RF Industries, Ltd., (NASDAQ:RFIL) today announced results for the fiscal third quarter and nine months ended July 31, 2011.
Third Quarter Highlights
Net sales increased 17% to a third quarter record $4,948,000 compared to record third quarter sales of $4,230,000 in the same quarter last year. Net income was affected by non-recurring expenses of approximately $503,000 for legal, accounting, investment banking and administrative expenses associated with the June 15, 2011 acquisition of Cables Unlimited Inc. and approximately $59,000 in additional consulting, legal, corporate and administrative expenses incurred in addressing certain stockholder issues and activities. After these expenses, net income for the third quarter was $63,000 or $0.01 per diluted share compared $312,000, or $0.05 per diluted share in the same period last year. In the third quarter of fiscal 2011, net income was affected by non-cash expenses for the write-off of Neulink inventory and goodwill impairment related to the Aviel acquisition of $248,000 and $137,000, respectively.
"Cables Unlimited contributed $909,000 to net sales for 45 days of the quarter. Excluding Cables Unlimited's sales, overall sales for RFI's continuing businesses were down 4.5% for the quarter, affected primarily by inventory adjustments and shipping delays from some of our major distributors. We believe these are adjustments and delays, not lost sales. Sales rates improved for August," said Howard Hill, CEO of RF Industries.RF Connector & Cable segment sales declined 7.7% in the quarter to $3,274,000 from $3,546,000 in the same period last year. Gross margins for this segment were 54% compared to 56% of sales in the same quarter last year, due to the sales decline. The operating loss was $99,000 for the quarter, compared to an operating profit of $683,000 in the same quarter last year. Profitability for this segment was affected by $503,000 in non-recurring expenses related to the Cables Unlimited, Inc. acquisition as well as approximately $59,000 of other corporate expenses.