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RF Industries Reports Preliminary Second Quarter Results

Bioconnect product sales increased 11% to $1,442,000 from $1,299,000 in the first six months last year, raising gross margin to 43% from 38% of sales in the same period last year. The increase in gross margin, along with flat selling and general expenses, combined to increase pre-tax income 44% to $439,000 from $306,000 in the first half last year.

Cables Unlimited's sales for the first six months were $3,280,000 and the gross margin was 33% of sales. Acquired in June 2011, after the end of the fiscal 2011 second quarter, there are no comparable results for this business last year. Efficiencies and tight cost controls implemented after the acquisition of this segment resulted in pre-tax income of $195,000 for the first half.

RF Wireless segment sales increased 173% to $989,000 compared to $363,000 for the first half last year. Strong sales gains at both RadioMobile and RF Neulink raised gross margin to 47% from 44% of sales and, combined with reduced general and engineering expenses, significantly narrowed the pre-tax loss to $5,000, compared to a pre-tax loss of $391,000 for the same period last year.

As of April 30, 2012, RFI reported cash and cash equivalents of $3,813,000 and investments in certificates of deposits of $748,000, for a total of $4,561,000 in liquid and short-term capital resources, working capital of $13,199,000, a 7 to 1 current ratio and stockholders' equity of $18,582,000, or $2.71 per outstanding share.

Second Quarter Conference Call

RFI has scheduled a conference call for Friday, June 8, 2012, at 11:30 a.m. EDT to discuss its results for the quarter. The dial-in number is 866-713-8395 and the passcode is #82160877. A simultaneous webcast of the call can be accessed from the Investor Info page at www.rfindustries.com. A replay will be available after 2:00 p.m. EDT at this same Internet address. For a telephone replay, dial 888-286-8010, passcode #47997641, after 2:00 p.m. EDT.

About RF Industries

RFI manufactures, designs and distributes Radio Frequency (RF) connectors and cable assemblies, medical cabling products, RF wireless products, and fiber optic cable products. Coaxial connectors, cable assemblies and custom microwave RF connectors are used for Wi-Fi, PCS, radio, test instruments, computer networks, antenna devices, aerospace, OEM and Government agencies. Medical Cabling and Interconnector products are specialized custom electrical cabling products for the medical equipment monitoring market. RF Wireless products include digital data transceivers for industrial monitoring, wide area networks, GPS tracking and mobile wireless network solutions. Fiber optic cable, connector and harness products serve computer, aerospace, computer networking and specialty applications.

Safe Harbor Statements under the Private Securities Litigation Reform Act of 1995.

This press release contains forward-looking statements with respect to future events 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; the operations of the Cables Unlimited division which was acquired in June 2011; unexpected difficulties or delays in implementing the new wireless system upgrade to the Los Angeles County Fire Department's existing remote communications equipment; and the Company's reliance on certain distributors for a significant portion of anticipated revenues. 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 Form 10-K. All forward-looking statements are based upon information available to the Company on the date they are published and the Company undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or new information after the date of this release.

 
RF INDUSTRIES, LTD.
PRELIMINARY CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share and share amounts) (unaudited)
 
Three Months Ended   Six Months Ended
April 30, April 30,
2012   2011 2012   2011
 
Net sales $ 6,672 $ 4,392 $ 12,231 $ 8,532
Cost of sales   3,650   2,155   6,707   4,125
Gross profit 3,022 2,237 5,524 4,407
 
Operating expenses:
Engineering 283 333 573 630
Selling and general   1,840   1,282   3,851   2,627
Total operating expenses   2,123   1,615   4,424   3,257
Operating income 899 622 1,099 1,150
Interest income   6   11   25   21
Income before provision for income taxes 904 632 1,124 1,172
Provision for income taxes   303   226   407   413

Net income attributable to RF Industries & Subsidiary

602 407 718 758
Net income attributable to deconsolidation of VIE   --   --   2   --
Consolidated net income $ 602 $ 407 $ 720 $ 758
Basic earnings per share:
Attributable to RF Industries & Subsidiary $ 0.09 $ 0.07 $ 0.10 $ 0.13
Attributable to VIE   0.00   0.00   0.00     0.00

Consolidated basic earnings per share

$

0.09

 

$

0.07

 

$

0.10

 

$

0.13

 
Diluted earnings per share:
Attributable to RF Industries & Subsidiary $ 0.08 $ 0.06 $ 0.09 $ 0.11
Attributable to VIE   0.00     0.00     0.00   0.00

Consolidated diluted earnings per share

$

0.08

 

$

0.06

 

$

0.09

 

$

0.11

 
Weighted average shares outstanding
Basic   6,872,439   6,009,849   6,938,395   5,954,628

Diluted

 

7,623,805

 

 

7,050,310

 

 

7,673,266

 

 

6,914,030

 
Dividends paid   342,538   130,512   695,230   215,321
 
 
RF INDUSTRIES, LTD. AND SUBSIDIARY
PRELIMINARY CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share and share amounts)
   
Apr. 30, Oct. 31,
2012 2011
ASSETS

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$ 3,813

 

$ 1,761

Restricted cash

--

 

67

Certificates of deposit

748

 

4,095

Trade accounts receivable, net

3,108

 

2,606

Inventories

6,312

 

6,189

Prepaid income taxes

249

 

572

Other current assets

513

 

512

Deferred tax assets

611

 

611

TOTAL CURRENT ASSETS

15,491

 

16,413

 

 

 

 

Property and equipment, net

1,247

 

2,443

Goodwill

3,076

 

3,076

Amortizable intangible assets, net

1,737

 

1,866

Non-amortizable intangible assets

410

 

410

Note receivable from stockholder

67

 

67

Other assets

32

 

103

TOTAL ASSETS

$ 22,061

 

$ 24,378

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

CURRENT LIABILITIES:

 

 

 

Accounts payable

$ 1,002

 

$ 521

Accrued expenses

1,290

 

1,580

Mortgages payable

--

 

1,394

TOTAL CURRENT LIABILITIES

2,292

 

3,495

 

 

 

 

Deferred tax liabilities

1,072

 

1,072

Other long-term liabilities

115

 

133

TOTAL LIABILITIES

3,479

 

4,700

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY:

 

 

 

Common stock - authorized 20,000,000 shares of $0.01 par value; 6,859,811 and 7,110,507 shares issued and outstanding

69

 

71

Additional paid-in capital

11,562

 

11,382

Retained earnings

6,951

 

8,011

Total RF Industries Ltd. and Subsidiary

18,582

 

19,464

 

 

 

 

Noncontrolling interest

--

 

214

TOTAL EQUITY

18,582

 

19,678

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$ 22,061

 

$ 24,378

 




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