RF Industries Announces First Quarter Fiscal 2023 Results
RF Industries announced its first fiscal quarter results for 2023, revealing a net sales increase of 8.4% to $18.3 million compared to Q1 2022. The company reported a gross profit margin of 27.7%, up 360 basis points year-over-year, attributed to higher-margin sales from Microlab. However, it faced an operating loss of $(1.2) million and a consolidated net loss of $(1.2) million, primarily due to decreased sales to wireless carriers. The backlog stands at $24.0 million, and management expects sequential sales growth in Q2 2023, with improved profitability in the second half of the year.
- Net sales increased 8.4% to $18.3 million.
- Gross profit margin improved to 27.7%, a 360 basis point increase.
- Backlog remains strong at $24.0 million.
- Operating loss of $(1.2) million, compared to $(362,000) in Q1 2022.
- Consolidated net loss increased to $(1.2) million from $(277,000) in Q1 2022.
- Adjusted EBITDA decreased to $78,000 from $691,000 in Q1 2022.
SAN DIEGO, CA / ACCESSWIRE / March 13, 2023 / RF Industries, Ltd, (NASDAQ:RFIL), a national manufacturer and marketer of interconnect products and systems, today announced results for its first fiscal quarter ended January 31, 2023.
First Quarter Fiscal 2023 Highlights and Operating Results:
- Net sales increased
8.4% to$18.3 million compared to the first quarter of fiscal 2022. - Backlog was
$24.5 million at the end of the first quarter on bookings of$15.0 million . As of today, backlog stands at$24.0 million . - Gross profit margin was
27.7% , up 360 basis points from24.1% in the first quarter of fiscal 2022, primarily due to the contribution of Microlab's higher margin sales. - Operating loss was
$(1.2) million compared to an operating loss of$(362,000) in the first quarter of fiscal 2022, primarily due to lower sales to wireless carriers, as well as non-cash rent expense and other one-time charges totaling$494,000. - Consolidated net loss was
$(1.2) million , or$(0.11) per diluted share, compared to a net loss of$(277,000) , or$(0.03) per diluted share in the first quarter of fiscal 2022. This is primarily due to lower sales to wireless carriers, and loan interest payments offset by an income tax benefit. - Non-GAAP net loss was
$(25,000) , or$(0.00) per diluted share compared to non-GAAP net income of$691,000 , or$0.07 per diluted share in the first quarter of fiscal 2022. - Adjusted EBITDA was
$78,000 compared to$691,000 in the first quarter of fiscal 2022.
See "Note Regarding Use of Non-GAAP Financial Measures," "Unaudited Reconciliation of GAAP to non-GAAP Net Income" and "Unaudited Reconciliation of Net Income to Adjusted EBITDA" below for additional information.
Management Commentary
"We delivered revenue growth of
"Following a record year in Fiscal 2022, we have been executing on our strategic plan for Fiscal 2023 that assumes significant cost reductions including consolidating and streamlining operations in all areas of our business. We are now accelerating this plan and working towards identifying additional cost savings opportunities that will position the Company to navigate any extended macro market challenges.
"Based on what we know today, we expect the first half of 2023 to be impacted by the changes in the carrier market. We also anticipate that second quarter sales will increase sequentially and that sales and profitability in the second half of the year will improve significantly over the first half.
"While we see near-term headwinds, we remain committed to our long-term strategy and are confident that we have the right business model, and team to deliver profitable growth and returns to our shareholders over time. We will remain heads down executing on our plan to grow revenue and to transition sales to higher margin solutions," concluded Dawson.
Conference Call and Webcast
RF Industries will host a conference call and live webcast today, March 13, 2023, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to discuss its fiscal 2023 first quarter financial results. To access the live call, dial 888-506-0062 (US and Canada) or 973-528-0011 (International) and give the participant access code 766536.
A live and archived webcast of the conference call will be accessible on the investor relations section of the Company's website at www.rfindustries.com. In addition, a phone replay will be available beginning approximately two hours after conclusion of the call and will remain available for two weeks. To access the phone replay, dial 877-481-4010 (US and Canada) or 919-882-2331 (International). The replay access code is 47765.
About RF Industries
RF Industries designs and manufactures a broad range of interconnect products across diversified, growing markets, including wireless/wireline telecom, data communications and industrial. The Company's products include high-performance components used in commercial applications such as RF connectors and adapters, RF passives including dividers, directional couplers and filters, coaxial cables, data cables, wire harnesses, fiber optic cables, custom cabling, energy-efficient cooling systems and integrated small cell enclosures. The Company is headquartered in San Diego, California with additional operations in Long Island, New York, Vista, California, Milford, Connecticut, North Kingstown, Rhode Island and Parsippany, New Jersey. 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, including our expectations about profitability, revenues, the strength of our distribution network and growth opportunities, including as relates to our ability to benefit from 4G and 5G network buildouts, 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 and materialization and timing of expected network buildouts; timing and breadth of new products; our ability to realize increased sales; successfully integrating new products and teams; our ability to execute on its go-to-market strategies and channel models; the duration and continuing impact of the coronavirus pandemic on the U.S. economy and the Company's customers; the Company's reliance on certain distributors and customers for a significant portion of anticipated revenues; the impact of existing and additional future tariffs imposed by U.S. and foreign nations; our ability to expand our OEM relationships; our ability to continue to deliver newly designed and custom fiber optic and cabling products to principal customers; our ability to maintain strong margins and diversify our customer base; and our ability to address the changing needs of the market. 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 Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. All forward-looking statements are based upon information available to the Company on the date they are published, and we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or new information after the date of this release.
Note Regarding Use of Non-GAAP Financial Measures
To supplement our condensed financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), this earnings release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including adjusted earnings before interest, taxes, depreciation, amortization (Adjusted EBITDA), non-GAAP net income and non-GAAP earnings per share, basic and diluted (non-GAAP EPS). We believe these financial measures provide useful information to investors with which to analyze our operating trends and performance.
In computing Adjusted EBITDA, non-GAAP net income, and non-GAAP EPS, we exclude stock-based compensation expense, which represents non-cash charges for the fair value of stock options and other non-cash awards granted to employees, non-cash and other lease charges, and severance. For Adjusted EBITDA we also exclude depreciation, amortization, interest expense and provision for income taxes. Because of varying available valuation methodologies, subjective assumptions, and the variety of equity instruments that can impact a company's non-cash operating expenses, we believe that providing non-GAAP financial measures that exclude non-cash expense and non-recurring costs and expenses allows for meaningful comparisons between our core business operating results and those of other companies, as well as providing us with an important tool for financial and operational decision-making and for evaluating our own core business operating results over different periods of time.
Our Adjusted EBITDA, non-GAAP net income, and non-GAAP EPS measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. Our Adjusted EBITDA, non-GAAP net income, and non-GAAP EPS are not measurements of financial performance under GAAP and should not be considered as an alternative to operating or net income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. We do not consider these non-GAAP measures to be a substitute for, or superior to, the information provided by GAAP financial results. A reconciliation of specific adjustments to GAAP results is provided in the last two tables at the end of this press release.
RF Industries Contact: Peter Yin | Investor Relations Contact: Financial Profiles, Inc. John Brownell |
SOURCE: RF Industries, Ltd.
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