RCM Technologies, Inc. (NASDAQ:RCMT) Q1 2024 Earnings Call Transcript

RCM Technologies, Inc. (NASDAQ:RCMT) Q1 2024 Earnings Call Transcript May 12, 2024

RCM Technologies, Inc. isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Ladies and gentlemen, welcome to the RCM Technologies' First Quarter Earnings Update. I will now turn the program over to RCM Management.

Kevin Miller: Good morning, and thank you for joining us. This is Kevin Miller, Chief Financial Officer of RCM Technologies. I am joined today by Brad Vizi, RCM's Executive Chairman. Our presentation in this call will contain forward-looking statements. The information contained in the forward-looking statements is based on our beliefs, estimates, assumptions, and information currently available to us. And these matters may materially change in the future. Many of these beliefs, estimates, and assumptions are subject to rapid changes. For more information on our forward-looking statements and the risks, uncertainties, and other factors to which they are subject, please see the periodic reports on forms 10-K, 10-Q, and 8-K that we follow with the SEC, as well as our press releases that we issue from time to time. I will now turn the call over to Brad Vizi, Executive Chairman, to provide an overview of RCM's operating performance during the quarter.

Brad Vizi: Thanks, Kevin. Good morning, everyone. As discussed in our prior call, the first quarter concluded as expected, with a seasonally slow start in January and acceleration as we moved through the quarter. Our breath of focus is both widening and deepening throughout the organization, with all teams executing on current initiatives while seeding new initiatives to propel growth well into the future. Further galvanizing the strength of the platform, we have introduced the shared services team, whose mandate is to help streamline the strategic focus of our groups, strengthen collaboration, and enhance communication about the RCM platform. Throughout the month, we will launch a much-improved digital initiative highlighting the mission critical work of each of our groups and helping distinguish us as what I believe to be one of a kind platform in the marketplace.

Without further ado, I will get into updates on the progress of each of our teams starting with healthcare. The healthcare division started 2024 with a continued emphasis on its core, excluding business we consider to be non-strategic, primarily consisting of a slow-paying, long-term care facility client we made the decision to reduce. Healthcare demonstrated solid double-digit top-line growth year-over-year. As we finished lapping the bulk of this headwind in Q2, we anticipate a reacceleration of growth in the second half for healthcare. This progress is a testament to the hard work and dedication of the team. Our K-12 education business, one of our key focus areas, continues to strengthen. We are confident about the potential of five new school districts already onboarded and 12 more in the final stages of negotiation, each anticipating to generate revenue in excess of $300,000.

Also of note, there are 11 new districts toward the late stages of the sales cycle that show promising contribution in the 2024-2025 school year. Our expansion efforts to grow our client-based nationwide continues to yield substantial results. We are leveraging our leadership position in K-12 staffing to capture new opportunities and strengthen our advantage. As we continue to execute our strategy, we are confident in our ability to deliver sustained value and growth to our shareholders. Transitioning to life sciences and data solutions, first quarter results demonstrate a continued progress in executing against our strategy to pursue project, solution, and managed service solutions' client engagements. Our renewal business doubled year-over-year.

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