RF Industries, Ltd. (NASDAQ:RFIL) Q1 2023 Earnings Call Transcript

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David Wright: Okay. And then, kind of staying with the relocation being Josh touched on it, the 444,000 non-cash and other one-time charges, is any of that related to facilities consolidation?

Peter Yin: No. I’ll take that one. David, the $444,000 there is basically a non-cash rent charge related to the new facility. We weren’t occupying the space yet. We entered into the space February. So, there were still charges related to lease expense on our books and that’s what you’re seeing there as the .

David Wright: Okay. Well, have you given quite an idea €“ have you given an idea of, kind of the cost of these facility relocations overall?

Rob Dawson: You’re talking about one-time charges related to actually doing the moves or in total, just increases and other things?

David Wright: Kind of in total.

Rob Dawson: Yes. So, I think a lot of what we did here was paid for by tenant improvements like normal real estate move. So, taken care of, I think all in by the time we’re said and done, it’s probably $1 million when we’ve moved multiple facilities into this one. We still have facility in Vista that needs to move in here. But €“ so from a West Coast perspective, there’s some meaningful investment to do it that will allow us to take out, you know over the long-term the operating savings, but we €“ just to get in here, it’s probably give or take $1 million.

David Wright: But that’s for the West Coast?

Rob Dawson: Correct. And a much smaller number, East Coast will be a fraction of that.

David Wright: Okay. So, as in the next quarters, are we going to see any kind of non-GAAP add back for these lease charges? Are you going to carve them out that way or not?

Rob Dawson: Yes, it’s a one-time charge on the non-GAAP side. We will add it back. It’s going to become less material fairly quickly here. You’ll start to see some more normalized easier to understand comparisons as well. We’ve got a lot going on obviously. So, we start seeing the number of moving pieces around accounting rules and one-time expenses it’ll start to get a lot more understandable as we get through Q2 into Q3. But yes, there’ll be a little bit of non-GAAP add backs.

David Wright: Great. Okay. Thanks for taking my questions.

Rob Dawson: Thanks, David.

Operator: Okay. It looks like we have no further questions in queue. We’ve reached the end of the question-and-answer session. And I will now turn the call back over to Rob Dawson for closing remarks.

Rob Dawson: That’s great. Thank you, John, and thanks everyone for joining our call today. If you’re attending the 35th Annual Roth Conference tomorrow, we hope to see you there. And we look forward to sharing our fiscal second quarter results in June. Have a good day.

Operator: This concludes today’s conference. And you may disconnect your lines at this time. Thank you for your participation.

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