I've started a position in RFIL
Currently losing $$ but trading at a discount to BV
I am speculating that under the current administration - with its emphasis on military spending and buy America - this could turn around
The Company’s Rel-Tech subsidiary, which designs and manufactures cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers, also has experienced a slowdown due to certain customers shifting their business to off-shore manufacturers.
| ASSETS | | | | | | | | | | | | | | | | | | | | CURRENT ASSETS | | | | | | | | | | Cash and cash equivalents | | $ | 4,354 | | | $ | 5,258 | | | Trade accounts receivable, net of allowance for doubtful accounts of $64 and $62, respectively | | | 3,692 | | | | 4,077 | | | Inventories, net | | | 6,554 | | | | 6,022 | | | Other current assets | | | 1,543 | | | | 1,436 | | | TOTAL CURRENT ASSETS | | | 16,143 | | | | 16,793 | | | | | | | | | | | | | Property and equipment: | | | | | | | | | | Equipment and tooling | | | 3,206 | | | | 3,203 | | | Furniture and office equipment | | | 802 | | | | 799 | | | | | | 4,008 | | | | 4,002 | | | Less accumulated depreciation | | | 3,247 | | | | 3,174 | | | Total property and equipment | | | 761 | | | | 828 | | | | | | | | | | | | | Goodwill | | | 3,219 | | | | 3,219 | | | Amortizable intangible assets, net | | | 3,472 | | | | 3,619 | | | Non-amortizable intangible assets | | | 1,237 | | | | 1,237 | | | Other assets | | | 121 | | | | 141 | | | TOTAL ASSETS | | $ | 24,953 | | | $ | 25,837 | |
See Notes to Unaudited Condensed Consolidated Financial Statements.
Item 1: Financial Statements (continued)
RF INDUSTRIES, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
| | | January 31, | | | October 31, | | | | | 2017 | | | 2016 | | | | | (Unaudited) | | | (Note 1) | | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | CURRENT LIABILITIES | | | | | | | | | | Accounts payable | | $ | 1,373 | | | $ | 1,138 | | | Accrued expenses | | | 2,009 | | | | 2,770 | | | TOTAL CURRENT LIABILITIES | | | 3,382 | | | | 3,908 | | | | | | | | | | | | | Deferred tax liabilities | | | 433 | | | | 409 | | | Other long-term liabilities | | | 88 | | | | 128 | | | TOTAL LIABILITIES | | | 3,903 | | | | 4,445 | | | | | | | | | | | | | COMMITMENTS AND CONTINGENCIES | | | | | | | | | | | | | | | | | | | | STOCKHOLDERS’ EQUITY | | | | | | | | | | Common stock - authorized 20,000,000 shares of $0.01 par value; 8,835,483 shares issued and outstanding at January 31, 2017 and October 31, 2016 | | | 88 | | | | 88 | | | Additional paid-in capital | | | 19,407 | | | | 19,379 | | | Retained earnings | | | 1,555 | | | | 1,925 | | | TOTAL STOCKHOLDERS' EQUITY | | | 21,050 | | | | 21,392 | | | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | | $ | 24,953 | | | $ | 25,837 | |
See Notes to Unaudited Condensed Consolidated Financial Statements.
Item 1: Financial Statements (continued)
RF INDUSTRIES, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands, except share and per share amounts)
| | | Three Months Ended January 31, | | | | | 2017 | | | 2016 | | | | | | | | | | | Net sales | | $ | 6,617 | | | $ | 6,784 | | | Cost of sales | | | 4,760 | | | | 4,761 | | | | | | | | | | | | | Gross profit | | | 1,857 | | | | 2,023 | | | | | | | | | | | | | Operating expenses: | | | | | | | | | | Engineering | | | 224 | | | | 161 | | | Selling and general | | | 1,992 | | | | 2,433 | | | Totals | | | 2,216 | | | | 2,594 | | | | | | | | | | | | | Operating loss | | | (359 | ) | | | (571 | ) | | | | | | | | | | | | Other income | | | 20 | | | | - | | | | | | | | | | | | | Loss from continuing operations before benefit for income taxes | | | (339 | ) | | | (571 | ) | | Benefit for income taxes | | | (101 | ) | | | (256 | ) | | | | | | | | | | | | Loss from continuing operations | | | (238 | ) | | | (315 | ) | | | | | | | | | | | | Income (loss) from discontinued operations, net of tax | | | 44 | | | | (38 | ) | | | | | | | | | | | | Net loss | | $ | (194 | ) | | $ | (353 | ) | | | | | | | | | | | | Earnings (loss) per share | | | | | | | | | | Basic | | | | | | | | | | Continuing operations | | $ | (0.03 | ) | | $ | (0.04 | ) | | Discontinued operations | | | 0.01 | | | | (0.00 | ) | | Net loss per share | | $ | (0.02 | ) | | $ | (0.04 | ) | | | | | | | | | | | | Earnings (loss) per share | | | | | | | | | | Diluted | | | | | | | | | | Continuing operations | | $ | (0.03 | ) | | $ | (0.04 | ) | | Discontinued operations | | | 0.01 | | | | (0.00 | ) | | Net loss per share | | $ | (0.02 | ) | | $ | (0.04 | ) | | | | | | | | | | | | Weighted average shares outstanding | | | | | | | | | | Basic | | | 8,834,747 | | | | 8,716,712 | | | Diluted | | | 8,834,747 | | | | 8,716,712 | |
See Notes to Unaudited Condensed Consolidated Financial Statements.
Item 1: Financial Statements (continued)
RF INDUSTRIES, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
| | | Three Months Ended January 31, | | | | | 2017 | | | 2016 | | | OPERATING ACTIVITIES: | | | | | | | | | | Net loss | | $ | (194 | ) | | $ | (353 | ) | | Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | Bad debt expense | | | 2 | | | | 20 | | | Depreciation and amortization | | | 220 | | | | 272 | | | Stock-based compensation expense | | | 51 | | | | 52 | | | Loss on disposal of fixed assets | | | - | | | | 40 | | | Deferred income taxes | | | 24 | | | | - | | | Changes in operating assets and liabilities: | | | | | | | | | | Trade accounts receivable | | | 383 | | | | 94 | | | Inventories | | | (532 | ) | | | (349 | ) | | Other current assets | | | (107 | ) | | | (613 | ) | | Other long-term assets | | | 20 | | | | (167 | ) | | Accounts payable | | | 235 | | | | 156 | | | Income taxes payable | | | - | | | | (65 | ) | | Accrued expenses | | | (761 | ) | | | (600 | ) | | Other long-term liabilities | | | (40 | ) | | | - | | | Net cash used in operating activities | | | (699 | ) | | | (1,513 | ) | | | | | | | | | | | | INVESTING ACTIVITIES: | | | | | | | | | | Proceeds from sale of fixed assets | | | - | | | | 22 | | | Proceeds from sale of inventory | | | - | | | | 322 | | | Capital expenditures | | | (6 | ) | | | (70 | ) | | Net cash provided by (used in) investing activities | | | (6 | ) | | | 274 | | | | | | | | | | | | | FINANCING ACTIVITIES: | | | | | | | | | | Proceeds from exercise of stock options | | | - | | | | 20 | | | Excess tax provision (benefit) from canceled stock options | | | (23 | ) | | | - | | | Dividends paid | | | (176 | ) | | | (610 | ) | | Net cash used in financing activities | | | (199 | ) | | | (590 | ) | | | | | | | | | | | | Net decrease in cash and cash equivalents | | | (904 | ) | | | (1,829 | ) | | | | | | | | | | | | Cash and cash equivalents, beginning of period | | | 5,258 | | | | 7,595 | | | | | | | | | | | | | Cash and cash equivalents, end of period | | $ | 4,354 | | | $ | 5,766 | | | | | | | | | | | | | Supplemental cash flow information – income taxes paid | | $ | 13 | | | $ | 165 | |
See Notes to Unaudited Condensed Consolidated Financial Statements.
|
