Company: PDEX
Filing Date: 2025-01-30
Form Type: 10-Q
Source: 0001079973-25-000164
Chunk: 27

Company: PRO DEX INC
Filing Date: 2025-01-30
Form: 10-Q
Item: Item 2
Chunk 27
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primarily to the release of a $60,000 valuation allowance related to previously recognized unrealized losses on investments. We have not
had a similar valuation allowance release in fiscal 2025. The effective tax rate for the six months ended December 31, 2024, and 2023
is 24% and 45%, respectively. The higher effective tax rate in the prior year was similarly due to the release of the valuation allowance
recorded in the second quarter of fiscal 2024 and was a tax benefit since we had a year-to-date pre-tax loss.

Liquidity and Capital Resources

Cash and cash equivalents
at December 31, 2024 decreased $2.6 million to $66,000 as compared to $2.6 million at June 30, 2024. The following table includes a summary
of our condensed statements of cash flows contained elsewhere in this report.

    As of
    and For the Six Months Ended December 31, 

    2024  
    2023 

    (in thousands) 
  
    Cash provided by (used in): 

    Operating activities	 
    $(2,263) 
    $1,102 
  
    Investing activities	 
    $(973) 
    $(2,009)
  
    Financing activities	 
    $671  
    $(740)

    Cash and Working Capital: 

           Cash and cash equivalents	 
    $66  
    $1,289 
  
           Working Capital	 
    $27,161  
    $26,610 

Operating Activities

Net cash used in
operating activities was $2.3 million for the six months ended December 31, 2024, due in part to net income of $4.5 million and non-cash
depreciation and amortization of $615,000 offset by non-cash unrealized gains on marketable equity investments of $510,000. Additionally,
accounts receivable, inventory and prepaid and other assets increased $4.6 million, $4.3 million, and $991,000, respectively, for the
six months ended December 31, 2024, offset by an increase in accounts payable and accrued expenses of $3.0 million. As our business continues
to grow, we expect to see increases in both inventory and accounts payable. Our accounts receivable is similarly expected to increase
during periods of increased revenue.

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