Company: ZRCN
Filing Date: 2025-09-10
Form Type: 10-K
Source: 0001641172-25-027037
Chunk: 654

Company: ZRCN Inc.
Filing Date: 2025-09-10
Form: 10-K
Item: Item 5
Chunk 654
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 deferred tax assets. The
Company recorded this valuation allowance as a result of net losses recorded during recent fiscal years.

Cash
Flow Analysis

    For
    the Years Ended March 31, 
  
    In thousands 
    2025  
    2024 
  
    Operating activities 
    $2,153  
    $1,184 
  
    Investing activities 
     (788) 
     (1,169)
  
    Financing activities 
     (667) 
     590 
  
    Effect of exchange rate
    changes 
     207  
     (132)
  
    Net
    increase (decrease) in cash 
    $905  
    $473 

Operating
Activities

During
the year ended March 31, 2025, net cash provided by operating activities was $2.2 million. This increase was due to a decrease in accounts
receivable of $2.3 million, a decrease in inventory and prepaids of $1.0 million, depreciation of $1.0 million, amortization of intangibles,
right-of-use assets, and deferred financing costs of $0.4 million, inventory obsolescence impairment of $0.6 million, provision for credit
losses of $0.2 million, stock based compensation of $0.3 million, a reduction in deferred tax assets of $0.5 million, and a reduction
in tax deposits of $0.2 million all offset by a net loss of $2.9 million, a decrease in accounts payable and accrued expense of $1.0
million, a decrease in lease liabilities of $0.2 million, and a foreign exchange gain of $0.2 million.

During
the year ended March 31, 2024, net cash provided by operating activities was $1.2 million. This increase was due to net income of $51,000,
non-cash expenses for depreciation, amortization, and inventory obsolescence impairment of $1.3 million, provision for bad debt and foreign
currency losses of $89,000, a decrease in prepaids and other assets of $0.2 million, and common stock issued for advisory services of
$0.1 million, an increase in accounts payable and accrued expenses and other current liabilities of $2.8 million, offset by an increase
in accounts receivable of $1.1 million, an increase in inventory of $1.4 million