# EDGAR Filing Document

**Accession Number:** 0000740664
**File Stem:** 0001437749-23-006361
**Filing Date:** 2023-3
**Character Count:** 19764
**Document Hash:** 45971f7c65b41624c0816cc9a2ff7db0
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-23-006361.hdr.sgml**: 20230313

**ACCESSION NUMBER**: 0001437749-23-006361

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 15

**CONFORMED PERIOD OF REPORT**: 20230313

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230313

**DATE AS OF CHANGE**: 20230313

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** R F INDUSTRIES LTD
- **CENTRAL INDEX KEY:** 0000740664
- **STANDARD INDUSTRIAL CLASSIFICATION:** ELECTRONIC CONNECTORS [3678]
- **IRS NUMBER:** 880168936
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1031

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-13301
- **FILM NUMBER:** 23727331

**BUSINESS ADDRESS:**
- **STREET 1:** 7610 MIRAMAR RD
- **STREET 2:** BLDG 6000
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92126-2313
- **BUSINESS PHONE:** 858-549-6340

**MAIL ADDRESS:**
- **STREET 1:** 7620 MIRAMAR RD #4100
- **STREET 2:** 7620 MIRAMAR RD #4100
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92126-4202

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** CELLTRONICS INC
- **DATE OF NAME CHANGE:** 19910204

rfil20230313_8k.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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): March 13, 2023<br>

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| |
|:---|
| **R F INDUSTRIES, LTD.** |
| (Exact name of registrant as specified in its charter) |

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| | | |
|:---|:---|:---|
| **Nevada**<br> (State or Other Jurisdiction<br> of Incorporation) | **0-13301**<br> (Commission File Number) | **88-0168936**<br> (I.R.S. Employer<br> Identification No.) |

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**16868 Via Del Campo Court, Suite 200 **San Diego**, **CA 92127**<br> (Address of Principal Executive Offices)<br>**(**858**) **549-6340**<br> (Registrant's Telephone Number)<br>**7610 Miramar Road, Bldg. 6000, San Diego, California 92126**<br> (Former Address)<br>

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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:

☐ 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))

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

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| | | |
|:---|:---|:---|
| <u>Title of each class</u> | <u>Trading Symbol(s)</u> | <u>Name of each exchange on which registered</u> |
| Common Stock, $0.01 par value per share | RFIL | NASDAQ Global Market |

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

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. ☐

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**Item 2.02 Results of Operations and Financial Condition.**

On March 13, 2023, RF Industries, Ltd. (the "Company") issued a press release announcing information regarding the Company's financial results for the first quarter ended January 31, 2023. A copy of the press release is attached to this Form 8-K as Exhibit 99.1 and is incorporated herein by reference.

The information furnished under this Item 2.02, including the accompanying Exhibit 99.1, shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act"), or otherwise subject to the liability of such section, nor shall such information be deemed to be incorporated by reference in any subsequent filing by the Company under the Securities Act of 1933 or the Exchange Act, regardless of the general incorporation language of such filing, except as specifically stated in such filing.

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| | |
|:---|:---|
| **Item 9.01** | **Financial Statements and Exhibits** |

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| | |
|:---|:---|
| (d) Exhibits. |  |
| **Exhibit No.** | **Description** |
| 99.1 | [Press Release of RF Industries, Ltd., dated March 13, 2023](ex_487996.htm) |
| 104 | Cover Page Interactive Date File (embedded within the Inline XBRL document). |

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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.

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|:---|:---|
| March 13, 2023 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; By: <u>/s/ Peter Yin</u><br> Peter Yin<br> Chief Financial Officer |

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## Exhibit 99.1

**Exhibit 99.1**

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| | |
|:---|:---|
| ![a01.jpg](a01.jpg) | ***FOR IMMEDIATE RELEASE*** |

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**RF Industries Announces First Quarter Fiscal 2023 Results**

**SAN DIEGO, CA, 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 from 24.1% 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 8.4% year-over-year and gross margin increased 360 basis points to 27.7% for the first quarter of fiscal 2023, which is historically our seasonally softest quarter of the year. We expected the quarter to be better as roughly $1.4 million in orders were delayed due to customer delays. During the quarter, we did not see carriers resume the expected level of CapEx spending related to next-generation wireless buildouts, which we expect will have an impact at least into our second quarter. Our core run-rate business, which is less project-centric, remains strong with many products selling through our distribution network. We have successfully increased revenues from these products by nearly 6 times since 2017, and we expect continued solid growth in them going forward," said Robert Dawson, President and Chief Executive Officer of RF Industries.

"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.

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"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 <u>www.rfindustries.com</u>. 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 <u>www.rfindustries.com</u>.

**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.

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**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.

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|:---|:---|
| **RF Industries Contact:**<br> Peter Yin<br> SVP and CFO<br> (858) 549-6340<br> <u>rfi@rfindustries.com</u>  | **Investor Relations Contact:**<br> Financial Profiles, Inc.<br> Jack Drapacz <br> (310) 622-8230 <br> John Brownell<br> (310) 622-8249<br> <u>RFIL@finprofiles.com</u>  |

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| **RF INDUSTRIES, LTD. AND SUBSIDIARIES** |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| (in thousands, except share and per share amounts) |

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| | | |
|:---|:---|:---|
|  | Jan. 31, | Oct. 31, |
|  | 2023 | 2022 |
| **ASSETS** | (unaudited) | (audited) |
| **CURRENT ASSETS** |  |  |
| Cash and cash equivalents | $3770 | $4532 |
| Trade accounts receivable, net | 13905 | 14812 |
| Inventories, net | 20937 | 21054 |
| Other current assets | 3184 | 5849 |
| **TOTAL CURRENT ASSETS** | 41796 | 46247 |
| Property and equipment, net | 4193 | 3173 |
| Operating right of use asset, net | 12780 | 13480 |
| Goodwill | 8085 | 8085 |
| Amortizable intangible assets, net | 14865 | 15296 |
| Non-amortizable intangible assets | 1174 | 1174 |
| Deferred tax assets | 1952 | 1816 |
| Other assets | 295 | 295 |
| **TOTAL ASSETS** | $85140 | $89566 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| **CURRENT LIABILITIES** |  |  |
| Accounts payable | $4849 | $5652 |
| Accrued expenses | 5568 | 8814 |
| Deferred revenue | 1133 |  |
| Current portion of Term loan | 2424 | 2424 |
| Current portion of operating lease liabilities | 1728 | 1887 |
| Income taxes payable | 1042 | 759 |
| **TOTAL CURRENT LIABILITIES** | 16744 | 19536 |
| Operating lease liabilities | 14866 | 15025 |
| Term Loan, net of debt issuance cost | 12532 | 13136 |
| **TOTAL LIABILITIES** | 44142 | 47697 |
| **COMMITMENTS AND CONTINGENCIES** |  |  |
| **STOCKHOLDERS' EQUITY** |  |  |
| Common stock, authorized 20,000,000 shares of $0.01 par value; 10,291,067 and 10,193,287 shares issued and outstanding at January 31, 2023 and October 31, 2022, respectively | 103 | 102 |
| Additional paid-in capital | 25408 | 25118 |
| Retained earnings | 15487 | 16649 |
| **TOTAL STOCKHOLDERS' EQUITY** | 40998 | 41869 |
| **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | $85140 | $89566 |

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|:---|
| **RF INDUSTRIES, LTD. AND SUBSIDIARIES** |
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
| (In thousands, except share and per share amounts) |

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| | | |
|:---|:---|:---|
|  | Three Months Ended | Three Months Ended |
|  | January 31, | January 31, |
|  | 2023 | 2022 |
|  | (unaudited) | (unaudited) |
| Net sales | $18343 | $16918 |
| Cost of sales | 13257 | 12834 |
| Gross profit | 5086 | 4084 |
| Operating expenses: |  |  |
| Engineering | 961 | 454 |
| Selling and general | 5294 | 3992 |
| Total operating expenses | 6255 | 4446 |
| Operating loss | (1169) | (362) |
| Other (expense) income | (153) | 5 |
| Loss before benefit for income taxes | (1322) | (357) |
| Benefit for income taxes | (160) | (80) |
| Net loss | $(1162) | $(277) |
| Loss per share - Basic | $(0.11) | $(0.03) |
| Loss per share - Diluted | $(0.11) | $(0.03) |
| Weighted average shares outstanding: |  |  |
| Basic | 10222540 | 10067186 |
| Diluted | 10222540 | 10067186 |

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| **RF INDUSTRIES, LTD. AND SUBSIDIARIES** |
| Unaudited Reconciliation of GAAP to Non-GAAP Net (Loss) Income |
| (In thousands, except share and per share amounts) |

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| | | |
|:---|:---|:---|
|  | Three Months Ended | Three Months Ended |
|  | January 31, | January 31, |
|  | 2023 | 2022 |
| Net loss | $(1162) | $(277) |
| Stock-based compensation expense | 212 | 139 |
| Non-cash and other one time charges | 444 | 734 |
| Severance | 50 |  |
| Amortization expense | 431 | 95 |
| Non-GAAP net (loss) income | $(25) | $691 |
| Non-GAAP net (loss) income per share: |  |  |
| Basic | $(0.00) | $0.07 |
| Diluted | $(0.00) | $0.07 |
| Weighted average shares outstanding |  |  |
| Basic | 10222540 | 10067186 |
| Diluted | 10222540 | 10215815 |

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| **RF INDUSTRIES, LTD. AND SUBSIDIARIES** |
| Unaudited Reconciliation of Net Loss to Adjusted EBITDA |
| (In thousands) |

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| | | |
|:---|:---|:---|
|  | Three Months Ended | Three Months Ended |
|  | January 31, | January 31, |
|  | 2023 | 2022 |
| Net loss | $(1162) | $(277) |
| Stock-based compensation expense | 212 | 139 |
| Non-cash and other one time charges | 444 | 734 |
| Severance | 50 |  |
| Amortization expense | 431 | 95 |
| Depreciation expense | 110 | 85 |
| Other expense (income) | 153 | (5) |
| Benefit from income taxes | (160) | (80) |
| Adjusted EBITDA | $78 | $691 |

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