Company: OCC
Filing Date: 2025-06-05
Form Type: 10-Q
Source: 0001437749-25-019494
Chunk: 48

Company: OPTICAL CABLE CORP
Filing Date: 2025-06-05
Form: 10-Q
Item: Item 1
Chunk 48
---
 the end of the first half of fiscal year 2025, our sales order backlog/forward load increased to $7.2 million when compared to $6.6 million as of January 31, 2025, and $5.7 million as of October 31, 2024.

Net sales for the first half of fiscal year 2025 were positively impacted by general market improvements in our industry overall, as well as in our military markets specifically.

Gross Profit

Our gross profit was $10.0 million in the first half of fiscal year 2025, an increase of 28.5% compared to gross profit of $7.8 million in the first half of fiscal year 2024. Gross profit margin was 29.9% in the first half of fiscal year 2025 compared to 25.0% in the first half of fiscal year 2024.

Gross profit margin for the first half of fiscal 2025, when compared to the same period last year, was positively impacted by higher volumes, as fixed charges were spread over higher sales—the impact of operating leverage. Additionally, our gross profit margin percentages are heavily dependent upon product mix on a quarterly basis and may vary based on changes in product mix.

Selling, General, and Administrative Expenses

SG&A expenses increased 7.6% to $11.2 million during the first half of fiscal year 2025, compared to $10.4 million for the same period last year. SG&A expenses as a percentage of net sales were 33.6% in the first half of fiscal years 2025 and 2024.

The increase in SG&A expenses during the first half of fiscal year 2025 compared to the same period last year was primarily the result of increases in employee and contracted sales personnel-related costs totaling $339,000 and shipping costs totaling $168,000. Included in employee and contracted sales personnel-related costs are compensation costs and sales incentives. Compensation costs increased due to new hires, net of terminations, and certain rate increases. Sales incentives and shipping costs increased primarily due to increases in net sales.

Royalty Income (Expense), Net

We recognized royalty expense, net of royalty income, totaling $13,000 during the first half of fiscal years 2025 and 2024. Royalty income and/or expense may fluctuate based on sales of related licensed products and estimates of amounts for non-licensed product sales, if any.

21

Amortization of Intangible Assets

We