EX-99 2 ex_667216.htm EXHIBIT 99 ex_667216.htm

Exhibit 99

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RCM Technologies, Inc.

Tel: 856.356.4500

Corporate Contacts:

2500 McClellan Avenue

info@rcmt.com

Bradley S. Vizi

Pennsauken, NJ 08109

www.rcmt.com

Executive Chairman

 

 

Kevin D. Miller
   

Chief Financial Officer

 

 

P R E S S   R E L E A S E

 

RCM TECHNOLOGIES, INC. ANNOUNCES

FIRST-QUARTER RESULTS

 

Pennsauken, NJ – May 8, 2024 -- RCM Technologies, Inc. (NasdaqGM: RCMT), a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced engineering, specialty health care, and information technology services, today announced financial results for the thirteen weeks ended March 30, 2024.

 

RCM Technologies reported revenue of $71.9 million for the thirteen weeks ended March 30, 2024 (the current quarter), an increase of 7.2% compared to $67.1 million for the thirteen weeks ended April 1, 2023 (the comparable prior quarter). Gross profit was $20.4 million for the current quarter, a 7.1% increase compared to $19.0 million for the comparable prior quarter.  The Company experienced GAAP net income of $4.0 million, or $0.48 per diluted share, for the current quarter compared to $3.8 million, or $0.41 per diluted share, for the comparable prior quarter. The Company experienced adjusted EBITDA (non-GAAP) of $6.8 million for the current quarter compared to $6.1 million for the comparable prior quarter.  The Company experienced $0.53 of adjusted net income per diluted share (non-GAAP) for the current quarter as compared to $0.41 for the comparable prior quarter.

 

Bradley Vizi, Executive Chairman of RCM Technologies, commented, “Our breadth of strategic focus is widening and deepening throughout the organization, with all teams executing on current initiatives while seeding new initiatives designed to propel growth well into the future.”

 

Kevin Miller, Chief Financial Officer of RCM Technologies, commented, “In the first quarter, adjusted EBITDA and adjusted EPS increased 11.1% and 30.4%, respectively. Cash conversion increased both sequentially and year over year. We anticipate continued improvement in cash flow from operations in each of the next two quarters.”

 

 
 

 

Conference Call

On Thursday, May 9, 2024, RCM Technologies will host a conference call to discuss these results. The call will begin at 11:30 a.m. Eastern Time. The dial-in number is (800) 285-6670.

 

About RCM

RCM Technologies (NasdaqGM: RCMT) is a business and technology solutions provider with world-class talent in key market segments. We help design, build, and enable the Industries of Tomorrow, Today. Operating at the intersection of resources, critical infrastructure and modernization of industries through advanced technologies, RCM is a provider of services in Health Care, Engineering, Aerospace & Defense, Process & Industrial, Life Sciences and Data & Solutions. www.rcmt.com.

 

The statements contained in this release that are not purely historical are forward-looking statements within the Private Securities Litigation Reform Act of 1995. They are subject to various risks, uncertainties, and other factors that could cause the Company’s actual results, performance, or achievements to differ materially from those expressed or implied by such forward-looking statements. These statements often include words such as “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “believe,” “plan,” “seek,” “could,” “can,” “should,” “are confident” or similar expressions. In addition, statements that are not historical should also be considered forward-looking statements. These statements are based on assumptions that we have made in light of our experience in the industry, and our perceptions of historical trends, current conditions, expected future developments, and other factors we believe are appropriate in these circumstances. Forward-looking statements include, but are not limited to, those relating to demand for the Company’s services, expectations regarding our future revenues and other financial results, such as cash flows, our pipeline, and potential project wins, and our expectations for investment and growth in our business. Such statements are based on current expectations that involve several known and unknown risks, uncertainties, and other factors, which may cause actual events to be materially different from those expressed or implied by such forward-looking statements. Risk, uncertainties, and other factors may emerge from time to time that could cause the Company’s actual results to differ from those indicated by the forward-looking statements. Investors are directed to consider such risks, uncertainties, and other factors described in documents filed by the Company with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. The Company assumes no obligation (and expressly disclaims any such obligation) to update any forward-looking statements contained in this release as a result of new information or future events or developments, except as may be required by law.

 

Tables to Follow

 

 
 

 

RCM Technologies, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In Thousands, Except Per Share Amounts)

 

 

 

Thirteen Weeks Ended

 
 

March 30,

2024

  

April 1,

2023

  

Revenue

$71,939

  

$67,124

  

Cost of services

51,572

  

48,100

  

Gross profit

20,367

  

19,024

  

Selling, general and administrative

14,199

  

13,396

  

Depreciation and amortization of property and equipment

287

  

271

  

Amortization of acquired intangible assets

45

  

45

  

Gain on sale of assets

-

  

(395

)

Operating income

5,836

  

5,707

  

Other expense, net

426

  

407

  

Income before income taxes

5,410

  

5,300

  

Income tax expense

1,458

  

1,463

  

Net income

$3,952

  

$3,837

  
         

Diluted net earnings per share data

$0.48

  

$0.41

  

Diluted weighted average shares outstanding

8,170,839

  

9,401,867

  

 

 

 
 

 

RCM Technologies, Inc.

Supplemental Operating Results on a Non-GAAP Basis

(Unaudited)

(In Thousands)

 

The following non-GAAP measures, which adjust for the categories of expenses described below, are non-GAAP financial measures.  Our management believes that these non-GAAP financial measures (“Adjusted operating income,” “EBITDA” and “Adjusted EBITDA”) are useful information for investors, shareholders, and other stakeholders of our Company in gauging our results of operations on an ongoing basis and to enhance investors’ overall understanding of our current financial performance and period-to-period comparisons.  Adjusted operating income, EBITDA and Adjusted EBITDA should not be considered alternatives to net income as an indicator of performance.  In addition, Adjusted operating income, EBITDA and Adjusted EBITDA do not take into account changes in certain assets and liabilities and interest and income taxes that can affect cash flows.  We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should be read-only in conjunction with our consolidated financial statements prepared in accordance with GAAP.

 

The following unaudited table presents the Company’s GAAP net income and the corresponding adjustments used to calculate Adjusted operating income, EBITDA and Adjusted EBITDA for the thirteen ended March 30, 2024 and April 1, 2023.   

 

 

Thirteen Weeks Ended

  
 

March 30,

2024

  

April 1,

2023

  

GAAP operating income

$5,836

  

$5,707

  

Adjustments

        

 Gain on sale of assets

-

  

(395

)

 Equity compensation

635

  

496

  

Adjusted operating income (non-GAAP)

$6,471

  

$5,808

  
         

GAAP net income

$3,952

  

$3,837

  

Income tax expense

1,458

  

1,463

  

Interest expense, net

478

  

360

  

Depreciation of property and equipment

287

  

271

  

Amortization of acquired intangible assets

45

  

45

  

EBITDA (non-GAAP)

$6,220

  

$5,976

  
         

Adjustments

        

Gain on sale of assets

-

  

(395

)

(Gain) loss on foreign currency transactions

(52

)

47

  

Equity compensation

635

  

496

  

Adjusted EBITDA (non-GAAP)

$6,803

  

$6,124

  

 

 

 
 

 

RCM Technologies, Inc.

Supplemental Operating Results on a Non-GAAP Basis (Continued)

(Unaudited)

(In Thousands)

 

 

 

Thirteen Weeks Ended

  
 

March 30,

2024

  

April 1,

2023

  

GAAP net income

$3,952

  

$3,837

  

Adjustments

        

Gain on sale of assets

-

  

(395

)

(Gain) loss on foreign currency transactions

(52

)

47

  

Equity compensation

635

  

496

  

Tax impact from normalized rate

(174

)

(136

)

Adjusted net income (non-GAAP)

$4,361

  

$3,849

  
         

GAAP diluted net earnings per share

$0.48

  

$0.41

  

Adjustments

        

Gain on sale of assets

-

  

(0.04

)

(Gain) loss on foreign currency transactions

0.00

  

0.00

  

Equity compensation

0.08

  

0.05

  

Tax impact from normalized rate

(0.03

)

(0.01

)

Adjusted diluted net earnings per share (non-GAAP)

$0.53

  

$0.41

  

 

 

 
 

 

RCM Technologies, Inc.

Summary of Selected Income Statement Data

(Unaudited)

(In Thousands)

 

 

 

Thirteen Weeks Ended March 30, 2024

  
 

Specialty

Health Care

  

Engineering

  

Life Sciences

and IT

  

Consolidated

  
                 

Revenue

$38,182

  

$23,505

  

$10,252

  

$71,939

  

Cost of services

27,108

  

18,003

  

6,461

  

51,572

  

Gross profit

$11,074

  

$5,502

  

$3,791

  

$20,367

  

Gross profit margin

29.0

%

23.4

%

37.0

%

28.3

%

 

 

 

 

Thirteen Weeks Ended April 1, 2023

  
 

Specialty

Health Care

  

Engineering

  

Life Sciences

and IT

  

Consolidated

  
                 

Revenue

$39,130

  

$18,490

  

$9,504

  

$67,124

  

Cost of services

27,458

  

14,444

  

6,198

  

48,100

  

Gross profit

$11,672

  

$4,046

  

$3,306

  

$19,024

  

Gross profit margin

29.8

%

21.9

%

34.8

%

28.3

%

 

 

 
 

 

RCM Technologies, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In Thousands, Except Share Amounts)

 

 

 

March 30,

  

December 30,

  
 

2024

  

2023

  
 

(Unaudited)

      

Current assets:

        
 

Cash and cash equivalents

$2,099

  

$6,284

  
 

Accounts receivable, net

73,486

  

70,690

  
 

Transit accounts receivable

9,722

  

8,891

  
 

Prepaid expenses and other current assets

4,515

  

4,637

  
   

Total current assets

89,822

  

90,502

  
             

Property and equipment, net

4,386

  

4,005

  
         

Deposits

290

  

313

  

Deferred income taxes, foreign

53

  

55

  

Goodwill

22,147

  

22,147

  

Operating right of use asset

3,147

  

2,779

  

Intangible assets, net

638

  

683

  
   

Total other assets

26,275

  

25,977

  
             
   

Total assets

$120,483

  

$120,484

  

 

Current liabilities:

        
 

Accounts payable and accrued expenses

$13,596

  

$12,454

  
 

Transit accounts payable

31,715

  

31,102

  
 

Accrued payroll and related costs

12,174

  

11,203

  
 

Finance lease payable

116

  

233

  
 

Income taxes payable

778

  

330

  
 

Operating right of use liability

615

  

693

  
 

Contingent consideration from acquisitions

300

  

300

  
 

Deferred revenue

3,514

  

1,881

  
   

Total current liabilities

62,808

  

58,196

  
         

Deferred income taxes, net, foreign

185

  

187

  

Deferred income taxes, net, domestic

1,619

  

1,568

  

Contingent consideration from acquisitions, net of current position

1,671

  

1,671

  

Operating right of use liability, net of current position

2,644

  

2,268

  

Borrowings under line of credit

22,159

  

30,804

  
 

Total liabilities

91,086

  

94,694

  
         

Contingencies (note 15)

-

  

-

  
         

Stockholders’ equity:

        
 

Preferred stock, $1.00 par value; 5,000,000 shares authorized;

        
   

no shares issued or outstanding

-

  

-

  
 

Common stock, $0.05 par value; 40,000,000 shares authorized;

        
   

17,775,693 shares issued and 7,947,087 shares outstanding at

March 30, 2024 and 17,673,427 shares issued and 7,844,821 shares

outstanding at December 30, 2023

887

  

882

  
 

Additional paid-in capital

116,256

  

116,579

  
 

Accumulated other comprehensive loss

(2,840

)

(2,813

)
 

Accumulated deficit

(15,313

)

(19,265

)
 

Treasury stock, 9,828,606 shares at March 30, 2024 and

        
 

December 30, 2023, at cost

(69,593

)

(69,593

)
   

Total stockholders’ equity

29,397

  

25,790

  
             
   

Total liabilities and stockholders’ equity

$120,483

  

$120,484

  

 

 
 

 

RCM Technologies, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In Thousands)

 

 

 

Thirteen Weeks Ended

 
 

March 30,

2024

  

April 1,

2023

  

Net income

$3,952

  

$3,837

  

Adjustments to reconcile net income to cash

used in operating activities

1,250

  

703

  

Changes in operating assets and liabilities:

        
 

Accounts receivable

(2,802

)

(8,035

)
 

Prepaid expenses and other current assets

120

  

960

  
 

Net of transit accounts receivable and payable

(219

)

1,472

  
 

Accounts payable and accrued expenses

1,345

  

(1,667

)
 

Accrued payroll and related costs

976

  

2,404

  
 

Right of use liabilities

(304

)

(348

)
 

Income taxes payable

451

  

141

  
 

Deferred revenue

1,633

  

(310

)
 

Deposits

24

  

11

  

Total adjustments

2,474

  

(4,669

)

Net cash provided by (used in) operating activities

6,426

  

(832

)
         

Net cash used in investing activities

(669

)

(332

)

Net cash (used in) provided by financing activities

(9,714

)

2,416

  

Effect of exchange rate changes on cash and cash equivalents

(228

)

234

  

(Decrease) increase in cash and cash equivalents

($4,185

)

$1,486