What changed in this filing

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Item 1. Financial Statements

2025-06-13 compared with 2024-12-23 · 149 added, 268 removed, 523 unchanged (44% of the section changed)

3 unchanged sentences

(In thousands, except per share data)

Three Months Ended October 31,

Nine Months Ended October 31,

Three Months Ended April 30,

$ 46,747 $ 34,321

4 unchanged sentences

General and administrative expenses

7,330 5,674 19,457 16,417

Selling expenses

1,170 1,471 3,757 4,201

Total operating expenses

8,500 7,145 23,214 20,618

Income from operations

5,586 6,039 14,863 8,806

Interest expense

468 640 1,489 1,788

Other expense

( 50 ) ( 502 ) ( 156 ) ( 350 )

Income before income taxes

5,068 4,897 13,218 6,668

Income tax expense

1,615 1,533 3,692 3,257

3,453 3,364 9,526 3,411

Net income attributable to non-controlling interest

962 1,429 2,303 1,577

Net income attributable to common stock

1 unchanged sentence

Weighted average common shares outstanding

7,981 7,955 7,947 7,996

8,027 8,021 7,991 8,106

Earnings per share attributable to common stock

3 unchanged sentences

PERMA-PIPE INTERNATIONAL HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

Three Months Ended October 31,

Nine Months Ended October 31,

Three Months Ended April 30,

$ 5,854 $ 1,790

Other comprehensive income (loss)

Other comprehensive income

Foreign currency translation adjustments, net of tax

3 unchanged sentences

Comprehensive income attributable to non-controlling interests

962 1,429 2,303 1,577

Total comprehensive income (loss) attributable to common stock

$ 2,306 $ ( 100 ) $ 5,431 $ ( 299 )

Total comprehensive income attributable to common stock

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(In thousands, except per share data)

October 31, 2024

April 30, 2025

January 31, 2025

3 unchanged sentences

Restricted cash

Trade accounts receivable, less allowance for credit losses of $ 704 at October 31, 2024 and $ 699 at January 31, 2024

Trade accounts receivable, less allowance for credit losses of $ 914 at April 30, 2025 and $ 703 at January 31, 2025

47,009 43,148

1 unchanged sentence

Prepaid expenses and other current assets

12,117 10,045

Unbilled accounts receivable

25 unchanged sentences

Income taxes payable

Loan payable to GIG

Total current liabilities

2 unchanged sentences

Long-term debt, less current maturities

Long-term finance obligation

Long-term finance obligations

Deferred compensation liabilities

5 unchanged sentences

26,459 28,073

Non-controlling interest

Commitments and contingencies

Non-controlling interest

12,238 10,967

Stockholders' equity

Common stock, $ .01 par value, authorized 50,000 shares;

7,983 issued and outstanding at October 31, 2024 and 8,017 at January 31, 2024

7,983 issued and outstanding at April 30, 2025 and January 31, 2025

Additional paid-in capital

60,006 60,151

Treasury stock, no shares at October 31, 2024 and 112 shares at January 31, 2024

Retained earnings

19 unchanged sentences

- - 4,952 - - 4,952

Common stock issued under stock plans, net of shares used for tax withholding

Stock-based compensation expense

6 unchanged sentences

$ 80 $ 60,006 $ 25,056 $ - $ ( 7,275 ) $ 77,867

Net income attributable to common stock

- - 3,289 - - 3,289

Common stock issued under stock plans, net of shares used for tax withholding

1 ( 210 ) - - - ( 209 )

Stock-based compensation expense

- 177 - - - 177

Amount attributable to non-controlling interest

- ( 29 ) - - - ( 29 )

Foreign currency translation adjustment

- - - - ( 192 ) ( 192 )

Total stockholders' equity at July 31, 2024

$ 81 $ 59,808 $ 16,820 $ ( 968 ) $ ( 7,158 ) $ 68,583

Net income attributable to common stock

- - 2,491 - - 2,491

Common stock issued under stock plans, net of shares used for tax withholding

- 23 - - - 23

Retirement of treasury stock

( 1 ) - ( 967 ) 968 - -

Stock-based compensation expense

- 232 - - - 232

Amount attributable to non-controlling interest

- 67 - - - 67

Foreign currency translation adjustment

- - - - ( 185 ) ( 185 )

Total stockholders' equity at October 31, 2024

$ 80 $ 60,130 $ 18,344 $ - $ ( 7,343 ) $ 71,211

Additional Paid-in Capital

5 unchanged sentences

$ 80 $ 60,063 $ 12,088 $ ( 968 ) $ ( 5,551 ) $ 65,712

Net loss attributable to common stock

- - ( 1,123 ) - - ( 1,123 )

Stock-based compensation expense

- 229 - - - 229

Foreign currency translation adjustment

- - - - ( 437 ) ( 437 )

Total stockholders' equity at April 30, 2023

$ 80 $ 62,791 $ 494 $ ( 26 ) $ ( 6,886 ) $ 56,453

Net income attributable to common stock

- - 1,443 - - 1,443

Common stock issued under stock plans, net of shares used for tax withholding

- ( 274 ) - - - ( 274 )

Repurchase of common stock

1 - - ( 312 ) - ( 311 )

Stock-based compensation expense

- 228 - - - 228

Foreign currency translation adjustment

- - - - 339 339

Total stockholders' equity at July 31, 2023

$ 81 $ 62,762 $ 1,516 $ ( 338 ) $ ( 6,547 ) $ 57,474

Net income attributable to common stock

- - 1,935 - - 1,935

Repurchase of common stock

( 1 ) - - ( 629 ) - ( 630 )

Stock-based compensation expense

Amount attributable to non-controlling interest

- ( 421 ) - - - ( 421 )

1 unchanged sentence

- - - - ( 1,415 ) ( 1,415 )

Total stockholders' equity at October 31, 2023

Total stockholders' equity at April 30, 2024

$ 80 $ 59,870 $ 13,531 $ ( 968 ) $ ( 6,966 ) $ 65,547

4 unchanged sentences

Shares issued, net of shares used for tax withholding

77,802 66,726

Prior period adjustments

Balances at period end

4 unchanged sentences

(In thousands)

Nine Months Ended October 31,

Three Months Ended April 30,

Operating activities

$ 5,854 $ 1,790

Adjustments to reconcile net income to net cash provided by operating activities

Adjustments to reconcile net income to net cash provided by (used in) operating activities

Depreciation and amortization

Deferred tax expense

Deferred tax expense (benefit)

Stock-based compensation expense

10 unchanged sentences

Accrued compensation and payroll taxes

( 124 ) 1,167

Customers' deposits

( 894 ) 1,272

Income taxes payable

Prepaid expenses and other current assets

( 1,633 ) ( 2,552 )

Unbilled accounts receivable

2 unchanged sentences

891 ( 2,826 )

Net cash provided by operating activities

Net cash provided by (used in) operating activities

Investing activities

1 unchanged sentence

( 927 ) ( 589 )

Proceeds from insurance recovery for property and equipment

Net cash used in investing activities

5 unchanged sentences

( 17,950 ) ( 16,405 )

Payments of principal on finance obligation

Payments of principal on finance obligations

( 54 ) ( 42 )

2 unchanged sentences

Decrease in drafts payable

( 19 ) ( 199 )

Payments on finance lease obligations

( 23 ) ( 176 )

Repurchase of common stock

Stock options exercised and taxes paid related to restricted shares vested

( 178 ) ( 273 )

Net cash provided by financing activities

6 unchanged sentences

Cash interest paid

$ 1,456 $ 1,754

Cash income taxes paid

Fixed assets acquired from non affiliates - non-cash

Fixed assets acquired - non-cash

See accompanying notes to consolidated financial statements.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2024

(In thousands, except per share data, or unless otherwise specified)

(Tabular amounts in thousands, except per share data, or unless otherwise specified)

Note 1 - Basis of presentation

8 unchanged sentences

Revision of Previously Issued Financial Statements

During the six months ended July 31, 2024, the Company identified and corrected an error relating to a subsidiary in the Middle East incorrectly recording a duplicate invoice related to the purchase of property, plant, and equipment ("PP&E"), resulting in an overstatement of PP&E and trade accounts payable of $ 1.4 million on the unaudited consolidated balance sheet as of April 30, 2024, and a corresponding overstatement of net cash provided by operating activities and net cash used in investing activities in the consolidated statement of cash flows during the three months ended April 30, 2024.

During 2024, the Company had identified and corrected an error relating to a subsidiary in the Middle East that incorrectly recorded a duplicate invoice related to the purchase of property, plant, and equipment ("PP&E"), which caused an overstatement of PP&E and trade accounts payable, and resulted in an overstatement of net cash provided by operating activities and net cash used in investing activities of approximately $ 1.4 million in the consolidated statement of cash flows during the three months ended April 30, 2024.

The Company determined that the error was not material to the unaudited consolidated financial statements in its Quarterly Report on Form 10 -Q for the three months ended April 30, 2024.

However, in order to correctly present the unaudited consolidated financial statements, management will revise the unaudited consolidated financial statements as of and for the three months ended April 30, 2024, the next time such unaudited consolidated financial statements are filed which will be in connection with the issuance of the Quarterly Report on Form 10 -Q for the three months ended April 30, 2025.

The following tables summarize the impact of this correction as of and for the periods presented:

However, in order to correctly present the unaudited consolidated financial statements, the Company revised the unaudited consolidated financial statements as of and for the three months ended April 30, 2024.

The following tables summarize the impact of this correction as of and for the three months ended April 30, 2024:

April 30, 2024

20 unchanged sentences

Note 2 - Business segment reporting

The Company is engaged in the manufacture and sale of products in one reportable segment:

The Company operates under one segment:

Piping Systems.

The Company engineers, manufactures and sells pre-insulated specialty piping systems and leak detection systems.

Pre-insulated specialty piping systems include:

(i) insulated and jacketed district heating and cooling piping systems for efficient energy distribution from central energy plants to multiple locations, (ii) primary and secondary containment piping systems for transporting chemicals, hazardous fluids and petroleum products, (iii) the coating and/or insulation of oil and gas gathering and transmission pipelines, and (iv) liquid and powder based anti-corrosion coatings applied both to the external and internal surfaces of steel pipe, including shapes like bends, reducers, tees, and other spools/fittings used in pipelines for the transportation of oil and gas products and potable water.

The Company's leak detection systems are sold with its piping systems or on a stand-alone basis to monitor areas where fluid intrusion may contaminate the environment, endanger personal safety, cause a fire hazard, impair essential services or damage equipment or property.

The results are presented on a consolidated basis to the Chief Executive Officer who serves as the chief operating decision maker ("CODM").

The CODM regularly reviews consolidated revenues, significant expenses, and consolidated net income attributable to common stock to make operating decisions and assess performance.

The CODM uses this information in making company-wide decisions when determining how to allocate resources.

Significant expenses represent amounts that are regularly provided to the CODM and included in consolidated net income attributable to common stock.

The following table summarizes the Company's revenues, net income attributable to common stock, and significant expenses:

Three Months Ended April 30,

$ 46,747 $ 34,321

Cost of sales

17,416 13,183

Depreciation and amortization

Other costs of sales

Total cost of sales

30,023 23,804

Operating expenses

Salaries and wages

Depreciation and amortization

Other general and administrative expense

General and administrative expenses

Selling expense

Total operating expenses

Income from operations

Interest expense

Other expense

Income before income tax

Income tax expense

Net income attributable to non-controlling interest

Net income attributable to common stock

$ 4,952 $ 1,443

The CODM regularly reviews asset information by our reporting segment in a manner that is consistent with the presentation on the Company's accompanying consolidated balance sheets.

Note 3 - Accounts receivable

5 unchanged sentences

Standard payment terms are generally net 30 to 60 days.

The allowance for credit losses is based on specifically identified amounts in customers' accounts, where future collectability is deemed uncertain.

Management may exercise its judgment in adjusting the provision as a consequence of known items, such as current economic factors and credit trends.

The Company maintains an allowance for credit losses for accounts receivable.

The assessment of the allowance for credit losses involves certain judgments and estimates.

Management estimates the allowance balance using relevant available information from internal and external sources relating to past events, current conditions and reasonable and supportable forecasts.

The Company may also establish an allowance for credit losses for specific receivables when it is probable that a specific receivable will not be collected and the loss can be reasonably estimated.

Past due trade accounts receivable balances are written off when the Company's collection efforts have been unsuccessful in collecting the amount due and the amount is deemed uncollectible.

The write off is recorded against the allowance for credit losses.

In 2015, the Company completed a project in the Middle East with billings in the aggregate amount of approximately $ 41.9 million.

The system has not yet been commissioned by the customer.

Nevertheless, the Company has received approximately $ 40.1 million as of October 31, 2024 , with a remaining balance due in the amount of $ 1.8 million, all of which pertains to retention clauses within the agreements with the Company's customer, and which become payable by the customer when this project is fully tested and commissioned.

Of this amount, $ 1.3 million is classified in other long-term assets on the Company's consolidated balance sheets.

The Company has been actively involved in ongoing efforts to collect this outstanding balance.

The Company continues to engage with the customer to ensure full payment of the open balances, and during the nine months ended October 31, 2024 , and at various times throughout 2023, the Company received partial payments to settle $ 0.3 million and $ 0.6 million, respectively, of the customer's outstanding balances.

Further, the Company has been engaged by the customer to perform additional work in 2024 under customary trade terms that support the continued cooperation between the Company and the customer.

As a result, the Company did not reserve any allowance against the remaining outstanding balances as of October 31, 2024 .

However, if the Company's efforts to collect on this account are not successful, the Company may recognize an allowance for all, or substantially all, of any such then uncollected amounts.

For the three months ended October 31, 2024 , no individual customer accounted for more than 10% of the Company's consolidated net sales, and during the same period in 2023, one customer accounted for greater than 10% of the Company's consolidated net sales.

For the nine months ended October 31, 2024 and 2023 , no individual customer accounted for more than 10% of the Company's consolidated net sales.

As of October 31, 2024 and January 31, 2024 , no individual customer accounted for more than 10% of the Company's accounts receivable, and one customer accounted for more than 10% of the Company's accounts receivable, respectively.

For the three months ended April 30, 2025 and 2024 , no individual customer accounted for more than 10% of the Company's consolidated net sales.

As of April 30, 2025 and January 31, 2025 , no individual customer accounted for more than 10% of the Company's accounts receivable .

Note 4 - Revenue recognition

5 unchanged sentences

Products - which include cables, leak detection products, heat trace products, material/goods not bundled with piping or flowline systems, and field services not bundled into a project contract.

In accordance with ASC 606 - 10 - 25 - 27 through 29, the Company recognizes specialty piping and coating systems revenue over time as the manufacturing process progresses because one of the following conditions exist:

the customer owns the material that is being coated, so the customer controls the asset and thus the work-in-process;

1 unchanged sentence

Products revenue is recognized when goods are shipped or services are performed (ASC 606 - 10 - 25 - 30 ).

A breakdown of the Company's revenues by revenue class for the three and nine months ended October 31, 2024 and 2023 are as follows:

Three Months Ended October 31,

Nine Months Ended October 31,

A breakdown of the Company's revenues by revenue class for the three months ended April 30, 2025 are as follows:

Three Months Ended April 30,

$ 3,640 8 % $ 3,253 9 %

18 unchanged sentences

The following table shows the reconciliation of costs in excess of billings and billings in excess of costs:

October 31, 2024

April 30, 2025

January 31, 2025

2 unchanged sentences

Estimated earnings

11,766 11,270

Earned revenue

13 unchanged sentences

$ 2,481 $ 1,685

The Company anticipates that substantially all costs incurred on uncompleted contracts as of October 31, 2024 will be billed and collected within one year .

The Company anticipates that substantially all costs incurred on uncompleted contracts as of April 30, 2025 will be billed and collected within one year .

Unbilled accounts receivable

The Company has recorded $ 19.7 million and $ 16.6 million of unbilled accounts receivable on the consolidated balance sheet s as of October 31, 2024 and January 31, 2024 , respectively, from revenues generated by certain of its subsidiaries.

The Company has recorded $ 23.3 million and $ 18.9 million of unbilled accounts receivable on the consolidated balance sheet s as of April 30, 2025 and January 31, 2025 , respectively, from revenues generated by certain of its subsidiaries.

The Company has fulfilled all performance obligations and has recorded revenue under the respective contracts.

The deliverables under these contracts have been accepted by the customer and billings will be made once the customer takes possession of or arranges shipping for the products.

The Company anticipates that substantially all of the amounts included in unbilled accounts receivable as of October 31, 2024 will be billed within one year.

The Company anticipates that substantially all of the amounts included in unbilled accounts receivable as of April 30, 2025 will be billed within one year.

Note 5 - Inventories

1 unchanged sentence

Cost is determined using the first -in, first -out method for all inventories.

Inventories consisted of the following:

October 31, 2024

April 30, 2025

January 31, 2025

14 unchanged sentences

therefore, actual results could differ materially from projections.

The Company's worldwide effective tax rates ("ETR") for the three months ended October 31, 2024 and 2023 were 32 % and 31 % , respectively.

The Company's ETR was 28 % and 49 % for the nine months ended October 31, 2024 and 2023 , respectively.

The change in the ETR is due to the ability to recognize tax benefits on losses in the United States in the current year, whereas the prior year had a full valuation allowance and changes to the mix of income and loss in various jurisdictions.

The Company's worldwide effective tax rates ("ETR") for the three months ended April 30, 2025 and 2024 were 21 % and 30 % , respectively.

The change in the ETR is due to changes to the mix of income and loss in various jurisdictions.

The Company expects that future distributions from foreign subsidiaries will not be subject to incremental U.S.

3 unchanged sentences

The earnings from these subsidiaries are subject to tax in their local jurisdiction and withholding taxes in these jurisdictions are considered.

As such, the Company has accrued a liability of $ 0.8 million as of October 31, 2024 related to these taxes.

As such, the Company has accrued a liability of $ 1.0 million as of April 30, 2025 related to these taxes.

Note 7 - Goodwill

All identifiable goodwill as of October 31, 2024 and January 31, 2024 , is attributable to the purchase of the remaining 50 % interest in Perma-Pipe Canada, Ltd., which occurred in 2016.

All identifiable goodwill as of April 30, 2025 and January 31, 2025 , is attributable to the purchase of the remaining 50 % interest in Perma-Pipe Canada, Ltd., which occurred in 2016.

The Company performs an impairment assessment of goodwill annually as of January 31, or more frequently if triggering events occur that could indicate that more likely than not that the fair value of the reporting unit did not exceed its carrying value, resulting in an impairment.

2 unchanged sentences

Foreign exchange change effect

October 31, 2024

April 30, 2025

$ 2,057 $ 100 $ 2,157

There were no triggering events identified during the three and nine months ended October 31, 2024 .

There were no triggering events identified during the three months ended April 30, 2025 .

Note 8 - Stock-based compensation

The Company has prior incentive plans under which previously granted awards remain outstanding, but under which no new awards may be granted, including the Company's 2021 Omnibus Stock Incentive Plan, which expired in May 2024.

At October 31, 2024 , the Company had reserved a total 196,276 shares for grants and issuances under these incentive plans, including issuances pursuant to unvested or unexercised prior awards.

At April 30, 2025 , the Company had reserved a total of 197,026 shares for grants and issuances under these incentive plans, including issuances pursuant to unvested or unexercised prior awards.

The Company's 2024 Omnibus Stock Incentive Plan, dated May 28, 2024, was approved by the Company's stockholders in July 2024 ( "2024 Plan").

6 unchanged sentences

The Company recognized the following stock-based compensation expense for the periods presented:

Three Months Ended October 31,

Nine Months Ended October 31,

Three Months Ended April 30,

Restricted stock-based compensation expense

$ 232 $ 227 $ 629 $ 686

Stock options

The Company did not grant any stock options during the three or nine months ended October 31, 2024 .

The Company did not grant any stock options during the three months ended April 30, 2025 .

The following table summarizes the Company's stock option activity:

4 unchanged sentences

1 $ 6.85 0.8 $ 4

( 5 ) 6.89 - 21

Expired or forfeited

( 17 ) 12.41 - -

Outstanding and exercisable at October 31, 2024

Outstanding and exercisable at April 30, 2025

1 $ 6.85 0.6 $ 4

There was no vesting, expiration or forfeiture of previously unvested stock options during the nine months ended October 31, 2024 .

There was no vesting, expiration or forfeiture of previously unvested stock options during the three months ended April 30, 2025 .

In addition , there were no remaining unvested stock options outstanding, and therefore no unrecognized compensation expense related to unvested stock options.

Restricted stock

The following table summarizes the Company's restricted stock activity for the nine months ended October 31, 2024 :

The following table summarizes the Company's restricted stock activity for the three months ended April 30, 2025 :

Restricted Shares

5 unchanged sentences

Forfeited or retired for taxes

Outstanding at October 31, 2024

Outstanding at April 30, 2025

231 $ 9.09 $ 2,098

As of October 31, 2024 , there was $ 1.3 million of unrecognized compensation expense related to unvested restricted stock granted under the plans.

As of April 30, 2025 , there was $ 0.8 million of unrecognized compensation expense related to unvested restricted stock granted under the plans.

These costs are expected to be recognized over a weighted average period of 1.7 years .

Note 9 - Earnings per share

Three Months Ended October 31,

Nine Months Ended October 31,

Basic weighted average common shares outstanding at October 31, 2024

7,981 7,955 7,947 7,996

Three Months Ended April 30,

Basic weighted average common shares outstanding at April 30, 2025

Dilutive effect of equity compensation plans

Weighted average common shares outstanding assuming full dilution

8,027 8,021 7,991 8,106

Stock options and restricted stock not included in the computation of diluted earnings per share of common stock because the option exercise prices or grant date prices exceeded the average market prices of the common shares

6 unchanged sentences

Note 10 - Debt

Debt totaled $ 27.0 million and $ 25.7 million at October 31, 2024 and January 31, 2024 , respectively.

Debt totaled $ 27.9 million and $ 24.5 million at April 30, 2025 and January 31, 2025 , respectively.

Revolving lines - North America .

3 unchanged sentences

The Renewed Senior Credit Facility matures on September 20, 2026.

As of October 31, 2024 , the Company had borrowed an aggregate of $ 7.8 million at a rate of 9.5 % and had $ 3.5 million available under the Renewed Senior Credit Facility.

As of April 30, 2025 , the Company had borrowed an aggregate of $ 8.5 million at a rate of 9.0 % and had $ 5.0 million available under the Renewed Senior Credit Facility.

As of January 31, 2025 , the Company had borrowed an aggregate of $ 6.8 million and had $ 3.7 million available under the Renewed Senior Credit Facility.

The Company was in compliance with respect to the covenants under the Credit Agreement as of October 31, 2024 .

The Company was in compliance with respect to the covenants under the Credit Agreement as of April 30, 2025 .

Finance obligation - buildings and land.

7 unchanged sentences

The Company utilized an incremental borrowing rate of 8.0 % to determine the finance obligation to record for the amounts received and will continue to depreciate the assets.

The current portion of the finance obligation of $ 0.2 million is recognized in current maturities of long-term debt and the long-term portion of $ 8.9 million is recognized in long-term finance obligation on the Company's consolidated balance sheets as of October 31, 2024 .

The current portion of the finance obligation of $ 0.2 million is recognized in current maturities of long-term debt and the long-term portion of $ 8.7 million is recognized in long-term finance obligation on the Company's consolidated balance sheets as of April 30, 2025 .

The net carrying amount of the financial liability and remaining assets will be zero at the end of the lease term.

6 unchanged sentences

Dirhams (approximately $

October 31, 2024

April 30, 2025

) from a bank in the U.A.E.

October 31, 2024

April 30, 2025

, the facility has an interest rate of approximately

and expired in July 2024.

The facility was subsequently renewed in November 2024 with substantially the same terms and conditions and expires in July 2025.

and expires in July 2025.

The Company had borrowed an aggregate of $ 0.5 million

as of October 31, 2024

and $ 0.2 million

as of January 31, 2024

, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

October 31, 2024 and January 31, 2024

as of April 30, 2025

and January 31, 2025

, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

April 30, 2025 and January 31, 2025

, the Company had unused borrowing availability of approximately $ 1.7 million and $ 1.6 million, respectively.

2 unchanged sentences

Dirhams (approximately $

October 31, 2024

April 30, 2025

) from a bank in the U.A.E.

October 31, 2024

April 30, 2025

, the facility has an interest rate of approximately

and expired in August 2024.

The facility was subsequently renewed in November 2024 with substantially the same terms and conditions, except for the revolving line, which decreased to 17.5 million U.A.E.

Dirhams (approximately $ 4.8 million at

October 31, 2024

and expires in August 2025.

The reduction in the revolving line was due primarily to the removal of 2 million U.A.E.

Dirhams (approximately $ 0.5 million) in connection with a capital expenditure component that is no longer applicable to the revolving credit facility and, to a lesser extent, 1 million U.A.E.

Dirhams (approximately $ 0.3 million) due to a decrease in revolver capacity.

The Company had borrowed an aggregate of $ 0.7 million

as of October 31, 2024

Company had no outstanding balance

as of April 30, 2025

and $ 0.1 million

1 unchanged sentence

, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

The Company had unused borrowing availability of approximately $ 1.0 million as of

October 31, 2024 and January 31, 2024

The Company had unused borrowing availability of approximately $ 8.0 million and $ 9.0 million as of

April 30, 2025 and January 31, 2025

, respectively.

1 unchanged sentence

million Egyptian Pounds (approximately $

October 31, 2024

April 30, 2025

This credit arrangement is in the form of project financing, for which the line is secured by certain assets (such as accounts receivable) of the Company's Egyptian subsidiary.

Among other covenants, the credit arrangement established a maximum leverage ratio allowable and restricted the Company's Egyptian subsidiary's ability to undertake any additional debt.

October 31, 2024

April 30, 2025

, the facility has an interest rate of approximately

and expired in November 2024.

The Company has started the process to renew and extend this credit agreement and the credit facility has continued without interruption or penalty.

October 31, 2024

, the Company had an immaterial amount outstanding with respect to this credit arrangement, and approximately $ 1.4 million outstanding at

January 31, 2024

, which is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

and expires in November 2025.

As of April 30, 2025 and January 31, 2025 , the Company had an immaterial amount outstanding, which is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

Further, as of

October 31, 2024

April 30, 2025

January 31, 2025

, the Company had unused borrowing capacity of $ 2.0 million and $ 3.2 million, respectively.

, the Company had approximately $ 2.0 million of unused borrowing capacity with respect to this credit arrangement.

In December 2021, the Company entered into a credit arrangement for project financing with a bank in Egypt for 28.2 million Egyptian Pounds.

As this project has progressed and the Company has made collections, the facility has decreased to a current amount of

As this project has progressed and the Company has received collections, the facility has decreased to a current amount of

million Egyptian Pounds (approximately $ 0.1 million at

October 31, 2024

April 30, 2025

This credit arrangement is in the form of project financing at rates competitive in Egypt.

3 unchanged sentences

The facility will expire in connection with final customer balance collections and the completion of the project.

The Company had approximately $ 0.1 million outstanding

as of October 31, 2024 and January 31, 2024

The Company had no outstanding balance

April 30, 2025 and January 31, 2025

, respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

In March 2022, the Company's Saudi Arabian subsidiary entered into a credit arrangement with a bank in Saudi Arabia for a revolving line of 37.0 million Saudi Riyals (approximately $ 9.9 million at October 31, 2024 ).

This credit arrangement is in the form of project financing at rates competitive in Saudi Arabia.

The line is secured by certain assets (such as accounts receivable) of the Company's Saudi Arabian subsidiary.

The facility was renewed in May 2024 with substantially the same terms and conditions and expires in May 2025.

As of October 31, 2024 , the facility has an interest rate of approximately 9.5 % .

The Company had borrowed an aggregate of $ 1.3 million and $ 3.2 million as of October 31, 2024 and January 31, 2024 , respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

The unused borrowing availability attributable to this credit arrangement at October 31, 2024 and January 31, 2024 , was $ 3.3 million and $ 6.1 million, respectively.

The line is secured by certain assets (such as accounts receivable) of the Company's Saudi Arabian subsidiary, and expired in May 2025.

The Company is in the process of renewing this credit arrangement with substantially the same terms and conditions and is in regular communication with the bank throughout this process ensuring the facility continues without interruption or penalty.

As of April 30, 2025 , the facility has an interest rate of approximately 8.9 % .

The Company had borrowed an aggregate of $ 3.1 million and $ 1.5 million as of April 30, 2025 and January 31, 2025 , respectively, and is presented as a component of current maturities of long-term debt in the Company's consolidated balance sheets.

The unused borrowing availability attributable to this credit arrangement at April 30, 2025 and January 31, 2025 , was $ 2.3 million and $ 3.0 million, respectively.

These credit arrangements are in the form of overdraft facilities and project financing at rates competitive in the countries in which the Company operates.

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The Company guarantees only a portion of the subsidiaries' debt, including foreign debt.

The amount of foreign subsidiary debt guaranteed by the Company was approxim ately $ 1.1 million and $ 0.1 million at October 31, 2024 and January 31, 2024 , respectively.

The Company was in compliance with respect to the covenants under the credit arrangements in the U.A.E., Egypt, and Saudi Arabia as of October 31, 2024 , with the exception of an arrangement that has expired and has not yet been renewed.

As of April 30, 2025 and January 31, 2025 , the amount of foreign subsidiary debt guaranteed by the Company was approxim ately $ 10.0 million.

The Company was in compliance with respect to the covenants under the credit arrangements in the U.A.E., Egypt, and Saudi Arabia as of April 30, 2025 , with the exception of an arrangement that has expired and has not yet been renewed.

Although a certain arrangement has expired and the borrowings could be required to be repaid immediately by the bank, the Company is in regular communication with the bank throughout the renewal process and the arrangement has continued without interruption or penalty.

On October 31, 2024 , interest rates were based on (i) the Emirates Inter Bank Offered Rate plus 3.0 % to 3.5 % per annum for the U.A.E.

On April 30, 2025 , interest rates were based on (i) the Emirates Inter Bank Offered Rate plus 3.0 % to 3.5 % per annum for the U.A.E.

credit arrangements, two of which have a minimum interest rate of 4.5 % per annum;

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and (iii) the Saudi Inter-Bank Offered Rate plus 3.5 % for the Saudi Arabia credit arrangement.

Based on these base rates, as of October 31, 2024 , the Company's interest rates ranged from 7.7 % to 20.8 %, with a weighted average rate of 10.6 %, and the Company had facility limits totaling $ 19.7 million under these credit arrangements.

As of October 31, 2024 , $ 11.0 million o f availability was used to support letters of credit to guarantee amounts committed for inventory purchases and for performance guarantees.

Additionally, as of October 31, 2024 , the Company had borrow ed $ 3.2 million and had an additional $ 8.3 million of borrowing remaining available under the foreign revolving credit arrangements.

The foreign revolving lines balances were included as a component of current maturities of long-term debt in the Company's consolidated balance sheets as of October 31, 2024 and January 31, 2024 .

Based on these base rates, as of April 30, 2025 , the Company's interest rates ranged from 7.5 % to 20.8 %, with a weighted average rate of 8.4 %, and the Company had facility limits totaling $ 31.8 million under these credit arrangements.

As of April 30, 2025 , $ 16.6 million o f availability was used to support letters of credit to guarantee amounts committed for inventory purchases and for performance guarantees.

Additionally, as of April 30, 2025 , the Company had borrow ed $ 6.3 million and had an additional $ 14.5 million of borrowing remaining available under the foreign revolving credit arrangements.

The foreign revolving lines balances were included as a component of current maturities of long-term debt in the Company's consolidated balance sheets as of April 30, 2025 and January 31, 2025 .

In June 2023, the Company assumed a promissory note of approximately $ 2.8 million in connection with the formation of the joint venture with Gulf Insulation Group (see Note 15 ).

I n accordance with the promissory note, all principal is due and payable on the maturity date of April 9, 2026, with the option to prepay, in whole or in part, at any time prior to the maturity date, without premium or penalty.

This amount is presented as a component of current liabilities in the Company's consolidated balance sheets.

On July 28, 2016, the Company entered into a mortgage agreement secured by the Company's manufacturing facility located in Alberta, Canada that matures on December 23, 2042.

As of October 31, 2024 , the remaining balance on the mortgage in Canada is approximately CAD 5.8 million (approximately $ 4.2 million at October 31, 2024 ).

The interest rate is variable, and was 7.8 % at October 31, 2024 .

The principal balance is included as a component of long-term debt, less current maturities in the Company's consolidated balance sheets and is presented net of issuance costs of $ 0.1 million as of October 31, 2024 and January 31, 2024 , respectively.

As of April 30, 2025 , the remaining balance on the mortgage in Canada is approximately CAD 5.7 million (approximately $ 4.1 million at April 30, 2025 ).

The interest rate is variable, and was 6.8 % at April 30, 2025 .

Note 11 - Leases

The Company classifies its leases as either operating or finance leases, which are recorded on the Company's consolidated balance sheets.

Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities short-term, and operating lease liabilities long-term in the Company's consolidated balance sheets.

Finance leases are included in property, plant and equipment, current maturities of long-term debt, and long-term debt less current maturities in the Company's consolidated balance sheets.

In calculating the ROU asset and lease liability, the Company elects to combine lease and non-lease components.

Additionally, most of the Company's leases do not provide an implicit rate, resulting in the Company using its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments.

The Company excludes short-term leases having an initial term of 12 months or less in accordance with an accounting policy election and recognizes rent expense on a straight-line basis over the lease term.

Operating Leases.

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The initial annual payments were approximately 1.2 million U.A.E.

Dirhams (approximatel y $ 0.3 million at October 31, 2024 ), inclusive of rent, escalation clauses, and other common charges contained in the agreement.

Dirhams (approximatel y $ 0.3 million at April 30, 2025 ), inclusive of rent, escalation clauses, and other common charges contained in the agreement.

The lease expires in August 2050.

In March and December 2022, the Company served Notices of Termination to its lessor in connection with a lease of land and buildings in Fujairah in the U.A.E., for which the Company intended to relocate to a different facility in Abu Dhabi.

Portions of the leased space were vacated in December 2022, and the Company expects to vacate the remaining space in December 2024.

In connection with the Notices of Termination, the Company was required to pay an additional amount equal to three months' rent.

This also resulted in adjustments to reduce the carrying balances attributable to short-term and long-term operating lease liabilities and operating lease right-of-use assets by $ 0.4 million, $ 6.0 million, and $ 5.5 million, respectively.

The additional payment and the effect of these adjustments were recorded in prior periods, and did not impact the Company's consolidated financial statements for the year ended January 31, 2024 , or during the three and nine months ended October 31, 2024 .

There were no other adjustments in connection with the Notices the Termination.

Finance Leases.

The Company has several lease agreements, with lease terms of one to thirty years, which consist of real estate, vehicles and office equipment leases.

These leases do not require any contingent rental payments, impose any financial restrictions or contain any residual value guarantees.

Certain of the Company’s leases include renewal options and escalation clauses;

renewal options have not been included in the calculation of the lease liabilities and ROU assets as the Company is not reasonably certain to exercise the options.

At October 31, 2024 , the Company had finance lease liabilities of $ 0.1 million included in current maturities of long-term debt and long-term debt less current maturities, and financial ROU assets of $ 0.3 million which were included in property plant and equipment, net of accumulated depreciation in the consolidated balance sheets.

At April 30, 2025 , the Company had finance lease liabilities of $ 0.1 million included in current maturities of long-term debt and long-term debt less current maturities , and financial ROU assets of $ 0.2 million which were included in property plant and equipment , net of accumulated depreciation in the consolidated balance sheets.

Supplemental balance sheet information related to leases is as follows:

Operating and Finance leases

October 31, 2024

April 30, 2025

January 31, 2025

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Total lease costs consist of the following:

Three Months Ended October 31,

Nine Months Ended October 31,

Three Months Ended April 30,

Consolidated Statements of Operations Classification

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Cost of sales

$ 25 $ 37 $ 100 $ 121

Interest on lease liabilities

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Cost of sales, SG&A expenses

463 564 1,361 1,450

Short-term lease costs (1)

Cost of sales, SG&A expenses

151 99 384 350

Sub-lease income

SG&A expenses

- ( 20 ) - ( 61 )

Total Lease costs

$ 640 $ 683 $ 1,850 $ 1,867

( 1 ) Includes variable lease costs, which are not material.

Supplemental cash flow information related to leases is as follows:

Nine Months Ended October 31,

Three Months Ended April 30,

Cash paid for amounts included in the measurement of lease liabilities:

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Operating cash outflows from operating leases

ROU assets obtained in exchange for new lease obligations:

Finance leases liabilities

Operating leases liabilities

$ 1,718 $ 3,615

Weighted-average lease terms and discount rates are as follows:

October 31, 2024

April 30, 2025

Weighted-average remaining lease terms (in years):

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Operating leases

Maturities of lease liabilities as of October 31, 2024 , are as follows:

Maturities of lease liabilities as of April 30, 2025 , are as follows:

Operating Leases Finance Leases

For the six months ending January 31, 2025

For the year ended January 31, 2026

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For the year ended January 31, 2030

For the year ended January 31, 2031

Total lease payments

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( 6,545 ) ( 4 )

Total lease liabilities at October 31, 2024

Rent expense attributable to operating leases was $ 0.6 million for the three months ended October 31, 2024 and 2023 , respectively.

Total lease liabilities at April 30, 2025

Rent expense attributable to operating leases was $ 0.9 million and $ 0.6 million for the three months ended April 30, 2025 and 2024 , respectively.

Note 12 - Restricted cash

Restricted cash held by foreign subsidiaries is related to fixed deposits that also serve as security deposits and guarantees:

October 31, 2024

April 30, 2025

January 31, 2025

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Note 14 - Recent accounting pronouncements

In November 2023, the FASB issued ASU No.

2023 - 07, Segment Reporting ( Topic 280 ):

Improvements to Reportable Segment Disclosures .

The standard update requires additional disclosures, including further details about segment expenses regarding a public entity's reportable segments on an annual and interim basis.

The additional segment disclosures are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company is still evaluating the impact of these updated disclosure requirements on its consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU No.

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Pursuant to this standard update, companies are required to provide additional information, which is primarily attributable to the rate reconciliation and income taxes paid.

The standard update is to be applied prospectively, with retrospective application permitted.

The new income tax disclosures are effective for fiscal years beginning after December 15, 2024.

The Company is still evaluating this standard update but does not expect it to have a material impact on its financial position or results of operations.

The Company is still evaluating this standard update but does not expect it to have a material impact on its consolidated financial statements.

In November 2024, the FASB issued ASU No.

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The Company is currently evaluating the impact of this standard update on its consolidated financial statements and related disclosures.

Note 15 - Treasury stock

The repurchase program approved on October 4, 2021 authorized the Company to use up to $ 3.0 million for the purchase of its outstanding shares of common stock.

Stock repurchases were permitted to be executed through open market or privately negotiated transactions, depending upon current market conditions and other factors.

On December 7, 2022 the Board of Directors authorized the use of $ 1.0 million remaining under the share repurchase program previously approved on October 4, 2021 that expired on October 3, 2022.

During the twelve months ended January 31, 2024 , the Company used the remaining $ 1.0 million authorized to repurchase its outstanding shares of common stock.

Accordingly, t here was no repurchase activity with respect to the Company's shares of common stock during the three and nine months ended October 31, 2024 .

On August 29, 2024, the Company retired all remaining treasury stock previously repurchased under the stock repurchase program.

The retirement was recorded as a reduction to common stock based on the par value of the shares, and the excess over par value was recorded as a decrease in retained earnings in accordance with ASC 505 - 30, Equity-Treasury Stock .

Note 15 - Noncontrolling interest

On June 1, 2023, the Company closed on its formation of a joint venture (the "JV", and the agreement governing the JV, the "JV Agreement") with Gulf Insulation Group ("GIG"), a leading provider of pre-insulated piping systems and pipe fabrication, in which the Company acquired a 60 % controlling financial interest and contributed assets consisting of a building and equipment.

The JV is a limited liability company named Perma Pipe Gulf Arabia Industry and is a closed joint stock company established under the laws of the Kingdom of Saudi Arabia.

The JV's capital is comprised of ordinary shares with 60 % owned by the Company and remaining 40 % owned by GIG.

The JV is a limited liability company named Perma Pipe Gulf Arabia Industry LLC and is a closed joint stock company established under the laws of the Kingdom of Saudi Arabia.

The JV's capital is comprised of ordinary shares with 60 % owned by the Company and the remaining 40 % owned by GIG.

The Company expects this collaborative business arrangement to result in expanding its market presence in Saudi Arabia, Kuwait, and Bahrain.

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The balance sheets and operating activities of this investment are included in the Company's consolidated financial statements.

T he carrying amount of the assets and liabilities of the JV that are consolidated by the Company totaled $ 31.8 million and $ 18.5 million, respectively, as of October 31, 2024 .

As of April 30, 2025 , t he carrying amount of the assets and liabilities of the JV that are consolidated by the Company totaled $ 39.6 million and $ 20.6 million, respectively, and $ 39.1 million and $ 22.1 million, respectively, as of January 31, 2025 .

The Company adjusts net income in the consolidated statements of operations to exclude the proportionate share of results that is attributable to the non-controlling interest.

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Adjustments made to reflect the change in the value of the redeemable non-controlling interest are offset against permanent equity within the Company's consolidated balance sheets.

Net income attributable to GIG was $ 1.0 million and $ 1.4 million for the three months ended October 31, 2024 and 2023 , respectively.

Net income attributable to GIG was $ 2.3 million and $ 1.6 million for the nine months ended October 31, 2024 and 2023 , respectively.

Net income attributable to GIG was $ 0.9 million and $ 0.3 million for the three months ended April 30, 2025 and 2024 , respectively.

The proportionate share of net income was accounted for as a reduction in deriving net income attributable to common stock in the Company's consolidated statements of operations.

The non-controlling interest as measured at fair value was $ 9.0 million and $ 6.3 million at October 31, 2024 and January 31, 2024 , respectively.

The non-controlling interest as measured at fair value was $ 12.2 million and $ 11.0 million at April 30, 2025 and January 31, 2025 , respectively.

The change in non-controlling interest consists of $ 0.9 million in current year net income attributable to non-controlling interest, and approximately $ 0.4 million as an adjustment to the carrying value of the redeemable non-controlling interest pertaining to the business arrangement.

In addition, there were no dividends or other forms of distributions from non-controlling interest for the period ended October 31, 2024 and January 31, 2024 , respectively.

In addition, there were no dividends or any other form of distributions from non-controlling interest for the periods ended April 30, 2025 and January 31, 2025 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements