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Red Flags Detected

  • Covenant Breach (unchanged) — Fixed Charge Coverage Ratio fell to 0.68 (vs. required 1.25), requiring a waiver from the lender.
  • Dividend Suspension (worsened) — Quarterly dividend fully suspended (from $0.01 prior quarter) to prioritize debt reduction.
  • Negative Operating Cash Flow (unchanged) — Operating cash flow swung from $3.8M source to $0.8M use due to working capital deterioration and lower profitability.
NASDAQ: NTIC NORTHERN TECHNOLOGIES INTERNATIONAL CORP 10-Q

NTIC swings to net loss, suspends dividend, breaches debt covenant as margins compress

Filed July 9, 2026 · Period ending May 31, 2026 · Compared to 10-Q Jul 11, 2025 · ~2 min read

Key Changes

  • high

    Breached Fixed Charge Coverage Ratio covenant (0.68 vs. required 1.25) as of May 31, 2026; obtained waiver from JPMorgan on July 7, 2026. Signals deteriorating financial performance and increased credit risk.

    Notes: Covenant breach and waiver verify on EDGAR →
  • high

    Suspended quarterly cash dividend entirely on April 24, 2026 to focus on debt reduction. Prior quarter had reduced dividend to $0.01 per share; now eliminated.

    MD&A: Dividend suspension verify on EDGAR →
  • high

    Gross margin compressed 480 basis points (Q3: 66.4% COGS vs. 61.6% prior year; 9M: 64.9% vs. 62.5%) due to higher raw material prices and pricing discounts. Operating cash flow swung from $3.8M source to $0.8M use.

    MD&A: Gross margin compression verify on EDGAR →

2 more material changes behind this preview — plus the full narrative summary, section-by-section diffs against the prior filing, and verbatim quotes with EDGAR citations.

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View original filing on SEC.gov View full financials on EDGAR ↗

Source-verified from EDGAR · Narrative written by AI · Jul 11, 2026 · How we verify