Innovative Solutions & Support

None of the serious warning signs we check for were found. 1 thing worth knowing.

We look for five warning signs: doubt it can keep going, weak checks on its own accounts, a notice that its past accounts can't be relied on, a change of auditor, and one customer bringing in a big share of sales. We don't check lawsuits, investigations or debt yet.

We checked the auditor's report, internal controls, restatement notices, auditor changes and big customers in the 10-K filed 23 Dec 2025, plus the 10-Q filed 13 Aug 2026 and 6 later 8-Ks.

• One big customer

  Worth knowing

  One customer brings in a big share of sales: 36% last year. Losing that customer would hurt.

  “In the fiscal year ended September 30, 2025, our three largest customers, Lockheed Martin, Pilatus, and Boeing accounted for 36%, 8% and 5% of total revenue, respectively.”

  From the 10-K filed 23 December 2025, Item 1. Business. Read it in the filing

Cheap for a reason is the question the numbers cannot answer.

Whether the price already reflects the risks is what the deep dive is for.

• Changes in U.S. government priorities, spending levels and response to world events could adversely affect the Company’s ability to maintain or grow the revenue the Company receives through government contracting.

  Additionally, U.S. government contracts are funded by agency budgets that operate on a fiscal year basis. As a result, government contracts are often not fully funded at inception. The remaining funds are only made available as appropriated by Congress over time, and thus subject to delay. Further, congressional appropriation and presidential approval are required for funding the governmental agencies with which we contract. In the past few years, the government has not been able to complete its budget process before the end of its fiscal year, resulting in government shutdowns, as well as insufficient funding for government agencies. For example, in October 2025, the U.S. federal government shut down for 43 days. We anticipate the federal budget, debt ceiling, regulatory environment and potential tax reform will continue to be subject to debate and compromise shaped by, among other things, the current administration and Congress, heightened political tensions, the global security environment, inflationary pressures and macroeconomic conditions. Additionally, the administration continues to take steps to evaluate government-wide and defense-specific staffing and procurement, which includes assessing mission priorities, procurement methods, program performance and other factors and then potentially taking action based on those assessments. In particular, the administration has issued executive orders aimed at deregulating the Department of Defense’s procurement process to achieve a more efficient and nimble procurement process. If the Company and its products are unable to successfully compete with its competitors in any reformed procurement environment, or if the administration’s efforts result in the Company facing a disadvantage in contracting decisions due to its size, history, product mix or any other factor, such reforms could result in impacts to both our current and future business prospects and financial performance. As a result, our sales revenue in the retrofit market are vulnerable to both delays in funding and reductions in spending. If our government contracts are not fully funded, or significant programs or contracts with the U.S. government are terminated, our business, financial condition and results of operations would be substantially adversely affected.

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• The F-16 program comprises a material portion of our revenue and reductions or delays in funding for this program and risks related to performance, schedule, cost and requirements of the program could adversely affect our performance.

  Could happen

  The F-16 program, which consists of multiple production and sustainment contracts, is our largest program and represented 36.7% of our total consolidated net sales in 2025. A decision by the U.S. Government, international partners, or FMS customer countries to cut spending on this program or reduce or delay planned orders would have an adverse impact on our business and results of operations. Given the size and complexity of the F-16 program, we anticipate that there will be continual reviews related to aircraft performance, program and delivery schedule, cost and requirements as part of the DoD, Congressional and international countries’ oversight and budgeting processes. Challenges and risks associated with this program include supplier performance, contract approval and receiving funding for contracts on a timely basis, the level of cost associated with life cycle operations, sustainment and potential contractual obligations, inflation-related cost pressures, the ability to improve affordability and potential competition from next-generation or other platforms.

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• The F-16 program comprises a material portion of our revenue and reductions or delays in funding for this program and risks related to performance, schedule, cost and requirements of the program could adversely affect our performance.

  Could happen

  We also may not be successful in making hardware upgrades and other modernization capabilities in a timely manner, including as a result of dependencies on suppliers, which could increase costs and create schedule delays. Our ability to capture and retain future F-16 growth in development, production and sustainment is dependent on the success of our efforts to achieve F-16 customer affordability, supply chain improvements, continued reliability improvements and other efficiencies, some of which are outside our control.

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