10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended July 31, 2014

Commission file number: 0-13301 

RF INDUSTRIES, LTD.

(Exact name of registrant as specified in its charter)

Nevada	88-0168936
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
7610 Miramar Road, Building 6000
San Diego, California	92126
(Address of principal executive offices)	(Zip Code)
(858) 549-6340
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.) Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

  Large accelerated filer  o Accelerated filer  o Non-accelerated filer  o Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):  Yes o No  x

The number of shares of the issuer’s Common Stock, par value $0.01 per share, outstanding as of September 5, 2014 was 8,260,307.

1

Part I. FINANCIAL INFORMATION

Item 1: Financial Statements

RF INDUSTRIES, LTD. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

	July 31,		October 31,
	2014		2013
	(Unaudited)		(Note 1)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	14,237	$	11,881
Trade accounts receivable, net of allowance for doubtful accounts of $58 and $103		2,589		3,160
Inventories		5,612		5,995
Other current assets		610		1,552
Deferred tax assets		322		322
TOTAL CURRENT ASSETS		23,370		22,910
Property and equipment:
Equipment and tooling		2,564		2,500
Furniture and office equipment		790		759
		3,354		3,259
Less accumulated depreciation		2,471		2,206
Total property and equipment		883		1,053
Goodwill		3,076		3,076
Amortizable intangible assets, net		1,241		1,407
Non-amortizable intangible assets		410		410
Note receivable from stockholder		67		67
Other assets		21		30
TOTAL ASSETS	$	29,068	$	28,953

2

Item 1: Financial Statements (continued)

RF INDUSTRIES, LTD. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

	July 31,		October 31,
	2014		2013
	(Unaudited)		(Note 1)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable	$	697	$	792
Accrued expenses		1,475		1,741
Customer deposit		12		51
TOTAL CURRENT LIABILITIES		2,184		2,584
Deferred tax liabilities		950		950
TOTAL LIABILITIES		3,134		3,534
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Common stock - authorized 20,000,000 shares of $0.01 par value; 8,260,307 and 8,075,124 shares issued and outstanding at July 31, 2014 and October 31, 2013, respectively		83		81
Additional paid-in capital		16,828		15,706
Retained earnings		9,023		9,632
TOTAL STOCKHOLDERS' EQUITY		25,934		25,419
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	29,068	$	28,953

See Notes to Unaudited Condensed Consolidated Financial Statements.

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Item 1: Financial Statements (continued)

RF INDUSTRIES, LTD. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(In thousands, except share and per share amounts)

	Three Months Ended July 31,					Nine Months Ended July 31,
	2014		2013			2014		2013
Net sales	$	5,536	$	9,478		$	17,150	$	28,220
Cost of sales		3,048		5,530			9,328		15,755
Gross profit		2,488		3,948			7,822		12,465
Operating expenses:
Engineering		228		200			697		599
Selling and general		1,632		1,987			5,395		6,283
Totals		1,860		2,187			6,092		6,882
Operating income		628		1,761			1,730		5,583
Other income – interest		7		5			22		13
Income from continuing operations before provision for income taxes		635		1,766			1,752		5,596
Provision for income taxes		277		489			670		1,574
Income from continuing operations		358		1,277			1,082		4,022
Income (loss) from discontinued operations, net of tax		14		(360	)		32		(445	)
Net income	$	372	$	917		$	1,114	$	3,577
Earnings per share - Basic:
Continuing operations	$	0.05	$	0.16		$	0.14	$	0.54
Discontinued operations		0.00		(0.04	)		0.00		(0.06	)
Net income per share	$	0.05	$	0.12		$	0.14	$	0.48
Earnings per share - Diluted:
Continuing operations	$	0.04	$	0.15		$	0.13	$	0.48
Discontinued operations		0.00		(0.04	)		0.00		(0.05	)
Net income per share	$	0.04	$	0.11		$	0.13	$	0.43
Weighted average shares outstanding:
Basic		8,250,042		7,798,608			8,200,476		7,492,137
Diluted		8,718,656		8,559,635			8,763,593		8,362,978

See Notes to Unaudited Condensed Consolidated Financial Statements.

4

Item 1: Financial Statements (continued)

RF INDUSTRIES, LTD. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(In thousands)

	Nine Months Ended July 31,
	2014			2013
OPERATING ACTIVITIES:
Net income	$	1,114		$	3,577
Adjustments to reconcile net income to net cash provided by operating activities:
Bad debt (recovery) expense		(36	)		61
Accounts receivable write-off		5			-
Depreciation and amortization		445			481
Stock-based compensation expense		323			161
Excess tax benefit from stock-based compensation		(277	)		(482	)
Changes in operating assets and liabilities:
Trade accounts receivable		602			1,564
Inventories		383			(326	)
Other current assets		942			135
Other long-term assets		9			5
Accounts payable		(95	)		(496	)
Customer deposit		(39	)		51
Income taxes prepaid (payable)		277			(25	)
Accrued expenses		(266	)		(173	)
Other long-term liabilities		-			(15	)
Net cash provided by operating activities		3,387			4,518
INVESTING ACTIVITIES:
Capital expenditures		(109	)		(145	)
Net cash used in investing activities		(109	)		(145	)
FINANCING ACTIVITIES:
Proceeds from exercise of stock options		524			2,225
Excess tax benefit from exercise of stock options		277			482
Dividends paid		(1,723	)		(1,790	)
Net cash (used in) provided by financing activities		(922	)		917
Net increase in cash and cash equivalents		2,356			5,290
Cash and cash equivalents, beginning of period		11,881			5,492
Cash and cash equivalents, end of period	$	14,237		$	10,782
Supplemental cash flow information
Income taxes paid	$	-		$	1,264
Write off of fully depreciated fixed assets	$	14		$	-

See Notes to Unaudited Condensed Consolidated Financial Statements.

5

RF INDUSTRIES, LTD. AND SUBSIDIARY

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Unaudited interim condensed consolidated financial statements

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments, which are normal and recurring, have been included in order to make the information not misleading. Information included in the consolidated balance sheet as of October 31, 2013 has been derived from, and certain terms used herein are defined in, the audited financial statements of the Company as of October 31, 2013 included in the Company’s Annual Report on Form 10-K (“Form 10-K”) for the year ended October 31, 2013 that was previously filed with the Securities and Exchange Commission (“SEC”). Operating results for the three and nine month periods ended July 31, 2014 are not necessarily indicative of the results that may be expected for the year ending October 31, 2014. The unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2013.

Principles of consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of RF Industries, Ltd. and its wholly owned subsidiary, Cables Unlimited, Inc. (“Cables Unlimited”), collectively (the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

Revenue recognition

Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and the products are shipped. Most of the Company’s products are sold to continuing customers with established credit histories.

Reclassifications

Certain amounts in the prior period condensed consolidated financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income.

Note 2 - Discontinued operations

During 2013, the Company sold its RF Neulink and RadioMobile divisions, which together had comprised the Company’s RF Wireless segment. The divisions were sold pursuant to asset purchase agreements, whereby no purchase price was paid at the closing. Rather, the agreements stipulated royalty payments from each of the purchasers over a three year period. For the three and nine months ended July 31, 2014, the Company recognized approximately $2,000 and $16,000, respectively, of royalty income related to the RF Neulink Agreement, which amounts have been included within discontinued operations. For the three and nine months ended July 31, 2014, the Company recognized approximately $21,000 and $53,000, respectively, of royalty income related to the RadioMobile Agreement, which amounts have been included within discontinued operations.

6

The following summarized financial information related to the RF Neulink and RadioMobile divisions is segregated from continuing operations and reported as discontinued operations for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,					Nine Months Ended July 31,
	2014		2013			2014		2013
Royalties	$	23	$	-		$	69	$	-
Net sales		-		181			-		1,110
Total revenue		23		181			69		1,110
Cost of sales		-		476			-		926
Gross profit (loss)		23		(295	)		69		184
Operating expenses		4		304			17		913
Operating income (loss)		19		(599	)		52		(729	)
Provision (benefit) for income taxes		5		(239	)		20		(284	)
Income (loss) from discontinued operations, net of tax	$	14	$	(360	)	$	32	$	(445	)

Note 3 - Inventories and major vendors

Inventories, consisting of materials, labor and manufacturing overhead, are stated at the lower of cost or market. Cost has been determined using the weighted average cost method. Inventories consist of the following (in thousands): 

	July 31, 2014		October 31, 2013
Raw materials and supplies	$	1,898	$	1,913
Work in process		18		15
Finished goods		3,696		4,067
Totals	$	5,612	$	5,995

Purchases of inventory from three major vendors during the nine months ended July 31, 2014 represented 14%, 14% and 13% of total inventory purchases compared to 33%, 14% and 10% of total inventory purchases for the same period in 2013. The Company has arrangements with these vendors to purchase product based on purchase orders periodically issued by the Company.

Note 4 - Earnings per share

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of common shares outstanding increased by the effects of assuming that other potentially dilutive securities (such as stock options) outstanding during the period had been exercised and the treasury stock method had been applied. Potentially dilutive securities totaling 252,182 and 21,177 for the three months ended July 31, 2014 and 2013, and 228,069 and 23,279 for the nine months ended July 31, 2014 and 2013, respectively, were excluded from the calculation of diluted per share amounts because of their anti-dilutive effect.

7

The following table summarizes the computation of basic and diluted weighted average shares outstanding:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
Weighted average shares outstanding for basic earnings per share		8,250,042		7,798,608		8,200,476		7,492,137
Add effects of potentially dilutive securities-assumed exercise of stock options		468,614		761,027		563,117		870,841
Weighted average shares outstanding for diluted earnings per share		8,718,656		8,559,635		8,763,593		8,362,978

Note 5 - Stock-based compensation and equity transactions

The Company’s current stock incentive plan provides for the granting of incentive and nonqualified options to the Company’s officers, directors and employees. Incentive stock options granted to the Company’s employees during the nine months ended July 31, 2014 generally vest and are exercisable equally over three years and expire in five years from date of grant. During the nine months ended July 31, 2014, the Company granted incentive stock options for the purchase of a total of 205,323 shares to the Company’s employees. The Company satisfies the exercise of options by issuing previously unissued common shares.

The weighted average fair value of employee and non-employee directors stock options granted by the Company during the nine months ended July 31, 2014 and 2013 was estimated to be $1.99 and $1.12 per share, respectively, using the Black-Scholes option pricing model with the following assumptions:

	2014			2013
Risk-free interest rate		1.11	%		0.36	%
Dividend yield		4.38	%		4.17	%
Expected life of the option		5.0 years			3.5 years
Volatility factor		52.9	%		42.85	%

Expected volatilities are based on historical volatility of the Company’s stock price and other factors. The Company used the historical method to calculate the expected life of the 2014 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options’ expected life. The dividend yield is based upon the historical dividend yield.

Issuances of common stock by the Company

During the nine months ended July 31, 2014, the Company issued 185,183 shares of common stock and received net proceeds of $524,000 in connection with the exercise of employee stock options.

Company stock option plans

Descriptions of the Company’s stock option plans are included in Note 8 of the Company’s Annual Report on Form 10-K for the year ended October 31, 2013. A summary of the status of the options granted under the Company’s stock option plans as of July 31, 2014 and the changes in options outstanding during the nine months then ended is presented in the table that follows:

				Weighted
				Average
	Shares			Exercise Price
Outstanding at November 1, 2013		988,215		$	2.24
Options granted		228,903		$	6.39
Options exercised		(185,183	)	$	2.83
Options canceled or expired		(67,503	)	$	2.10
Options outstanding at July 31, 2014		964,432		$	3.12
Options exercisable at July 31, 2014		648,682		$	1.91
Options vested and expected to vest at July 31, 2014		957,535		$	3.10

Weighted average remaining contractual life of options outstanding as of July 31, 2014: 4.84 years

Weighted average remaining contractual life of options exercisable as of July 31, 2014: 4.53 years

8

Weighted average remaining contractual life of options vested and expected to vest as of July 31, 2014: 4.85 years

Aggregate intrinsic value of options outstanding at July 31, 2014: $2.4 million

Aggregate intrinsic value of options exercisable at July 31, 2014: $2.3 million

Aggregate intrinsic value of options vested and expected to vest at July 31, 2014: $2.4 million

As of July 31, 2014, $443,000 of expense with respect to nonvested share-based arrangements has yet to be recognized which is expected to be recognized over a weighted average period of 4.65 years.

Non-employee directors receive $30,000 annually, which amount is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company’s common stock. During the nine months ended July 31, 2014, the Company granted each of its three non-employee directors options to purchase 7,860 shares. The number of stock option shares granted to each director was determined by dividing $15,000 by the fair value of a stock option grant using the Black Scholes model ($1.91 per share). These options vest ratably over fiscal year 2014.

Stock option expense

During the nine months ended July 31, 2014 and 2013, stock-based compensation expense totaled $323,000 and $161,000, respectively. During the three months ended July 31, 2014 and 2013, stock-based compensation expense totaled $52,000 and $54,000, respectively. For the nine months ended July 31, 2014 and 2013, stock-based compensation classified in cost of sales amounted to $48,000 and $38,000, respectively, and stock-based compensation classified in selling and general expense amounted to $275,000 and $123,000, respectively.

Note 6 - Concentrations of credit risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At July 31, 2014, the Company had cash and cash equivalent balances in excess of Federally insured limits in the amount of approximately $13.5 million.

One customer accounted for approximately 33% and 53% of the Company’s net sales for the nine month periods ended July 31, 2014 and 2013, respectively. This same customer accounted for approximately 34% and 55% of the Company’s net sales for the three months ended July 31, 2014 and 2013, respectively. At July 31, 2014 and October 31, 2013, this customer’s account receivable balance accounted for approximately 29% and 27%, respectively, of the Company’s total net accounts receivable balances.  Although this customer has been an on-going major customer of the Company continuously during the past 15 years, the written agreements with this customer do not have any minimum purchase obligations and the customer could stop buying the Company’s products at any time and for any reason. A reduction, delay or cancellation of orders from this customer or the loss of this customer could significantly reduce the Company’s future revenues and profits.

Sales of one product line accounted for $388,000 or 7% of net sales and $1.8 million or 11% of net sales for the three and nine months ended July 31, 2014, respectively. The Company has a standard written purchase order with this customer and, therefore, this customer does not have any minimum purchase obligations and could stop buying the product at any time. A reduction, delay or cancellation of orders for this product or the loss of this customer could significantly reduce the Company’s revenues and profits.

Note 7 - Segment information

The Company aggregates operating divisions into operating segments which have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; (5) if applicable, the nature of the regulatory environment. The Company currently has three segments - RF Connector and Cable Assembly, Cables Unlimited and Medical Cabling and Interconnector based upon this evaluation. During fiscal 2013, the Company disposed of its RF Wireless segment.

  The RF Connector and Cable Assembly segment is comprised of two divisions, whereas the Cables Unlimited segment and the Medical Cabling and Interconnector segment are each comprised of one division. The three divisions that meet the quantitative thresholds for segment reporting are Connector and Cable Assembly, Cables Unlimited and Bioconnect. The other division aggregated into the RF Connector and Cable Assembly segment has similar products that are marketed to their respective customer base and production and product development processes that are similar in nature. The specific customers are different for each division; however, there is some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.

Management identifies the Company’s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the Company aggregates the Connector and Cable Assembly and Aviel divisions into the RF Connector and Cable Assembly segment, while the Cables Unlimited division constitutes the Cables Unlimited segment. The Bioconnect Division comprises the Medical Cabling and Interconnector segment.

9

As reviewed by the Company’s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Effective beginning with the second quarter of fiscal 2013, the Company changed its measurement of segment profit or loss whereby certain corporate costs, previously attributed to the RF Connector and Cable Assembly segment, have been allocated to each of the segments. Certain amounts in the fiscal 2013 segment tables have been reclassified to conform to the fiscal 2014 presentation to reflect all segment information on a comparable basis. Additionally, with the sale and discontinuation of the RF Neulink and RadioMobile divisions during fiscal 2013, the segment information has been adjusted as these divisions are reflected within discontinued operations. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same as for the Company as a whole.

Substantially all of the Company’s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. The following table presents the sales of the Company by geographic area for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
United States	$	5,148	$	9,152	$	15,897	$	27,104
Foreign Countries:
Canada		91		159		310		439
Israel		65		62		287		210
Mexico		132		55		390		333
All Other		100		50		266		134
		388		326		1,253		1,116
Totals	$	5,536	$	9,478	$	17,150	$	28,220

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the three months ended July 31, 2014 and 2013 are as follows (in thousands): 

	RF Connector					Medical
	and		Cables			Cabling and
	Cable Assembly		Unlimited			Interconnector		Corporate		Total
2014
Net sales	$	3,375	$	1,497		$	664	$	-	$	5,536
Income (loss) from continuing operations before provision for income taxes		662		(199	)		166		6		635
Depreciation and amortization		47		98			6		-		151
2013
Net sales	$	3,164	$	5,548		$	766	$	-	$	9,478
Income from continuing operations before provision for income taxes		315		1,277			173		1		1,766
Depreciation and amortization		59		89			11		2		161

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the nine months ended July 31, 2014 and 2013 are as follows (in thousands): 

10

	RF Connector					Medical
	and		Cables			Cabling and
	Cable Assembly		Unlimited			Interconnector		Corporate		Total
2014
Net sales	$	9,659	$	5,364		$	2,127	$	-	$	17,150
Income (loss) from continuing operations before provision for income taxes		1,621		(385	)		499		17		1,752
Depreciation and amortization		143		281			21		-		445
2013
Net sales	$	10,548	$	15,390		$	2,282	$	-	$	28,220
Income from continuing operations before provision for income taxes		1,501		3,524			568		3		5,596
Depreciation and amortization		181		261			33		6		481

Note 8 -Income tax provision

The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rates from quarter to quarter.

The provision for income taxes was 44% and 28% of income from continuing operations before income taxes for the three months ended July 31, 2014 and 2013, respectively, and 38% and 28% of income from continuing operations before income taxes for the nine months ended July 31, 2014 and 2013, respectively. The change in the effective income tax rate from period to period was primarily driven by changes in the rate resulting from the reversal of cumulative compensation expense related to disqualifying disposition of incentive stock options under ASC 718.

The total amount of unrecognized tax benefits was $0 as of July 31, 2014 and October 31, 2013. The gross liability for income taxes related to unrecognized tax benefits, if any, is included in other long-term liabilities in the Company's condensed consolidated balance sheets.

The total balance of accrued interest and penalties related to uncertain tax positions was $0 as of July 31, 2014 and October 31, 2013. The Company recognizes interest and penalties related to uncertain tax positions as a component of income tax expense and the accrued interest and penalties are included in deferred and other long-term liabilities in the Company's condensed consolidated balance sheets. There were no material interest or penalties included in income tax expense for each of the three and nine months ended July 31, 2014 and 2013.

Note 9 - Intangible assets

Intangible assets are comprised of the following (in thousands): 

	July 31, 2014			October 31, 2013
Amortizable intangible assets:
Non-compete agreements (estimated life 5 years)	$	200		$	200
Accumulated amortization		(125	)		(95	)
		75			105
Customer relationships (estimated life 9.6 years)		1,730			1,730
Accumulated amortization		(564	)		(428	)
		1,166			1,302
Totals	$	1,241		$	1,407
Non-amortizable intangible assets:
Trademarks	$	410		$	410

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 Note 10 - Accrued expenses and other long-term liabilities

Accrued expenses consist of the following (in thousands):

	July 31, 2014		October 31, 2013
Wages payable	$	559	$	1,188
Accrued receipts		818		376
Other current liabilities		98		177
Totals	$	1,475	$	1,741

Accrued receipts represent purchased inventory for which invoices have not been received.

Note 11 - Line of credit

In March 2014, the Company entered into an agreement for a line of credit (“LOC”) in the amount of $5.0 million. Amounts outstanding under the LOC shall bear interest at a rate of 3.0% plus LIBOR (“base interest rate”), with interest payable on the last day of each month. All principal outstanding under the LOC which is not bearing interest at a base interest rate shall bear interest at Union Bank’s Reference Rate, as defined, which rate shall vary. Borrowings under the LOC are secured by a security interest in certain assets of the Company. The LOC contains certain loan covenants as described in the agreement. Failure to maintain the loan covenants shall constitute an event of default resulting in all outstanding amounts of principal and interest becoming immediately due and payable. All outstanding principal and interest is due and payable on June 30, 2016. As of July 31, 2014, no amounts were outstanding under the LOC.

Note 12 - Commitments

In April 2014, the Company amended its lease for its facility in San Diego, California extending the term of the lease and reducing its square footage. The amended lease expires in March 2017 and requires minimum annual rental payments (starting at approximately $19,000 per month) that are subject to fixed annual increases. The minimum annual rentals under this lease are being charged to expense on a straight-line basis over the lease term. The San Diego lease also requires the payment of the Company’s pro rata share of real estate taxes and insurance, maintenance and other operating expenses related to the facilities. As of July 31, 2014, the aggregate remaining minimum lease payments under this lease totaled $627,000.

Note 13 - Cash dividend and declared dividends

The Company paid dividends of $0.07 per share during the three months ended July 31, 2014, April 30, 2014 and January 31, 2014 for a total of $1.7 million. The Company paid dividends of $0.07 per share during the three months ended July 31, 2013 and April 30, 2013 and $0.10 per share during the three months ended January 31, 2013 for a total of $1.8 million during the nine months ended July 31, 2013.

Note 14 - Stock Repurchase Program

During April 2014, the Company announced that its Board of Directors authorized the repurchase of up to 500,000 shares of its common stock. The share repurchase program may be suspended or terminated at any time without prior notice. As of July 31, 2014, no shares had been repurchased pursuant to the program.

Note 15 - Subsequent events

At its September 5, 2014 meeting, the Board of Directors of the Company declared a quarterly cash dividend of $0.07 per share to be paid on October 15, 2014 to stockholders of record on September 30, 2014.

Item 2:   Management’s Discussion and Analysis of Financial Condition and Results of Operations 

This report contains forward-looking statements. These statements relate to future events or the Company’s future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “except,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither the Company, nor any other person, assumes responsibility for the accuracy and completeness of the forward-looking statements. The Company is under no obligation to update any of the forward-looking statements after the filing of this Quarterly Report on Form 10-Q to conform such statements to actual results or to changes in its expectations.

12

The following discussion should be read in conjunction with the Company’s unaudited condensed consolidated financial statements and the related notes and other financial information appearing elsewhere in this Form 10-Q. Readers are also urged to carefully review and consider the various disclosures made by the Company which attempt to advise interested parties of the factors which affect the Company’s business, including without limitation the disclosures made under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the caption “Risk Factors,” and the audited consolidated financial statements and related notes included in the Company’s Annual Report filed on Form 10-K for the year ended October 31, 2013 and other reports and filings made with the Securities and Exchange Commission.

Critical Accounting Policies

The unaudited condensed consolidated financial statements of the Company are prepared in conformity with accounting principles generally accepted in the United States of America (“U. S. GAAP”). U.S. GAAP requires the Company to make certain estimates and judgments that may affect the financial statements. One of the accounting policies that involves significant judgments and estimates concerns our inventory valuation. Inventories are valued at their weighted average cost. Certain items in inventory may be considered obsolete or excess and, as such, we periodically review our inventories for excess and slow moving items and make provisions as necessary to properly reflect inventory value. Because inventories represent a significant portion of our total assets, any material reduction in the value of our inventories would require us to take write-offs that would affect our net worth and future earnings.

Another accounting policy that involves significant judgments and estimates is our accounts receivable allowance valuation, which requires us to make estimates about matters that are inherently uncertain. The Company routinely assesses the financial strength of its customers and maintains an allowance for doubtful accounts that management believes will adequately provide for credit losses.

Another critical accounting policy that involves significant judgments and estimates is management’s assessment of non-amortizable intangible assets for impairments. We review our non-amortizable intangible assets for impairment annually in the fourth quarter at the reporting unit level. Each quarter, we also analyze whether any indicators of impairment exist.

Another critical accounting policy that involves significant judgments and estimates is management’s assessment of goodwill for impairment, which requires us to make assumptions and judgments regarding expected future cash flows. We review our goodwill for impairment annually in the fourth quarter at the reporting unit level. Each quarter, we also analyze whether any indicators of impairment exist.

The Company uses the Black-Scholes model to value stock option grants. This valuation is affected by the Company’s stock price as well as assumptions regarding a number of inputs which involve significant judgments and estimates. These inputs include the expected term of employee stock options, the expected volatility of the stock price, the risk-free interest rate and expected dividends.

Overview

The Company primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. The Company’s connectivity solutions are used across diversified, high growth markets including wireless carriers and infrastructure and medical and industrial companies. The Company’s Cables Unlimited subsidiary designs, develops and manufactures custom connectivity solutions for special projects. Accordingly, Cables Unlimited’s revenues fluctuate with the demand for its custom products.

Liquidity and Capital Resources

Management believes that existing current assets and the amount of cash it anticipates it will generate from current operations will be sufficient to fund the anticipated liquidity and capital resource needs of the Company for at least twelve months. Additionally, the Company has access to a line of credit in the amount of $5.0 million, of which the full amount is available as of July 31, 2014, should the Company need to obtain additional capital. Management believes that its existing assets and the cash expected to be generated from operations will be sufficient during the current fiscal year based on the following:

· As of July 31, 2014, the Company had cash and cash equivalents equal to $14.2 million.

· As of July 31, 2014, the Company had $23.4 million in current assets and $2.2 million in current liabilities.

· As of July 31, 2014, the Company had no outstanding indebtedness for borrowed funds.

The Company does not anticipate needing material additional capital equipment in the next twelve months. In the past, the Company has financed some of its equipment and furnishings requirements through capital leases. No additional capital equipment purchases have been currently identified that would require significant additional leasing or capital expenditures during the next twelve months. Management also believes that based on the Company’s current financial condition and recent operating results, as well as access to its line of credit, the Company would be able to finance its expansion, if necessary.

13

In April 2014, the Company announced that it may repurchase up to 500,000 shares of the Company’s common stock in open market transactions. The share repurchase program may be suspended or terminated at any time. As of July 31, 2014, no shares have been repurchased pursuant to this program.

The Company generated $2.4 million of cash primarily from operating activities of $3.4 million during the nine months ended July 31, 2014. The increase in cash from operating activities was primarily due to net income of $1.1 million, $1.8 million generated from operating assets and liabilities and other non-cash charges of $737,000, which were offset by excess tax benefit from stock-based compensation of $277,000. Additionally, the Company generated cash of $801,000 from the exercise of stock options inclusive of the related tax benefits from these exercises. These cash increases were partially offset by the payment of $1.7 million of dividends to its stockholders.

As of July 31, 2014, the Company had a total of $14.2 million of cash and cash equivalents compared to a total of $11.9 million of cash and cash equivalents as of October 31, 2013. As of July 31, 2014, the Company had working capital of $21.2 million and a current ratio of approximately 11:1.

Results of Operations

Three Months Ended July 31, 2014 vs. Three Months Ended July 31, 2013

Net sales for the three months ended July 31, 2014 (the “fiscal 2014 quarter”) decreased by 42% or $3.9 million to $5.5 million from $9.4 million for the three months ended July 31, 2013 (the “fiscal 2013 quarter”) primarily due to a significant decrease in net sales at the Company’s Cables Unlimited segment. The Cables Unlimited segment generated $1.5 million of sales in the fiscal 2014 quarter, a decrease of $4.0 million or 73%, compared to the fiscal 2013 quarter. Most of the revenues generated by Cables Unlimited in the fiscal 2013 quarter were generated by the sale of a single line of new cabling products that Cables Unlimited developed to address the needs of some telecommunications companies. The decrease in net sales at Cables Unlimited during the fiscal 2014 quarter was primarily due to a decline in demand for this project based line of cabling products. Orders for Cables Unlimited’s new cabling product are primarily dependent upon the number of cellular telephone sites that are being retrofitted for 4G technologies and, to a lesser extent, on the availability of other competing products. Accordingly, the future demand for this product will depend upon the number of cell site upgrades and, therefore, cannot be accurately estimated. The overall decrease in sales during the fiscal 2014 quarter was partially offset by an increase in sales of $211,000 or 7% at the RF Connector and Cable Assembly segment, which generated sales of $3.4 million during the fiscal 2014 quarter compared to $3.2 million during the fiscal 2013 quarter. The Medical Cabling and Interconnector segment generated revenues of $664,000 during the fiscal 2014 quarter, a decrease of $102,000 or 13% over the prior comparable period. The decrease in medical cabling revenue was due to decreased sales from a significant existing customer. Due to the slowdown in orders from this significant customer for the Medical Cabling and Interconnector segment, the Company expects a decline in revenues at this segment in subsequent quarters.

The Company’s gross profit as a percentage of sales increased by 3% to 45% during the fiscal 2014 quarter compared to 42% in the fiscal 2013 quarter primarily as a result of a change in the product mix. Gross margins at the Cables Unlimited segment typically are lower than in the RF Connector and Cable Assembly segment. Accordingly, as net sales decreased at Cables Unlimited, a proportionately larger portion of sales was generated by the RF Connector and Cable Assembly segment, which typically operates at a higher gross margin compared to the other segments.

Engineering expenses increased $28,000, or 14% in the fiscal 2014 quarter to $228,000 from $200,000 in the fiscal 2013 quarter. Engineering expenses represent costs incurred relating to the ongoing development of new products.

Selling and general expenses decreased $355,000, or 18%, in the fiscal 2014 quarter to $1.6 million from $2.0 million in the comparable quarter of the prior fiscal year. The decrease in selling and general expenses was primarily due a reduction in the number of the Company’s employees, which reductions were made in response to decreased sales in certain segments. The reduced number of employees lowered compensation and benefits expense during the current year. Selling and general expenses were higher in the fiscal 2013 quarter because of higher legal and consulting fees incurred in connection with the termination and replacement of an employee in that period.

The provision for income taxes during the fiscal 2014 quarter was $277,000 (or an effective tax rate of approximately 44%), compared to $489,000 in the fiscal quarter 2013 (or an effective tax rate of approximately 28%). The significant decrease in the fiscal 2014 quarter provision for tax is due to the significantly lower income before provision for income taxes during the period. However, the lower effective tax rate in the fiscal 2013 quarter is attributable to the larger tax benefits received by the Company in the 2013 period as a result of the high number of disqualifying dispositions of incentive stock options. The Company receives a tax deduction when its employees make disqualifying dispositions, which tax benefit is equal to the amount of ordinary income the employees recognize for the sale of their disqualifying incentive stock options.

Income from discontinued operations, net of tax, during the fiscal 2014 quarter was $14,000 compared to a loss from discontinued operations, net of tax, of $360,000 in the fiscal 2013 quarter. During fiscal 2013, the Company sold its RadioMobile and RF Neulink divisions and, accordingly, the results of these divisions are included in discontinued operations for all periods presented. During the fiscal 2013 quarter, these discontinued divisions incurred losses from operations; however, these divisions are no longer owned by the Company, but the Company continues to generate royalties in connection with the sale of these divisions.

14

Nine Months Ended July 31, 2014 vs. Nine Months Ended July 31, 2013

Net sales for the nine months ended July 31, 2014 decreased by 39% or $11.0 million to $17.2 million from $28.2 million for the nine months ended July 31, 2013 primarily due to a significant decrease in net sales at the Company’s Cables Unlimited segment and, to a lesser extent, to a decrease in net sales in the other two segments. Cables Unlimited segment revenues decreased by $10.0 million, or 65%, in the nine months ended July 31, 2014, compared to the prior year period. Most of the revenues generated by Cables Unlimited during the nine months ended July 31, 2013 were generated by the sale of a single line of new cabling products. The decrease in net sales at Cables Unlimited was primarily due to a decline in demand for this new line of cabling products. Also contributing to the overall decrease in sales during the nine months ended July 31, 2014 was a decrease in sales of $889,000 or 8% at the RF Connector and Cable Assembly segment, which generated sales of $9.7 million during the nine months ended July 31, 2014 compared to $10.5 million during the prior year comparable period. The decrease in net sales at the RF Connector and Cable Assembly segment is attributable to an industry-wide softening of demand for RF cable and connector products. The Medical Cabling and Interconnector segment had revenues of $2.1 million, a decrease of $155,000 or 7% over the prior comparable period. The decrease in medical cabling revenue was due to decreased sales from a significant existing customer.

The Company’s gross profit as a percentage of sales increased slightly by 1% to 45% during the nine months ended July 31, 2014 compared to 44% in the comparable prior year period primarily as a result of a change in the product mix with a larger portion of sales coming from the RF Connector and Cable Assembly segment, which typically operates at a higher gross margin compared to the other segments. The overall increase in gross margins was partially offset by a decrease in gross margins for the Cables Unlimited products resulting from certain fixed manufacturing costs spread over a lower revenue base, as well as lower pricing due to increased competition and a change in customers.

Engineering expenses increased $98,000 or 16% during the nine months ended July 31, 2014 to $697,000 compared to $599,000 during the comparable prior year period due to increased salary expense related to engineering activities. Engineering expenses represent costs incurred relating to the ongoing development of new products.

Selling and general expenses decreased $888,000, or 14%, during the nine months ended July 31, 2014 to $5.4 million from $6.3 million in the comparable prior year period. The decrease in selling and general expenses was primarily due to lower compensation and benefits expense as a result of a decrease in headcount during fiscal 2014. In addition, the nine months ended July 31, 2013 included lump-sum bonus payments to senior management and increased legal and consulting fees in connection with the termination and replacement of an employee. These decreases in selling and general expenses were partially offset by increased stock-based compensation expense during fiscal 2014 related to the acceleration of certain stock options to a former employee.

The provision for income taxes during the nine months ended July 31, 2014 was $670,000 (or an effective tax rate of approximately 38%), compared to $1.6 million in the comparable prior year period (or an effective tax rate of approximately 28%). The significant decrease in the provision for tax for the nine months ended July 31, 2014 is due to the significantly lower income before provision for income taxes during the period. However, the lower effective tax rate in the fiscal 2013 period is attributable to the larger tax benefits received by the Company in the 2013 period as a result of the high number of disqualifying dispositions of incentive stock options.

Income from discontinued operations, net of tax, during the nine months ended July 31, 2014 was $32,000 compared to a loss from discontinued operations, net of tax, of $445,000 during the nine months ended July 31, 2013. During fiscal 2013, the Company sold its RadioMobile and RF Neulink divisions and, accordingly, the results of these divisions are included in discontinued operations for all periods presented. During the nine months ended July 31, 2014, these discontinued divisions incurred gains from operations; however, these divisions are no longer owned by the Company, but the Company continues to generate royalties in connection with the sale of these divisions.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Nothing to report.

Item 4. Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by Securities and Exchange Commission Rule 13a-15(b), the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the fiscal quarter covered by this report. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of July 31, 2014.

15

There has been no change in the Company’s internal control over financial reporting during the quarter ended July 31, 2014 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Part II. OTHER INFORMATION

Item 1. Legal Proceedings

Nothing to report.

Item 1A. Risk Factors

The discussion of our business and operations should be read together with the risk factors contained in Item 1A of our Annual Report on Form 10-K for the fiscal year ended October 31, 2013 filed with the SEC, which describe various risks and uncertainties to which we are or may become subject. These risks and uncertainties have the potential to affect our business, financial condition, results of operations, cash flows, strategies or prospects in a material and adverse manner. There have been no material changes from the risk factors previously disclosed in the above-mentioned periodic report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Nothing to report.

Item 3. Defaults upon Senior Securities

Nothing to report.

Item 4. Mine Safety Disclosures

Nothing to report.

Item 5. Other Information

Nothing to report.

Item 6. Exhibits

Exhibit
Number
31.1:	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2:	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1:	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2:	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1:	Press Release dated September 11, 2014 announcing the financial results for the quarter ended July 31, 2014.

16

SIGNATURES

In accordance with 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 thereunto duly authorized.

	RF INDUSTRIES, LTD.
Date: September 11, 2014	By:	/s/ Howard F. Hill
		Howard F. Hill
		President and Chief Executive Officer

Date: September 11, 2014	By:	/s/ Mark Turfler
		Mark Turfler
		Chief Financial Officer

17

EX-31.1

  Exhibit 31.1

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Howard F. Hill, certify that:

1. I have reviewed this report on Form 10-Q for the quarter ended July 31, 2014 of RF Industries, Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period for which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 11, 2014	/s/ Howard F. Hill
	Howard F. Hill
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Mark Turfler, certify that:

1. I have reviewed this report on Form 10-Q for the quarter ended July 31, 2014 of RF Industries, Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period for which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 11, 2014	/s/ Mark Turfler
	Mark Turfler
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. § 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of RF Industries, Ltd. (the “Company”) on Form 10-Q for the quarter ended July 31, 2014, as filed with the Securities and Exchange Commission (the “Report”), I, Howard F. Hill, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: September 11, 2014	/s/ Howard F. Hill
	Howard F. Hill
	President and Chief Executive Officer

EX-32.2

 Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. § 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of RF Industries, Ltd. (the “Company”) on Form 10-Q for the quarter ended July 31, 2014, as filed with the Securities and Exchange Commission (the “Report”), I, Mark Turfler, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: September 11, 2014	/s/ Mark Turfler
	Mark Turfler
	Chief Financial Officer

EX-99.1

Exhibit 99.1

	FOR IMMEDIATE RELEASE
	Company Contact:	Investor Contact:
	Howard Hill	Robert Jacobs
	President & CEO	Jacobs Communications
	(858) 549-6340	(310) 927 3108
	rfi@rfindustries.com	robert.jacobs@jacobscon.com

RF Industries Reports Third Quarter and

Nine Months Fiscal 2014 Results

Regular Quarterly Dividend of $0.07 Per Share

San Diego, California, September 11, 2014 — RF Industries, Ltd. (NASDAQ: RFIL) today announced results for the third quarter and nine months ended July 31, 2014.

Third Quarter Results

Sales for the fiscal third quarter of 2014 declined $3.9 million to $5.5 million compared to sales of $9.4 million for the same quarter last year. Net income was $372,000, or $0.04 per diluted share, compared to $917,000, or $0.11 per diluted share, in the same period last year. Net sales were affected by a $4.0 million sales decline at the Cables Unlimited (CUI) segment to $1.5 million for the quarter, compared to sales of $5.5 million at CUI in the same quarter last year. The Company's net income for the quarter was also affected by an operating loss at CUI of $199,000, compared to operating income of $1.3 million at CUI in the same period last year.

Gross profit declined to $2.5 million from $3.9 million, but improved, as a percentage of sales, to 45% from 42% of sales in the third quarter last year. Third quarter selling and general expenses declined by $355,000 to $1.6 million, primarily due to lower compensation and benefits expense in connection with a decrease in headcount in the current year.

Howard Hill, President and CEO said, "The decline in the Company's sales and net income is primarily attributable to reduced sales at CUI, due to lower sales of OptiFlex^TM custom wireless cable products, as the pace of antenna tower upgrades to 4G wireless technology has abated. CUI is actively seeking other applications and new customers for its fiber-optic and custom cabling products. While it is anticipated that CUI's sales in the short term will continue at these levels, we are actively developing new products and are optimistic regarding the opportunities to expand sales and market share for this segment.

"RF Connector and Cable Assembly segment sales have increased quarter over quarter this fiscal year as our Passive Intermodulation (PIM) product continues to gain market acceptance. Fiscal 2014 third quarter sales of $3.4 million for this segment increased $211,000, or 7%, compared to the same period last year."

Nine Months Results

Net sales for the nine months ended July 31, 2014 were $17.2 million, compared to sales of $28.2 million for the same period in fiscal 2013. Net income was $1.1 million, or $0.13 per diluted share, compared to $3.6 million, or $0.43 per diluted share, for the same period last year. The Company's net sales were negatively impacted by a $10.0 million decline in sales at CUI to $5.4 million in the nine month period, compared to sales of $15.4 million at CUI for the same period last year. CUI's operating loss was $386,000 for the first nine months of fiscal 2014, compared to operating income of $3.5 million for the same period of fiscal 2013.

(more)

7610 Miramar Road, San Diego, CA 92126-4202 ● (858) 549-6340 ● (800) 233-1728 ● FAX (858) 549-6345

E-mail: rfi@rfindustries.com ● Internet: www.rfindustries.com

RF Industries Reports Third Quarter and Nine Months Fiscal 2014 Results

September 11, 2014

Page Two

The Company's gross profit declined to $7.8 million for the first nine months of fiscal 2014, compared to $12.5 million in the same period last year, but improved, as a percentage of sales, to 46% for the first nine months of 2014 versus 44% of sales for the same period last year. Selling and general expenses declined to $5.4 million, compared to $6.3 million for the same period in fiscal 2013. The decrease in selling and general expenses was primarily due to lower compensation and benefits expense as a result of a decrease in headcount during fiscal 2014. In addition, the first nine months of 2013 included lump-sum bonus payments to senior management and increased legal and consulting fees in connection with the termination and replacement of an employee.

"Our results, year to date, have been strongly affected by the performance of our CUI subsidiary. Although we are not anticipating a rapid upturn in sales of OptiFlex related products, CUI has opportunities to expand its fiber optic and custom cabling and wire harness product line in local and adjacent geographic markets. We believe that the Company's strong cash position enables us to invest in businesses through acquisitions which may supplement our core product lines or improve CUI's market and sales opportunities. We are confident the Company will remain profitable and that our strong balance sheet will provide support for growth and reward our investors", said Howard Hill.

Balance Sheet Data

At July 31, 2014, the Company had working capital of $21.2 million, including cash and cash equivalents of $14.2 million, a current ratio of approximately 11-to-1, no long-term obligations and stockholders' equity of $25.9 million. During the first nine months of fiscal 2014, the Company returned $1.7 million of equity capital to its stockholders as cash dividends.

As previously announced, the Board of Directors declared a regular cash dividend of $0.07 per common share, payable October 15, 2014, to shareholders of record on September 30, 2014.

Conference Call Information

RFI has scheduled a conference call at 11:00 a.m. EDT this morning to discuss its results for the quarter. To participate in the call, dial (877) 407-9210 or (201) 689-8049. A simultaneous webcast of the conference call may be accessed online from the Webcasts and Conference Call link on the Investor Information page at www.rfindustries.com. A replay will be available after 1:00 p.m. EDT at this same Internet address. For a telephone replay, dial (877) 660-6853 or (201) 612-7415, conference ID# 13589710, after 1:00 p.m. EDT.

About RF Industries

RF Industries is a leading designer and manufacturer of innovative interconnect products and complex cable assemblies across diversified, high growth markets including wireless carriers & infrastructure, medical and industrial. The Company's products include RF connectors, coaxial and custom cable assemblies, fiber optic cables, wiring harnesses and medical wiring. The Company's connectivity products are used throughout the growing and evolving wireless infrastructure. The Company has reported 20 consecutive years of profitability and is headquartered in San Diego, California with operations in Las Vegas, Nevada and Yaphank, New York. Please visit the RF Industries website at www.rfindustries.com.

Forward-Looking Statements

This press release contains forward-looking statements with respect to future events which are subject to a number of factors that could cause actual results to differ materially. Factors that could cause or contribute to such differences include, but are not limited to: changes in the telecommunications industry; the operations of the Cables Unlimited division; and the Company's reliance on certain distributors for a significant portion of anticipated revenues. Further discussion of these and other potential risk factors may be found in the Company's public filings with the Securities and Exchange Commission (www.sec.gov) including its Form 10-K. All forward-looking statements are based upon information available to the Company on the date they are published and the Company undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or new information after the date of this release.

* * * * *

RF INDUSTRIES, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED) (in thousands, except share and per share amounts)

	Three Months Ended					Nine Months Ended
	July 31					July 31
	2014		2013			2014		2013
Net sales	$	5,536	$	9,478		$	17,150	$	28,220
Cost of sales		3,048		5,530			9,328		15,755
Gross profit		2,488		3,948			7,822		12,465
Operating expenses:
Engineering		228		200			697		599
Selling and general		1,632		1,987			5,395		6,283
Total operating expenses		1,860		2,187			6,092		6,882
Operating income		628		1,761			1,730		5,583
Other income - interest		7		5			22		13
Income before provision for income taxes		635		1,766			1,752		5,596
Provision for income taxes		277		489			670		1,574
Income from continuing operations		358		1,277			1,082		4,022
Income (loss) from discontinued operations, net of tax		14		(360	)		32		(445	)
Net income	$	372	$	917		$	1,114	$	3,577
Earnings per basic share:
Continuing operations	$	0.05	$	0.16		$	0.14	$	0.54
Discontinued operations		0.00		(0.04	)		0.00		(0.06	)
Net income per share	$	0.05	$	0.12		$	0.14	$	0.48
Earnings per diluted share:
Continuing operations	$	0.04	$	0.15		$	0.13	$	0.48
Discontinued operations		0.00		(0.04	)		0.00		(0.05	)
Net income per share	$	0.04	$	0.11		$	0.13	$	0.43
Weighted average shares outstanding:
Basic		8,250,042		7,798,608			8,200,476		7,492,137
Diluted		8,718,656		8,559,635			8,763,593		8,362,978

RF INDUSTRIES, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	Jul. 31 2014		Oct. 31 2013
	(unaudited)		(audited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	14,237	$	11,881
Trade accounts receivable, net		2,589		3,160
Inventories		5,612		5,995
Other current assets		610		1,552
Deferred tax assets		322		322
TOTAL CURRENT ASSETS		23,370		22,910
Property and equipment, net		883		1,053
Goodwill		3,076		3,076
Amortizable intangible assets, net		1,241		1,407
Non-amortizable intangible assets		410		410
Note receivable from stockholder		67		67
Other assets		21		30
TOTAL ASSETS	$	29,068	$	28,953
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable	$	697	$	792
Accrued expenses		1,475		1,741
Customer deposit		12		51
TOTAL CURRENT LIABILITIES		2,184		2,584
Deferred tax liabilities		950		950
TOTAL LIABILITIES		3,134		3,534
COMMITTMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, authorized 20,000,000 shares of $0.01 par value; 8,260,307 and 8,075,124 shares issued and outstanding at July 31, 2014 and October 31, 2013, respectively		83		81
Additional paid-in capital		16,828		15,706
Retained earnings		9,023		9,632
TOTAL STOCKHOLDERS' EQUITY		25,934		25,419
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	29,068	$	28,953

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Net Sales, Income (Loss) Before Provision for Income Taxes and Other Related Segment Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Segment Reporting Information [Line Items]
Net sales	$ 5,536	$ 9,478	$ 17,150	$ 28,220
Income (loss) from continuing operations before provision for income taxes	635	1,766	1,752	5,596
Depreciation and amortization	151	161	445	481
RF Connector and Cable Assembly
Segment Reporting Information [Line Items]
Net sales	3,375	3,164	9,659	10,548
Income (loss) from continuing operations before provision for income taxes	662	315	1,621	1,501
Depreciation and amortization	47	59	143	181
Cables Unlimited
Segment Reporting Information [Line Items]
Net sales	1,497	5,548	5,364	15,390
Income (loss) from continuing operations before provision for income taxes	(199)	1,277	(385)	3,524
Depreciation and amortization	98	89	281	261
Medical Cabling and Interconnector
Segment Reporting Information [Line Items]
Net sales	664	766	2,127	2,282
Income (loss) from continuing operations before provision for income taxes	166	173	499	568
Depreciation and amortization	6	11	21	33
Corporate
Segment Reporting Information [Line Items]
Net sales	0	0	0	0
Income (loss) from continuing operations before provision for income taxes	6	1	17	3
Depreciation and amortization	$ 0	$ 2	$ 0	$ 6

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Subsequent events - Additional Information (Detail) (USD $)	3 Months Ended						0 Months Ended
	Jul. 31, 2014	Apr. 30, 2014	Jan. 31, 2014	Jul. 31, 2013	Apr. 30, 2013	Jan. 31, 2013	Oct. 15, 2014 Subsequent Event
Subsequent Event [Line Items]
Dividends paid, per share	$ 0.07	$ 0.07	$ 0.07	$ 0.07	$ 0.07	$ 0.10	$ 0.07
Dividends payable, record date							Sep. 30, 2014

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Cash dividend and declared dividends - Additional Information (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended						9 Months Ended
	Jul. 31, 2014	Apr. 30, 2014	Jan. 31, 2014	Jul. 31, 2013	Apr. 30, 2013	Jan. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Dividends Payable [Line Items]
Dividends paid, per share	$ 0.07	$ 0.07	$ 0.07	$ 0.07	$ 0.07	$ 0.10
Dividends paid							$ 1,723	$ 1,790

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Computation of Basic and Diluted Weighted Average Shares Outstanding (Detail)	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Weighted Average Number of Shares Outstanding [Line Items]
Weighted average shares outstanding for basic earnings per share	8,250,042	7,798,608	8,200,476	7,492,137
Add effects of potentially dilutive securities-assumed exercise of stock options	468,614	761,027	563,117	870,841
Weighted average shares outstanding for diluted earnings per share	8,718,656	8,559,635	8,763,593	8,362,978

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Segment information (Tables)

9 Months Ended

Jul. 31, 2014

Segment Reporting [Abstract]

Sales by Geographic Area

The following table presents the sales of the Company by geographic area for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
United States	$	5,148	$	9,152	$	15,897	$	27,104
Foreign Countries:
Canada		91		159		310		439
Israel		65		62		287		210
Mexico		132		55		390		333
All Other		100		50		266		134
		388		326		1,253		1,116
Totals	$	5,536	$	9,478	$	17,150	$	28,220

Net Sales, Income (Loss) Before Provision for Income Taxes and Other Related Segment Information

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the three months ended July 31, 2014 and 2013 are as follows (in thousands): 

	RF Connector				Medical
	and		Cables		Cabling and
	Cable Assembly		Unlimited		Interconnector		Corporate		Total
2014
Net sales	$	3,375	$	1,497	$	664	$	-	$	5,536
Income (loss) from continuing operations before provision for income taxes		662		(199)		166		6		635
Depreciation and amortization		47		98		6		-		151
2013
Net sales	$	3,164	$	5,548	$	766	$	-	$	9,478
Income from continuing operations before provision for income taxes		315		1,277		173		1		1,766
Depreciation and amortization		59		89		11		2		161

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the nine months ended July 31, 2014 and 2013 are as follows (in thousands): 

	RF Connector				Medical
	and		Cables		Cabling and
	Cable Assembly		Unlimited		Interconnector		Corporate		Total
2014
Net sales	$	9,659	$	5,364	$	2,127	$	-	$	17,150
Income (loss) from continuing operations before provision for income taxes		1,621		(385)		499		17		1,752
Depreciation and amortization		143		281		21		-		445
2013
Net sales	$	10,548	$	15,390	$	2,282	$	-	$	28,220
Income from continuing operations before provision for income taxes		1,501		3,524		568		3		5,596
Depreciation and amortization		181		261		33		6		481

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Components of Intangible Assets (Parenthetical) (Detail)	9 Months Ended	12 Months Ended
	Jul. 31, 2014	Oct. 31, 2013
Non-compete agreements (estimated life 5 years)
Intangible Assets [Line Items]
Amortizable intangible assets, estimated life	5 years	5 years
Customer relationships (estimated life 9.6 years)
Intangible Assets [Line Items]
Amortizable intangible assets, estimated life	9 years 7 months 6 days	9 years 7 months 6 days

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Concentrations of credit risk - Additional Information (Detail) (USD $)	9 Months Ended	3 Months Ended		9 Months Ended			12 Months Ended	3 Months Ended	9 Months Ended
	Jul. 31, 2014	Jul. 31, 2014 Sales Revenue, Goods, Net	Jul. 31, 2013 Sales Revenue, Goods, Net	Jul. 31, 2014 Sales Revenue, Goods, Net	Jul. 31, 2013 Sales Revenue, Goods, Net	Jul. 31, 2014 Accounts Receivable	Oct. 31, 2013 Accounts Receivable	Jul. 31, 2014 Optiflex Customer Concentration Risk	Jul. 31, 2014 Optiflex Customer Concentration Risk
Concentration Risk [Line Items]
Cash, FDIC insured amount	$ 13,500,000
Concentration risk, percentage		34.00%	55.00%	33.00%	53.00%	29.00%	27.00%	7.00%	11.00%
Concentration agreement with major customer	15 years
Sales revenue, goods, net								$ 388,000	$ 1,800,000

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Stock Repurchase Program - Additional Information (Detail)	Jul. 31, 2014	Apr. 30, 2014 Board Of Directors
Stock Repurchase Program [Line Items]
Stock Repurchase Program, Number of Shares Authorized to be Repurchased	0	500,000

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Earnings per share

9 Months Ended

Jul. 31, 2014

Earnings Per Share [Abstract]

Earnings per share

Note 4 - Earnings per share

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of common shares outstanding increased by the effects of assuming that other potentially dilutive securities (such as stock options) outstanding during the period had been exercised and the treasury stock method had been applied. Potentially dilutive securities totaling 252,182 and 21,177 for the three months ended July 31, 2014 and 2013, and 228,069 and 23,279 for the nine months ended July 31, 2014 and 2013, respectively, were excluded from the calculation of diluted per share amounts because of their anti-dilutive effect.

The following table summarizes the computation of basic and diluted weighted average shares outstanding:

	Three Months Ended July 31,		Nine Months Ended July 31,
	2014	2013	2014	2013
Weighted average shares outstanding for basic earnings per share	8,250,042	7,798,608	8,200,476	7,492,137
Add effects of potentially dilutive securities-assumed exercise of stock options	468,614	761,027	563,117	870,841
Weighted average shares outstanding for diluted earnings per share	8,718,656	8,559,635	8,763,593	8,362,978

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Accrued Expenses (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2014	Oct. 31, 2013
Schedule of Accrued Liabilities [Line Items]
Wages payable	$ 559	$ 1,188
Accrued receipts	818	376
Other current liabilities	98	177
Totals	$ 1,475	$ 1,741

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Summary of Financial Information Related to RF Neulink (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Summary Financial Information Related to RF Neulink [Line Items]
Income (loss) from discontinued operations, net of tax	$ 14	$ (360)	$ 32	$ (445)
RF Wireless segment
Summary Financial Information Related to RF Neulink [Line Items]
Royalties	23	0	69	0
Net sales	0	181	0	1,110
Total revenue	23	181	69	1,110
Cost of sales	0	476	0	926
Gross profit (loss)	23	(295)	69	184
Operating expenses	4	304	17	913
Operating income (loss)	19	(599)	52	(729)
Provision (benefit) for income taxes	5	(239)	20	(284)
Income (loss) from discontinued operations, net of tax	$ 14	$ (360)	$ 32	$ (445)

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Discontinued operations - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Jul. 31, 2014	Jul. 31, 2014
Radio Mobile, Inc
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Royalty revenue	$ 21	$ 53
RF Neulink
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Royalty revenue	$ 2	$ 16

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Line of credit - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Mar. 31, 2014
Line of Credit Facility [Line Items]
Line of Credit Facility, Interest Rate During Period	3.00%
Line of Credit Facility, Expiration Date	Jun. 30, 2016
Letter of Credit
Line of Credit Facility [Line Items]
Long-term Line of Credit	$ 5.0

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Components of Inventories (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2014	Oct. 31, 2013
Schedule of Inventory [Line Items]
Raw materials and supplies	$ 1,898	$ 1,913
Work in process	18	15
Finished goods	3,696	4,067
Totals	$ 5,612	$ 5,995

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Inventories and major vendors - Additional Information (Detail)	9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013
Schedule of Inventory [Line Items]
Number of major vendors	3
Vendor One
Schedule of Inventory [Line Items]
Purchases of connector products, percentage	14.00%	33.00%
Vendor Two
Schedule of Inventory [Line Items]
Purchases of connector products, percentage	14.00%	14.00%
Vendor Three
Schedule of Inventory [Line Items]
Purchases of connector products, percentage	13.00%	10.00%

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Inventories and major vendors

9 Months Ended

Jul. 31, 2014

Inventory Disclosure [Abstract]

Inventories and major vendors

Note 3 - Inventories and major vendors

Inventories, consisting of materials, labor and manufacturing overhead, are stated at the lower of cost or market. Cost has been determined using the weighted average cost method. Inventories consist of the following (in thousands): 

	July 31, 2014		October 31, 2013
Raw materials and supplies	$	1,898	$	1,913
Work in process		18		15
Finished goods		3,696		4,067
Totals	$	5,612	$	5,995

Purchases of inventory from three major vendors during the nine months ended July 31, 2014 represented 14%, 14% and 13% of total inventory purchases compared to 33%, 14% and 10% of total inventory purchases for the same period in 2013. The Company has arrangements with these vendors to purchase product based on purchase orders periodically issued by the Company.

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Earnings per share - Additional Information (Detail)	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares excluded from computation of diluted per share amount	252,182	21,177	228,069	23,279

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Income tax provision - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013	Oct. 31, 2013
Income Taxes [Line Items]
Provision for income tax as percentage of income before income taxes	44.00%	28.00%	38.00%	28.00%
Unrecognized tax benefits	$ 0		$ 0		$ 0
Accrued interest and penalties related to uncertain tax positions	$ 0		$ 0		$ 0

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jul. 31, 2014	Oct. 31, 2013
CURRENT ASSETS
Cash and cash equivalents	$ 14,237	$ 11,881
Trade accounts receivable, net of allowance for doubtful accounts of $58 and $103	2,589	3,160
Inventories	5,612	5,995
Other current assets	610	1,552
Deferred tax assets	322	322
TOTAL CURRENT ASSETS	23,370	22,910
Property and equipment:
Equipment and tooling	2,564	2,500
Furniture and office equipment	790	759
Total	3,354	3,259
Less accumulated depreciation	2,471	2,206
Total property and equipment	883	1,053
Goodwill	3,076	3,076
Amortizable intangible assets, net	1,241	1,407
Non-amortizable intangible assets	410	410
Note receivable from stockholder	67	67
Other assets	21	30
TOTAL ASSETS	29,068	28,953
CURRENT LIABILITIES
Accounts payable	697	792
Accrued expenses	1,475	1,741
Customer deposit	12	51
TOTAL CURRENT LIABILITIES	2,184	2,584
Deferred tax liabilities	950	950
TOTAL LIABILITIES	3,134	3,534
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock - authorized 20,000,000 shares of $0.01 par value; 8,260,307 and 8,075,124 shares issued and outstanding at July 31, 2014 and October 31, 2013, respectively	83	81
Additional paid-in capital	16,828	15,706
Retained earnings	9,023	9,632
TOTAL STOCKHOLDERS' EQUITY	25,934	25,419
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 29,068	$ 28,953

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Commitments - Additional Information (Detail) (USD $)	1 Months Ended	9 Months Ended
	Apr. 30, 2014	Jul. 31, 2014
Commitments And Contingencies [Line Items]
Operating Leases, Rent Expense, Net, Total		$ 627,000
Minimum annual rental payments	$ 19,000
Lease Expiration Date	Mar. 31, 2017

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Unaudited interim condensed consolidated financial statements

9 Months Ended

Jul. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Unaudited interim condensed consolidated financial statements

Note 1 - Unaudited interim condensed consolidated financial statements

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments, which are normal and recurring, have been included in order to make the information not misleading. Information included in the consolidated balance sheet as of October 31, 2013 has been derived from, and certain terms used herein are defined in, the audited financial statements of the Company as of October 31, 2013 included in the Company’s Annual Report on Form 10-K (“Form 10-K”) for the year ended October 31, 2013 that was previously filed with the Securities and Exchange Commission (“SEC”). Operating results for the three and nine month periods ended July 31, 2014 are not necessarily indicative of the results that may be expected for the year ending October 31, 2014. The unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2013.

Principles of consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of RF Industries, Ltd. and its wholly owned subsidiary, Cables Unlimited, Inc. (“Cables Unlimited”), collectively (the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

Revenue recognition

Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and the products are shipped. Most of the Company’s products are sold to continuing customers with established credit histories.

Reclassifications

Certain amounts in the prior period condensed consolidated financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income.

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Computation of Weighted Average Fair Value of Employee Stock Options using Black-Scholes Option Pricing Model Assumptions (Detail)	9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	1.11%	0.36%
Dividend yield	4.38%	4.17%
Expected life of the option	5 years	3 years 6 months
Volatility factor	52.90%	42.85%

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Inventories and major vendors (Tables)

9 Months Ended

Jul. 31, 2014

Inventory Disclosure [Abstract]

Components of Inventories

 Inventories consist of the following (in thousands): 

	July 31, 2014		October 31, 2013
Raw materials and supplies	$	1,898	$	1,913
Work in process		18		15
Finished goods		3,696		4,067
Totals	$	5,612	$	5,995

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Summary of Status of Options Granted under Stock Option Plans and Changes in Options Outstanding (Detail) (Stock Option, USD $)	9 Months Ended
	Jul. 31, 2014
Stock Option
Shares
Options outstanding at November 1, 2013	988,215
Options granted	228,903
Options exercised	(185,183)
Options canceled or expired	(67,503)
Options outstanding at July 31, 2014	964,432
Options exercisable at July 31, 2014	648,682
Options vested and expected to vest at July 31, 2014	957,535
Weighted Average Exercise Price
Options outstanding at November 1, 2013	$ 2.24
Options granted	$ 6.39
Options exercised	$ 2.83
Options canceled or expired	$ 2.10
Options outstanding at July 31, 2014	$ 3.12
Options exercisable at July 31, 2014	$ 1.91
Options vested and expected to vest at July 31, 2014	$ 3.10

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Stock-based compensation and equity transactions (Tables)

9 Months Ended

Jul. 31, 2014

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Computation of Weighted Average Fair Value of Employee Stock Options using Black-Scholes Option Pricing Model Assumptions

The weighted average fair value of employee and non-employee directors stock options granted by the Company during the nine months ended July 31, 2014 and 2013 was estimated to be $1.99 and $1.12 per share, respectively, using the Black-Scholes option pricing model with the following assumptions:

	2014			2013
Risk-free interest rate		1.11	%		0.36	%
Dividend yield		4.38	%		4.17	%
Expected life of the option		5.0 years			3.5 years
Volatility factor		52.9	%		42.85	%

Summary of Status of Options Granted under Stock Option Plans and Changes in Options Outstanding

A summary of the status of the options granted under the Company’s stock option plans as of July 31, 2014 and the changes in options outstanding during the nine months then ended is presented in the table that follows:

			Weighted
			Average
	Shares		Exercise Price
Outstanding at November 1, 2013		988,215	$	2.24
Options granted		228,903	$	6.39
Options exercised		(185,183)	$	2.83
Options canceled or expired		(67,503)	$	2.10
Options outstanding at July 31, 2014		964,432	$	3.12
Options exercisable at July 31, 2014		648,682	$	1.91
Options vested and expected to vest at July 31, 2014		957,535	$	3.10

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Discontinued operations

9 Months Ended

Jul. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

Discontinued operations

Note 2 - Discontinued operations

During 2013, the Company sold its RF Neulink and RadioMobile divisions, which together had comprised the Company’s RF Wireless segment. The divisions were sold pursuant to asset purchase agreements, whereby no purchase price was paid at the closing. Rather, the agreements stipulated royalty payments from each of the purchasers over a three year period. For the three and nine months ended July 31, 2014, the Company recognized approximately $2,000 and $16,000, respectively, of royalty income related to the RF Neulink Agreement, which amounts have been included within discontinued operations. For the three and nine months ended July 31, 2014, the Company recognized approximately $21,000 and $53,000, respectively, of royalty income related to the RadioMobile Agreement, which amounts have been included within discontinued operations.

The following summarized financial information related to the RF Neulink and RadioMobile divisions is segregated from continuing operations and reported as discontinued operations for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
Royalties	$	23	$	-	$	69	$	-
Net sales		-		181		-		1,110
Total revenue		23		181		69		1,110
Cost of sales		-		476		-		926
Gross profit (loss)		23		(295)		69		184
Operating expenses		4		304		17		913
Operating income (loss)		19		(599)		52		(729)
Provision (benefit) for income taxes		5		(239)		20		(284)
Income (loss) from discontinued operations, net of tax	$	14	$	(360)	$	32	$	(445)

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Jul. 31, 2014	Oct. 31, 2013
Trade accounts receivable, allowance for doubtful accounts	$ 58	$ 103
Common stock, authorized	20,000,000	20,000,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares issued	8,260,307	8,075,124
Common stock, shares outstanding	8,260,307	8,075,124

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Commitments

9 Months Ended

Jul. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments

Note 12 - Commitments

In April 2014, the Company amended its lease for its facility in San Diego, California extending the term of the lease and reducing its square footage. The amended lease expires in March 2017 and requires minimum annual rental payments (starting at approximately $19,000 per month) that are subject to fixed annual increases. The minimum annual rentals under this lease are being charged to expense on a straight-line basis over the lease term. The San Diego lease also requires the payment of the Company’s pro rata share of real estate taxes and insurance, maintenance and other operating expenses related to the facilities. As of July 31, 2014, the aggregate remaining minimum lease payments under this lease totaled $627,000.

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Document And Entity Information	9 Months Ended
	Jul. 31, 2014	Sep. 05, 2014
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q3
Entity Registrant Name	R F INDUSTRIES LTD
Entity Central Index Key	0000740664
Current Fiscal Year End Date	--10-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	RFIL
Entity Common Stock, Shares Outstanding		8,260,307

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Cash dividend and declared dividends

9 Months Ended

Jul. 31, 2014

Cash Dividend And Dividends Declaration [Abstract]

Cash dividend and declared dividends

Note 13 - Cash dividend and declared dividends

The Company paid dividends of $0.07 per share during the three months ended July 31, 2014, April 30, 2014 and January 31, 2014 for a total of $1.7 million. The Company paid dividends of $0.07 per share during the three months ended July 31, 2013 and April 30, 2013 and $0.10 per share during the three months ended January 31, 2013 for a total of $1.8 million during the nine months ended July 31, 2013.

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Net sales	$ 5,536	$ 9,478	$ 17,150	$ 28,220
Cost of sales	3,048	5,530	9,328	15,755
Gross profit	2,488	3,948	7,822	12,465
Operating expenses:
Engineering	228	200	697	599
Selling and general	1,632	1,987	5,395	6,283
Totals	1,860	2,187	6,092	6,882
Operating income	628	1,761	1,730	5,583
Other income - interest	7	5	22	13
Income from continuing operations before provision for income taxes	635	1,766	1,752	5,596
Provision for income taxes	277	489	670	1,574
Income from continuing operations	358	1,277	1,082	4,022
Income (loss) from discontinued operations, net of tax	14	(360)	32	(445)
Net income	$ 372	$ 917	$ 1,114	$ 3,577
Earnings per share - Basic:
Continuing operations	$ 0.05	$ 0.16	$ 0.14	$ 0.54
Discontinued operations	$ 0.00	$ (0.04)	$ 0.00	$ (0.06)
Net income per share	$ 0.05	$ 0.12	$ 0.14	$ 0.48
Earnings per share - Diluted:
Continuing operations	$ 0.04	$ 0.15	$ 0.13	$ 0.48
Discontinued operations	$ 0.00	$ (0.04)	$ 0.00	$ (0.05)
Net income per share	$ 0.04	$ 0.11	$ 0.13	$ 0.43
Weighted average shares outstanding:
Basic	8,250,042	7,798,608	8,200,476	7,492,137
Diluted	8,718,656	8,559,635	8,763,593	8,362,978

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Segment information

9 Months Ended

Jul. 31, 2014

Segment Reporting [Abstract]

Segment information

Note 7 - Segment information

The Company aggregates operating divisions into operating segments which have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; (5) if applicable, the nature of the regulatory environment. The Company currently has three segments - RF Connector and Cable Assembly, Cables Unlimited and Medical Cabling and Interconnector based upon this evaluation. During fiscal 2013, the Company disposed of its RF Wireless segment.

  The RF Connector and Cable Assembly segment is comprised of two divisions, whereas the Cables Unlimited segment and the Medical Cabling and Interconnector segment are each comprised of one division. The three divisions that meet the quantitative thresholds for segment reporting are Connector and Cable Assembly, Cables Unlimited and Bioconnect. The other division aggregated into the RF Connector and Cable Assembly segment has similar products that are marketed to their respective customer base and production and product development processes that are similar in nature. The specific customers are different for each division; however, there is some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.

Management identifies the Company’s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the Company aggregates the Connector and Cable Assembly and Aviel divisions into the RF Connector and Cable Assembly segment, while the Cables Unlimited division constitutes the Cables Unlimited segment. The Bioconnect Division comprises the Medical Cabling and Interconnector segment.

As reviewed by the Company’s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Effective beginning with the second quarter of fiscal 2013, the Company changed its measurement of segment profit or loss whereby certain corporate costs, previously attributed to the RF Connector and Cable Assembly segment, have been allocated to each of the segments. Certain amounts in the fiscal 2013 segment tables have been reclassified to conform to the fiscal 2014 presentation to reflect all segment information on a comparable basis. Additionally, with the sale and discontinuation of the RF Neulink and RadioMobile divisions during fiscal 2013, the segment information has been adjusted as these divisions are reflected within discontinued operations. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same as for the Company as a whole.

Substantially all of the Company’s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. The following table presents the sales of the Company by geographic area for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
United States	$	5,148	$	9,152	$	15,897	$	27,104
Foreign Countries:
Canada		91		159		310		439
Israel		65		62		287		210
Mexico		132		55		390		333
All Other		100		50		266		134
		388		326		1,253		1,116
Totals	$	5,536	$	9,478	$	17,150	$	28,220

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the three months ended July 31, 2014 and 2013 are as follows (in thousands): 

	RF Connector				Medical
	and		Cables		Cabling and
	Cable Assembly		Unlimited		Interconnector		Corporate		Total
2014
Net sales	$	3,375	$	1,497	$	664	$	-	$	5,536
Income (loss) from continuing operations before provision for income taxes		662		(199)		166		6		635
Depreciation and amortization		47		98		6		-		151
2013
Net sales	$	3,164	$	5,548	$	766	$	-	$	9,478
Income from continuing operations before provision for income taxes		315		1,277		173		1		1,766
Depreciation and amortization		59		89		11		2		161

Net sales, income (loss) from continuing operations before provision for income taxes and other related segment information for the nine months ended July 31, 2014 and 2013 are as follows (in thousands): 

	RF Connector				Medical
	and		Cables		Cabling and
	Cable Assembly		Unlimited		Interconnector		Corporate		Total
2014
Net sales	$	9,659	$	5,364	$	2,127	$	-	$	17,150
Income (loss) from continuing operations before provision for income taxes		1,621		(385)		499		17		1,752
Depreciation and amortization		143		281		21		-		445
2013
Net sales	$	10,548	$	15,390	$	2,282	$	-	$	28,220
Income from continuing operations before provision for income taxes		1,501		3,524		568		3		5,596
Depreciation and amortization		181		261		33		6		481

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Concentrations of credit risk

9 Months Ended

Jul. 31, 2014

Risks and Uncertainties [Abstract]

Concentrations of credit risk

Note 6 - Concentrations of credit risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At July 31, 2014, the Company had cash and cash equivalent balances in excess of Federally insured limits in the amount of approximately $13.5 million.

One customer accounted for approximately 33% and 53% of the Company’s net sales for the nine month periods ended July 31, 2014 and 2013, respectively. This same customer accounted for approximately 34% and 55% of the Company’s net sales for the three months ended July 31, 2014 and 2013, respectively. At July 31, 2014 and October 31, 2013, this customer’s account receivable balance accounted for approximately 29% and 27%, respectively, of the Company’s total net accounts receivable balances.  Although this customer has been an on-going major customer of the Company continuously during the past 15 years, the written agreements with this customer do not have any minimum purchase obligations and the customer could stop buying the Company’s products at any time and for any reason. A reduction, delay or cancellation of orders from this customer or the loss of this customer could significantly reduce the Company’s future revenues and profits.

Sales of one product line accounted for $388,000 or 7% of net sales and $1.8 million or 11% of net sales for the three and nine months ended July 31, 2014, respectively. The Company has a standard written purchase order with this customer and, therefore, this customer does not have any minimum purchase obligations and could stop buying the product at any time. A reduction, delay or cancellation of orders for this product or the loss of this customer could significantly reduce the Company’s revenues and profits.

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Earnings per share (Tables)

9 Months Ended

Jul. 31, 2014

Earnings Per Share [Abstract]

Computation of Basic and Diluted Weighted Average Shares Outstanding

The following table summarizes the computation of basic and diluted weighted average shares outstanding:

	Three Months Ended July 31,		Nine Months Ended July 31,
	2014	2013	2014	2013
Weighted average shares outstanding for basic earnings per share	8,250,042	7,798,608	8,200,476	7,492,137
Add effects of potentially dilutive securities-assumed exercise of stock options	468,614	761,027	563,117	870,841
Weighted average shares outstanding for diluted earnings per share	8,718,656	8,559,635	8,763,593	8,362,978

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Stock Repurchase Program

9 Months Ended

Jul. 31, 2014

Equity [Abstract]

Stock Repurchase Program

Note 14 - Stock Repurchase Program

During April 2014, the Company announced that its Board of Directors authorized the repurchase of up to 500,000 shares of its common stock. The share repurchase program may be suspended or terminated at any time without prior notice. As of July 31, 2014, no shares had been repurchased pursuant to the program.

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Accrued expenses and other long-term liabilities

9 Months Ended

Jul. 31, 2014

Payables and Accruals [Abstract]

Accrued expenses and other long-term liabilities

Note 10 - Accrued expenses and other long-term liabilities

Accrued expenses consist of the following (in thousands):

	July 31, 2014		October 31, 2013
Wages payable	$	559	$	1,188
Accrued receipts		818		376
Other current liabilities		98		177
Totals	$	1,475	$	1,741

Accrued receipts represent purchased inventory for which invoices have not been received.

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Income tax provision

9 Months Ended

Jul. 31, 2014

Income Tax Disclosure [Abstract]

Income tax provision

Note 8 -Income tax provision

The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rates from quarter to quarter.

The provision for income taxes was 44% and 28% of income from continuing operations before income taxes for the three months ended July 31, 2014 and 2013, respectively, and 38% and 28% of income from continuing operations before income taxes for the nine months ended July 31, 2014 and 2013, respectively. The change in the effective income tax rate from period to period was primarily driven by changes in the rate resulting from the reversal of cumulative compensation expense related to disqualifying disposition of incentive stock options under ASC 718.

The total amount of unrecognized tax benefits was $0 as of July 31, 2014 and October 31, 2013. The gross liability for income taxes related to unrecognized tax benefits, if any, is included in other long-term liabilities in the Company's condensed consolidated balance sheets.

The total balance of accrued interest and penalties related to uncertain tax positions was $0 as of July 31, 2014 and October 31, 2013. The Company recognizes interest and penalties related to uncertain tax positions as a component of income tax expense and the accrued interest and penalties are included in deferred and other long-term liabilities in the Company's condensed consolidated balance sheets. There were no material interest or penalties included in income tax expense for each of the three and nine months ended July 31, 2014 and 2013.

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Intangible assets

9 Months Ended

Jul. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible assets

Note 9 - Intangible assets

Intangible assets are comprised of the following (in thousands): 

	July 31, 2014		October 31, 2013
Amortizable intangible assets:
Non-compete agreements (estimated life 5 years)	$	200	$	200
Accumulated amortization		(125)		(95)
		75		105
Customer relationships (estimated life 9.6 years)		1,730		1,730
Accumulated amortization		(564)		(428)
		1,166		1,302
Totals	$	1,241	$	1,407
Non-amortizable intangible assets:
Trademarks	$	410	$	410

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Line of credit

9 Months Ended

Jul. 31, 2014

Debt Disclosure [Abstract]

Line of credit

Note 11 - Line of credit

In March 2014, the Company entered into an agreement for a line of credit (“LOC”) in the amount of $5.0 million. Amounts outstanding under the LOC shall bear interest at a rate of 3.0% plus LIBOR (“base interest rate”), with interest payable on the last day of each month. All principal outstanding under the LOC which is not bearing interest at a base interest rate shall bear interest at Union Bank’s Reference Rate, as defined, which rate shall vary. Borrowings under the LOC are secured by a security interest in certain assets of the Company. The LOC contains certain loan covenants as described in the agreement. Failure to maintain the loan covenants shall constitute an event of default resulting in all outstanding amounts of principal and interest becoming immediately due and payable. All outstanding principal and interest is due and payable on June 30, 2016. As of July 31, 2014, no amounts were outstanding under the LOC.

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Stock-based compensation and equity transactions - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average remaining life of options outstanding			4 years 10 months 2 days
Weighted average remaining contractual life of options exercisable			4 years 6 months 11 days
Weighted average life of options vested and expected to vest			4 years 10 months 6 days
Aggregate intrinsic value of options outstanding	$ 2,400,000		$ 2,400,000
Aggregate intrinsic value of options exercisable	2,300,000		2,300,000
Aggregate intrinsic value of options vested and expected to vest	2,400,000		2,400,000
Non-vested stock-based arrangements yet to be recognized	443,000		443,000
Stock based arrangements yet to be recognized, weighted average period expected to be recognized			4 years 7 months 24 days
Weighted average fair value of stock options under Black-Scholes pricing model			$ 1.99	$ 1.12
Proceeds from exercise of stock options			524,000	2,225,000
Non-employee director annual grant	30,000		30,000
Options granted for each non-employee director			7,860
Value of stock option issued			15,000
Fair value of stock option	$ 1.91		$ 1.91
Stock based compensation expense	52,000	54,000	323,000	161,000
Incentive stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Incentive stock options			205,323
Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Issuance of common stock for exercise of stock option			185,183
Cost of Sales
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense			48,000	38,000
Selling, General and Administrative Expenses
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense			$ 275,000	$ 123,000

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Discontinued operations (Tables)

9 Months Ended

Jul. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

Summary Financial Information Related to RF Neulink

The following summarized financial information related to the RF Neulink and RadioMobile divisions is segregated from continuing operations and reported as discontinued operations for the three and nine months ended July 31, 2014 and 2013 (in thousands):

	Three Months Ended July 31,				Nine Months Ended July 31,
	2014		2013		2014		2013
Royalties	$	23	$	-	$	69	$	-
Net sales		-		181		-		1,110
Total revenue		23		181		69		1,110
Cost of sales		-		476		-		926
Gross profit (loss)		23		(295)		69		184
Operating expenses		4		304		17		913
Operating income (loss)		19		(599)		52		(729)
Provision (benefit) for income taxes		5		(239)		20		(284)
Income (loss) from discontinued operations, net of tax	$	14	$	(360)	$	32	$	(445)

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Intangible assets (Tables)

9 Months Ended

Jul. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Components of Intangible Assets

Intangible assets are comprised of the following (in thousands): 

	July 31, 2014		October 31, 2013
Amortizable intangible assets:
Non-compete agreements (estimated life 5 years)	$	200	$	200
Accumulated amortization		(125)		(95)
		75		105
Customer relationships (estimated life 9.6 years)		1,730		1,730
Accumulated amortization		(564)		(428)
		1,166		1,302
Totals	$	1,241	$	1,407
Non-amortizable intangible assets:
Trademarks	$	410	$	410

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Components of Intangible Assets (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2014	Oct. 31, 2013
Intangible Assets [Line Items]
Amortizable intangible assets, net	$ 1,241	$ 1,407
Non-amortizable intangible assets, trade marks	410	410
Non-compete agreements (estimated life 5 years)
Intangible Assets [Line Items]
Amortizable intangible assets, gross	200	200
Amortizable intangible assets, accumulated amortization	(125)	(95)
Amortizable intangible assets, net	75	105
Customer relationships (estimated life 9.6 years)
Intangible Assets [Line Items]
Amortizable intangible assets, gross	1,730	1,730
Amortizable intangible assets, accumulated amortization	(564)	(428)
Amortizable intangible assets, net	$ 1,166	$ 1,302

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013
OPERATING ACTIVITIES:
Net income	$ 1,114	$ 3,577
Adjustments to reconcile net income to net cash provided by operating activities:
Bad debt (recovery) expense	(36)	61
Accounts receivable write-off	5	0
Depreciation and amortization	445	481
Stock-based compensation expense	323	161
Excess tax benefit from stock-based compensation	(277)	(482)
Changes in operating assets and liabilities:
Trade accounts receivable	602	1,564
Inventories	383	(326)
Other current assets	942	135
Other long-term assets	9	5
Accounts payable	(95)	(496)
Customer deposit	(39)	51
Income taxes prepaid (payable)	277	(25)
Accrued expenses	(266)	(173)
Other long-term liabilities	0	(15)
Net cash provided by operating activities	3,387	4,518
INVESTING ACTIVITIES:
Capital expenditures	(109)	(145)
Net cash used in investing activities	(109)	(145)
FINANCING ACTIVITIES:
Proceeds from exercise of stock options	524	2,225
Excess tax benefit from exercise of stock options	277	482
Dividends paid	(1,723)	(1,790)
Net cash (used in) provided by financing activities	(922)	917
Net increase in cash and cash equivalents	2,356	5,290
Cash and cash equivalents, beginning of period	11,881	5,492
Cash and cash equivalents, end of period	14,237	10,782
Supplemental cash flow information - income taxes paid	0	1,264
Supplemental cash flow information - Write off of fully depreciated fixed assets	$ 14	$ 0

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Stock-based compensation and equity transactions

9 Months Ended

Jul. 31, 2014

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Stock-based compensation and equity transactions

Note 5 - Stock-based compensation and equity transactions

The Company’s current stock incentive plan provides for the granting of incentive and nonqualified options to the Company’s officers, directors and employees. Incentive stock options granted to the Company’s employees during the nine months ended July 31, 2014 generally vest and are exercisable equally over three years and expire in five years from date of grant. During the nine months ended July 31, 2014, the Company granted incentive stock options for the purchase of a total of 205,323 shares to the Company’s employees. The Company satisfies the exercise of options by issuing previously unissued common shares.

The weighted average fair value of employee and non-employee directors stock options granted by the Company during the nine months ended July 31, 2014 and 2013 was estimated to be $1.99 and $1.12 per share, respectively, using the Black-Scholes option pricing model with the following assumptions:

	2014			2013
Risk-free interest rate		1.11	%		0.36	%
Dividend yield		4.38	%		4.17	%
Expected life of the option		5.0 years			3.5 years
Volatility factor		52.9	%		42.85	%

Expected volatilities are based on historical volatility of the Company’s stock price and other factors. The Company used the historical method to calculate the expected life of the 2014 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options’ expected life. The dividend yield is based upon the historical dividend yield.

Issuances of common stock by the Company

During the nine months ended July 31, 2014, the Company issued 185,183 shares of common stock and received net proceeds of $524,000 in connection with the exercise of employee stock options.

Company stock option plans

Descriptions of the Company’s stock option plans are included in Note 8 of the Company’s Annual Report on Form 10-K for the year ended October 31, 2013. A summary of the status of the options granted under the Company’s stock option plans as of July 31, 2014 and the changes in options outstanding during the nine months then ended is presented in the table that follows:

			Weighted
			Average
	Shares		Exercise Price
Outstanding at November 1, 2013		988,215	$	2.24
Options granted		228,903	$	6.39
Options exercised		(185,183)	$	2.83
Options canceled or expired		(67,503)	$	2.10
Options outstanding at July 31, 2014		964,432	$	3.12
Options exercisable at July 31, 2014		648,682	$	1.91
Options vested and expected to vest at July 31, 2014		957,535	$	3.10

Weighted average remaining contractual life of options outstanding as of July 31, 2014: 4.84 years

Weighted average remaining contractual life of options exercisable as of July 31, 2014: 4.53 years

Weighted average remaining contractual life of options vested and expected to vest as of July 31, 2014: 4.85 years

Aggregate intrinsic value of options outstanding at July 31, 2014: $2.4 million

Aggregate intrinsic value of options exercisable at July 31, 2014: $2.3 million

Aggregate intrinsic value of options vested and expected to vest at July 31, 2014: $2.4 million

As of July 31, 2014, $443,000 of expense with respect to nonvested share-based arrangements has yet to be recognized which is expected to be recognized over a weighted average period of 4.65 years.

Non-employee directors receive $30,000 annually, which amount is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company’s common stock. During the nine months ended July 31, 2014, the Company granted each of its three non-employee directors options to purchase 7,860 shares. The number of stock option shares granted to each director was determined by dividing $15,000 by the fair value of a stock option grant using the Black Scholes model ($1.91 per share). These options vest ratably over fiscal year 2014.

Stock option expense

During the nine months ended July 31, 2014 and 2013, stock-based compensation expense totaled $323,000 and $161,000, respectively. During the three months ended July 31, 2014 and 2013, stock-based compensation expense totaled $52,000 and $54,000, respectively. For the nine months ended July 31, 2014 and 2013, stock-based compensation classified in cost of sales amounted to $48,000 and $38,000, respectively, and stock-based compensation classified in selling and general expense amounted to $275,000 and $123,000, respectively.

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Accrued expenses and other long-term liabilities (Tables)

9 Months Ended

Jul. 31, 2014

Payables and Accruals [Abstract]

Accrued Expenses

Accrued expenses consist of the following (in thousands):

	July 31, 2014		October 31, 2013
Wages payable	$	559	$	1,188
Accrued receipts		818		376
Other current liabilities		98		177
Totals	$	1,475	$	1,741

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Sales by Geographic Area (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2014	Jul. 31, 2013	Jul. 31, 2014	Jul. 31, 2013
Revenue, Major Customer [Line Items]
Sales revenue	$ 5,536	$ 9,478	$ 17,150	$ 28,220
United States
Revenue, Major Customer [Line Items]
Sales revenue	5,148	9,152	15,897	27,104
Canada
Revenue, Major Customer [Line Items]
Sales revenue	91	159	310	439
Israel
Revenue, Major Customer [Line Items]
Sales revenue	65	62	287	210
Mexico
Revenue, Major Customer [Line Items]
Sales revenue	132	55	390	333
All other
Revenue, Major Customer [Line Items]
Sales revenue	100	50	266	134
Foreign Countries, total
Revenue, Major Customer [Line Items]
Sales revenue	$ 388	$ 326	$ 1,253	$ 1,116

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Subsequent events

9 Months Ended

Jul. 31, 2014

Subsequent Events [Abstract]

Subsequent events

Note 15 - Subsequent events

At its September 5, 2014 meeting, the Board of Directors of the Company declared a quarterly cash dividend of $0.07 per share to be paid on October 15, 2014 to stockholders of record on September 30, 2014.