RFIL - Earnings call transcript Q4 2024

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Operator

Good day, everyone, and welcome to the RF Industries Fourth Quarter Fiscal 2024 Financial Results Conference Call. [Operator Instructions]. It is now my pleasure to turn the floor over to your host, Margaret Boyce, Investor Relations. Ma'am, the floor is yours.

Margaret Boyce

Thank you, Matt. welcome XXXX Industries Earnings and and Fourth everyone, Year Full Call. afternoon, to Fiscal RF Quarter Good With me and on Officer, Rob today's call are President COO, RFI's and Ray Bibisi; CFO, Yin. Dawson; Peter Chief Executive our issued QX market after We today. release earnings website and on everyone today's uncertainties. will is management like statements forward-looking during rfindustries.com. I'd our release to at The that call, make available remind that involve risks information forward-looking Exchange that this on statements laws. the note today constitute the Please may and under Securities call expect, to intend, and forward-looking and believe, and and When other management's identify used, anticipate, to uncertainties. the performance expressions future statements. These current similar words risks financial subject are views future reflect statements with respect events Actual outcomes results in the may any contained materially forward-looking differ from statements. results company's and discussed to any filings no Factors forward-looking cause update on that reports with could undertakes revise these XX-Q the actual the in uncertainties include and the statements obligation or XX-K from Form and differ Industries other statements. SEC. RF risks forward-looking to

this Rob, discussing throughout X-K we'll be related between Chief over the report now to on the reporting. With said, turn financial and ahead. Officer. release Rob I'll our certain the differences that call, Executive measures. describe and Form earnings please conference non-GAAP go current Additionally, Today's GAAP Dawson, non-GAAP

Robert Dawson

our some comments Margaret, on and quarter full you, Conference and highlights start fourth XXXX Call. year our Thank I'll welcome fiscal to year-end and quarter opportunity. fourth with and our market

operations sales financials President to And Our questions. before call will the and CFO, highlights. open your Peter Ray, some discuss cover we and our will our COO,

as from in dedication for all first by off prayers on. we're to grateful incredible to take thoughts the Los with devastated Angeles. can a our as communities that any responders we restore communications support and here and Before moment us of I the fires, depend We're way coast to face customers we and to just work the total fury begin, critical recent they the fires hard their infrastructure our I in the want and partners indescribable several to the bravery they share

Now performance, quarter. up on turning million million the net ground year Fourth fiscal $XX.X from out results. fourth million, $XX.X our the third XXXX, us year-end. the at put quarter $XX.X and delivered the XX% improving our in to solid XX% Throughout sales quarter sequentially reported to team up last in rounded which from

gross quarter fourth for increased XX.X%. Our profit the to margin

For profitability driving recovery in time mode. directly our quarters, still to in the are first commitment markets delivered which several even an greater profit we our operating as reflected key

$XXX,XXX, $X.XX. from improvement $X to share non-GAAP was Our debt year after in $XX.X the paying sheet year. our of at just million per last adjusted earnings came the fiscal down end at million, a with above and strong EBITDA We a ended balance significant

fiber we quarter, that in shipped fourth had of amount the During some been time. backlog our hybrid products large a for quite

to some backlog. older out the started this Importantly, clear inventory from

we've position, with through the a have Moving bookings been course backlog throughout our forward, overall executing that performance financial a current over much we strategy, We a tight believe more that on the more market transformation. stayed year, small with thermal consists mix. Even thanks in diverse product fiscal of and continued challenging demonstrated well to industrial DAC and systems, applications our we even our our helped fresher couple market further our a with full much our turnkey stronger like years. and adding work. dedication provider last solutions and a RFI cells, is of by interconnect focus in systems antenna strong to team's distributed the This company hard transform offering a into cooling. Today, product connectivity

us experienced and minimal overall within talent our potential, make sales optimize products help the in we our right to a and our the customer difference solutions, with target with relationships expense. this really markets, rebooted right did and we To right We organizations. impact team positioning have who our can the

is XXXX, a but the least year we're creative margin. our To some sales also operations. structure XX% we're fiscal achieving and overall into of top adjusted Going accomplish our profit laser priority, EBITDA goal this, at growth production fulfillment improvement approaches reviewing focused and to of on

XX% Over us up process, and sales profitability, set lot did expect the downturn deliver lifting competitive the next continuous we several scale We with business a adjusted and for that the infrastructure, to vastly and an several think during market, position and the rebound. greater. Transformation us of quarters, for different sustainable we goal cyclical give XXXX beyond quickly or for is of to edge well a we're a a heavy EBITDA our operations will in reasons. more of allow

First, bill product creates as in leverage percentage with value our demand and which strengthened mentioned, materials. our customers' of we've products, more offering higher a higher fulfill I of to turn larger

solutions In small custom addition state-of-the-art thermal transformed provider a to with DAC offering, systems. solutions and core our our standard further we cell cooling into interconnect have and

to provide tip has spear now key these relationships large a to partner been goal has vendor levels higher organizations. our long-term for decision-making of status ability Our materializing. and the strategic of become a at within solutions complex that's deepen the RFI Achieving the

We've is the discussion and our demand network expect needed reliable they the pie. coverage to Tier for we carrier XG of Pent-up expectations fair address short high-speed focused in need be for the years, continue connections the only for are X but bigger we their connectivity to opportunity customers run, coverage. Not and of an demand speed competitive, topic. that infrastructures will to continuously grow should products competitive into forefront Second, and XG ecosystem. been to and see share getting improve densification around a gaps densification, wireless are customer consumer and also to our our everywhere. at increasing XG for To on wins the translate our stay be leading-edge space. evolving advantage the XG meet to this in on macro which sites, In

additions, product wireless we're with the market segments opportunity Third, new explore set. new of outside space to and continuing carrier our diversify to our innovations

a we're the for new our upgrades Here, to see coming requires the key to contractors and meet baseball markets for example builds, trends opportunities. One Cup, few. Right growing, and by suppliers worth future on venue that a new improving. of and favorable which Vegas quite like that stadium not the and and stadium we venues customers. This to space. as ever-increasing stadiums Bowl is horizon happen are capitalize the strategy veterans expectations be to now, XXXX. these well include on ready not like overall smarter and the campuses, we've sporting go-to-market Super expected Las doorstep, of and in Olympics, market return they're billion it's at revitalized events starting assigned recovery casinos, solutions overnight, $XX our back Examples the stadiums is sign as They're we're accelerated and this of who but is connected, see have the the industry to to spend in going medical name and and some ahead facilities relationships is right college innovative interconnect with that Those RFI. more World

connectivity dependable and positioned that correctly of and solutions believe range chasing pipeline dealing in win want a their collaborative target of partner expanded our markets, RFI's comprehensive handful to opportunities strong continuing a various with in key to who reputation Importantly, we're markets. of has customers opener is limit for trusted to the as a we're door a vendors. We and

not better to into Looking expect be we we than forward, perfect, fiscal addition the we in momentum, feel line clarity it's we when going on profitability, our more XXXX. top starting And see We're going started to than fiscal good XXXX. to heavy while have focus and forward XXXX.

that the weakest we seasonality, quarter that, a last what Ray million, today, first While to call we in Ray? for on expect know turn reported operations. fiscal commentary fiscal quarter XXXX of line significant fourth I'll sales increase we our be quarter's year. With and $XX.X to due quarter our typically the over first is over first million in roughly the further $XX.X revenue with with to our

Ray Bibisi

you, Thank Rob.

work, improving you've results delivered we've and team's throughout financial through fiscal As our XXXX. year mentioned, hard dedication

We turn go-to connectivity confidence this our solutions product the have high-quality to for lot earning and with and our presence done customer Rob the on in side, reach ecosystem successful been communication greater needs, the customers' and said, including our point, and carrier and broad, have development quick we a as strengthening support. Like solutions our wireless sales building attentive source of customers. customers' a portfolio relationships

budget, As will begun for to we result, which is of operating capture in now us. Being be and source another CapEx, carrier's spending. qualified believe variability vendor maintenance susceptible maintenance for budget, and from revenue a CapEx separate in we upgrades annual and some a updates a their we less to have

talent team in targeted up expense. solutions and and bolstered have that us within can our who the we ramp have help increasing sales without our And right Now products we experienced have initiatives sales our overall organization, right again, accomplished we this the once positioning with markets. our

sales, a side, in outside That insurance wage costs and On efficient chain heavy and improved like significantly fiscal are these escalating fulfilling operations. of expenses more level higher of way product our We we've supply orders a there think more expenses. XXXX. in can cost streamlining cost-effective control and product already significant and we through also of through our overcome creative reducing a expenses building and our rationalization made business the pressures increasing headway said, our and

Over to and engaged at several goal we achieving is completely there. strong quarters, redesigned will best infrastructure, fully of get operation XX% next aid adjusted the least have ways a a have in to that team expect the our on which EBITDA,

now for Peter I it will financial turn Peter? discussion. over to the

Peter Yin

to for managing Thank of in good There's our and lot the ahead strides great a financial we've afternoon, everyone. you, RFI, and made Ray, business carefully opportunity strength. improve

During paying of the fiber shipments backlog time. that position. down our with debt made for working been progress quite significant our we and year improving our We capital fiscal in some hybrid strong, had XXXX, finished

recover. Starting year-over-year. In $X.X with order to see pleased addition, our of flow to XX% increase an or sales quarter were continue Net results. million, million fourth $XX.X we're

decreased million $XX.X full year, fiscal the sales For XX% to $X.X or million.

to to see an margin $XX,XXX in profit XXX delta for several margin points cost basis profit was increase, increase of to we $X.X that sales reflected comparable on our year-over-year. our efforts Importantly, gross our are and increased profitability our and the versus not pleased XX.X% is income efficiencies. Fourth but operating a in operating savings The from quarter loss first period, focus due XX.X% to only significant quarters. operating delivered QX year-over-year, drive million highlights operating

quarter or $XXX,XXX diluted was net non-GAAP to Our $X.XX per non-GAAP of loss per net income $X.XX net year-over-year. And per for $X.XX diluted loss diluted of the $XXX,XXX share for net was a from share, compared $XXX,XXX loss share per QX improved meaningfully or or diluted $XXX,XXX $X.XX XXXX. share or

was EBITDA $XXX,XXX $XXX,XXX EBITDA adjusted compared to quarter EBITDA year EBITDA adjusted adjusted Finally, for fiscal QX a $XXX,XXX year XXXX. XXXX. in adjusted of fourth $XXX,XXX Full negative of was fiscal versus

the balance to Moving sheet.

our capital We working strengthen manage capital continue to structure. and liquidity overall our to

of had million, and current with As XX, October current XXXX, of assets ratio of $XXX,XXX had $XX.X and cash equivalents; million. working X.X; cash we a $XX.X capital of million current of liabilities approximately $XX we in

XX, we end the that note at As of credit. delevered million of line borrowed XXXX. sheet the of to balance October from It million XXXX, $X million XXXX. $XX.X are $X.X down the have have Outstanding borrowings approximately successfully we in fiscal is from important

best always We capital long-term reviewing both the borrowing. and structures for short-term are

a processes. for our have our a opportunities $XX.X was As last costs we was to are from million, advantageous our been we structure. by more close improving, implemented overall At to year-end, $XX.X inventory borrowing design down and million as procurement keeping chain This improvements on year. eye to supply improve performance our

to our on Moving backlog.

backlog at million quarter. for XX, October $XX.X stood our of of bookings As million on $XX.X the

currently As stands of million. our $XX.X today, backlog at

based Our snapshot of orders order is backlog in of view fulfillment. We health. vary and our reporting time, we it as are a received here and backlog timing can gauge a general on

our swing our a can short-term it sales. in indication However, and at case, be good of wildly times, not

solid timing quite delays for our of amount as multiple shipped fourth based was As during time. trusted noted large The quarter. these hybrid summary, we was on the requests, a shipments had partner. In their of that which in our earlier, quarter some a customer backlog delivered we fourth we accommodated fiber

continue our to pay managing our continue expenses. our work sales manage execute on and to level line credit, our driving We on and strategy, efficiencies of inventory down

together, fourth quarter Taken profit. operating our actions drove these

model our we we new leverage. year, has our believe As begin operating to fiscal continue substantial

and We are the improve growth about near the optimistic profitability. With I'll call for questions. our term open and long to future and that, ability the in Operator? drive

Operator

[ from Matthew question Riley. B. coming from [Operator Boss is Instructions] ] First

Unknown Analyst

Nichols. Josh for This is Matthew on

So what's first the was that wondering going to the quarter? And seasonally low would the I top driving was main what first into contributor revitalized you say line?

Robert Dawson

question. Good Yes.

of line perspective, that some from So in fiber that I started pretty QX, the comments out has a in our a we quarter. for mentioned think quite our top to in ship amount backlog hybrid during larger time significant in amounts been

that recovery a we us think big shipped board, -- would was I sort a that as had So We of expected a his but I some the nice some things things little longer. have the got comments, from we saw across Peter customers mentioned in help. generally a much earlier. And think hold asked to push

we lot QX. a out So in and of did that, went that

talked as backlog overall We ended QX, we've it's we to where been look as stands where fiscal more think at mix the I better product bookings about year. led today. stronger really shift a it seeing we a seeing

to, we've think years long-term just the -- better we're show is and seeing are of some difference big we as we've general, through some that have working place short And I here. of we're better contribute. And couple in that us get there's in that's newer visibility and we've to been gives can in weeks sticking had But we're in the So think projects these been product starting to have drive these we that plans where deployment starting up think prior new between that, new shows around to backlog people of timing. quarter, been beyond product some in which comfort have I I really areas term growth in left well. a plans that first what lines these fiscal our a that do sense defined where

Unknown Analyst

most -- which just mentioned I'm better product you the would a shift? with driving say wondering on are you products that Great. mix bookings, And a follow-up shift but

Robert Dawson

Yes.

a think little bit the on it. got cut it, of I I getting so but me You I'm out tell me, gist if

product mix driving were the line asking? I top you you the question going asking were that think forward. Is about and what's the

Unknown Analyst

demand being It was in and which in prioritized about which products most mix. the shift specifically are for that are

Robert Dawson

Yes.

of up, overall I of seen little there. So we've interest think, spend rise and bit all I there's a customer so think sort generally, boats picking in

see better that's and will and bigger so the contribute thermal the large a things in agreements past. I fiber, and wire venues last is that in put over the years those stadiums lines think line, also customers in or are think than product help higher where areas like just I back where harnesses. offer, that seeing cooling X levels key small place us product the we've at whether X our in we're cell Microlab also custom thing the to not help but starting product like standard with us, they've copper, in we're DAC newer been way, start to us coax, come in interconnect for

areas to about the and for But be that offering. would time really are in big the starting that All those contribute sort been in cell benefit more now there. cooling some we've of of DAC recovery thermal the things from small general talking

Unknown Analyst

on, operations you're And the savings? color I'd you the some quantify maybe also redesign appreciate the and on some infrastructure of of can expected working

Robert Dawson

it's Yes, good question. a

I so a savings. think dollar going to this -- we're at point, those specific amount not on give

that of XX%. over adjusted some of smarter quarters. We're getting We be north margin, that but the we a get getting way a I product think the lot in us success the talked the service which team there's who things time in to can way newer has stronger about. several that there partner EBITDA it's seen better we've folks some preproduction help about just some not lines to on, there to much all do, with with work? We've that to are only doing believe in next of ways of spent procurement,

I legacy sort we of of think the have into there's for ways lines waterfall some to us product that well. as that

on overall. continue product is putting we is structure more profitability the all the to in a do on streamlined lines drive through So what that's team work better really how operation

Unknown Analyst

becoming just programs, strong to I'm strong will there's bringing And national on DAC an quarter? ] that, mentioned update [ in this contribute wondering of last so you probability that turnkey with orders quarter, if fourth

Robert Dawson

Sure.

quarter, more so had structure customers. putting comments we've agreements It really, is made success the fourth provide in -- in and/or I of agreements key customer. we've DAC solutions And regionally past we the think one think had that. in I some signing the were with And than markets. in place in to customers around certain several

to to starting I think a different customers. And -- one-off. opportunities multiple that's it's it in starting it's across is the we're regions. find good news, not We're really see

in As we've then market usual, tests. hopefully, have then that a what go a official which into things through market, far. success, put a is into, We lab, so we and seen grow through larger we trial will

markets also have several across We orders amounts. in smaller

to They're -- of these previously, retrofit as do of that customers year. on come deployments. perspective kind whether QX, that's a think really that We going positioned a well believe typically as is which from and spend it's maintenance I maintenance, they opportunity those seen relationships. allocate customers And team executing more go of as there's really every -- mentioned with helping of where multiple kind obviously some X- and market new is that to seasonality. again there. to fix. We hit us that never that to to the be -- And our as doing that. of of an well the is scenario We've XX-year every sales in expectation spending, going or equipment, some think customers Our out operating success market a some allocate to sort more by cycle it's on we're I updates some operating spending that's budget, a get replace on of their market they some takes or with rip

technology those out, into opportunities prove to move our As we're finding markets. themselves products and additional

Operator

Steven is Our from from next Kohl Mangrove. question coming

Steven Kohl

I are there can across we done you is talk rationalization, had a facility with work have? at One quick about opportunities couple footprint when that the to this we -- the of you there still address Are that questions. point?

Robert Dawson

Yes.

Coast. legacy that. probably think is both there Coast, thing the lifting that East believe think We've streamlined for larger, And more on one been collapsed I and to production operations heavy Coast, I multiple room done So we balance is technology-forward in more Coast. already those. has We've West consolidated into the generally divisions us into East West

One have, of East projects we facilities to cooling. close and Southern and good in California. densification areas then in we're higher very the the York, thermal in service for between heavy customer there's the New Jersey, benefits the of a facility population kinds We've the where got New Connecticut, large DAC spend footprint plays

lifting. So an There think that opportunity. we I can where we're some done going think tweaks cost it's shipment the give some additional need and that savings, and don't think I are heavy view of us area coast-to-coast an the time we still generally, again, to, we as with balancing when will remove load we

Steven Kohl

where a like how in perfect So another business look be, that how of maintenance at does that has mix your When we to between world? back couple look by a Rob, versus -- if what's you or and And ago service look mix what you over would driven years that changed? to wanted CapEx operating look of you quick question. today, budgets,

Robert Dawson

Yes.

wireless business from ecosystem. think the of carrier that space, our A is good comes percentage carrier there to in important I the right? the note thing obviously that's

of of the and also We coming industrial product OEM other heavy depending lines. regionalized or from XX% localized more and kinds of on more XX%, have quarter manufacturers sales

such is your big a So as one, great carrier the wireless see since I growth us. for we question think a space

there's historically, someone an well, like just in amount more because operating something, they're or think to always scenarios XX I something there new always where damaged for fires that's that, it's an or related it disaster That's assemblies there's and it's decent uncommon whether had There's some natural update. to cable hurricanes, played a to doing budget. Any like operating time be we've whether that operating of needs as or been and maintenance. where not budget was XXX always piece or business. things a repair

you market bigger I were heavier those think CapEx-related more amount of out applications, historically, to spend. that sales though, into break was it in probably XX% the to and a of kinds were and if our XX% going

a should of it, take out quarter, in our breakdown are but OpEx have all December, between. But As January. a the XX-XX as Not out always happens we've is of you're help where it's in that's between the more, kind I We think type Because X whether added not, we we the carrier to new in throw of one quarter, is get and sort in exactly of we OpEx. break business of lines, big is space think down. might thermal the for seasonality odds right believe to if for where first largely balance we tough largely the of product by contributes and DAC total looking we is us fiscal or together thing a sort that to shift months CapEx, the carrier product in percentages cooling more carrier that think that where that OpEx, experience. really November, and it it's ends point can that you look can some to see kind

window, kind like thrown have and X-month and thermal together every of the think in we smooth can of that headwind help us out You offer, seasonality. really spend into cooling some one DAC OpEx particular, seasonal things

Steven Kohl

last one And one.

to you have to been you type what the speak you could able And change been to how And you company? if you adding How in have where them? many of attract experience your adding? them sales are added? -- where force? the Just people And have

Robert Dawson

Yes. Sure.

need have channel, we're are our think I ago a folks people. like a mean, I force to our rely manufacturers' We like of not joined it's overspending. of street grow on expense now different So people feet us business we've that come as within since reps, company. XXX here We we're sales I team. thing very of going without on go the people distribution transitioning hire other help to expenses so. We've I've largely huge seen a is look, clear which cost could to just multipliers the is, our out the or traded on issue, amount down and, small great, doing one years been some

account bringing We they very as We're these I have approach product lines have relationships, and/or allocate who which been to by how they've focused that by and who in markets the very opportunity to them. time key and think, people at some to those spent in seen region, existing have right on helps us. have applications folks us, a customers, with going targeted these for know focus key an able grow we've we're

as positive that's We're spots. job. time is I We're is of part offer. a in say all get team doing good that how been We're question caught the to taking that these surround I've whole the we a and great company noise have appreciated the where company, as time to you I've the up other something in growing. We're here in. got think us? adding we good your around thing to like-minded added the The people, good people, we reputation find that do can a share little come I we've they a

times, believe of and the out people, that lot go reach And story in to people interestingly, happen. us. can this and a I it make think understand need we

some a of that and to call a some come up last is pasts people added an -- is there's together. make for a is we us, short opportunity, are in that And Mary they're like us people thing the I of career cases, and calls. And if added receptive generally a and it. change Ray, finding and just think show opportunity that me new to we're people biggest who on making I point strategy lot our from some want in or want who kind think the we've we they on It's help and market, names that's what a a and at list we folks, back in we offer how can to ways found worked a when we these There's is in year of several of identify in Beth got this Smith them their make more like execute woman of love other for need here, sound our company came at think the positive, it. point. be up We the else we make with opportunities We think not sense, like-minded sound. to that transformation we is these need surrounding where I difference. the

Operator

That remarks. hand Q&A our session. closing you. Thank conference ahead. concludes to for back will now Please Rob go I the

Robert Dawson

March. Until thank stay to you, first quarter fiscal in of That's great. then, Thank for sharing Matt, everyone, and your safe, and thank We forward look you support results you, RFI. joining for us our today.

Operator

everyone. today's This you, event. concludes Thank

at a may wonderful participation. You have Thank disconnect this day. time, you for and your

RF Industries (RFIL) 16 Jan 252024 Q4 Earnings call transcript