RCM Technologies, Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>RCM Technologies, Inc. filed its 2023 10-K, reporting $17.3M in revenue and $9.8M in net income.</b>

AI Summary

RCM TECHNOLOGIES, INC. (RCMT) filed a Annual Report (10-K) with the SEC on March 14, 2024. RCM Technologies, Inc. reported total assets of $17,673,427 for the fiscal year ended December 30, 2023. The company's net income for the fiscal year ended December 30, 2023, was $9,828,606. Revenue for the fiscal year ended December 30, 2023, was $17,287,967. Total debt for RCM Technologies, Inc. was $6,612,222 as of December 30, 2023. The company's operating margin for the fiscal year ended December 30, 2023, was 65.1%.

Why It Matters

For investors and stakeholders tracking RCM TECHNOLOGIES, INC., this filing contains several important signals. The filing provides a comprehensive overview of RCM Technologies' financial performance and position for the fiscal year 2023, including detailed financial statements and risk factors. Investors can use this report to assess the company's profitability, asset management, debt levels, and overall financial health to make informed investment decisions.

Risk Assessment

Risk Level: medium — RCM TECHNOLOGIES, INC. shows moderate risk based on this filing. The company's financial performance is subject to market conditions and operational execution, as indicated by the revenue and net income figures presented in the 10-K.

Analyst Insight

Review the detailed financial statements and risk factors in the 10-K to understand RCM Technologies' operational performance and potential future challenges.

Revenue Breakdown

Key Numbers

• 17,673,427 — Total Assets (As of December 30, 2023)
• 9,828,606 — Net Income (For the fiscal year ended December 30, 2023)
• 17,287,967 — Revenue (For the fiscal year ended December 30, 2023)
• 6,612,222 — Total Debt (As of December 30, 2023)
• 65.1 — Operating Margin (For the fiscal year ended December 30, 2023)
• 1.80 — EPS (For the fiscal year ended December 30, 2023)
• 0.50 — Debt/Equity Ratio (As of December 30, 2023)
• 5,000,000 — Common Stock (As of December 30, 2023)

Key Players & Entities

• RCM TECHNOLOGIES, INC. (company) — Filer name
• 20231230 (date) — Conformed period of report
• 20240314 (date) — Filed as of date
• Bradley S. Vizi (person) — Executive Chairman & President
• Michael Saks (person) — Division President, Health Care Services
• PENNSAUKEN, NJ (location) — Business address
• 7363 (industry_code) — Standard Industrial Classification
• NV (state) — State of incorporation

FAQ

Risk Factors

• Goodwill Deductibility [medium — financial]: Goodwill is expected to be fully deductible for tax purposes, except for contingent consideration which is deductible only when paid.

Key Financial Figures

• $0.05 — ch Registered Common Stock, par value $0.05 per share RCMT The NASDAQ Stock Mar
• $18.40 — million based upon the closing price of $18.40 per share of the registrant's common st

Filing Documents

• rcmt20231230_10k.htm (10-K) — 2529KB
• ex_629739.htm (EX-21) — 2KB
• ex_629740.htm (EX-23.1) — 4KB
• ex_629741.htm (EX-23.2) — 3KB
• ex_629742.htm (EX-31.1) — 8KB
• ex_629743.htm (EX-31.2) — 8KB
• ex_629744.htm (EX-32.1) — 6KB
• ex_629745.htm (EX-32.2) — 6KB
• ex_629746.htm (EX-97) — 47KB
• 0001437749-24-007884.txt (&nbsp;) — 10826KB
• rcmt-20231230.xsd (EX-101.SCH) — 70KB
• rcmt-20231230_cal.xml (EX-101.CAL) — 77KB
• rcmt-20231230_def.xml (EX-101.DEF) — 489KB
• rcmt-20231230_lab.xml (EX-101.LAB) — 455KB
• rcmt-20231230_pre.xml (EX-101.PRE) — 539KB
• rcmt20231230_10k_htm.xml (XML) — 2197KB

Business

Business 2 Item 1A.

Risk Factors

Risk Factors 15 Item 1B. Unresolved Staff Comments 21 Item 1C. Cybersecurity 21 Item 2.

Properties

Properties 22 Item 3.

Legal Proceedings

Legal Proceedings 23 Item 4. Mine Safety Disclosures 23 PART II 24 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 24 Item 6. Reserved 25 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 26 Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 46 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 46 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 46 Item 9A.

Controls and Procedures

Controls and Procedures 47 Item 9B. Other Information 49 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections 49 PART III 50 Item 10. Directors, Executive Officers and Corporate Governance 50 Item 11.

Executive Compensation

Executive Compensation 50 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 50 Item 13. Certain Relationships and Related Transactions, and Director Independence 50 Item 14. Principal Accountant Fees and Services 50 PART IV 51 Item 15. Exhibits and Financial Statement Schedules 51 Item 16. Form 10-K Summary 54

Signatures

Signatures 55 PART I Private Securities Litigation Reform Act Safe Harbor Statement Certain statements included herein and in other reports and public filings made by RCM Technologies, Inc. ("RCM" or the "Company") are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements regarding the adoption by businesses of new technology solutions; the use by businesses of outsourced solutions, such as those offered by the Company, in connection with such adoption; the Company's strategic and business initiatives and growth strategies; and the outcome of litigation (at both the trial and appellate levels) and arbitrations, or other business disputes, involving the Company. Readers are cautioned that such forward-looking statements, as well as others made by the Company, which may be identified by words such as "may," "will," "expect," "anticipate," "continue," "estimate," "project," "intend," "believe," and similar expressions, are only predictions and are subject to risks and uncertainties that could cause the Company's actual results and financial position to differ materially from such statements. Such risks and uncertainties include, without limitation: (i) unemployment and general economic conditions affecting the provision of life sciences, information technology and engineering services and solutions and the placement of temporary staffing personnel; (ii) the Company's ability to continue to attract, train and retain personnel qualified to meet the requirements of its clients; (iii) the Company's ability to identify appropriate acquisition candidates, complete such acquisitions and successfully integrate acquired businesses; (iv) the Company's relationships with and reliance upon significant customers, and ability to collect accounts receivable from such customers; (v) risks associated with foreign currency fluctuations and changes in exchange rates, part

BUSINESS

ITEM 1. BUSINESS General RCM Technologies, Inc. is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers. The Company provides these services through the deployment of specialty health care, engineering, life sciences, information technology services, data management and solutions. For over 50 years, the Company has developed and assembled an extensive portfolio of capabilities, service offerings and delivery options with world class technical talent in key end markets and high-growth industries. This combination, paired with RCM's efficient pricing structure and global reach, offers clients a compelling value proposition. RCM consists of three operating segments: Specialty Health Care, Engineering, and Life Sciences and Information Technology services. The Specialty Health Care segment provides staffing solutions including medical health care professionals, health information management professionals, nurses, paraprofessionals, physicians and therapists for many of the largest healthcare institutions and school districts across the United States. The segment also provides Teletherapy services targeting the education sector with an emphasis on behavioral health. The Engineering segment provides a comprehensive portfolio of engineering and design services across three verticals: (1) Energy Services, (2) Process & Industrial and (3) Aerospace. The segment also offers a complementary suite of consulting solutions and services to augment its engineering portfolio, including design and supply of high-quality engineered process solutions and equipment, data management, technical writing and digital documentation across marine, locomotive, transportation and aerospace markets, integrated design and construction, and engineering, procurement and construction management ("EPC"), as well as demand side management/energy conservation services. The business segment staffs engineers to design

BUSINESS (CONTINUED)

ITEM 1. BUSINESS (CONTINUED) Industry Overview (Continued) In the health care services industry, a shortage of nurses and other medical personnel in the United States has led to increases in business activity for health care service companies, including the Company's Specialty Health Care group. Due in part to an aging population and improved medical technology, the demand for selected health care professionals is expected to continue over the next several years, with an emphasis on leveraging technology to expand access to care. The increased adoption of telemedicine, an area in which the Specialty Health Care group has developed new service offerings, is a primary example. In addition, public educational institutions are outsourcing their requirements for school nurses, therapists and paraprofessionals to lower their costs and it is expected that this will continue and grow. Each of these dynamics have been exacerbated by COVID-19. Various factors, including the pandemic, technological advances and patient habits, have also altered patterns in health care delivery, with newer delivery models gaining traction, namely telemedicine. Given federal and state regulatory changes as well as private insurer reimbursement methods, utilization of telemedicine services increased significantly. CDC researchers stated that maintaining the expansion of telehealth remains critical to providing access to care. It is expected the total addressable market opportunity will continue to expand and grow. Expanding access to behavioral health and mental well-being is also a priority for public health officials. Increasing and maintaining access to proper care remains a top priority and the market opportunity for these services is expected to continue to grow. While the Company believes that the demand for Healthcare related services remains historically high, the Company also believes this demand subsided some as COVID-19 shifted from a pandemic to an endemic. The Company's Engineer

BUSINESS (CONTINUED)

ITEM 1. BUSINESS (CONTINUED) Business Strategy The Company is dedicated to providing solutions to meet its clients' business needs by delivering specialty health care, engineering, life sciences and information technology services. The Company's objective is to remain a recognized leader of specialized professional staffing, consulting services and solutions in major markets throughout North America. The Company adapts operating strategies to achieve this objective. The following is a discussion of the key elements of its growth and operating strategies: Growth Strategy Promote Full Life Cycle Solution Capability The Company promotes a full life cycle solution capability to its customers. The goal of the full life cycle solution strategy is to fully address a client's project implementation cycle at each stage of its design, development and deployment. This entails the Company working with its clients from the initial conceptualization of a project through its design and project execution, and extending into ongoing management and support of the delivered product. RCM's strategy is to build projects and integrated solutions offerings selectively, utilizing its extensive resource base. The Company believes that the effective execution of this strategy will generate improved margins on its existing resources. The completion of this service-offering continuum is intended to afford the Company the opportunity to strengthen long-term client relationships that will further contribute to a more predictable revenue stream. In addition to a full life cycle solution offering, the Company continues to focus on transitioning into higher value oriented services in an effort to increase its margins on its various service lines and generate revenue that is more sustainable. The Company believes this transition is accomplished by pursuing additional vertical market specific solutions in conjunction or combination with longer-term based solutions, through expansion of its

BUSINESS (CONTINUED)

ITEM 1. BUSINESS (CONTINUED) Growth Strategy (Continued) Pursue Selective Strategic Acquisitions The industries in which the Company operates continue to be highly fragmented, and the Company plans to continue to selectively assess opportunities to make strategic acquisitions as such opportunities are presented to the Company. The Company's acquisition strategy is designed to broaden the scope of services and technical competencies and grow its full life cycle solution capabilities. In considering acquisition opportunities, the Company focuses principally on companies with (i) technologies or market segments RCM has targeted for strategic value enhancement, (ii) margins that are accretive to existing margins, (iii) experienced management personnel, (iv) substantial growth prospects and (v) sellers who desire to join the Company's management team. To retain and provide incentives for management of its acquired companies, the Company has generally structured a significant portion of the acquisition price in the form of multi-tiered consideration based on growth of operating profitability of the acquired company over a two-to-four-year period. Operating Strategy Develop and Maintain Strong Customer Relationships The Company seeks to develop and maintain strong cross-functional customer relationships by anticipating and focusing on its customers' needs. The Company emphasizes a relationship-oriented and partnership-based approach to business, rather than the transaction or assignment-oriented approach that the Company believes is used by many of its competitors. This industry-centric strategy is designed to allow RCM to expand further its relationships with clients in RCM's targeted sectors. To develop close customer relationships, the Company's practice managers and/or salespeople regularly meet with both existing and prospective clients to identify areas of need and help design solutions and identify the resources needed to execute their strategies. The Co

BUSINESS (CONTINUED)

ITEM 1. BUSINESS (CONTINUED) Specialty Health Care The Company's Specialty Health Care Group specializes in long-term and short-term staffing of medical professionals as well as executive search, international recruitment, and placement solutions for many of the largest healthcare institutions and school districts across the United States. The segment's portfolio of services includes, but is not limited to, the following fields: Allied and Therapy Staffing : Specializes in recruiting outstanding professionals across the health care industry. Our allied health care professionals and therapists work in schools, health systems, hospitals, nursing homes, and rehabilitation facilities. Correctional Healthcare Staffing : Staffing services for local, state and federal correctional facilities and provide screening, onboarding, and employee assessments as well as employee and inmate vaccination and treatment services. Health Information Management : Provide healthcare organizations with experienced medical coding professionals that manage staffing shortages, backlogs, vacation coverage and long-term coding support. Nursing Services : Provides nurse placement and staffing services in healthcare facilities, schools, hospitals and correctional facilities. Physicians and Advanced Practice : Our national locum tenens (temporary practitioner) practice specializes in placing physicians, physician assistants and nurse practitioners. School Staffing and Recruitment : Provides full-time and part-time nurse employment services for school districts across the country. The Company also offers other health care professionals to perform school evaluations and treat students, including occupational and physical therapists, speech and language pathologists, as well as special education support services and registered behavioral technicians to support students' individualized education plan and behavioral health needs. Telepractice : The Company's teletherapy solution is an evidenc

BUSINESS (CONTINUED)

ITEM 1. BUSINESS (CONTINUED) Engineering

View Full Filing

View this 10-K filing on SEC EDGAR