dash that headlines a 14-race card beginning at 6 p.m.
The track handicapper has given the nod to Metal Man as the early choice, a horse that has shown some great speed this year, but also inconsistency.
Metal Man (Huntsville-Apple Delight) was unraced at two, but started his 3-year-old season a winner in an overnight at the Meadowlands in 1:52.3. In his next start he broke and then was subsequently scratched in back-to-back races. He qualified back after five weeks off and then won back to back overnight races at Yonkers, one in 1:52.4 over the hilltop half mile. Since that time he has made consecutive breaks again and was forced to qualify on July 12. He just won his last outing in another overnight at Yonkers in 1:53.2, but he has yet to win a NYSS event.
Jim Morrill Jr. will be up behind Metal Man for the first time for trainer Travis Alexander and has drawn post five.
It’s A Me Mario (American Ideal-Nf Salsa) is one of only two horses in this race that has won a NYSS event this year and has already faced the best 3-year-olds in the country. After starting the year with four straight wins at Yonkers, It’s A Me Mario won his first NYSS event at Vernon in a lifetime best 1:49.4 effort to run his streak to five. He then headed to the Grand Circuit and had some bad draw and racing luck. In the Messenger at Yonkers he drew post seven and was 11-¼ lengths off the leader at the quarter before taking air for almost the rest of the mile. Then in the Meadowlands Pace elimination, he drew post seven again but was able to finish a very impressive third, timed in 1:48.3. Then in that final, It’s A Me Mario drew post eight, was tenth at the half and chased an impossible :52.2 back half and :25.4 last quarter set by Confederate. His next outing was a NYSS race at Monticello where he drew post seven and was interfered with before the quarter, but still was able to grab a check.
He still drew post six in here, but It’s A Me Mario looks for some better racing luck this week for driver Lauren Tritton who will steer for trainer Shane Tritton.
The other NYSS winner from this year is Duval Street (Huntsville-Native Bride) who got that 1:52.4 tally at Saratoga on June 24, but that wasn’t his best outing of the season. Duval Street has a pair of 1:50.2 victories; one at the Meadows in a 7-½ length romp and one at Mohegan Sun Pocono. He finished third in his last two starts, which were both NYSS events, behind Thunder Hunter Joe and Storm The Court, neither of which are entered here this week. His versatility allows him to either leave or race from behind, giving him a big advantage if the inside speed develops early.
Regular driver Jason Bartlett is back behind Duval Street for trainer Ed Hart and they will start from post three.
There are also three $20,000 NYSS Excelsior divisions on the program and those splits will be contested in races six, seven, and eight. The NYSS main event is carded as race 10.
Free full past performance programs for every live card of racing at Batavia can always be downloaded at the Downs’ website (bataviadownsgaming.com) under the “Live Racing” tab and all the racing action can be viewed as it happens for free at the Batavia Downs Live Facebook page.
Photo of Dewanslittlelorie courtesy of Wendy J. Lowery.
The Batavia Downs spotlight shone brightly on Joe Chindano Jr. Saturday night (August 5) as he trained and drove the winners of both weekly features while producing one record-breaking performance in the process.
First, in the $15,000 Open, I trot, Chindano won with Dewanslittlelorie, who was the lone mare in the race that showed up the boys as she went gate to wire in track record time.
Dewanslittlelorie had little trouble grabbing the lead from post two and cruised in command to the quarter in :28 flat. As Con Air Hall (Jim Morrill Jr.) tracked from the garden spot, Johnny Boy (Kevin Cummings) mounted an outside attack from fourth at the half and pushed the three-quarters to 1:25.3. But that didn’t put a crimp in Dewanslittlelorie’s plans as she rebuffed the challenge before she rounded the last turn. Dewanslittlelorie entered the lane comfortably on top and stretched out to a 2-¼ length margin of victory in 1:55.2.
The winning time established a new Batavia Downs track record for an aged trotting mare (1:56.1).
It was the third win in the last four starts and the fifth win overall this year for Dewanslittlelorie ($5.30) who is owned by Fox Racing and RBH Ventures.
Then in the $15,000 Open I Handicap pace, Chindano lit up the board with Villiam, who brushed late to victory in a thrilling finish.
Villiam got away seventh and trailed the leading Mark Witha K (Todd Cummings) by 11-¼ lengths at the quarter. While Out On Bail (Jim Morrill Jr.) followed closely in second, Mark Witha K paced sharply on the point to the half where Rally Your Crew (Denny Bucceri) made a first-over bid with Villiam following loosely behind in the breeze. Rally Your Crew’s bid fell apart midway up the backstretch, forcing Villiam three-deep before the three-quarters. As the group passed that station, Mark Witha K was still in command by over a length while Out On Bail tipped out, forcing Villiam three-deep again. Heading for the line, Mark Witha K was still the one to catch and Villiam was the one to do it, as he flew down the track and tripped the beam first in 1:54.3 in a seasonal best effort.
It was also the fifth win of the year for Villiam ($20.20) and owner Anthony Evgenikos.
Jim Morrill Jr. and Dave McNeight III both had driving triples on Saturday.
When live racing resumes at Batavia Downs on Tuesday (Aug. 8) at 6 p.m., there will be a $1,662 carryover in the Jackpot Hi-5 pentafecta in the 14th race. Also on Tuesday, the New York Sire Stakes will be back in town featuring the 3-year-old pacing colts and geldings going one division for a hefty purse of $119,800.
Free full card past performance programs for every live card of racing at Batavia can always be downloaded at the Downs’ website (bataviadownsgaming.com) under the “Live Racing” tab and all the racing action can be viewed as it happens for free at the Batavia Downs Live Facebook page.
The Fargo Road Bridge Replacement Project is set to commence on August 14, bringing essential improvements to the bridge located over Black Creek near Route 63 and Little Canada Extension.
The current 11-foot-wide jack arch bridge will be replaced with a modern 28-foot precast concrete arch bridge to meet hydraulic capacity requirements. This upgrade is crucial for maintaining smooth truck routes, as Fargo Road serves as a superload route within the County.
The project is locally funded, with Ravi Engineering in Rochester leading as the Engineer and LC Whitford as the Contractor. Construction is planned to continue diligently until the end of November.
Fargo Road will be closed during the construction period for the safety of motorists and construction workers. However, a well-marked detour will be in place to guide motorists and trucks efficiently.
Seven-on-seven flag football returns to Batavia on Aug. 27 for a cash-prize tournament for teams of seven to 13 players.
The tournament is being organized by Ray Williams, Thomas Ognibene, and Noah Talone.
Team sign-ups are being accepted up until the week of the tournament, and the cost is $650 per team.
The total cash prize for the winning team will be announced once organizers know how many teams are participating. In the past, the first-place prize has been $2,500.
Participants receive a team shirt.
For more information, call Ray at 585-356-5956, Thomas at 585-297-9409, or Noah at 585-813-8733.
The Batavia Society of Artists is hosting artist Karen Crittenden at 7 p.m. this Tuesday at GO ART!/Seymour Place, 201 E. Main St., Batavia.
Karen will be doing a hands-On Gelli Plates and Alcohol Inks demonstration. All materials will be provided at no cost. Refreshments are provided. Non-members are welcome for a $5 fee. The 2.o.1. Tavern will be open for cash purchases.
Please join us for a fun and interesting evening of making art! Any questions, please call Teresa Tamfer at 585-506-2465.
Notre Dame High School is proud to announce its 2023 Sports Hall of Fame Class. The Induction program will be held on Saturday, November 18 on the Notre Dame campus.
The program will begin with a social hour and dinner with the Induction recognition portion to follow.
Inductees to be honored on November 18, 2023 are:
Jimmy Fanara '67 Coach & Contributor
John Borrelli '86 Athlete
Jeff “Bingo” Messina '87 Athlete
Margaret Dwyer Niedzwiecki '88 Athlete
Carolyn Dwyer Babcock '91 Athlete
Maura Flynn Sprague '00 Athlete
1999 NYSPHSAA NYS and NYS Federation Girls Basketball State Championship Team
Ticket information for the November 18th Induction Program will be announced shortly.
The Genesee and Orleans County Health Departments (GO Health) are offering free drive-thru rabies vaccination clinic in August.
The Genesee County Rabies Vaccination Clinic will be held on August 10 from 4-6:30 p.m. at the Genesee County Fairgrounds (5056 East Main Street, Batavia)
Vaccinations are free for dogs, cats, and ferrets. Animals must be at least 3 months old. Each animal must be leashed or crated and accompanied by an adult who can control the animal. Limit 4 pets per car maximum.
“Rabies continues to be a public health issue in Genesee and Orleans Counties,” stated Paul Pettit, Public Health Director for GO Health. “We urge pet owners to take this opportunity to ensure their pets are protected against rabies.”
For more information on GO Health’s programs and services, visit GOHealthNY.org. You can also contact the Genesee County health department at 585-344-2580 x5555 or Health@co.genesee.ny.us.
New Listing - 3473 W. Main St. Road, Batavia (Town). Great opportunity and great home for the person who is looking for move-in ready home – whether starting out or downsizing! This solid three bedroom home is located in the Town of Batavia, and the Pembroke School System, and minutes from all the shopping and restaurants! This home has a great remodeled large kitchen with huge center island for the cook or just to gather around! Tons of cupboards and a large pantry closet. There is also pretty tongue and groove full dining room with slider door to awesome yard! Large living room, first floor bedroom, first floor laundry, and first floor bath and attached powder room!! Two bedrooms are located on second floor. 200 Amp electrical system, central air, public water & sewer are a definite bonus and besides awesome location! This home sits on pretty and deep lot with detached garag, a large Amish built barn that has heat, electric with loft area and is perfect for the hobbyist or great place to just hang out!! Priced affordably and ready to go! Easy to see immediately. Call Reliant Real Estate now, call 585-344-4663.
GLOW Corporate Cup organizer Steve Tufts last week with the Corporate Cup at the official Genesee County Fair's Media Center. Photo by Howard Owens.
When the runners take the line today for the 10th GLOW Corporate Cup at Centennial Park Thursday evening, at least a dozen of the participants will share the rare distinction of being the only ones to take to the track every year of the event.
That will make them part of a fundraiser that will surpass this year's $200,000 in cumulative donations to the GLOW YMCA since 2014.
Close to 800 runners and walkers are expected to complete the 5K track, said race organizer Steve Tufts.
Tufts has organized the race since the first year, because Merrill Lynch office partner John Riter approached him about organizing a corporate challenge style 5K more than a decade ago. Riter came to Tufts because Tufts had experience laying out courses and ensuring they obtain 5K certification.
"The thing that makes the GLOW Cup unique is we entertain people," Tufts said. "We bring live music. This year it's Groove, a local band, and it's always a local band, and most of the teams bring their own food, have it catered, or cook right on site. It's like a corporate picnic built right into Centennial Park."
A twist this year to the race is the "couples challenge," or as it's known at the Corporate Cup, the "CUPles Challenge." The three married couples with the lowest cumulative times will win prizes, with a random drawing prize that all couples, regardless of time, are eligible to win.
Tufts said some smaller companies now use the Corporate Cup as their company's annual picnic, saving the expense of doing a separate event. One local company used to set up their own horseshoe pits each year.
"It's different things to different people," Tufts told The Batavian last week while visiting the Media Center at the Genesee County Fair. "But I think the thing that makes it successful is it's the GLOW region, and people do enjoy a night where they're not heading all the way over to the Rochester or Buffalo areas. This is in our back yard. From a runner's perspective, people do like the course because it's super fast. It is accurate. It's a certified course, which means it's an accurate distance, but it's not eligible for World Records, I'm sorry to say, because it's got a little bit too much down elevation for the distance. That is because we start out by the Blind School, and it goes down the hill down to Northside Deli and then turns left, and then it's pretty flat after that. So, just a little bit too much down for USA Track and Field Conference."
The certification expires in 2024, so Tufts plans to alter the course to start closer to State Street and end the race further up Ellicott Avenue, which should solve the elevation problem, just in case anybody wants to try and set a world record for his or age bracket.
Merrill Lynch chose the GLOW YMCA because the Y, like the Batavia Merrill Lynch office, serves the entire GLOW region.
The bonus is, the Y comes with a built-in set of volunteers.
"Right now, I'd say I wouldn't want it any other way," Tufts said. "I'm not sure how long I would get 70 people out on my course keeping people safe (without the Y). So it's been a great partnership."
Corporate sponsors help cover event expenses, which ensures all of the $25 entry fees go to the Y, Tufts said. Because of corporate sponsors, the organizers have been able to maintain the $25 entry fee, so it remains affordable for small businesses and individuals.
In the first year of the race, Tufts said they were expecting about 350 participants. They had more than 400. It went up every year until more than 800 in 2019, the last race before the pandemic. There was no race in 2020, and in 2021 numbers were down. In 2021, there were more than 700 again, but Tufts doesn't expect to exceed 800 this year because race participation across the nation, he said, is down since the pandemic.
The event has drawn a lot of sponsor support this year, and with anticipated participation from runners and walkers, Tufts expects to raise more than $25,000 for the Y this year, stopping the 2019 record of $23,005.
Last year was the second-best year at $22,963.
Going into this year, the cumulative total was nearly $180,000 raised.
K of C members Tom Trescott and Grand Knight Ken Mullen present a scholarship check to Principal Karen Green of St. Joseph School. Photo by Steve Ognibene
In 2019, The Msgr. Kirby Knights of Columbus Council 325 graciously offered to start a yearly scholarship fund to celebrate and recognize some of St. Joseph Regional School's students. The recipients are nominated by the school staff and the awards are presented at the End of the Year Awards Ceremony. Two students are chosen in grades K-6 and are nominated using the following criteria:
Students who have achieved satisfactory progress and are hard working;
participation in school activities;
a dedication to strong Christian values; and
a spirit of enthusiasm.
St. Joseph Regional School has received $17,500 over the last 5 years due to the support of the Knights of Columbus. Each year we are honored to recognize some of our most deserving students and are proud of the partnership and commitment the Knights have shown to St. Joseph Regional School for many years.
K of C members along with Grand Knight Ken Mullen present a scholarship check to Notre Dame business administrator Thomas Rapone. Photo by Steve Ognibene
The Knights of Columbus have supported Notre Dame High School and her wonderful students for over 30 years. Most recently their contributions have helped with building improvements, classroom and technology upgrades, beautification of our campus, and most importantly, tuition support scholarships.
The scholarships provided by the Knights support our mission that the incredibly unique and wonderful Notre Dame experience should be available to all families throughout the region regardless of their financial position. These scholarships have helped over 100 students graduate from Notre Dame that otherwise would not have been able to attend. The results of this investment in Notre Dame students can be seen daily here on campus with the many happy faces currently attending, as well as out in the community where Knights-funded Notre Dame graduates are making a positive daily impact throughout the Genesee Region.
At Notre Dame High School we take great pride in being the #1 Ranked High School in the entire GLOW Region, and we have equal pride in our longstanding relationship with the Knights of Columbus.
Information above by Karen Green, principal of St. Joseph School, and Business Administrator Thomas Rapone of Notre Dame High School.
176 students from Genesee Community College were named to Dean's List. Students honored on the Dean's List have maintained full or part-time enrollment and earned a quality point index of 3.50 to 3.74.
No parking signs have temporarily been posted on Bank Street in Batavia, in preparation for the annual GLOW Corporate Cup 5K, which is set for 6 p.m. Thursday at Centennial Park. Racers will take off from Richmond Avenue eastward and turn onto Bank Street along a three-mile route that ends up back at the park for some mingling, food and fun. Photo by Joanne Beck
On Thursday, Aug. 3, Fairmont Avenue, Hart Street, and Norris Avenue (between State Street and Bank Street) in the City of Batavia will be getting paved. This project is expected to be between the hours of 7 a.m. and 5 p.m.
Residents and businesses are asked not to park on the street during this time. This is weather-dependent work and will be scheduled for the next business day if necessary.
Contact the Bureau of Maintenance and ask to speak to the Streets Supervisor or the Superintendent at 585-345-6400 opt. 1 if you have any questions. Thank you for your cooperation in advance.
