8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):  November 8, 2023

RCM Technologies, Inc.

(Exact Name of Registrant as Specified in Charter)

Nevada (State or Other Jurisdiction of Incorporation) 1-10245 (Commission File Number) 95-1480559 (I.R.S. Employer Identification No.)

2500 McClellan Avenue, Suite 350
Pennsauken, NJ	08109-4613
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (856) 356-4500 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12).
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b)).
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c)).

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.05 per share	RCMT	The NASDAQ Stock Market LLC

Item 2.02.       Results of Operations and Financial Condition.

On November 8, 2023, the Registrant issued a press release regarding its financial results for the thirteen and thirty-nine weeks ended September 30, 2023.  A copy of the press release is furnished as Exhibit 99 to this report.

The information set forth under this “Item 2.02. Results of Operations and Financial Condition” (including the exhibit) shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference in any filing made by the Registrant pursuant to the Securities Act of 1933, as amended, other than to the extent that such filing incorporates by reference any or all of such information by express reference thereto.

Item 9.01.       Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

None.

(b) Pro Forma Financial Information.

None.

(c) Shell Company Transactions.

None.

(d) Exhibits.

Exhibit Number
99	Press Release by the Registrant, dated November 8, 2023, furnished in accordance with Item 2.02 of this Current Report on Form 8-K.
104	Cover Page Interactive Data File (formatted as Inline XBRL).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

RCM TECHNOLOGIES, INC.

By:	/s/ Kevin D. Miller
	Kevin D. Miller
	Chief Financial Officer, Treasurer and Secretary

Dated: November 8, 2023

EX-99

Exhibit 99

RCM Technologies, Inc.	Tel: 856.356.4500	Corporate Contacts:
2500 McClellan Avenue	Fax: 856.356.4600	Bradley S. Vizi
Pennsauken, NJ 08109	info@rcmt.com	Executive Chairman
	www.rcmt.com	Kevin D. Miller
		Chief Financial Officer

P R E S S   R E L E A S E

RCM TECHNOLOGIES, INC. ANNOUNCES

THIRD QUARTER RESULTS

Pennsauken, NJ – November 8, 2023 -- 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 and thirty-nine weeks ended September 30, 2023.

RCM Technologies reported revenue of $58.0 million for the thirteen weeks ended September 30, 2023 (the current period), a decrease of 0.2% compared to $58.2 million for the thirteen weeks ended October 1, 2022 (the comparable prior-year period). Gross profit was $17.3 million for the current period, a 0.4% decrease compared to $17.4 million for the comparable prior-year period.  The Company experienced GAAP operating income of $4.3 million for the current period compared to $4.8 million for the comparable prior-year period.  The Company experienced GAAP net income of $3.8 million, or $0.46 per diluted share, for the current period compared to $3.5 million, or $0.33 per diluted share, for the comparable prior-year period. The Company experienced adjusted EBITDA (non-GAAP) of $4.6 million for the current period compared to $4.8 million for the comparable prior-year period. 

RCM Technologies reported revenue of $192.2 million for the thirty-nine weeks ended September 30, 2023 (the current period), a decrease of 10.4% compared to $214.5 million for the thirty-nine weeks ended October 1, 2022 (the comparable prior-year period). Gross profit was $55.1 million for the current period, a 11.8% decrease compared to $62.5 million for the comparable prior-year period.  The Company experienced GAAP operating income of $15.8 million for the current period compared to $22.0 million for the comparable prior-year period.  The Company experienced GAAP net income of $11.6 million, or $1.33 per diluted share, for the current period compared to $16.1 million, or $1.52 per diluted share, for the comparable prior-year period. The Company experienced adjusted EBITDA (non-GAAP) of $16.3 million for the current period compared to $22.5 million for the comparable prior-year period. 

Bradley Vizi, Executive Chairman of RCM Technologies, commented, “The cadence of our business continues to accelerate as we move through the year. As such, we expect the fourth quarter to be our strongest, and continue to be confident that the long-term outlook for RCM is bright.”

Kevin Miller, Chief Financial Officer of RCM Technologies, commented, “With our continued focus on return on equity, the productivity of our revenue improved in the third quarter of 2023, resulting in 180 basis points of gross margin improvement over the second quarter of 2023.”

Conference Call

On Thursday, November 9, 2023, RCM Technologies will host a conference call to discuss these results. The call will begin at 11:00 a.m. Eastern Time. The dial-in number is (800) 285-6670.

About RCM

RCM Technologies, Inc. is 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 information technology and engineering services. RCM is an innovative leader in delivering these solutions to commercial and government sectors. RCM is also a provider of specialty healthcare services to major health care institutions and educational facilities. RCM’s offices are located in major metropolitan centers throughout North America and Serbia. Additional information can be found at 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, 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
	September 30, 2023	October 1, 2022
Revenue	$58,049	$58,152
Cost of services	40,768	40,794
Gross profit	17,281	17,358
Selling, general and administrative	12,662	12,551
Depreciation and amortization of property and equipment	243	266
Amortization of acquired intangible assets	45	-
Gain on sale of assets	-	(219	)
Operating income	4,331	4,760
Other expense (income), net	141	(55	)
Income before income taxes	4,190	4,815
Income tax expense	434	1,297
Net income	$3,756	$3,518
Diluted net earnings per share data	$0.46	$0.33
Diluted weighted average shares outstanding	8,196,330	10,522,158

	Thirty-Nine Weeks Ended
	September 30, 2023		October 1, 2022
Revenue	$192,209		$214,459
Cost of services	137,144		151,998
Gross profit	55,065		62,461
Selling, general and administrative	38,782		39,962
Depreciation and amortization of property and equipment	756		729
Amortization of acquired intangible assets	136		-
Gain on sale of assets	(395	)	(219	)
Operating income	15,786		21,989
Other expense (income), net	965		(31	)
Income before income taxes	14,821		22,020
Income tax expense	3,245		5,968
Net income	$11,576		$16,052
Diluted net earnings per share data	$1.33		$1.52
Diluted weighted average shares outstanding	8,730,998		10,566,816

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 and thirty-nine weeks ended September 30, 2023 and October 1, 2022.    

	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
GAAP net income	$3,756		$3,518		$11,576		$16,052
Income tax expense	434		1,297		3,245		5,968
Interest expense, net	185		35		970		201
Depreciation of property and equipment	243		266		756		729
Amortization of acquired intangible assets	45		-		136		-
EBITDA (non-GAAP)	$4,663		$5,116		$16,683		$22,950
Adjustments
Gain on sale of assets	-		(219	)	(395	)	(219	)
Gain on foreign currency transactions	(44	)	(90	)	(5	)	(232	)
Adjusted EBITDA (non-GAAP)	$4,619		$4,807		$16,283		$22,499

RCM Technologies, Inc.

Summary of Selected Income Statement Data

(Unaudited)

(In Thousands)

	Thirteen Weeks Ended September 30, 2023
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated
Revenue	$24,895		$22,452		$10,702		$58,049
Cost of services	17,438		16,846		6,484		40,768
Gross profit	$7,457		$5,606		$4,218		$17,281
Gross profit margin	30.0	%	25.0	%	39.4	%	29.8	%

	Thirteen Weeks Ended October 1, 2022
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated
Revenue	$27,997		$20,922		$9,233		$58,152
Cost of services	19,014		15,594		6,186		40,794
Gross profit	$8,983		$5,328		$3,047		$17,358
Gross profit margin	32.1	%	25.5	%	33.0	%	29.8	%

	Thirty-Nine Weeks Ended September 30, 2023
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated
Revenue	$99,553		$61,956		$30,700		$192,209
Cost of services	70,623		47,482		19,039		137,144
Gross profit	$28,930		$14,474		$11,661		$55,065
Gross profit margin	29.1	%	23.4	%	38.0	%	28.6	%

	Thirty-Nine Weeks Ended October 1, 2022
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated
Revenue	$123,638		$61,726		$29,095		$214,459
Cost of services	86,772		45,653		19,573		151,998
Gross profit	$36,866		$16,073		$9,522		$62,461
Gross profit margin	29.8	%	26.0	%	32.7	%	29.1	%

RCM Technologies, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In Thousands, Except Share Amounts)

			September 30,	December 31,
			2023	2022
			(Unaudited)
Current assets:
	Cash and cash equivalents		$654	$339
	Accounts receivable, net		57,459	50,762
	Transit accounts receivable		9,550	3,280
	Prepaid expenses and other current assets		5,311	4,636
		Total current assets	72,974	59,017
Property and equipment, net			2,221	2,098
Other assets:
	Deposits		168	173
	Goodwill		22,147	22,147
	Operating right of use asset		2,976	3,665
	Intangible assets, net		728	864
		Total other assets	26,019	26,849
		Total assets	$101,214	$87,964

Current liabilities:
	Accounts payable and accrued expenses		$12,153		$14,147
	Transit accounts payable		38,421		9,767
	Accrued payroll and related costs		14,619		13,023
	Finance lease payable		348		462
	Income taxes payable		247		85
	Operating right of use liability		884		1,349
	Contingent consideration from acquisitions		300		472
	Deferred revenue		335		1,119
		Total current liabilities	67,307		40,424
Deferred income taxes, net, foreign			166		166
Deferred income taxes, net, domestic			1,652		1,495
Finance lease payable			-		232
Contingent consideration from acquisitions, net of current position			1,671		1,970
Operating right of use liability, net of current position			2,382		2,932
Borrowings under line of credit			6,657		8,783
		Total liabilities	79,835		56,002
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;
		17,660,999 shares issued and 7,900,190 shares outstanding at September 30, 2023 and 17,287,967 shares issued and 9,285,318 shares outstanding at December 31, 2022	880		863
	Additional paid-in capital		116,146		113,878
	Accumulated other comprehensive loss		(2,858	)	(2,863	)
	Accumulated deficit		(24,520	)	(36,096	)
	Treasury stock, 9,760,809 shares at September 30, 2023 and
		8,002,649 shares at December 31, 2022, at cost	(68,269	)	(43,820	)
		Total stockholders’ equity	21,379		31,962
		Total liabilities and stockholders’ equity	$101,214		$87,964

RCM Technologies, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In Thousands)

		Thirteen Weeks Ended
		September 30, 2023		October 1, 2022
Net income		$3,756		$3,518
Adjustments to reconcile net income to cash  used in operating activities		1,049		364
Changes in operating assets and liabilities:
	Accounts receivable	4,143		(5,155	)
	Prepaid expenses and other current assets	(987	)	169
	Net of transit accounts receivable and payable	1,556		(788	)
	Accounts payable and accrued expenses	(785	)	2,064
	Accrued payroll and related costs	2,790		1,187
	Right of use liabilities	(333	)	(366	)
	Income taxes payable	15		(336	)
	Deferred revenue	(169	)	(621	)
	Deposits	2		(11	)
Total adjustments		7,281		(3,488	)
Net cash provided by operating activities		$11,037		$30
Net cash used in investing activities		(315	)	(44	)
Net cash used in financing activities		(11,343	)	(2,293	)
Effect of exchange rate changes on cash and cash equivalents		2		(44	)
Increase in cash and cash equivalents		($619	)	($2,351	)
Common stock repurchase		($3,389	)	($3,613	)

		Thirty-Nine Weeks Ended
		September 30, 2023		October 1, 2022
Net income		$11,576		$16,052
Adjustments to reconcile net income to cash  used in operating activities		2,795		1,550
Changes in operating assets and liabilities:
	Accounts receivable	(6,696	)	(1,590	)
	Prepaid expenses and other current assets	(675	)	603
	Net of transit accounts receivable and payable	22,384		(998	)
	Accounts payable and accrued expenses	(1,798	)	1,479
	Accrued payroll and related costs	1,596		4,235
	Right of use liabilities	(1,016	)	(1,306	)
	Income taxes payable	162		2,574
	Deferred revenue	(784	)	(1,858	)
	Deposits	4		-
Total adjustments		15,972		4,689
Net cash provided by operating activities		27,548		$20,741
Net cash used in investing activities		(480	)	(453	)
Net cash used in financing activities		(26,558	)	(19,468	)
Effect of exchange rate changes on cash and cash equivalents		(195	)	(294	)
Increase in cash and cash equivalents		$315		$526
Common stock repurchase		($24,449	)	($6,394	)

XML

Document And Entity Information	Nov. 08, 2023
Document Information [Line Items]
Entity, Registrant Name	RCM Technologies, Inc.
Document, Type	8-K
Document, Period End Date	Nov. 08, 2023
Entity, Incorporation, State or Country Code	NV
Entity, File Number	1-10245
Entity, Tax Identification Number	95-1480559
Entity, Address, Address Line One	2500 McClellan Avenue, Suite 350
Entity, Address, City or Town	Pennsauken
Entity, Address, State or Province	NJ
Entity, Address, Postal Zip Code	08109-4613
City Area Code	856
Local Phone Number	356-4500
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	RCMT
Security Exchange Name	NASDAQ
Amendment Flag	false
Entity, Central Index Key	0000700841