Company: BKTI
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001437749-25-009464
Chunk: 467

Company: BK Technologies Corp
Filing Date: 2025-03-27
Form: 10-K
Item: Item 2
Chunk 467
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 from capitalized research and development expenses and deferred revenue.

In order to fully utilize the net deferred tax assets, we will need to generate sufficient taxable income in future years. We analyze all positive and negative evidence to determine if, based on the weight of available evidence, we are more likely than not to realize the benefit of the net deferred tax assets. The recognition of the net deferred tax assets and related tax benefits is based upon our conclusions regarding, among other considerations, estimates of future earnings based on information currently available and current and anticipated customers, contracts, and product introductions, as well as historical operating results and certain tax planning strategies.

Based on our analysis of all available evidence, both positive and negative, we have concluded that, except for the capital loss carryforward of approximately $802,000, we will have the ability to generate sufficient taxable income in the necessary period to utilize the entire benefit for the deferred tax assets. Accordingly, we recorded a decrease in the valuation allowance of approximately $3,596,000 as of December 31, 2024. We cannot presently estimate what, if any, changes to the valuation of our deferred tax assets may be deemed appropriate in the future. If we incur future losses, it may be necessary to record additional valuation allowance related to the deferred tax assets recognized as of December 31, 2024.

      19

Liquidity and Capital Resources 

For the year ended December 31, 2024, net cash provided by operating activities totaled approximately $11.4 million, compared with cash provided by operating activities of approximately $1.7 million for the prior year. Cash provided by operating activities for 2024 was primarily related to net income, a decrease in inventories, an increase in deferred revenues, an increase in accrued other expenses and other current liabilities and depreciation and amortization, which were partially offset by a decrease in accounts payable, increases in prepaid expenses and other current assets and capitalized product development costs.

For 2024, we had a net income of $8.4 million, compared with net loss of approximately $2.2 million for the prior year. Net inventories decreased during the year ended December 31, 2024, by approximately $5.9 million, compared with an increase of approximately $2.4 million for the year 2023.  The decrease was primarily attributable to reductions in work in progress and raw materials related to the transition of production to East West Manufacturing, LLC.