PENNSAUKEN, N.J., March 30, 2022 (GLOBE NEWSWIRE) -- RCM Technologies, Inc. (NasdaqGM: RCMT), a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced engineering, specialty health care and information technology services, today announced financial results for the thirteen and fifty-two week periods ended January 1, 2022.
RCM Technologies reported revenue of $64.9 million for the thirteen week period ended January 1, 2022 (the current period), a 57.7% increase as compared to $41.2 million for the fourteen week period ended January 2, 2021 (the comparable prior year period). Gross profit was $17.8 million for the current period, a 66.5% increase as compared to $10.7 million for the comparable prior year period. The Company experienced GAAP operating income of $7.1 million for the current period as compared to a GAAP operating loss of $1.9 million for the comparable prior year period. The Company experienced adjusted operating income of $5.1 million for the current period as compared to $0.4 million for the comparable prior year period. The Company experienced GAAP net income of $6.0 million, or $0.54 per diluted share, for the current period as compared to a GAAP net loss of $1.7 million, or ($0.15) per diluted share, for the comparable prior year period. The Company experienced adjusted EBITDA of $5.3 million for the current period as compared to adjusted EBITDA of $0.7 million for the comparable prior year period. The Company experienced adjusted net income of $3.7 million, or $0.34 per diluted share, for the current period as compared to an adjusted net loss of $0.1 million, or ($0.01) per diluted share, for the comparable prior year period.
RCM Technologies reported revenue of $203.9 million for the fifty-two week period ended January 1, 2022 (the current period), a 35.5% increase as compared to $150.4 million for the fifty-three week period ended January 2, 2021 (the comparable prior year period). Gross profit was $53.1 million for the current period, a 36.7% increase as compared to $38.9 million for the comparable prior year period. The Company experienced GAAP operating income of $14.1 million for the current period as compared to a GAAP operating loss of $11.0 million for the comparable prior year period. The Company experienced adjusted operating income of $10.0 million for the current period as compared to an adjusted operating loss of $0.3 million for the comparable prior year period. The Company experienced GAAP net income of $11.0 million, or $0.95 per diluted share, for the current period as compared to a GAAP net loss of $8.9 million, or ($0.73) per diluted share, for the comparable prior year period. The Company experienced adjusted EBITDA of $11.1 million for the current period as compared to $1.1 million for the comparable prior year period. The Company experienced adjusted net income of $7.1 million, or $0.61 per diluted share, for the current period as compared to an adjusted net loss of $1.0 million, or ($0.09) per diluted share, for the comparable prior year period.
On July 30, 2021, the Company sold the principal assets and certain liabilities of its Pickering and Kincardine offices, located in Ontario, Canada. These two offices were often referred to as the Canadian Power Systems business and principally provided engineering services to two major nuclear power providers in Canada. The two Canadian Power Systems offices were part of a reporting unit within the Company’s Engineering segment. The Company continues to offer other engineering services in Canada and similar services in the United States. For the thirteen week periods ended January 1, 2022 and January 2, 2021, these two offices generated revenue of zero and $3.2 million, respectively. For the fifty-two week period ended January 1, 2022 and the fifty-three week period ended January 2, 2021, these two offices generated revenue of $4.9 million and $11.8 million, respectively.
Bradley Vizi, Executive Chairman of RCM Technologies, commented, “Our fourth quarter results serve as a nice bookend to 2021. As I reflect on our transformation plan dating back before the pandemic, I am proud of the team's execution. The results speak for themselves, with broad-based strength across each segment.”
Kevin Miller, Chief Financial Officer of RCM Technologies, commented, “We are excited to announce our record fourth quarter of 2021, growing adjusted EBITDA by 627% over 2020 and 120% over 2019. In addition, we grew revenue by $53 million for the year and continued to generate positive cash flow from operations.”
Conference Call
On Thursday, March 31, 2022, RCM Technologies will host a conference call to discuss these results. The call will begin at 10:00 a.m. Eastern Time. The dial-in number is (888) 272-8703.
About RCM
RCM Technologies, Inc. is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced information technology and engineering services. RCM is an innovative leader in the delivery of these solutions to commercial and government sectors. RCM is also a provider of specialty healthcare services to major health care institutions and educational facilities. RCM’s offices are located in major metropolitan centers throughout North America and Serbia. Additional information can be found at www.rcmt.com.
The Statements contained in this release that are not purely historical are forward-looking statements within the Private Securities Litigation Reform Act of 1995 and are subject to various risks, uncertainties and other factors that could cause the Company's actual results, performance or achievements to differ materially from those expressed or implied by such forward-looking statements. These statements often include words such as “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “believe,” “plan,” “seek,” “could,” “can,” “should,” “are confident” or similar expressions. In addition, statements that are not historical should also be considered forward-looking statements. These statements are based on assumptions that we have made in light of our experience in the industry, as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate in these circumstances. Forward-looking statements include, but are not limited to, those relating to the impact of the COVID-19 pandemic, demand for the Company’s services, expectations regarding our future revenues and other financial results, our pipeline and potential project wins and our expectations for growth in our business. Such statements are based on current expectations that involve a number of known and unknown risks, uncertainties and other factors, which may cause actual events to be materially different from those expressed or implied by such forward-looking statements. Risk, uncertainties and other factors may emerge from time to time that could cause the Company’s actual results to differ from those indicated by the forward-looking statements. Investors are directed to consider such risks, uncertainties and other factors described in documents filed by the Company with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. The Company assumes no obligation (and expressly disclaims any such obligation) to update any forward-looking statements contained in this release as a result of new information or future events or developments, except as may be required by law.
Tables to Follow
RCM Technologies, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In Thousands, Except Per Share Amounts)
|
Thirteen Week
Period Ended
January 1, 2022 |
|
Fourteen Week
Period Ended
January 2, 2021 |
|
| Revenue |
$64,922 |
|
$41,163 |
|
| Cost of services |
47,128 |
|
30,474 |
|
| Gross profit |
17,794 |
|
10,689 |
|
| Selling, general and administrative |
12,453 |
|
9,954 |
|
| Depreciation and amortization of property and equipment |
232 |
|
272 |
|
| Amortization of acquired intangible assets |
- |
|
81 |
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
- |
|
| Impairment of right of use assets and related costs |
- |
|
2,231 |
|
| Gain on sale of assets |
(269 |
) |
- |
|
| Remeasurement of acquisition related contingent consideration |
(1,713 |
) |
- |
|
| Operating income (loss) |
7,091 |
|
(1,849 |
) |
| Other income (expense), net |
7 |
|
(212 |
) |
| Income (loss) before income taxes |
7,098 |
|
(2,061 |
) |
| Income tax expense (benefit) |
1,124 |
|
(373 |
) |
| Net income (loss) |
$5,974 |
|
($1,688 |
) |
|
|
|
|
|
| Diluted net earnings (loss) per share data |
$0.54 |
|
($0.15 |
) |
|
Fifty-Two Week
Period Ended
January 1, 2022 |
|
Fifty-Three Week
Period Ended
January 2, 2021 |
|
| Revenue |
$203,875 |
|
$150,409 |
|
| Cost of services |
150,751 |
|
111,554 |
|
| Gross profit |
53,124 |
|
38,855 |
|
| Selling, general and administrative |
42,019 |
|
37,791 |
|
| Depreciation and amortization of property and equipment |
1,007 |
|
1,065 |
|
| Amortization of acquired intangible assets |
95 |
|
321 |
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
8,397 |
|
| Impairment of right of use assets and related costs |
- |
|
2,231 |
|
| Gain on sale of assets |
(2,420 |
) |
- |
|
| Remeasurement of acquisition-related contingent consideration |
(1,713 |
) |
- |
|
| Operating income (loss) |
14,136 |
|
(10,950 |
) |
| Other expense, net |
(222 |
) |
(1,107 |
) |
| Income (loss) before income taxes |
13,914 |
|
(12,057 |
) |
| Income tax expense (benefit) |
2,925 |
|
(3,188 |
) |
| Net income (loss) |
$10,989 |
|
($8,869 |
) |
|
|
|
|
|
| Diluted net earnings (loss) per share data |
$0.95 |
|
($0.73 |
) |
|
|
|
|
|
RCM Technologies, Inc.
Summary Consolidated Selected Balance Sheet Data
(In Thousands)
|
January 1,
2022 |
|
January 2,
2021 |
|
|
(Unaudited) |
|
|
|
| Cash and cash equivalents |
$235 |
|
$734 |
|
| Accounts receivable, net |
$48,240 |
|
$36,007 |
|
| Total current assets |
$51,971 |
|
$43,934 |
|
| Total assets |
$72,852 |
|
$68,339 |
|
| Total current liabilities |
$29,857 |
|
$28,741 |
|
| Borrowing under line of credit |
$14,151 |
|
$11,890 |
|
| Net debt (line of credit less cash) |
$13,916 |
|
$11,156 |
|
| Total liabilities |
$46,883 |
|
$46,101 |
|
| Stockholders’ equity |
$25,969 |
|
$22,238 |
|
|
|
|
|
|
RCM Technologies, Inc.
Supplemental Operating Results on a Non-GAAP Basis
(Unaudited)
(In Thousands)
The following non-GAAP measures, which adjust for the categories of expenses described below are non-GAAP financial measures. Our management believes that these non-GAAP financial measures (“Adjusted operating income (loss)”, “EBITDA”, “Adjusted EBITDA”, “Adjusted net income (loss)”, and “Adjusted diluted net earnings (loss) per share”) are useful information for investors, shareholders and other stakeholders of our company in gauging our results of operations on an ongoing basis and to enhance investors’ overall understanding of our current financial performance and period-to-period comparisons. We believe these non-GAAP financial measures are performance measures and not liquidity measures. These non-GAAP financial measures should not be considered as an alternative to net income as an indicator of performance. In addition, neither EBITDA nor Adjusted EBITDA takes into account changes in certain assets and liabilities as well as interest and income taxes that can affect cash flows. We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.
The following unaudited tables present the Company's GAAP net income and GAAP operating income and the corresponding adjustments used to calculate Adjusted operating income (loss), EBITDA, Adjusted EBITDA, Adjusted net income (loss) and Adjusted diluted net earnings (loss) per share for the fifty-two week period ended January 1, 2022 and the fifty-three week period ended January 2, 2021.
|
Thirteen
Week Period
Ended
January 1,
2022 |
|
Fourteen
Week Period
Ended
January 2,
2021 |
|
Fifty-Two
Week
Period
Ended
January 1,
2022 |
|
Fifty-Three Week
Period
Ended
January 2,
2021 |
|
| GAAP operating income (loss) |
$7,091 |
|
($1,849 |
) |
$14,136 |
|
($10,950 |
) |
| Adjustments |
|
|
|
|
|
|
|
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
- |
|
- |
|
8,397 |
|
| Impairment of right of use assets and related costs |
- |
|
2,231 |
|
- |
|
2,231 |
|
| Gain on sale of assets |
(269 |
) |
- |
|
(2,420 |
) |
- |
|
| Remeasurement of acquisition related contingent consideration |
(1,713 |
) |
- |
|
(1,713 |
) |
- |
|
| Adjusted operating income (loss) (non-GAAP) |
$5,109 |
|
$382 |
|
$10,003 |
|
($322 |
) |
|
|
|
|
|
|
|
|
|
| GAAP net income (loss) |
$5,974 |
|
($1,688 |
) |
$10,989 |
|
($8,869 |
) |
| Income tax expense (benefit) |
1,124 |
|
(373 |
) |
2,925 |
|
(3,188 |
) |
| Interest expense, net |
58 |
|
128 |
|
365 |
|
778 |
|
| Change in fair value of contingent consideration |
- |
|
37 |
|
52 |
|
145 |
|
| Depreciation of property and equipment |
232 |
|
272 |
|
1,007 |
|
1,065 |
|
| Amortization of acquired intangible assets |
- |
|
81 |
|
95 |
|
321 |
|
| EBITDA (non-GAAP) |
$7,388 |
|
($1,543 |
) |
$15,433 |
|
($9,748 |
) |
|
|
|
|
|
|
|
|
|
| Adjustments |
|
|
|
|
|
|
|
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
- |
|
- |
|
8,397 |
|
| Impairment of right of use assets and related costs |
- |
|
2,231 |
|
- |
|
2,231 |
|
| Gain on sale of assets |
(269 |
) |
- |
|
(2,420 |
) |
- |
|
| Remeasurement of acquisition related contingent consideration |
(1,713 |
) |
- |
|
(1,713 |
) |
- |
|
| Loss (gain) on foreign currency transactions |
(65 |
) |
47 |
|
(195 |
) |
184 |
|
| Adjusted EBITDA (non-GAAP) |
$5,341 |
|
$735 |
|
$11,105 |
|
$1,064 |
|
|
|
|
|
|
|
|
|
|
RCM Technologies, Inc.
Supplemental Operating Results on a Non-GAAP Basis (Continued)
(Unaudited)
(In Thousands)
|
Thirteen
Week Period
Ended
January 1,
2022 |
|
Fourteen
Week Period
Ended
January 2,
2021 |
|
Fifty-Two
Week
Period
Ended
January 1,
2022 |
|
Fifty-Three Week
Period
Ended
January 2,
2021 |
|
| GAAP net income (loss) |
$5,974 |
|
($1,688 |
) |
$10,989 |
|
($8,869 |
) |
| Adjustments |
|
|
|
|
|
|
|
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
- |
|
- |
|
8,397 |
|
| Impairment of right of use assets and related costs |
- |
|
2,231 |
|
- |
|
2,231 |
|
| Gain on sale of assets |
(269 |
) |
- |
|
(2,420 |
) |
- |
|
| Remeasurement of acquisition related contingent consideration |
(1,713 |
) |
- |
|
(1,713 |
) |
- |
|
| Tax impact from normalized rate |
(282 |
) |
(420 |
) |
237 |
|
(2,795 |
) |
| Adjusted net income (loss) (non-GAAP) |
$3,710 |
|
$123 |
|
$7,093 |
|
($1,036 |
) |
|
|
|
|
|
|
|
|
|
| GAAP diluted net earnings (loss) per share |
$0.54 |
|
($0.15 |
) |
$0.95 |
|
($0.73 |
) |
| Adjustments |
|
|
|
|
|
|
|
|
| Write-off of receivables and professional fees incurred related to arbitration |
- |
|
- |
|
- |
|
$0.69 |
|
| Impairment of right of use assets and related costs |
- |
|
$0.20 |
|
- |
|
$0.18 |
|
| Gain on sale of assets |
($0.02 |
) |
- |
|
($0.21 |
) |
- |
|
| Remeasurement of acquisition related contingent consideration |
($0.16 |
) |
- |
|
($0.15 |
) |
- |
|
| Tax impact from normalized rate |
(0.02 |
) |
($0.04 |
) |
$0.02 |
|
($0.23 |
) |
| Adjusted diluted net earnings (loss) per share (non-GAAP) |
$0.34 |
|
$0.01 |
|
$0.61 |
|
($0.09 |
) |
|
|
|
|
|
|
|
|
|
RCM Technologies, Inc.
Summary of Selected Income Statement Data
(Unaudited)
(In Thousands)
|
Thirteen Week Period Ended January 1, 2022 |
|
|
Engineering |
|
Specialty
Health Care |
|
Information
Technology |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
| Revenue |
$18,290 |
|
$34,772 |
|
$11,860 |
|
$64,922 |
|
| Cost of services |
13,234 |
|
25,613 |
|
8,281 |
|
47,128 |
|
| Gross profit |
$5,056 |
|
$9,159 |
|
$3,579 |
|
$17,794 |
|
| Gross profit margin |
27.6 |
% |
26.3 |
% |
30.2 |
% |
27.4 |
% |
|
Fourteen Week Period Ended January 2, 2021 |
|
|
Engineering |
|
Specialty
Health Care |
|
Information
Technology |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
| Revenue |
$14,427 |
|
$18,585 |
|
$8,151 |
|
$41,163 |
|
| Cost of services |
10,554 |
|
14,079 |
|
5,841 |
|
30,474 |
|
| Gross profit |
$3,873 |
|
$4,506 |
|
$2,310 |
|
$10,689 |
|
| Gross profit margin |
26.8 |
% |
24.2 |
% |
28.3 |
% |
26.0 |
% |
|
Fifty-Two Week Period Ended January 1, 2022 |
|
|
Engineering |
|
Specialty
Health Care |
|
Information
Technology |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
| Revenue |
$66,172 |
|
$98,495 |
|
$39,208 |
|
$203,875 |
|
| Cost of services |
50,109 |
|
73,177 |
|
27,465 |
|
150,751 |
|
| Gross profit |
$16,063 |
|
$25,318 |
|
$11,743 |
|
$53,124 |
|
| Gross profit margin |
24.3 |
% |
25.7 |
% |
30.0 |
% |
26.1 |
% |
|
Fifty-Three Week Period Ended January 2, 2021 |
|
|
Engineering |
|
Specialty
Health Care |
|
Information
Technology |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
| Revenue |
$57,715 |
|
$60,481 |
|
$32,213 |
|
$150,409 |
|
| Cost of services |
41,227 |
|
47,116 |
|
23,211 |
|
111,554 |
|
| Gross profit |
$16,488 |
|
$13,365 |
|
$9,002 |
|
$38,855 |
|
| Gross profit margin |
28.6 |
% |
22.1 |
% |
28.0 |
% |
25.8 |
% |
|
|
|
|
|
|
|
|
|
RCM Technologies, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In Thousands)
|
Thirteen Week
Period Ended
January 1, 2022 |
|
Fourteen Week
Period Ended
January 2, 2021 |
|
| Net income (loss) |
$5,974 |
|
($1,688 |
) |
| Adjustments to reconcile net income (loss) to cash (used in) provided by operating activities |
657 |
|
2,532 |
|
| Changes in operating assets and liabilities: |
|
|
|
|
|
Accounts receivable |
(5,108 |
) |
(2,944 |
) |
|
Prepaid expenses and other current assets |
(1,252 |
) |
(2,432 |
) |
|
Net of transit accounts receivable and payable |
132 |
|
1,701 |
|
|
Accounts payable and accrued expenses |
(1,005 |
) |
(327 |
) |
|
Accrued payroll and related costs |
(1,645 |
) |
3,732 |
|
|
Right of use liabilities |
(462 |
) |
221 |
|
|
Income taxes payable |
(695 |
) |
210 |
|
|
Deferred revenue |
(502 |
) |
458 |
|
|
Deposits |
(1 |
) |
1 |
|
| Total adjustments |
(9,881 |
) |
3,152 |
|
| Net cash (used in) provided by operating activities |
(3,907 |
) |
1,464 |
|
|
|
|
|
|
| Net cash provided by (used in) investing activities |
193 |
|
(60 |
) |
| Net cash used in financing activities |
1,197 |
|
(1,441 |
) |
| Effect of exchange rate changes |
(68 |
) |
14 |
|
| Increase (decrease) in cash and cash equivalents |
($2,585 |
) |
($23 |
) |
|
Fifty-Two Week
Period Ended
January 1, 2022 |
|
Fifty-Three Week
Period Ended
January 2, 2021 |
|
| Net income (loss) |
$10,989 |
|
($8,869 |
) |
Adjustments to reconcile net income (loss) to cash
provided by operating activities |
1,790 |
|
10,559 |
|
| Changes in operating assets and liabilities: |
|
|
|
|
|
Accounts receivable |
(14,710 |
) |
15,947 |
|
|
Net of transit accounts receivable and payable |
(1,317 |
) |
2,757 |
|
|
Prepaid expenses and other current assets |
1,838 |
|
(162 |
) |
|
Accounts payable and accrued expenses |
1,518 |
|
1,587 |
|
|
Accrued payroll and related costs |
149 |
|
4,557 |
|
|
Right of use liabilities |
(1,919 |
) |
(1,529 |
) |
|
Income taxes payable |
(436 |
) |
304 |
|
|
Deferred revenue |
3,020 |
|
52 |
|
|
Deposits |
(7 |
) |
41 |
|
| Total adjustments |
(10,074 |
) |
34,113 |
|
| Net cash provided by operating activities |
915 |
|
25,244 |
|
|
|
|
|
|
| Net cash provided by (used in) investing activities |
6,291 |
|
(460 |
) |
| Net cash used in financing activities |
(7,554 |
) |
(25,632 |
) |
| Effect of exchange rate changes on cash and cash equivalents |
(151 |
) |
(265 |
) |
| Decrease in cash and cash equivalents |
($499 |
) |
($1,113 |
) |
|
|
|
|
|
| RCM Technologies, Inc. |
Tel: 856.356.4500 |
Corporate Contacts: |
| 2500 McClellan Avenue |
Fax: 856.356.4600 |
Bradley S. Vizi |
| Pennsauken, NJ 08109 |
info@rcmt.com |
Executive Chairman |
|
www.rcmt.com |
Kevin D. Miller |
|
|
Chief Financial Officer |
