THE WOODLANDS, Texas - MIND Technology, Inc. (NASDAQ:MIND; MINDP) announced today that its proposal to amend the Certificate of Designations for its 9% Series A Cumulative Preferred Stock has been approved by stockholders. The approval permits the conversion of preferred stock into common stock at the discretion of the company's Board of Directors.
The virtual special meeting, which reconvened today, saw the Preferred Stock Proposal receive affirmative votes from over two-thirds of the outstanding shares of Preferred Stock. This majority approval enables the Board of Directors to file the amendment with the Delaware Secretary of State anytime before October 31, 2024.
Rob Capps, President and CEO of MIND, expressed his satisfaction with the outcome, emphasizing the potential for increased flexibility and the ability to deliver value to all stakeholders. Approximately 89% of the votes cast were in favor of the conversion proposal.
MIND Technology specializes in providing equipment and technology to various industries including oceanographic, hydrographic, defense, seismic, and security. The company, with its headquarters in The Woodlands, Texas, operates globally with significant locations in the United States, Singapore, Malaysia, and the United Kingdom.
The company's announcement comes with a note of caution regarding forward-looking statements, which are subject to risks, uncertainties, and assumptions that could cause actual results to differ from expectations. These statements, which include projections about future operations and financial outcomes, are based on current beliefs and are qualified by the inherent risks associated with the company's business environment.
The approval of the Preferred Stock Proposal is a strategic development for MIND Technology, as it seeks to navigate its business operations and stakeholder interests. This information is based on a press release statement from the company.
In other recent news, MIND Technology is seeking approval for an amendment to its preferred stock Certificate of Designations, initiating a solicitation process to gather votes from preferred stockholders. The company has also deferred the quarterly cash dividend for its 9.00% Series A Cumulative Preferred Stock for the eighth consecutive quarter, a decision affecting the second quarter of the fiscal year ending January 31, 2025. As a result, holders of the Series A Preferred Stock now have the right to appoint two directors to MIND Technology's Board.
MIND Technology recently reported a return to profitability for the first time in a decade, with a 51% surge in the company's Marine Technology product revenues to $13.4 million in the fiscal 2024 fourth quarter. This contributed to the highest annual revenue ever recorded by MIND's Seamap business at $36.5 million. The company's backlog for fiscal 2025 is robust, standing at over $38 million, indicating continued order momentum.
In addition, MIND Technology announced the sale of Klein, using the proceeds to eliminate high-cost debt, thus becoming debt-free. The company plans to use liquidity and capital to fund growth and backlog execution, and a meeting to discuss the conversion of preferred stock to common stock has been postponed. Despite anticipated fluctuations in quarterly revenue, MIND expects to sustain higher-level revenue in fiscal 2025 and beyond.
InvestingPro Insights
In light of MIND Technology's recent strategic move to enhance capital flexibility, a closer look at the company's financial standing through InvestingPro data reveals critical insights. With a market capitalization of $5.47 million, MIND Technology is navigating the waters of the tech industry with a moderate market presence. Despite a negative P/E ratio of -2.38, which reflects the company's current lack of profitability, there are signs of robust revenue growth. Over the last twelve months as of Q1 2023, MIND Technology saw its revenue increase by 34.19%, indicating a potential for scaling operations and improving financial health in the future.
InvestingPro Tips point to a company that is currently trading at a high EBITDA valuation multiple, which suggests the market may be anticipating future growth or operational improvements. This aligns with the analysts' predictions that MIND Technology will turn profitable this year, marking a potential turning point for the company. Additionally, the firm's liquid assets exceed its short-term obligations, providing it with a buffer to manage its moderate level of debt effectively.
For investors considering MIND Technology's stock, it's worth noting that the company does not pay a dividend, which may influence investment strategies focused on income generation. Those interested in further analysis and additional InvestingPro Tips can find them at InvestingPro's dedicated section for MIND Technology, which includes a total of 9 tips, offering a comprehensive overview of the company's financial health and potential investment risks or opportunities.
As MIND Technology continues to evolve its business model and capital structure, these financial metrics and expert insights will be vital in assessing the company's trajectory and the potential impact of its strategic decisions on shareholder value.
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