# EDGAR Filing Document

**Accession Number:** 0000355948
**File Stem:** 0000950170-23-000137
**Filing Date:** 2023-1
**Character Count:** 28224
**Document Hash:** f7fe591f82b3a1cfd53a0dec94b00493
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000950170-23-000137.hdr.sgml**: 20230104

**ACCESSION NUMBER**: 0000950170-23-000137

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 15

**CONFORMED PERIOD OF REPORT**: 20230104

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

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230104

**DATE AS OF CHANGE**: 20230104

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** RICHARDSON ELECTRONICS, LTD.
- **CENTRAL INDEX KEY:** 0000355948
- **STANDARD INDUSTRIAL CLASSIFICATION:** WHOLESALE-ELECTRONIC PARTS & EQUIPMENT, NEC [5065]
- **IRS NUMBER:** 362096643
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0527

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-12906
- **FILM NUMBER:** 23507021

**BUSINESS ADDRESS:**
- **STREET 1:** 40W267 KESLINGER RD
- **STREET 2:** PO BOX 393
- **CITY:** LAFOX
- **STATE:** IL
- **ZIP:** 60147
- **BUSINESS PHONE:** 630 208-2200

**MAIL ADDRESS:**
- **STREET 1:** 40W267 KESLINGER ROAD
- **STREET 2:** P.O. BOX 393
- **CITY:** LAFOX
- **STATE:** IL
- **ZIP:** 60147

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** RICHARDSON ELECTRONICS LTD/DE
- **DATE OF NAME CHANGE:** 19920703

?xml version="1.0" encoding="ASCII"? 8-K

**UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549**

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**FORM** 8-K

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**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934**

**Date of Report (Date of earliest event reported):** January 04, 2023<br>

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RICHARDSON ELECTRONICS, LTD.

**(Exact name of Registrant as Specified in Its Charter)**

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| | | |
|:---|:---|:---|
| Delaware | 0-12906 | 36-2096643 |
| **(State or Other Jurisdiction<br>of Incorporation)** | **(Commission File Number)** | **(IRS Employer<br>Identification No.)** |
| 40W267 Keslinger Road<br>P.O. Box 393 |  |  |
| LaFox**,** Illinois |  | 60147-0393 |
| **(Address of Principal Executive Offices)** |  | **(Zip Code)** |

---

**Registrant's Telephone Number, Including Area Code:** (630) 208-2200<br>

**(Former Name or Former Address, if Changed Since Last Report)**

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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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| | | |
|:---|:---|:---|
| **<br>Title of each class** | **Trading<br>Symbol(s)** | **<br>Name of each exchange on which registered** |
| Common stock, $0.05 Par Value per share | RELL | The NASDAQ Global Select 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 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. ☐

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

On January 4, 2023, Richardson Electronics, Ltd. (the "Company") issued a press release announcing earnings results for the second quarter ended November 26, 2022. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.

The information contained in Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

**Item 9.01 Financial Statements and Exhibits.**

(d) Exhibits

99.1 [<u>Press release issued January 4, 2023, furnished herewith</u>](rell-ex99_1.htm) <br> 104 Cover Page Interactive Data 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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| | | | |
|:---|:---|:---|:---|
|  |  |  | **Richardson Electronics, Ltd.** |
| Date: | January 4, 2023 | By:  | /s/ Robert J. Ben |
|  |  |  | Robert J. Ben<br>Chief Financial Officer and Chief Accounting Officer |

---

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## Exhibit 99.1

**Exhibit 99.1**

![img150668434_0.jpg](img150668434_0.jpg)

Press Release

**For Immediate Release**

![img150668434_1.jpg](img150668434_1.jpg)

---

| | | |
|:---|:---|:---|
| **For Details Contact:** |  | **40W267 Keslinger Road** |
| **Edward J. Richardson** | **Robert J. Ben** | **PO BOX 393** |
| Chairman and CEO | EVP & CFO | LaFox, IL 60147-0393 USA |
| Phone: (630) 208-2320 | (630) 208-2203 | (630) 208-2200 \| Fax: (630) 208-2550 |

---

**RICHARDSON ELECTRONICS REPORTS SECOND QUARTER FISCAL 2023 NET INCOME OF $5.5 MILLION OR 8.4% OF NET SALES; DECLARES QUARTERLY CASH DIVIDEND**

**<u>Green Energy Solutions sales increase 150.3% over Q2 FY22; total net sales increase 22.1%</u>** 

**<u>Second Quarter Highlights</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Net sales of $65.9 million were up 22.1% from last year's second quarter driven by increases in Power and Microwave Technologies ("PMT"), Green Energy Solutions ("GES") and Canvys business units.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Backlog totaled $192.6 million in the second quarter versus $199.2 million at the end of the first quarter of fiscal 2023 and $146.9 million at the end of the second quarter of last fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Gross margin was 33.2% of net sales for the second quarter of fiscal 2023 versus 32.7% of net sales in the prior year's second quarter representing strong sales and growth in engineered solutions within the PMT and GES business units.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Operating income was $7.2 million in the second quarter of fiscal 2023 compared to $4.5 million for the second quarter of fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Income tax expense was $1.5 million for the second quarter of fiscal 2023 or 21.5% versus $0.6 million in the prior year's second quarter due to the use of federal NOLs in fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Earnings per common share (diluted) were $0.39 for the second quarter of fiscal 2023 compared to $0.30 per common share (diluted) in the second quarter of fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Cash and investments were $31.1 million as of November 26, 2022 compared to $35.6 million on August 27, 2022, and $40.5 million as of May 28, 2022. The use of cash was related to higher working capital to support sales growth.

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**LaFox, IL, JANUARY 4, 2023:** Richardson Electronics, Ltd. (NASDAQ: RELL) today reported financial results for its second quarter ended November 26, 2022. The Company also announced that its Board of Directors declared a $0.06 per share quarterly cash dividend.

"We are extremely pleased with the strong financial performance we continue to achieve because of our success capitalizing on new market opportunities, and positive demand trends underway tied to our key growth initiatives. The second quarter of fiscal 2023 was the ninth consecutive quarter of quarter of year-over-year revenue growth and positions us for another strong year of operating and financial performance for fiscal 2023," said Edward J. Richardson, Chairman, Chief Executive Officer, and President. "In the first quarter of fiscal 2023, we began reporting a new segment, Green Energy Solutions ("GES"). With rapidly increasing sales from green energy products and customers and over $192 million in total Company backlog, we believe sales and profits will continue to significantly increase in fiscal 2023."

**<u>Second Quarter Results</u>**

Net sales for the second quarter of fiscal 2023 increased 22.1% to $65.9 million compared to net sales of $54.0 million in the prior year's second quarter due to higher net sales in PMT, GES and Canvys, partially offset by slightly lower sales for Healthcare. PMT sales increased $3.8 million or 10.2% from last year's second quarter. Sales of manufactured products for our semiconductor wafer fabrication equipment customers and distributed products for RF and Microwave applications increased from the second quarter of fiscal 2022. Net sales for GES increased $7.4 million or 150.3% from last year's second quarter. GES combines our key technology partners and engineered solutions capabilities, to design and manufacture products for the fast-growing green energy market and power management applications. Canvys sales increased by $0.9 million or 10.2% primarily due to strong customer demand in North America. Richardson Healthcare sales decreased $0.2 million or 4.7% due to a decrease in parts sales, partially offset by increases in equipment and CT tube sales.

Gross margin was 33.2% of net sales during the second quarter of fiscal 2023 compared to 32.7% of net sales during the second quarter of fiscal 2022. PMT margin increased to 34.5% from 33.7% and GES margin increased to 33.9% from 32.3% primarily due to product mix. Canvys margin as a percent of net sales decreased to 29.7% from 31.8% because of product mix and foreign exchange effects. Healthcare gross margin was 23.2% in the second quarter of fiscal 2023 compared to 24.5% in the prior year's second quarter due to product mix.

Operating expenses were $14.7 million compared to $13.1 million in the second quarter of fiscal 2022. The increase in operating expenses resulted from higher employee compensation expenses, including incentive expense from significantly higher operating income and higher travel expenses. Operating expenses as a percentage of net sales decreased to 22.3% during the second quarter of fiscal 2023 compared to 24.3% during the second quarter of fiscal 2022 as the Company benefits from higher sales and controlled operating expenses.

The Company reported operating income of $7.2 million for the second quarter of fiscal 2023 compared to operating income of $4.5 million in the prior year's second quarter. Other expenses for the second quarter of fiscal 2023, including interest income and foreign exchange, were $0.1 million, compared to other income of $0.2 million in the second quarter of fiscal 2022.

Income tax expense was $1.5 million for the second quarter of fiscal 2023 or 21.5% versus $0.6 million in the prior year's second quarter due to the use of federal NOLs in fiscal 2022.

Net income for the second quarter of fiscal 2023 was $5.5 million compared to net income of $4.1 million in the second quarter of fiscal 2022. Earnings per common share (diluted) were $0.39 in the second quarter of fiscal 2023 compared to $0.30 per common share (diluted) in the second quarter of fiscal 2022.

Cash and investments at the end of the second quarter of fiscal 2023 were $31.1 million compared to $35.6 million at the end of the first quarter of fiscal 2023 and $40.5 million at the end of fiscal 2022. The Company continues to invest in inventory and working capital to support its growth initiatives and invested $1.3 million during the quarter on capital expenditures primarily related to its manufacturing business, facilities, and IT system, versus $0.8 million during the second quarter of fiscal 2022.

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**<u>FINANCIAL SUMMARY – SIX MONTHS ENDED NOVEMBER 26, 2022</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Net sales for the first six months of fiscal 2023 were $133.5 million, an increase of 23.9%, compared to net sales of $107.7 million during the first six months of fiscal 2022. Sales increased by $8.7 million or 11.2% for PMT, $13.3 million or 177.9% for GES, $2.9 million or 16.5% for Canvys and $0.9 million or 16.5% for Richardson Healthcare.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Gross profit increased to $44.9 million during the first six months of fiscal 2023, compared to $34.0 million during the first six months of fiscal 2022. As a percentage of net sales, gross margin increased to 33.6% of net sales during the first six months of fiscal 2023, compared to 31.5% of net sales during the first six months of fiscal 2022, primarily because of a favorable product mix in PMT and GES, decreased component scrap expense and improved manufacturing absorption in Healthcare, partially offset by an unfavorable product mix and foreign currency effects in Canvys.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Operating expenses increased to $28.9 million for the first six months of fiscal 2023, compared to $26.6 million for the first six months of fiscal 2022. The increase in operating expenses resulted from higher employee compensation and travel expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Operating income during the first six months of fiscal 2023 was $16.0 million, compared to an operating income of $7.3 million during the first six months of fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Other expense for the first six months of fiscal 2023, including interest income and foreign exchange, was $0.5 million, as compared to other income of $0.1 million in the first six months of fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•The income tax provision was $3.6 million during the first six months of fiscal 2023 or 23.4% versus $0.7 million in the prior year's first six months due to the use of federal NOLs in fiscal 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•Net income for the first six months of fiscal 2023 was $11.9 million, versus $6.8 million during the first six months of fiscal 2022. Earnings per common share (diluted) were $0.83 for the first six months of fiscal 2023 compared to $0.50 per common share (diluted) for the first six months of fiscal 2022.

**<u>CASH DIVIDEND DECLARED</u>**

The Board of Directors of Richardson Electronics declared a $0.06 quarterly cash dividend per share to holders of common stock and a $0.054 cash dividend per share to holders of Class B common stock. The dividend will be payable on February 22, 2023, to common stockholders of record as of February 3, 2023.

**<u>CONFERENCE CALL INFORMATION</u>**

On Thursday, January 5, 2023, at 9:00 a.m. Central Time, Edward J. Richardson, Chairman and Chief Executive Officer, and Robert J. Ben, Chief Financial Officer, will host a conference call to discuss the Company's second quarter fiscal 2023 results. A question-and-answer session will be included as part of the call's agenda.

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<u>Participant Instructions</u> 

Participants may register for the call <u>here</u>. While not required, it is recommended you join 10 minutes prior to the event start. A replay of the call will be available beginning at 1:00 p.m. Central Time on January 5, 2023, for seven days. Registration instructions are also on our website at <u>www.rell.com</u>.

In addition, the webcast link is available <u>here</u>.

**<u>FORWARD-LOOKING STATEMENTS</u>** 

This release includes certain "forward-looking" statements as defined by the Securities and Exchange Commission. Statements in this press release regarding the Company's business that are not historical facts represent "forward-looking" statements that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, "Risk Factors" in the Company's Annual Report on Form 10-K filed on August 1, 2022, and other reports we file with the Securities and Exchange Commission. The Company assumes no responsibility to update the "forward-looking" statements in this release as a result of new information, future events or otherwise.

**<u>ABOUT RICHARDSON ELECTRONICS, LTD.</u>** 

Richardson Electronics, Ltd. is a leading global manufacturer of engineered solutions, power grid and microwave tubes and related consumables; power conversion and RF and microwave components; high-value replacement parts, tubes, and service training for diagnostic imaging equipment; and customized display solutions. More than 60% of our products are manufactured in LaFox, Illinois, Marlborough, Massachusetts, or Donaueschingen, Germany, or by one of our manufacturing partners throughout the world. All our partners manufacture to our strict specifications and per our supplier code of conduct. We serve customers in the alternative and green energy, healthcare, aviation, broadcast, communications, industrial, marine, medical, military, scientific and semiconductor markets. The Company's strategy is to provide specialized technical expertise and "engineered solutions" based on our core engineering and manufacturing capabilities. The Company provides solutions and adds value through design-in support, systems integration, prototype design and manufacturing, testing, logistics and aftermarket technical service and repair through its global infrastructure. More information is available at <u>www.rell.com</u>.

Richardson Electronics, Ltd. common stock trades on the NASDAQ Global Select Market under the ticker symbol RELL.

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**Richardson Electronics, Ltd.** 

 **Consolidated Balance Sheets**

(in thousands, except per share amounts)

---

| | | |
|:---|:---|:---|
|  | **Unaudited** | **Audited** |
|  | **November 26, 2022** | **May 28, 2022** |
| **Assets** |  |  |
| &nbsp;&nbsp;&nbsp;**Current assets:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $26106 | $35495 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, less allowance of $178 and $186, respectively | 34880 | 29878 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories, net | 97434 | 80390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other assets | 2521 | 2448 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments - current | 5000 | 5000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current assets** | **165941** | **153211** |
| &nbsp;&nbsp;&nbsp;**Non-current assets:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property, plant and equipment, net | 17964 | 16961 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible assets, net | 2025 | 2010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease ROU asset | 2527 | 3239 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | 302 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current deferred income taxes | 4342 | 4398 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total non-current assets** | **27160** | **26608** |
| **Total assets** | $**193101** | $**179819** |
| **Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;**Current liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $24603 | $23987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 17074 | 16110 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liability current | 1015 | 1109 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | **42692** | **41206** |
| &nbsp;&nbsp;&nbsp;**Non-current liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current deferred income tax liabilities | 83 | 85 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liability non-current | 1512 | 1915 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current liabilities | 726 | 766 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total non-current liabilities** | **2321** | **2766** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities** | **45013** | **43972** |
| **Stockholders' Equity** |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.05 par value; issued and outstanding 12,022 shares on<br> November 26, 2022 and 11,649 shares on May 28, 2022 | 601 | 582 |
| &nbsp;&nbsp;&nbsp;Class B common stock, convertible, $0.05 par value; issued and outstanding<br> 2,052 shares on November 26, 2022 and 2,053 shares on May 28, 2022 | 103 | 103 |
| &nbsp;&nbsp;&nbsp;Preferred stock, $1.00 par value, no shares issued |  |  |
| &nbsp;&nbsp;&nbsp;Additional paid-in-capital | 69669 | 66331 |
| &nbsp;&nbsp;&nbsp;Retained earnings | 78254 | 68031 |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive (loss) income | (539) | 800 |
| **&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity** | **148088** | **135847** |
| **Total liabilities and stockholders' equity** | $**193101** | $**179819** |

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**Richardson Electronics, Ltd.** 

**Unaudited Consolidated Statements of Comprehensive Income** 

(in thousands, except per share amounts)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **November 26, 2022** | **November 27, 2021** | **November 26, 2022** | **November 27, 2021** |
| Net sales | $65905 | $53979 | $133462 | $107683 |
| Cost of sales | 44054 | 36322 | 88584 | 73729 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Gross profit** | **21851** | **17657** | **44878** | **33954** |
| Selling, general and administrative expenses | 14677 | 13135 | 28925 | 26604 |
| (Gain) loss on disposal of assets | (25) | 2 | (25) | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Operating income** | **7199** | **4520** | **15978** | **7348** |
| Other expense (income): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment/interest income | (78) | (8) | (103) | (25) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange loss | 223 | (150) | 597 | (123) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other, net | (13) | 6 | (15) | 22 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense (income) | 132 | (152) | 479 | (126) |
| Income before income taxes | 7067 | 4672 | 15499 | 7474 |
| Income tax provision | 1518 | 550 | 3626 | 717 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net income** | **5549** | **4122** | **11873** | **6757** |
| Foreign currency translation gain (loss), net of tax | 976 | (1420) | (1339) | (2422) |
| **Comprehensive income** | $**6525** | $**2702** | $**10534** | $**4335** |
| **Net income per share:** |  |  |  |  |
| Common shares - Basic | $0.40 | $0.31 | $0.87 | $0.52 |
| Class B common shares - Basic | 0.36 | 0.28 | 0.78 | 0.46 |
| Common shares - Diluted | 0.39 | 0.30 | 0.83 | 0.50 |
| Class B common shares - Diluted | 0.35 | 0.27 | 0.75 | 0.45 |
| **Weighted average number of shares:** |  |  |  |  |
| Common shares – Basic | 11918 | 11270 | 11816 | 11232 |
| Class B common shares – Basic | 2053 | 2097 | 2053 | 2097 |
| Common shares – Diluted | 12535 | 11697 | 12442 | 11568 |
| Class B common shares – Diluted | 2053 | 2097 | 2053 | 2097 |
| **Dividends per share:** |  |  |  |  |
| Common share | $0.060 | $0.060 | $0.120 | $0.120 |
| Class B common share | 0.054 | 0.054 | 0.108 | 0.108 |

---

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**Richardson Electronics, Ltd.** 

 **Unaudited Consolidated Statements of Cash Flows**

(in thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **November 26, 2022** | **November 27, 2021** | **November 26, 2022** | **November 27, 2021** |
| **Operating activities:** |  |  |  |  |
| Net income | $5549 | $4122 | $11873 | $6757 |
| Adjustments to reconcile net income to cash (used in) provided by operating activities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 893 | 859 | 1776 | 1688 |
| &nbsp;&nbsp;&nbsp;Inventory provisions | 124 | 57 | 195 | 140 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense | 213 | 153 | 524 | 372 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Gain) loss on disposal of assets | (25) | 2 | (25) | 2 |
| &nbsp;&nbsp;&nbsp;Deferred income taxes | 27 | (23) | 28 | 12 |
| Change in assets and liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivable | (2009) | 1862 | (5505) | (3146) |
| &nbsp;&nbsp;&nbsp;Inventories | (7658) | (4225) | (18126) | (9182) |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other assets | 774 | (994) | (425) | (1056) |
| &nbsp;&nbsp;&nbsp;Accounts payable | (699) | 1695 | 796 | 2302 |
| &nbsp;&nbsp;&nbsp;Accrued liabilities | (1062) | 1032 | 1147 | 1512 |
| &nbsp;&nbsp;&nbsp;Other | (49) | 91 | 589 | 357 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash (used in) provided by operating activities** | **(3922)** | **4631** | **(7153)** | **(242)** |
| **Investing activities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Capital expenditures | (1301) | (770) | (2743) | (1607) |
| &nbsp;&nbsp;&nbsp;Proceeds from sale of assets | 193 |  | 193 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in investing activities** | **(1108)** | **(770)** | **(2550)** | **(1607)** |
| **Financing activities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of common stock | 1517 | 672 | 2902 | 724 |
| &nbsp;&nbsp;&nbsp;Cash dividends paid | (831) | (792) | (1650) | (1578) |
| &nbsp;&nbsp;&nbsp;Other |  | (46) | (69) | (91) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by (used in) financing activities** | **686** | **(166)** | **1183** | **(945)** |
| &nbsp;&nbsp;&nbsp;Effect of exchange rate changes on cash and cash equivalents | (183) | (448) | (869) | (857) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(Decrease) increase in cash and cash equivalents** | **(4527)** | **3247** | **(9389)** | **(3651)** |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents at beginning of period | 30633 | 36418 | 35495 | 43316 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Cash and cash equivalents at end of period** | $**26106** | $**39665** | $**26106** | $**39665** |

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**Richardson Electronics, Ltd.**

**Unaudited Net Sales and Gross Profit**

**For the Second Quarter and First Six Months of Fiscal 2023 and 2022**

($ in thousands)

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| | | | | |
|:---|:---|:---|:---|:---|
| **By Strategic Business Unit:** |  |  |  |  |
| **<u>Net Sales</u>** |  |  |  |  |
|  | **Q2 FY 2023** |  | **Q2 FY 2022** | **% Change** |
| PMT | $40585 |  | $36826 | 10.2% |
| GES | 12293 |  | 4911 | 150.3% |
| Canvys | 10079 |  | 9150 | 10.2% |
| Healthcare | 2948 |  | 3092 | -4.7% |
| &nbsp;&nbsp;&nbsp;Total | $65905 |  | $53979 | 22.1% |
|  | **YTD FY 2023** |  | **YTD FY 2022** | **% Change** |
| PMT | $85939 |  | $77261 | 11.2% |
| GES | 20804 |  | 7485 | 177.9% |
| Canvys | 20492 |  | 17591 | 16.5% |
| Healthcare | 6227 |  | 5346 | 16.5% |
| &nbsp;&nbsp;&nbsp;Total | $133462 |  | $107683 | 23.9% |
| **<u>Gross Profit</u>** |  |  |  |  |
|  | **Q2 FY 2023** | **% of Net Sales** | **Q2 FY 2022** | **% of Net Sales** |
| PMT | $14011 | 34.5% | $12399 | 33.7% |
| GES | 4162 | 33.9% | 1587 | 32.3% |
| Canvys | 2995 | 29.7% | 2912 | 31.8% |
| Healthcare | 683 | 23.2% | 759 | 24.5% |
| &nbsp;&nbsp;&nbsp;Total | $21851 | 33.2% | $17657 | 32.7% |
|  | **YTD FY 2023** | **% of Net Sales** | **YTD FY 2022** | **% of Net Sales** |
| PMT | $29546 | 34.4% | $24586 | 31.8% |
| GES | 7184 | 34.5% | 2331 | 31.1% |
| Canvys | 6261 | 30.6% | 5730 | 32.6% |
| Healthcare | 1887 | 30.3% | 1307 | 24.4% |
| &nbsp;&nbsp;&nbsp;Total | $44878 | 33.6% | $33954 | 31.5% |

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