RELIABILITY INC 10-K

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDERS’ MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET INFORMATION AND HOLDERS The Company’s Common Stock trades in the over-the-counter market under the symbol RLBY. The high and low sale prices for 2023 and 2022 are set forth below. High and low price is based on the last trading day of the quarter. First Quarter Second Quarter Third Quarter Fourth Quarter 2023 High $ 0.0590 $ 0.0425 $ 0.0549 $ 0.0550 Low $ 0.0440 $ 0.0425 $ 0.0549 $ 0.0550 2022 High $ 0.0570 $ 0.0580 $ 0.0583 $ 0.0420 Low $ 0.0560 $ 0.0450 $ 0.0550 $ 0.0420 The Company paid no cash dividends in 2022 or 2023. As of March 18, 2024, the last reported sales price for Company Common Stock was $0.0800 per share. As of March 22, 2024, there were 525 holders of record of Company Common Stock. EQUITY COMPENSATION PLANS None RECENT SALES OF UNREGISTERED SECURITIES None SHARE REPURCHASES None ITEM 6. SELECTED FINANCIAL DATA The following tables set forth our summary of consolidated historical financial data. You should read the information set forth below in conjunction with “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated historical financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K. The statement of operations data for the fiscal years ended 2023 and 2022 and the balance sheet data as of December 31, 2023 and 2022 set forth below are derived from our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. December 31, Balance Sheet Data: 2023 2022 Working capital $ 7,913 $ 8,645 Total assets $ 9,786 $ 13,490 Total outstanding borrowings, net $ 174 $ 2,619 Total other long-term liabilities $ - $ - Stockholders’ equity $ 7,931 $ 8,671 25 December 31, Statement of Operation Data: 2023 2022 Revenues $ 21,451 $ 25,725 Gross profit 3,039 3,494 Selling, general and administrative expenses 3,788 4,400 Operating loss (749 ) (906 ) Interest income 25 53 Interest income from related parties 269 232 Interest expense (92 ) (171 ) Other income (expense) (179 ) 223 Income (loss) before income taxes (726 ) (569 ) Income tax benefit (expense) (14 ) (170 ) Net income (loss) $ (740 ) $ (739 ) December 31, Net Income (Loss) Per Share: 2023 2022 Net income (loss) per share – basic $ .00 $ .00 Net income (loss) per share – diluted $ .00 $ .00 Weighted average shares outstanding – basic 300,000,000 300,000,000 Weighted average shares outstanding – diluted 300,000,000 300,000,000 December 31, Other Financial Data: 2023 2022 OIBITDA (1) $ 57 $ 577 (1) We present OIBITDA as a measure that is not in accordance with generally accepted accounting principles (“non-GAAP”), in this Annual Report on Form 10-K to provide investors with a supplemental measure of our operating performance. We believe that OIBITDA is a useful performance measure and is employed by us to facilitate comparisons of our operating performance on a consistent basis from period-to-period and to provide for a more complete understanding of factors and trends affecting our core business than measures under generally accepted accounting principles (“GAAP”) can provide alone. Our board and management also use OIBITDA as some of the primary methods for planning and forecasting overall expected performance and for evaluating on a quarterly and annual basis actual result against such expectations, and as a performance evaluation metric in determining achievement of certain compensation programs and plans for our management and organization. We define OIBITDA as operational earnings before interest expense, related party interest, income taxes, depreciation and amortization expense, loss on early extinguishment of debt and related party debt, transaction fees and costs related to our corporate overhead which consist mainly of costs associated with being a public company. Omitting interest, taxes and the other items provides a financial measure that facilitates comparisons of our results of operations with those of companies having different capital structures. Since the levels of indebtedness and tax structures that other companies have are different from ours, we omit these amounts to facilitate investors’ ability to make like comparisons. Similarly, we omit depreciation and amortization because many other companies likely employ a greater amount of property and intangible assets. We omit corporate or non-operating costs as they are meant to be allocated against a larger operational base which our business plan outlines. As we grow our operations organically and through M&A activities these corporate costs are absorbed more equitably, we will use Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) as our means of measuring comparable operational performance to other companies in our industry. We also believe that investors, analysts, and other interested parties view our ability to generate OIBITDA as an important measure of our operating performance and that of other companies in our industry. OIBITDA should not be considered as an alternative to net income (loss) for the periods indicated as a measure of our performance. The use of OIBITDA has limitations as analytical tools, and you should not consider these performance measures in isolation from, or as an alternative to, GAAP measures such as net income (loss). OIBITDA is not a measure of liquidity under GAAP or otherwise and is not an alternative to cash flow from continuing operating activities. Our presentation of OIBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items. The limitations of OIBITDA include: (i) it does not reflect our corporate expenditures or future requirements for capital expenditures or contractual commitments; (ii) it does not reflect changes in, or cash requirements for, our working capital needs; (iii) it does not reflect income tax payments we may be required to make; and (iv) it does not reflect the cash requirements necessary to service interest or principal payments associated with indebtedness. 26 To properly and prudently evaluate our business, we encourage you to review our consolidated financial statements included elsewhere in this Annual Report on Form 10-K and the reconciliation to OIBITDA from net income (loss), the most directly comparable financial measure presented in accordance with GAAP, set forth in the following table. All the items included in the reconciliation from net income (loss) to OIBITDA are either (i) corporate costs or (ii) items that management does not consider in assessing our on-going operating performance. In the case of the other items that management does not consider in assessing our on-going operating performance, management believes that investors may find it useful to assess our operating performance if the measures are presented without these items because their financial impact may not reflect on-going operating performance. OIBITDA calculation comparison for the years ended December 31, 2023 and 2022 are as follows: December 31, 2023 2022 Operating income (loss) $ (749 ) $ (906 ) Depreciation and amortization 18 32 Sales, general, and administrative 788 1,451 $ 57 $ 577 Operational performance comparison for the years ended December 31, 2023 and 2022 are as follows: December 31, 2023 2022 Revenue $ 21,451 $ 25,725 Gross profit $ 3,039 $ 3,494 OIBITDA $ 57 $ 577 Net income (loss) $ (740 ) $ (739 ) 27