RCM Technologies, Inc. (NASDAQ:RCMT) Q4 2022 Earnings Call Transcript

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So when you look at the school market, we believe we’re the largest health care provider to the school market in the country, but we’re still just capturing a pretty small percentage of the overall market. And the growth is clearly there. And we’re just scratching the surface, frankly, on the behavioral health side, which we think is just an explosive market. It’s big today and 3 or 4 years from now, it’s going to be 10x as it is today, in our opinion.

Brad Vizi: Yes. I think that’s a key point and a good way to kind of articulate it we’ll be scratching the surface of the opportunity. And I think you’re going to have another meaningful leg of growth to that end market in general from behavioral health but with respect to driving margins and pricing and so on. Pricing isn’t really a primary variable that we focus on. We’ll see a mix shift depending on the types of professionals we staff and so on. But it really is less a matter of maximizing rate. So we think the education market has significant legs for a long time. This is an area that’s been underinvested in for a long time, and people are just starting to wake up to it, as a result of COVID and even just coming out of COVID.

To be honest with you, it even ramped up a little bit slower than we would have anticipated, but you’re really starting to see it full throttle in many ways now. And we anticipate that being reflected in our results as we kind of move forward and get into the back half of this year.

Alex Rygiel: And then one last question as it relates to the Energy services business. Obviously, this is in Puerto Rico and Florida is pretty strategic. Given the amount of hurricane or repair activity and infrastructure upgrade that has been needed and is going to be needed in the area to activities that are forever ongoing in Florida and other markets. Can you talk about sort of those new geographies and sort of your thoughts and growth expectations and maybe some of the customers or services you’re providing in the…

Brad Vizi: Yes. This is a great question. We’re actually very excited about these initiatives. We’ve been doing business in Puerto Rico for a very long time, but primarily in the Life Sciences front. We are increasing significantly in Energy Services there. And in many ways, that’s a function of the technological capability and really the goodwill with major utility clients in the United States that we’ve been able to leverage into increased market share in Puerto Rico. So I actually look for that to be certainly a bright spot in the portfolio going forward. We had significant success over the last, call it, 90 to 120 days or so, and we actually think that, that’s very much at the beginning. And it’s exciting as you see the portfolio start to grow because historically, if you look at the geographic concentration of the business, we certainly had a strong hold in the Northeast and throughout the East Coast.

Now we are starting to migrate and follow demographics in a much more meaningful way down in the Southeast, South and out West. So it’s exciting and strategic for a number of reasons.

Operator: All right. And at this time, there are no further questions in queue. Did you gentlemen want to press –excuse me, sorry.

Brad Vizi: No. I think we’re fine. So we’ll go ahead and kind of close it out here. So thank you, everyone, for attending the fourth quarter call, and we look forward to our next update in May.

Operator: All right. Ladies and gentlemen, that does conclude your call. You may now disconnect your lines, and thank you again for joining us today.

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