Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): November 7, 2024

RCM Technologies, Inc.

(Exact Name of Registrant as Specified in Charter)

Nevada

(State or Other

Jurisdiction of

Incorporation)

1-10245

(Commission File

Number)

95-1480559

(I.R.S. Employer

Identification No.)

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

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

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

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

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

Emerging growth company ☐

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

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

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

Item 2.02. Results of Operations and Financial Condition.

On November 7, 2024, the Registrant issued a press release regarding its financial results for the thirteen and thirty-nine weeks ended September 28, 2024. A copy of the press release is furnished as Exhibit 99 to this report.

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

Item 9.01. Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

None.

(b) Pro Forma Financial Information.

None.

(d) Exhibits.

Exhibit Number
99	Press Release by the Registrant, dated November 7, 2024, furnished in accordance with Item 2.02 of this Current Report on Form 8-K.
104	Cover Page Interactive Data File (formatted as Inline XBRL).

SIGNATURES

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

RCM TECHNOLOGIES, INC.

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

Dated: November 7, 2024

Exhibit 99

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

P R E S S R E L E A S E

RCM TECHNOLOGIES, INC. ANNOUNCES

THIRD QUARTER RESULTS

Pennsauken, NJ – November 7, 2024 -- RCM Technologies, Inc. (NasdaqGM: RCMT), a premier provider of solutions designed to enhance the operational performance of its customers through the deployment of advanced engineering, specialty health care, and information technology services, today announced financial results for the thirteen and thirty-nine weeks ended September 28, 2024.

RCM Technologies reported revenue of $60.4 million for the thirteen weeks ended September 28, 2024 (the current quarter), an increase of 4.0% compared to $58.0 million for the thirteen weeks ended September 30, 2023 (the comparable prior quarter). Gross profit was $17.8 million for the current quarter, a 3.2% increase compared to $17.3 million for the comparable prior quarter. The Company experienced GAAP net income of $2.7 million, or $0.35 per diluted share, for the current quarter compared to $3.8 million, or $0.46 per diluted share, for the comparable prior quarter. The Company experienced adjusted EBITDA (non-GAAP) of $5.6 million for the current quarter, a 9.5% increase compared to $5.1 million for the comparable prior quarter. The Company experienced $0.44 of adjusted net income per diluted share (non-GAAP) for the current quarter as compared to $0.50 for the comparable prior quarter.

RCM Technologies reported revenue of $201.5 million for the thirty-nine weeks ended September 28, 2024 (the current period), an increase of 4.8% compared to $192.2 million for the thirty-nine weeks ended September 30, 2023 (the comparable prior-year period). Gross profit was $58.2 million for the current period, a 5.7% increase compared to $55.1 million for the comparable prior-year period. The Company experienced GAAP net income of $10.5 million, or $1.31 per diluted share, for the current period compared to $11.6 million, or $1.33 per diluted share, for the comparable prior-year period. The Company experienced adjusted EBITDA (non-GAAP) of $19.6 million for the current period, a 10.5% increase compared to $17.7 million for the comparable prior-year period. The Company experienced $1.54 of adjusted net income per diluted share (non-GAAP) for the current period as compared to $1.41 for the comparable prior-year period.

Bradley Vizi, Executive Chairman of RCM Technologies, commented, “Third-quarter growth was led by Healthcare and Engineering, as both businesses continue to ramp in their respective end markets.”

Kevin Miller, Chief Financial Officer of RCM Technologies, commented, “Growth remains consistent, while we anticipate enhanced cash conversion in coming quarters.”

Conference Call

On Friday, November 8, 2024, RCM Technologies will host a conference call to discuss these results. The call will begin at 1:00 p.m. Eastern Time. The dial-in number is (888) 272-8703.

About RCM

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

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

Tables to Follow

RCM Technologies, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In Thousands, Except Per Share Amounts)

	Thirteen Weeks Ended
	September 28, 2024	September 30, 2023
Revenue	$60,365	$58,049
Cost of services	42,524	40,768
Gross profit	17,841	17,281
Selling, general and administrative	13,018	12,662
Depreciation and amortization of property and equipment	393	243
Amortization of acquired intangible assets	45	45
Operating income	4,385	4,331
Other expense, net	619	141
Income before income taxes	3,766	4,190
Income tax expense	1,020	434
Net income	$2,746	$3,756

Diluted net earnings per share data	$0.35	$0.46
Diluted weighted average shares outstanding	7,789,446	8,196,330

	Thirty-Nine Weeks Ended
	September 28, 2024	September 30, 2023
Revenue	$201,468	$192,209
Cost of services	143,259	137,144
Gross profit	58,209	55,065
Selling, general and administrative	40,762	38,782
Depreciation and amortization of property and equipment	1,012	756
Amortization of acquired intangible assets	136	136
Costs associated with potential stock issuance	259	-
Gain on sale of assets	-	(395	)
Operating income	16,040	15,786
Other expense, net	1,619	965
Income before income taxes	14,421	14,821
Income tax expense	3,961	3,245
Net income	$10,460	$11,576

Diluted net earnings per share data	$1.31	$1.33
Diluted weighted average shares outstanding	7,990,238	8,730,998

RCM Technologies, Inc.

Supplemental Operating Results on a Non-GAAP Basis

(Unaudited)

(In Thousands)

The following non-GAAP measures, which adjust for the categories of expenses described below, are non-GAAP financial measures. Our management believes that these non-GAAP financial measures (“Adjusted operating income,” “EBITDA,” “Adjusted EBITDA,” “Adjusted net income” and “Adjusted diluted net earnings 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. Adjusted operating income, EBITDA, Adjusted EBITDA, Adjusted net income and Adjusted diluted net earnings per share should not be considered alternatives to operating income or net income, as the case may be, as an indicator of performance. In addition, Adjusted operating income, EBITDA, Adjusted EBITDA, Adjusted net income and Adjusted diluted net earnings per share do not take into account changes in certain assets and liabilities and interest and income taxes that can affect cash flows. We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should be read-only in conjunction with our consolidated financial statements prepared in accordance with GAAP.

The following unaudited table presents the Company’s GAAP operating income and GAAP net income and the corresponding adjustments used to calculate Adjusted operating income, EBITDA, Adjusted EBITDA, Adjusted net income and Adjusted diluted net earnings per share for the thirteen and thirty-nine weeks ended September 28, 2024 and September 30, 2023.

	Thirteen Weeks Ended			Thirty-Nine Weeks Ended
	September 28, 2024	September 30, 2023		September 28, 2024	September 30, 2023
	(Unaudited)	(Unaudited)		(Unaudited)	(Unaudited)

GAAP operating income	$4,385	$4,331		$16,040	$15,786
Adjustments
Gain on sale of assets	-	-		-	(395	)
Costs associated with potential stock issuance	-	-		259	-
Equity compensation	767	484		2,154	1,451
Adjusted operating income (non-GAAP)	$5,152	$4,815		$18,453	$16,842

GAAP net income	$2,746	$3,756		$10,460	$11,576
Income tax expense	1,020	434		3,961	3,245
Interest expense, net	492	185		1,551	970
Depreciation of property and equipment	393	243		1,012	756
Amortization of acquired intangible assets	45	45		136	136
EBITDA (non-GAAP)	$4,696	$4,663		$17,120	$16,683

Adjustments
Gain on sale of assets	-	-		-	(395	)
Costs associated with potential stock issuance	-	-		259	-
Loss (gain) on foreign currency transactions	127	(44	)	68	(5	)
Equity compensation	767	484		2,154	1,451
Adjusted EBITDA (non-GAAP)	$5,590	$5,103		$19,601	$17,734

RCM Technologies, Inc.

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

(Unaudited)

(In Thousands)

	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)

GAAP net income	$2,746		$3,756		$10,460		$11,576
Adjustments
Gain on sale of assets	-		-		-		(395	)
Costs associated with potential stock issuance	-		-		259		-
Loss (gain) on foreign currency transactions	127		(44	)	68		(5	)
Equity compensation	767		484		2,154		1,451
Tax impact from normalized rate	(190	)	(138	)	(674	)	(295	)
Adjusted net income (non-GAAP)	$3,450		$4,058		$12,267		$12,332

GAAP diluted net earnings per share	$0.35		$0.46		$1.31		$1.33
Adjustments
Gain on sale of assets							($0.04	)
Costs associated with potential stock issuance	-		-		$0.03		-
Loss (gain) on foreign currency transactions	$0.01		-		$0.01		-
Equity compensation	$0.10		$0.06		$0.27		$0.16
Tax impact from normalized rate	($0.02	)	($0.02	)	($0.08	)	($0.04	)
Adjusted diluted net earnings per share (non-GAAP)	$0.44		$0.50		$1.54		$1.41

RCM Technologies, Inc.

Summary of Selected Income Statement Data

(Unaudited)

(In Thousands)

	Thirteen Weeks Ended September 28, 2024
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated

Revenue	$26,554		$24,167		$9,644		$60,365
Cost of services	18,271		18,273		5,980		42,524
Gross profit	8,283		5,894		3,664		17,841
Gross profit margin	31.2	%	24.4	%	38.0	%	29.6	%

	Thirteen Weeks Ended September 30, 2023
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated

Revenue	$24,895		$22,452		$10,702		$58,049
Cost of services	17,438		16,846		6,484		40,768
Gross profit	$7,457		$5,606		$4,218		$17,281
Gross profit margin	30.0	%	25.0	%	39.4	%	29.8	%

	Thirty-Nine Weeks Ended September 28, 2024
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated

Revenue	$101,668		$70,180		$29,620		$201,468
Cost of services	71,672		52,818		18,769		143,259
Gross profit	29,996		17,362		10,851		58,209
Gross profit margin	29.5	%	24.7	%	36.6	%	28.9	%

	Thirty-Nine Weeks Ended September 30, 2023
	Specialty Health Care		Engineering		Life Sciences and IT		Consolidated

Revenue	$99,553		$61,956		$30,700		$192,209
Cost of services	70,623		47,482		19,039		137,144
Gross profit	$28,930		$14,474		$11,661		$55,065
Gross profit margin	29.1	%	23.4	%	38.0	%	28.6	%

RCM Technologies, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In Thousands, Except Share Amounts)

			September 28,	December 30,
			2024	2023
			(Unaudited)
Current assets:
	Cash and cash equivalents		$3,156	$6,284
	Accounts receivable, net of provision for credit losses of $1,600 at September 28, 2024 and December 30, 2023		75,913	70,690
	Transit accounts receivable		6,315	8,891
	Prepaid expenses and other current assets		5,112	4,637
		Total current assets	90,496	90,502

Property and equipment, net			6,793	4,005

Deposits			215	313
Deferred income taxes, foreign			55	55
Goodwill			22,147	22,147
Operating right of use asset			5,292	2,779
Intangible assets, net			547	683
		Total other assets	28,256	25,977

		Total assets	$125,545	$120,484

Current liabilities:
	Accounts payable and accrued expenses		$11,525		$12,454
	Transit accounts payable		28,215		31,102
	Accrued payroll and related costs		11,634		11,203
	Finance lease payable		689		233
	Income taxes payable		220		330
	Operating right of use liability		1,019		693
	Contingent consideration from acquisitions		300		300
	Deferred revenue		2,042		1,881
		Total current liabilities	55,644		58,196

Deferred income taxes, net, foreign			185		187
Deferred income taxes, net, domestic			1,719		1,568
Finance lease payable, net of current position			1,290		-
Contingent consideration from acquisitions, net of current position			1,671		1,671
Operating right of use liability, net of current position			4,519		2,268
Borrowings under line of credit			30,477		30,804
		Total liabilities	95,505		94,694

Contingencies (note 15)			-		-

Stockholders’ equity:
	Preferred stock, $1.00 par value; 5,000,000 shares authorized;
		no shares issued or outstanding	-		-
	Common stock, $0.05 par value; 40,000,000 shares authorized;
		17,833,287 shares issued and 7,597,028 shares outstanding at September 28, 2024 and 17,673,427 shares issued and 7,844,821 shares outstanding at December 30, 2023	890		882
	Additional paid-in capital		118,136		116,579
	Accumulated other comprehensive loss		(2,787	)	(2,813	)
	Accumulated deficit		(8,805	)	(19,265	)
	Treasury stock, 10,236,259 shares at September 28, 2024 and
		9,828,606 shares at December 30, 2023, at cost	(77,394	)	(69,593	)
		Total stockholders’ equity	30,040		25,790

		Total liabilities and stockholders’ equity	$125,545		$120,484

RCM Technologies, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In Thousands)

		Thirteen Weeks Ended
		September 28, 2024		September 30, 2023
Net income		$2,746		$3,756
Adjustments to reconcile net income to cash used in operating activities		1,508		1,049
Changes in operating assets and liabilities:
	Accounts receivable	(9,033)		4,143
	Prepaid expenses and other current assets	321		(987	)
	Net of transit accounts receivable and payable	435		1,556
	Accounts payable and accrued expenses	(1,445	)	(785	)
	Accrued payroll and related costs	1,919		2,790
	Right of use liabilities	(228	)	(333	)
	Income taxes payable	81		15
	Deferred revenue	(636	)	(169	)
	Deposits	(12	)	2
Total adjustments		(7,090	)	7,281
Net cash (used in) provided by operating activities		($4,344	)	$11,037

Net cash (used in) provided by investing activities		(522	)	79
Net cash provided by (used in) financing activities		4,375		(11,343	)
Effect of exchange rate changes on cash and cash equivalents		167		(392	)
Decrease in cash and cash equivalents		($324	)	($619	)

Common stock repurchase		($2,410	)	($3,389	)

		Thirty-Nine Weeks Ended
		September 28, 2024		September 30, 2023
Net income		$10,460		$11,576
Adjustments to reconcile net income to cash used in operating activities		4,200		2,795
Changes in operating assets and liabilities:
	Accounts receivable	(5,207	)	(6,696	)
	Prepaid expenses and other current assets	(475	)	(675	)
	Net of transit accounts receivable and payable	(311	)	22,384
	Accounts payable and accrued expenses	(760	)	(1,798	)
	Accrued payroll and related costs	433		1,596
	Right of use liabilities	(686	)	(1,016	)
	Income taxes payable	(106	)	162
	Deferred revenue	161		(784	)
	Deposits	98		4
Total adjustments		(2,653	)	15,972
Net cash provided by operating activities		7,807		27,548

Net cash used in investing activities		(1,589	)	(480	)
Net cash used in financing activities		(9,135	)	(26,558	)
Effect of exchange rate changes on cash and cash equivalents		(211	)	(195	)
(Decrease) increase in cash and cash equivalents		($3,128	)	$315

Common stock repurchase		($7,801	)	($24,449	)

Document And Entity Information	Nov. 07, 2024
Document Information [Line Items]
Entity, Registrant Name	RCM Technologies, Inc.
Document, Type	8-K
Document, Period End Date	Nov. 07, 2024
Entity, Incorporation, State or Country Code	NV
Entity, File Number	1-10245
Entity, Tax Identification Number	95-1480559
Entity, Address, Address Line One	2500 McClellan Avenue, Suite 350
Entity, Address, City or Town	Pennsauken
Entity, Address, State or Province	NJ
Entity, Address, Postal Zip Code	08109-4613
City Area Code	856
Local Phone Number	356-4500
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	RCMT
Security Exchange Name	NASDAQ
Amendment Flag	false
Entity, Central Index Key	0000700841