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Reliability Incorporated (RLBY+19.05%) has submitted its annual report on Form 10-K filing for the fiscal year ended December 31, 2024.
The filing reports a revenue increase of 11.8% to $23,982,000 compared to the previous year. This growth was mainly driven by the Employer of Record (EOR) segment, which constituted 85% of total revenue.
Gross profit for the year was $3,192,000, up from $3,039,000 in 2023. However, the gross margin decreased from 14.2% to 13.3% due to a shift in revenue mix towards lower-margin EOR business.
Selling, general, and administrative expenses increased slightly to $3,899,000 from $3,788,000 in the previous year, primarily due to higher salary and benefit costs.
The company reported a net loss of $594,000 for the year, an improvement from the $740,000 loss in 2023. Interest income from related parties increased to $452,000, reflecting adjustments following arbitration awards.
Reliability's top three clients accounted for 63.6% of total revenue, with the largest client contributing 26.9%. The company continues to face concentration risk with a few key clients.
The company has ongoing legal proceedings related to the Vivos Group, with arbitration awards totaling $7,710,000. A receiver has been appointed to collect damages.
Reliability's liquidity is supported by a factoring facility and a Buyer Initiated Payment agreement with American Express, allowing for improved cash flow management.
The company plans to expand its staffing services beyond media roles to include IT, accounting, and other administrative positions to diversify its revenue streams.
Reliability is exploring options to increase its authorized shares to facilitate potential acquisitions and capital market access once legal matters are resolved.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Reliability Incorporated annual 10-K report dated March 31, 2025. To report an error, please email earnings@qz.com.