Item 1A. Risk Factors
Not required.
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Cybersecurity Governance
The Board of Directors (the “Board”) of the Company is responsible for the oversight of the Company’s cybersecurity program and recognizes the risks that cybersecurity threats may impose on the Company, its business partners, employees and investors. The Company's IT Director is responsible for overall IT governance, risk and compliance including the Company’s cybersecurity program. The Audit Committee of the Board collaborates with the full Board and the IT Director to facilitate alignment of overall IT related controls and processes. We have a formalized IT Security Incident Report process which provides a method to document and communicate details of security incidents to appropriate stakeholders. The Board and the Audit Committee receive periodic briefings on cybersecurity and help set priorities and strategic direction. As part of continuous improvement, our cybersecurity program is being aligned with the NIST Cybersecurity Framework 2.0 to help ensure comprehensive controls and oversight.
Cybersecurity Controls
We have implemented a modern, comprehensive set of controls that restrict access to systems using a combination of firewalls, virtual private networks, multi-factor authentication and enforced use of corporate controlled compliant devices. We make extensive use of best-in-class automated intrusion prevention, intrusion detection and response systems which constantly monitor activity, build usage patterns and respond or alert when unusual activity is detected. We have experienced staff who perform root cause analysis, respond to any immediate threat, and implement improved controls for future prevention. Our cybersecurity tools are fully integrated and collect data from various sources to build relationships and detect more complex multi-channel attack strategies. Application controls are role-based and designed to protect data confidentiality and provide overall data integrity. A risk-based approach is taken regarding third-party systems utilized in our business.
We have controls specifically focused on E-mail phishing including impersonation attempts. Although our automated controls prevent most phishing attempts, some can be delivered to employees. To mitigate this risk, we provide training to employees using various methods including E-mail phishing campaigns which send phishing-style E-mails, monitors user responses and automatically assigns further training as appropriate. Employees have been trained to send any suspicious activity to a central IT Service Desk for evaluation and appropriate timely action.
All critical systems have rigorous data backups and are designed for disaster recovery, ensuring business continuity in the event of a catastrophic incident. As part of continuous improvement, disaster recovery testing is being conducted and documented.
We are not aware of any unmitigated risk or any prior incident that may have materially affected the Company’s data integrity, confidentiality, operations, business strategy or financial reporting. Given our reliance on modern systems, we are aware a significant incident could impact the Company’s overall goals so we strive to provide modern counter measures to manage this risk.
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Item 2. Properties
The principal real properties of the Company are described in the following table:
Location Approximate Size Ownership
Lone Star, Texas
Plant — Texas Tubular Products 161,000 sq. feet Owned(1)
Offices — Texas Tubular Products 12,200 sq. feet Owned(1)
Land — Texas Tubular Products 122.4 acres Owned(1)
Longview, Texas
Offices — Administrative 5,100 sq. feet Leased(2)
Hickman, Arkansas
Plant and Warehouse — Flat Roll Products 64,600 sq. feet Owned(1)
Offices — Flat Roll Products 2,500 sq. feet Owned(1)
Land — Flat Roll Products 26.2 acres Owned(1)
Decatur, Alabama
Plant and Warehouse — Flat Roll Products 48,000 sq. feet Owned(1)
Offices — Flat Roll Products 2,000 sq. feet Owned(1)
Land — Flat Roll Products 47.3 acres Owned(1)
Sinton, Texas
Offices — Flat Roll Products 3,100 sq. feet Leasehold Improvement (3)
Land — Flat Roll Products 26.5 acres Leased (3)
East Chicago, Indiana
Plant and Warehouse — Flat Roll Products 150,900 sq. feet Owned (1)
Offices — Flat Roll Products 3,200 sq. feet Owned (1)
Land — Flat Roll Products 5.0 acres Owned (1)
Granite City, Illinois
Offices — Flat Roll Products 4,400 sq. feet Leasehold Improvement (4)
Land — Flat Roll Products 31.1 acres Leased (4)
The Woodlands, Texas
Offices — Administrative 5,000 sq. feet Leased (5)
Item 3. Legal Proceedings
The Company is not, and during fiscal year 2024 was not, a party to, nor is its property the subject of, any material pending legal proceedings.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The Company’s Common Stock is traded principally on the NYSE – American (Symbol: FRD).
Reference is hereby made to the sections of the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024, entitled “Description of Business — Range of High and Low Sales Prices of Common Stock” and “Description of Business — Cash Dividends Declared Per Share of Common Stock”, which sections are hereby incorporated herein by reference.
The approximate number of shareholders of record of Common Stock of the Company as of April 26, 2024 was 156. Because many of the Company’s common shares are held by brokers and other institutions on behalf of shareholders, the Company is unable to estimate the total number of individual shareholders represented by these record holders.
Item 6. Selected Financial Data
Not required.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Information with respect to Item 7 is hereby incorporated herein by reference from the section of the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024, entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Not required.
Item 8. Financial Statements and Supplementary Data
The following financial statements and notes thereto of the Company included in the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024, are hereby incorporated herein by reference:
Consolidated Balance Sheets — March 31, 2024 and 2023
Consolidated Statements of Operations — Years ended March 31, 2024 and 2023
Consolidated Statements of Comprehensive Income — Years ended March 31, 2024 and 2023
Consolidated Statements of Stockholders’ Equity — Years ended March 31, 2024 and 2023
Consolidated Statements of Cash Flows — Years ended March 31, 2024 and 2023
Notes to Consolidated Financial Statements
Reports of Independent Registered Public Accounting Firm
The following supplementary schedule for the Company for the years ended March 31, 2024 and 2023, is incorporated herein by reference above in this Item 8 from the Company's Annual Report to Shareholders for the fiscal year ended March 31, 2024.
Schedule II — Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable accounting regulation of the SEC are not required under the related instructions or are inapplicable and, therefore, have been omitted.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Information with respect to Item 9A is hereby incorporated herein by reference from the sections of the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024, entitled “Management's Report on Internal Control Over Financial Reporting”.
Item 9B. Other Information
None.
Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
Not applicable.
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
Except as otherwise set forth below, information with respect to Item 10 is hereby incorporated herein by reference from the Company’s proxy statement in respect of the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Information with respect to Item 10 regarding executive officers is hereby incorporated by reference from the information set forth under the caption “Executive Officers of the Company” in Item 1 of this Annual Report on Form 10-K.
The Company has adopted the Friedman Industries, Incorporated Code of Conduct and Ethics (the “Code”), which applies to the Company’s employees, directors and officers, including its principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. A copy of the Code is filed as an exhibit hereto.
Item 11. Executive Compensation
Information with respect to Item 11 is hereby incorporated herein by reference from the Company’s proxy statement in respect of the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Equity Compensation Plan Information
The disclosure required pursuant to Item 201(d) of Regulation S-K is hereby incorporated herein by reference from the Company’s proxy statement in respect of the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Additional information with respect to Item 12 regarding equity compensation plan information relating to the Company is hereby incorporated herein by reference from Note 3 — Equity Compensation Plans and Capital Stock included in the Notes to Consolidated Financial Statements of the Company included in the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024.
Security Ownership Information
The additional information with respect to Item 12 regarding the security ownership of certain beneficial owners and management, and related matters, is hereby incorporated herein by reference from the Company’s proxy statement in respect to the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Item 13. Certain Relationships, Related Transactions and Director Independence
Information with respect to Item 13 is hereby incorporated herein by reference from the Company’s proxy statement in respect of the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Item 14. Principal Accountant Fees and Services
Information with respect to Item 14 is hereby incorporated herein by reference from the Company’s proxy statement in respect of the 2024 Annual Meeting of Shareholders, definitive copies of which are expected to be filed with the SEC on or before 120 days after the end of the Company’s 2024 fiscal year.
Audit Id: 659 Audit firm:Moss Adams LLP Audit location: Houston, Texas
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PART IV
Item 15. Exhibits and Financial Statement Schedules
(a) Documents included in this report
1. Financial Statements
The following financial statements and notes thereto of the Company are included in the Company’s Annual Report to Shareholders for the fiscal year ended March 31, 2024, which is incorporated herein by reference:
Consolidated Balance Sheets — March 31, 2024 and 2023
Consolidated Statements of Operations — Years ended March 31, 2024 and 2023
Consolidated Statements of Comprehensive Income — Years ended March 31, 2024 and 2023
Consolidated Statements of Stockholders’ Equity — Years ended March 31, 2024 and 2023
Consolidated Statements of Cash Flows — Years ended March 31, 2024 and 2023
Notes to Consolidated Financial Statements
Reports of Independent Registered Public Accounting Firm
2. Financial Statement Schedules
The following financial statement schedule is included in the Company's Annual Report to Shareholders for the fiscal year ended March 31, 2024, which is incorporated herein by reference:
Schedule II — Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable and, therefore, have been omitted.
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3. Exhibits
Exhibit No. Description
**14.1 — Friedman Industries, Incorporated Code of Conduct and Ethics.
**21.1 — List of Subsidiaries.
**23.1 — Consent of Moss Adams LLP.
**101.INS — Inline XBRL Instance Document.
**101.SCH — Inline XBRL Taxonomy Schema Document.
**101.CAL — Inline XBRL Calculation Linkbase Document.
**101.DEF — Inline XBRL Definition Linkbase Document.
**101.LAB — Inline XBRL Label Linkbase Document.
**101.PRE — Inline XBRL Presentation Linkbase Document.
** Filed herewith.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Friedman Industries, Incorporated has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FRIEDMAN INDUSTRIES, INCORPORATED
By: /S/ MICHAEL J. TAYLOR
Michael J. Taylor
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Friedman Industries, Incorporated in the capacities and on the dates indicated.
Signature Title Date
/S/ MICHAEL J. TAYLOR President and Chief Executive Officer and June 11, 2024
Michael J. Taylor Director (Principal Executive Officer)
/S/ ALEX LARUE Chief Financial Officer — Secretary and June 11, 2024
Alex LaRue Treasurer (Principal Financial Officer
and Principal Accounting Officer)
/S/ DURGA D. AGRAWAL Director June 11, 2024
Durga D. Agrawal
/S/ MAX REICHENTHAL Director June 11, 2024
Max Reichenthal
/S/ SANDY SCOTT Director June 11, 2024
Sandy Scott
/S/ JOEL SPIRA Director June 11, 2024
Joel Spira
/S/ TIM STEVENSON Director June 11, 2024
Tim Stevenson
/S/ SHARON TAYLOR Director June11, 2024
Sharon Taylor
/S/ JOE L. WILLIAMS Director June 11, 2024
Joe L. Williams
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