UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 1998
Commission file number: 1-10245
RCM TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
Nevada 95-1480559
(State of Incorporation) (IRS Employer Identification No.)
2500 McClellan Avenue, Suite 350,
Pennsauken, New Jersey 08109-4613
(Address of principal executive offices)
(609) 486-1777
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
Indicate the number of shares outstanding of the Registrant's class of common
stock, as of the latest practicable date.
CLASS
Common Stock, $.05 par value 7,634,131
Outstanding as of March 5, 1998
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
PART I - FINANCIAL INFORMATION
Item 1 - Consolidated Financial Statements
Page
Consolidated Balance Sheets as of January 31, 1998 (Unaudited)
and October 31, 1997 (Audited) 3
Unaudited Consolidated Statements of Income for the Three Month
Periods Ended January 31, 1998 and 1997 5
Unaudited Consolidated Statement of Changes in Shareholders'
Equity for the Three Month Period Ended January 31, 1998 6
Unaudited Consolidated Statements of Cash Flows for the Three
Month Periods Ended January 31, 1998 and 1997 7
Notes to Unaudited Consolidated Financial Statements 9
ITEM 2
Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
PART II - OTHER INFORMATION
ITEM 6 - Exhibits and Reports on Form 8-K 16
SIGNATURES 17
2
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
January 31, 1998 and October 31, 1997
ASSETS
1998 1997
-------------- ---------
(Unaudited) (Audited)
Current assets
Cash and cash equivalents $ 557,089 $ 918,028
Accounts receivable, net of allowance for doubtful accounts
of $331,000 and $316,000 in 1998 and 1997, respectively 26,476,435 24,850,304
Prepaid expenses and other current assets 347,479 673,265
------- -------
Total current assets 27,381,003 26,441,597
---------- ----------
Property and equipment, at cost
Equipment and leasehold improvements 3,390,018 2,508,680
Less: accumulated depreciation and amortization 1,904,668 1,373,275
--------- ---------
1,485,350 1,135,405
--------- ---------
Other assets
Deposits 102,847 94,149
Intangible assets (net of accumulated amortization
of $989,797 and $804,640 in 1998 and 1997,
respectively) 29,493,114 26,411,445
---------- ----------
29,595,961 26,505,594
Total assets $ 58,462,314 $ 54,082,596
= ========== = ==========
The accompanying notes are an integral part of these
financial statements.
3
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - CONTINUED
January 31, 1998 and October 31, 1997
LIABILITIES AND SHAREHOLDERS' EQUITY
1998 1997
---- ----
(Unaudited) (Audited)
Current liabilities
Note payable - bank $ 2,000,000 $ 2,000,000
Accounts payable and accrued expenses 1,619,559 1,315,937
Accrued payroll 4,193,615 4,501,502
Taxes other than income taxes 2,110,627 665,106
Income taxes payable 1,396,852 679,937
--------- -------
Total current liabilities 11,320,653 9,162,482
---------- ---------
Income taxes payable 198,047 308,129
------- -------
Shareholders' equity
Preferred stock, $1.00 par value; 5,000,000 shares authorized;
no shares issued or outstanding
Common stock, $0.05 par value; 40,000,000 shares authorized; 7,624,152 and
7,582,206 shares issued in 1998 and
1997, respectively 381,208 379,110
Additional paid-in capital 41,429,670 40,877,540
Retained earnings 5,132,736 3,355,335
--------- ---------
46,943,614 44,611,985
Total liabilities and shareholders' equity $ 58,462,314 $ 54,082,596
= ========== = ==========
The accompanying notes are an integral part of these
financial statements.
4
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended January 31,
1998 1997
---- ----
(Unaudited) (Unaudited)
Revenues $ 37,232,243 $ 21,150,721
Cost of services 28,080,004 16,051,317
---------- ----------
Gross profit 9,152,239 5,099,404
--------- ---------
Operating costs and expenses
Selling, general and administrative 5,813,557 3,625,653
Depreciation and amortization 251,256 118,629
------- -------
6,064,813 3,744,282
--------- ---------
Operating income 3,087,426 1,355,122
Interest expense, net of interest income 39,332 84,801
------ ------
Income before income taxes 3,048,094 1,270,321
Income taxes 1,270,693 489,334
--------- -------
Net income $ 1,777,401 $ 780,987
= ========= = =======
Net earnings per share $.22 $.16
==== ====
The accompanying notes are an integral part of these
financial statements.
5
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Three Months Ended January 31, 1998
(Unaudited)
Additional
Common Stock Paid-in Retained
Shares Amount Capital Earnings
------ ------ ------- --------
Balance, October 31, 1997 7,582,206 $ 379,110 $40,877,540 $3,355,335
Exercise of Stock Options 7,100 356 49,931
Exercise of Warrants 34,846 1,742 502,199
Net Income 1,777,401
---------- ------- ---------- ---------
Balance, January 31, 1998 7,624,152 $ 381,208 $41,429,670 $5,132,736
========== ========= =========== ==========
The accompanying notes are an integral part of these
financial statements.
6
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended January 31,
1998 1997
---- ----
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net income $ 1,777,401 $ 780,987
- --------- - -------
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
Depreciation and amortization 251,256 118,629
Provision for losses on accounts
receivable 15,000 81,000
Changes in assets and liabilities:
Accounts receivable ( 1,641,131) 278,442
Prepaid expenses and other
current assets 325,786 ( 246,776 )
Accounts payable and accrued expenses 303,622 ( 76,269 )
Accrued payroll ( 307,887) ( 215,376 )
Taxes other than income taxes 1,445,521 227,921
Income taxes payable 606,833 162,914
------- -------
Total adjustments 999,000 330,485
------- -------
Net cash provided by operating activities 2,776,401 1,111,472
--------- ---------
The accompanying notes are an integral part of these
financial statements.
7
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
Three Months Ended January 31,
1998 1997
---- ----
(Unaudited) (Unaudited)
Cash flows from investing activities:
Increase in intangible assets ($ 141,826) ($ 137,272 )
Property and equipment acquired ( 416,044) ( 80,546 )
Increase in deposits ( 8,698) ( 4,333 )
Cash paid for acquisitions,
net of cash acquired ( 3,125,000) ( 5,012,394 )
--------- ---------
Net cash used in investing activities ( 3,691,568) ( 5,225,879 )
--------- ---------
Cash flows from financing activities:
Exercise of stock options and warrants 554,228
Net borrowings under short term debt arrangements 4,253,364
Repayments of long term debt ( 20,090 )
------
Net cash provided by financing activities 554,228 4,233,274
------- ---------
Net increase (decrease) in cash and cash equivalents ( 360,939) 118,867
Cash and cash equivalents at beginning of period 918,028 5,989
------- -----
Cash and cash equivalents at January 31, $ 557,089 $ 124,856
= ======= = =======
Supplemental cash flow information:
Cash paid for:
Interest expense $ 55,114 $ 90,189
Income taxes $ 663,860 $ 197,438
Acquisitions:
Fair value of assets acquired $ 4,440,881 $
Liabilities assumed 1,315,881
---------
Cash paid, net of cash acquired $ 3,125,000 $
= ========= =
The accompanying notes are an integral part of these
financial statements.
8
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. General
The accompanying consolidated financial statements have been prepared by
the Company pursuant to the rules and regulations of the Securities and
Exchange Commission (SEC). This Report on Form 10-Q should be read in
conjunction with the Company's Annual Report on Form 10-K for the year
ended October 31, 1997. Certain information and footnote disclosures which
are normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to SEC rules and regulations. The information reflects all normal
and recurring adjustments which, in the opinion of management, are
necessary for a fair presentation of the financial position of the Company
and its results of operations for the interim periods set forth herein. The
results for the three months ended January 31, 1998 are not necessarily
indicative of the results to be expected for the full year.
2. Acquisition
On January 5, 1998, the Company purchased Northern Technical Services, Inc.
("NTS"), a privately-held, provider of technical professional and
information technology personnel. The purchase price was $3,125,000 plus
$1,500,000 of contingent consideration payable over two years. The
agreement provides for additional purchase consideration upon the
attainment of certain earnings targets at the end of each twelve month
period following the closing, for a period of two years. Any additional
consideration paid will be recorded as additional purchase price. Revenues
for the year ended November 30, 1997, provided by the management of NTS,
were $12.6 million.
On February 27, 1998, the Company purchased Staffworks, Inc.
("Staffworks"), a privately-held, provider of technical professional and
information technology personnel. The purchase price was $3,000,000 plus
$2,000,000 of contingent consideration payable over three years. The
agreement provides for additional purchase consideration upon the
attainment of certain earnings targets at the end of each twelve month
period following the closing, for a period of three years. Any additional
consideration paid will be recorded as additional purchase price. Current
annualized revenues provided by the management of Staffworks, is
approximately $12.0 million.
The following unaudited results of operations have been prepared assuming
that all acquisitions which have occurred since November 1, 1996 had
occurred at the beginning of the periods presented. Those results are not
necessarily indicative of results of future operations nor of results that
would have occurred had the acquisitions been consummated as of the
beginning of the periods presented.
Three Months Ended January 31,
1998 1997
---- ----
Revenues $ 39,371,000 $ 30,834,000
Operating income $ 3,242,000 $ 2,210,000
Net income $ 1,848,000 $ 1,050,000
Earnings per common share $.23 $.21
3. Earnings Per Share
Earnings per share is based on the weighted average number of common
shares outstanding during the periods presented. For the three months
ended January 31, 1998 and 1997, the weighted average number of shares
outstanding was 8,177,283 and 4,970,620, respectively.
9
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
4. Interest Expense
Interest expense for the three months ended January 31, 1998 and 1997 was
$55,114 and $90,189, respectively.
5. Reclassification
Certain items in the 1997 Statement of Income have been reclassified to
conform to 1998 financial statement presentation.
6. New Accounting Standard
On November 1, 1997, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 128, "Earnings per Share" (SFAS 128).
SFAS 128 eliminates primary and fully diluted earnings per share and
requires presentation of basic and diluted earnings per share in
conjunction with the disclosure of the methodology used in computing such
earnings per share. Basic earnings per share excludes dilution and is
computed by dividing income available to common shareholders by the
weighted-average common shares outstanding during the period. Diluted
earnings per share takes into account the potential dilution that could
occur if securities or other contracts to issue common stock were
exercised and converted into common stock. Prior period earnings per
share calculations have been restated to reflect the adoption of SFAS
128.
10
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Private Securities Litigation Reform Act Safe Harbor Statement
When used in or incorporated by reference into this Report, the words
"estimate," "project," "intend," "expect" and similar expressions are intended
to identify forward-looking statements regarding events and financial trends
which may affect the Company's future operating results and financial position.
Such statements are subject to risks and uncertainties that could cause the
Company's actual results and financial position to differ materially. Certain of
these factors have been identified within the Company's various Reports,
Registration Statements and other filings previously made with the SEC.
Overview
The Company provides contract and temporary personnel in the information
technology, professional engineering and technical, specialty healthcare and
general support sectors of the staffing industry to a diversified base of
national, regional and local customers.
The Company's business and strategy have changed dramatically since its
inception in 1971. From 1992 through 1994, current management repositioned its
core staffing business to improve profitability and to take advantage of
consolidating market dynamics. Significant revenue growth began in Fiscal 1995
as the Company implemented a growth strategy that since then has resulted in the
acquisition of twelve businesses in the staffing industry. These acquisitions
shifted the Company's business toward the higher margin information technology
and specialty healthcare sectors. During this time, the Company also elected to
discontinue providing certain lower margin general support services. General
support services, which from Fiscal 1992 to Fiscal 1994 accounted for
approximately 51.0% of the Company's revenues, decreased as a percentage of the
Company's revenues to 14.7% during the three months ended January 31, 1998.
Correspondingly, revenues from the Company's specialty professional services
accounted for 85.3% of the Company's revenues during the three months ended
January 31, 1998. Prior to implementation of its growth strategy, in Fiscal 1994
the Company's revenues and operating income for the three months ended January
31, 1994, were $6.8 million and $216,000, respectively. The Company's revenues
and operating income for the three months ended January 31, 1998, were $37.2
million and $3.1 million, respectively. On a pro forma basis, after giving
effect to the acquisitions that occurred during Fiscal 1997 and the three months
ended January 31, 1998, as if they had occurred on November 1, 1997, the
Company's revenues and operating income would have increased to $39.4 million
and $1.8 million, respectively.
The Company realizes revenues from the placement of contract and temporary
staffing personnel. Revenues are recognized when the services are provided.
Principally all of these services are provided to the customer on a time and
material basis at hourly rates that are established for each of the Company's
staffing personnel, based upon their skill level, experience and type of work
performed. In some instances, the Company derives revenues on a fixed fee basis
in connection with consulting projects. In view of the diversification of the
Company's service offerings, and by drawing upon the skills developed within the
Company's engineering and technical group, management intends to develop project
management skills within its information technology and other groups and
believes that an additional percentage of its business may be derived in the
future from larger-scale consulting projects.
Costs of services, which entail the principal cost associated with operations,
consist primarily of salaries and compensation related expenses for billable
staffing personnel, including payroll taxes, employee benefits, worker's
compensation and other insurance. Principally all of the billable personnel are
treated by the Company as employees, although a small segment of information
technology personnel are treated as independent contractors. Selling, general
11
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations - (Continued)
Overview - (Continued)
and administrative expenses consist primarily of salaries and benefits of
personnel responsible for operating activities and include corporate overhead
expenses. Corporate overhead expenses relate to salaries and benefits of
personnel responsible for corporate activities, including the Company's
acquisition program and corporate marketing, administrative and reporting
responsibilities. The Company records these expenses when incurred. Depreciation
relates primarily to the fixed assets of the Company. Amortization relates
principally to the goodwill resulting from the Company's acquisitions. These
acquisitions have been accounted for under the purchase method of accounting for
financial reporting purposes and have created goodwill estimated at $30.4
million which is being amortized over a 40 year period currently resulting in
amortization expense aggregating approximately $762,000 annually.
Liquidity and Capital Resources
Operating activities provided $2.8 million and $1.1 million of cash during the
three months ended January 31, 1998 and 1997, respectively. The change was
primarily attributable to an increase in accounts receivable which was partially
offset by increased levels of profitability, income taxes payable and withheld
payroll taxes and depreciation and amortization associated with the acquisitions
that were completed during Fiscal 1997 and the three months ended January 31,
1998.
Investing activities utilized $3.7 million and $5.2 million in the three months
ended January 31, 1998 and 1997, respectively. During three months ended January
31, 1998, the Company purchased one staffing company which required the use of
$3.1 million in cash. During three months ended January 31, 1997, the Company
purchased one staffing company which required the use of $4.5 million in cash.
Financing activities provided $554,000 and $4.2 million for three months ended
January 31, 1998 and 1997, respectively. The Company has historically funded its
capital requirements with cash generated from operations and advances under its
outstanding credit facility. On June 13, 1997, the Company completed a public
offering of 2,875,000 shares of Common Stock, of which, 2,698,187 shares were
offered and sold by the Company and 176,813 shares were offered by certain
selling stockholders ("the Public Offering"). The Public Offering was undertaken
pursuant to the terms of a Registration Statement on Form S-1 originally filed
with the Securities and Exchange Commission on March 21, 1997 and a final
Prospectus dated June 10, 1997. The net proceeds to the Company after offering
costs was $23,271,723. The Company at January 31, 1998, had approximately
$557,000 million in cash and approximately $12.7 million in loan availability on
its revolving line of credit. The net offering proceeds through January 31,
1998, have been used to retire bank debt and fund acquisitions (requiring $15.6
million). On February 25, 1998, the Company completed the acquisition of
Staffworks, Inc. which required the use of $3.1 million of loan availability on
its revolving line of credit.
On December 19, 1996, the Company and its subsidiaries entered into an amended
and restated loan agreement with Mellon Bank, N.A. for providing a credit
facility of up to $20.0 million (the "Revolving Credit Facility") which expires
on June 30, 1999. The Revolving Credit Facility is collateralized by accounts
receivable, contract rights and furniture and fixtures together with unlimited
guarantees from the Company. The Revolving Credit Facility requires the Company
and its subsidiaries to meet certain financial objectives and maintain certain
financial covenants with respect to net income, effective net worth, working
capital, senior indebtedness to effective net worth ratios, capital
expenditures, current assets to current liabilities ratios, consolidated working
capital and consolidated tangible net worth. At January 31, 1998, the Company
and its subsidiaries were in compliance with all financial covenants contained
within the Revolving Credit Facility.
12
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations - (Continued)
Liquidity and Capital Resources - (Continued)
Borrowings under the Revolving Credit Facility are to be used to meet cash flow
requirements for the subsidiaries as well as operating expenses for the Company.
Borrowings under the Revolving Credit Facility bear interest at the Company's
option, at LIBOR (London Interbank Offered Rate) or the bank's prime rate, plus
applicable margin.
The Company anticipates that its primary uses of capital in future periods will
be for acquisitions and the funding of increases in accounts receivables. The
Company has fully utilized the net proceeds made available through the Public
Offering. Accordingly, funding for further acquisitions will be derived from the
Revolving Credit Facility, funds generated through operations, or future
financing transactions.
The Company's business strategy is to achieve growth both internally through
operations and externally through strategic acquisitions. The Company's
liquidity and capital resources may be affected in the future as the Company
continues to grow through implementation of this strategy which may involve
acquisitions facilitated through the use of cash and/or debt and equity
securities.
The Company does not currently have material commitments for capital
expenditures and does not anticipate entering into any such commitments during
the next twelve months. The Company continues to evaluate acquisitions of
various businesses which are complementary to its current operations. The
Company's current commitments consist primarily of lease obligations for office
space. The Company believes that its capital resources are sufficient to meet
its present obligations and those to be incurred in the normal course of
business for the next twelve months.
The Company may derive up to approximately $2.3 million of proceeds from the
issuance of up to approximately 157,000 shares of Common Stock that may occur
upon the exercise of all of its outstanding Class C Warrants. At March 5, 1998,
there were 562,584 Class C Warrants outstanding. The Class C Warrants were
issued in a public offering undertaken by the Company during 1989, and after
several extensions, are scheduled to expire on April 30, 1998. As adjusted by a
subsequent recapitalization of the Company, each five Class C Warrants entitle
the holder to purchase one share of Common Stock at an exercise price of $15.00.
As of March 5, 1998, the Company had received $672,000 from the exercise of the
Class C Warrants.
13
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations - (Continued)
Three Months Ended January 31, 1998 Compared to Three Months Ended January 31, 1997
Three Months Ended January 31,
1998 1997
---- ----
% Of % Of
Amount Revenue Amount Revenue
------ ------- ------ -------
Revenues $ 37,232,243 100.0% $ 21,150,721 100.0 %
Cost of services 28,080,004 75.4 16,051,317 75.9
Gross profit 9,152,239 24.6 5,099,404 24.1
Selling, general and administrative 5,813,557 15.6 3,625,653 17.1
Depreciation and amortization 251,256 .7 118,629 .6
Operating income 3,087,426 8.3 1,355,122 6.4
Interest expense, net of interest income 39,332 .1 84,801 .4
Income before income taxes 3,048,094 8.2 1,270,321 6.0
Income taxes 1,270,693 3.4 489,334 2.3
Net income $ 1,777,401 4.8% $ 780,987 3.7 %
Earnings per share $.22 $.16
==== ====
REVENUES. Revenues increased 76.0%, or $16.1 million, for the three months ended
January 31, 1998 as compared to the comparable prior year period. The increase
was due to the acquisition of five companies during Fiscal 1997 and one company
during the three months ended January 31, 1998 along with strong internal
growth. The pro forma internal growth rate (as if all acquisitions occurred as
of November 1, 1996) for the three months ended January 31, 1998 was 27.7%.
COST OF SERVICES. Cost of services increased 75.0%, or $12.0 million, for the
three months ended January 31, 1998 as compared to the equivalent prior year
period. This increase was primarily due to increased salaries and compensation
associated with the increased revenues experienced during this period. Cost of
services as a percentage of revenues decreased to 75.4% for the three months
ended January 31, 1998 from 75.9% for the comparable prior year period. This
decline was primarily due to a greater percentage of the Company's revenues
being derived from specialty staffing services.
SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses increased 60.3%, or $2.2 million, for the three months ended January
31, 1998 as compared to the comparable prior year period. This increase resulted
from the change in the mix of the business during the three months ended January
31, 1998, which required higher marketing, sales, recruiting and administrative
expenses than the comparable prior year period. Selling, general and
administrative expenses as a percentage of revenues decreased to 15.6% for the
three months ended January 31, 1998 from 17.1% in the comparable prior year
period, primarily attributable to the sharing of administrative overhead over a
larger revenue base.
DEPRECIATION AND AMORTIZATION. Depreciation and amortization increased 111.8%,
or $133,000, for the three months ended January 31, 1998 as compared to the
comparable prior year period. This increase was primarily due to the
amortization of intangible assets incurred in connection with the acquisitions
that occurred after the first quarter of fiscal 1997.
14
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations - (Continued)
Three Months Ended January 31, 1998 Compared to
Three Months Ended January 31, 1997 - (Continued)
INTEREST EXPENSE, NET OF INTEREST INCOME. Actual interest expense of $55,000 for
three months ended January 31, 1998, was partially offset by $16,000 of interest
income, that was earned from the investment in interest bearing deposits of the
net proceeds of the Company's recent public offering, after the retirement of
bank debt. Interest expense decreased 38.9%, or $35,100, for three months ended
January 31, 1998 as compared to the comparable prior year period. This decrease
was due to the decreased borrowings necessary to provide the funds for working
capital.
INCOME TAX. Income tax expense increased 159.7%, or $781,000, for the three
months ended January 31, 1998 as compared to the comparable prior year period.
This increase was due to increased levels of income and an increase in the
effective tax rate from 38.5% to 41.7%. The increase in the effective tax rate
was primarily due to the non deductibility of goodwill amortization.
15
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
11 Computation of earnings per share.
27 Financial Data Schedule.
27a Restated Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file a report of Form 8-K during the
period ended January 31, 1998.
16
RCM TECHNOLOGIES, INC.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
RCM Technologies, Inc.
(Registrant)
Date: March 5, 1998 By:/s/ Stanton Remer
-----------------
Stanton Remer
Chief Financial Officer,
(Principal Accounting Officer)
Treasurer, Secretary and Director
17
EXHIBIT 11
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE
Three Months Ended January 31, 1998 and 1997
1998 1997
---- ----
Diluted earnings
Net income applicable to common stock $ 1,777,401 $ 780,987
= ========= = =======
Shares
Weighted average number of shares
outstanding 7,593,447 4,815,676
Common stock equivalents 583,836 146,865
------- -------
Total 8,177,283 4,962,541
============== =========
Diluted earnings per common share $.22 $.16
==== ====
Basic earnings
Net income applicable to common stock $ 1,777,401 $ 780,987
============= ===============
Shares
Weighted average number of shares
outstanding 7,593,447 4,815,676
============== =============
Basic earnings per common share $.23 $.16
==== ====