SEC Info - Omega Flex, Inc. - ‘10-Q’ for 9/30/22

Page	(sequential)		(alphabetic)	↑Top
		Alternative Formats (Word, et al.) Condensed Consolidated Balance Sheets at September 30, 2022 (unaudited) and December 31, 2021 Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2022 and 2021 (unaudited) Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited) Condensed Consolidated Statements of Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited) Condensed Consolidated Statements of Shareholders' Equity for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited) Controls and Procedures Defaults Upon Senior Securities Exhibits Financial Information Financial Statements Legal Proceedings Management's Discussion and Analysis of Financial Condition and Results of Operations Mine Safety Disclosures Notes to the Condensed Consolidated Financial Statements (unaudited) Other Information Part I -- Financial Information Part Ii -- Other Information Quantitative and Qualitative Information About Market Risks Risk Factors Signatures Unregistered Sales of Equity Securities and Use of Proceeds
1	1st Page – Filing Submission
"	Part I -- Financial Information
"	Condensed Consolidated Balance Sheets at September 30, 2022 (unaudited) and December 31, 2021
"	Condensed Consolidated Statements of Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)
"	Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)
"	Condensed Consolidated Statements of Shareholders' Equity for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)
"	Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2022 and 2021 (unaudited)
"	Notes to the Condensed Consolidated Financial Statements (unaudited)
"	Item 2 -- Management's Discussion and Analysis of Financial Condition and Results of Operations
"	Item 3 -- Quantitative and Qualitative Information About Market Risks
"	Part Ii -- Other Information
"	Item 1 -- Legal Proceedings
"	Item 1A -- Risk Factors
"	Item 2 -- Unregistered Sales of Equity Securities and Use of Proceeds
"	Item 4 -- Mine Safety Disclosures
"	Signatures

i 0001317945 i false i Q3 i --12-31 i i i i i i i i i i i i i i i i i i i 0001317945 2022-01-01 2022-09-30 0001317945 2022-09-30 0001317945 2021-12-31 0001317945 2022-07-01 2022-09-30 0001317945 2021-07-01 2021-09-30 0001317945 2021-01-01 2021-09-30 0001317945 us-gaap:CommonStockMember 2022-06-30 0001317945 us-gaap:TreasuryStockMember 2022-06-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0001317945 us-gaap:RetainedEarningsMember 2022-06-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2022-06-30 0001317945 us-gaap:NoncontrollingInterestMember 2022-06-30 0001317945 2022-06-30 0001317945 us-gaap:CommonStockMember 2021-06-30 0001317945 us-gaap:TreasuryStockMember 2021-06-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2021-06-30 0001317945 us-gaap:RetainedEarningsMember 2021-06-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2021-06-30 0001317945 us-gaap:NoncontrollingInterestMember 2021-06-30 0001317945 2021-06-30 0001317945 us-gaap:CommonStockMember 2021-12-31 0001317945 us-gaap:TreasuryStockMember 2021-12-31 0001317945 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001317945 us-gaap:RetainedEarningsMember 2021-12-31 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2021-12-31 0001317945 us-gaap:NoncontrollingInterestMember 2021-12-31 0001317945 us-gaap:CommonStockMember 2020-12-31 0001317945 us-gaap:TreasuryStockMember 2020-12-31 0001317945 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0001317945 us-gaap:RetainedEarningsMember 2020-12-31 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2020-12-31 0001317945 us-gaap:NoncontrollingInterestMember 2020-12-31 0001317945 2020-12-31 0001317945 us-gaap:CommonStockMember 2022-07-01 2022-09-30 0001317945 us-gaap:TreasuryStockMember 2022-07-01 2022-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2022-07-01 2022-09-30 0001317945 us-gaap:RetainedEarningsMember 2022-07-01 2022-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2022-07-01 2022-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2022-07-01 2022-09-30 0001317945 us-gaap:CommonStockMember 2021-07-01 2021-09-30 0001317945 us-gaap:TreasuryStockMember 2021-07-01 2021-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2021-07-01 2021-09-30 0001317945 us-gaap:RetainedEarningsMember 2021-07-01 2021-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2021-07-01 2021-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2021-07-01 2021-09-30 0001317945 us-gaap:CommonStockMember 2022-01-01 2022-09-30 0001317945 us-gaap:TreasuryStockMember 2022-01-01 2022-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-09-30 0001317945 us-gaap:RetainedEarningsMember 2022-01-01 2022-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2022-01-01 2022-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2022-01-01 2022-09-30 0001317945 us-gaap:CommonStockMember 2021-01-01 2021-09-30 0001317945 us-gaap:TreasuryStockMember 2021-01-01 2021-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-09-30 0001317945 us-gaap:RetainedEarningsMember 2021-01-01 2021-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2021-01-01 2021-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2021-01-01 2021-09-30 0001317945 us-gaap:CommonStockMember 2022-09-30 0001317945 us-gaap:TreasuryStockMember 2022-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2022-09-30 0001317945 us-gaap:RetainedEarningsMember 2022-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2022-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2022-09-30 0001317945 us-gaap:CommonStockMember 2021-09-30 0001317945 us-gaap:TreasuryStockMember 2021-09-30 0001317945 us-gaap:AdditionalPaidInCapitalMember 2021-09-30 0001317945 us-gaap:RetainedEarningsMember 2021-09-30 0001317945 OFLX:AccumulatedOtherComprehensiveIncomeLossMember 2021-09-30 0001317945 us-gaap:NoncontrollingInterestMember 2021-09-30 0001317945 2021-09-30 0001317945 srt:MinimumMember 2022-01-01 2022-09-30 0001317945 srt:MaximumMember 2022-01-01 2022-09-30 0001317945 OFLX:LoanAgreementMember 2017-12-01 0001317945 OFLX:LoanAgreementMember 2017-11-29 2017-12-01 0001317945 2020-10-01 2020-12-31 0001317945 2022-01-03 2022-01-05 0001317945 srt:MinimumMember us-gaap:InsuranceClaimsMember 2022-09-30 0001317945 srt:MaximumMember us-gaap:InsuranceClaimsMember 2022-09-30 0001317945 OFLX:PhantomStockPlanMember 2022-01-01 2022-09-30 0001317945 OFLX:FullValueUnitsMember 2022-02-20 2022-02-22 0001317945 2022-02-01 2022-02-28 0001317945 2022-03-01 2022-03-31 0001317945 2018-01-01 2018-12-31 0001317945 2019-01-01 2019-12-31 0001317945 2020-01-01 2020-12-31 0001317945 OFLX:FullValueUnitsMember 2022-08-18 2022-08-19 0001317945 2022-08-01 2022-08-31 0001317945 OFLX:PhantomStockPlanMember 2021-01-01 2021-09-30 0001317945 OFLX:PhantomStockPlanMember 2022-07-01 2022-09-30 0001317945 OFLX:PhantomStockPlanMember 2021-07-01 2021-09-30 0001317945 us-gaap:PhantomShareUnitsPSUsMember 2022-01-01 2022-09-30 0001317945 us-gaap:PhantomShareUnitsPSUsMember 2021-12-31 0001317945 us-gaap:PhantomShareUnitsPSUsMember 2022-09-30 0001317945 OFLX:HoustonMember 2022-01-01 2022-09-30 0001317945 OFLX:MiddletownMember 2022-01-01 2022-09-30 0001317945 OFLX:BanburyMember 2022-01-01 2022-09-30 0001317945 2021-09-01 2021-09-30 0001317945 srt:MaximumMember 2014-04-04 0001317945 2007-12-31 0001317945 2014-01-01 2014-12-31 0001317945 2022-09-30 2022-09-30 0001317945 2022-10-24 2022-10-24 0001317945 2022-06-24 2022-06-24 0001317945 2022-07-05 2022-07-05 0001317945 2022-03-29 2022-03-29 0001317945 2022-04-25 2022-04-25 0001317945 2021-12-09 2021-12-09 0001317945 2021-12-30 2021-12-30 0001317945 2021-09-15 2021-09-15 0001317945 2021-10-04 2021-10-04 0001317945 2021-06-09 2021-06-09 0001317945 2021-07-06 2021-07-06 0001317945 2021-03-24 2021-03-24 0001317945 2021-04-14 2021-04-14 0001317945 2020-12-11 2020-12-11 0001317945 2021-01-05 2021-01-05 0001317945 OFLX:AffiliatedShareHoldersMember srt:MaximumMember 2022-01-01 2022-09-30 iso4217:USD xbrli:shares iso4217:USD xbrli:shares iso4217:GBP xbrli:pure

i ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

i ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________________ to ______________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. i Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). i Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, non-accelerated filer, or a smaller reporting company filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange. (Check one):

Large accelerated filer ☐ i Accelerated filer ☒ Non-accelerated filer ☐ Smaller reporting Company i ☐ Emerging Growth Company i ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of The Exchange Act). Yes ☐ i No ☒

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 12 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by the courts.

See Accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

This report contains forward-looking statements, which are subject to inherent uncertainties. These uncertainties include, but are not limited to, variations in weather, changes in the regulatory environment, customer preferences, general economic conditions, increased competition, the outcome of outstanding litigation, and future developments affecting environmental matters. All of these are difficult to predict, and many are beyond the ability of the Company to control.

Certain statements in this Quarterly Report on Form 10-Q that are not historical facts, but rather reflect the Company’s current expectations concerning future results and events, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believes”, “expects”, “intends”, “plans”, “anticipates”, “hopes”, “likely”, “will”, and similar expressions identify such forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company, or industry results, to differ materially from future results, performance or achievements expressed or implied by such forward-looking statements.

Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s view only as of the date of this Form 10-Q. The Company undertakes no obligation to update the result of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, conditions, or circumstances.

The Company is a leading manufacturer of flexible metal hose and is currently engaged in a number of different markets, including construction, manufacturing, transportation, petrochemical, pharmaceutical and other industries.

The Company’s business is managed as a single operating segment that consists of the manufacture and sale of flexible metal hose, fittings, and accessories. The Company’s products are concentrated in residential and commercial construction, and general industrial markets, with a comprehensive portfolio of intellectual property and patents issued in various countries around the world. The Company’s primary product, flexible gas piping, is used for gas piping within residential and commercial buildings. Through its flexibility and ease of use, the Company’s TracPipe^® and TracPipe^®CounterStrike^® flexible gas piping, along with its fittings distributed under the trademarks AutoSnap^® and AutoFlare^®, allows users to substantially cut the time required to install gas piping, as compared to traditional methods. The Company’s newest product line MediTrac^®corrugated medical tubing is used for piping medical gases (oxygen, nitrogen, nitrous oxide, carbon dioxide, and medical vacuum) in health care facilities. Building on the recognized strengths and strategies employed in the flexible gas piping market, MediTrac^®can be used in place of rigid copper pipe, and due to its long continuous lengths and flexibility, it can be installed approximately five times faster than rigid copper pipe, saving on installation labor and construction schedules. The Company’s products are manufactured at its Exton, Pennsylvania and Houston, Texas facilities in the U.S., and in Banbury, Oxfordshire in the U.K. A majority of the Company’s sales across all industries are generated through independent outside sales organizations such as sales representatives, wholesalers and distributors, or a combination of both. The Company has a broad distribution network in North America and to a lesser extent in other global markets.

The Company’s cash balance of $30,569,000 on September 30, 2022 decreased $2,344,000 (7.1%) from a balance of $32,913,000 as of December 31, 2021 mainly because of dividends paid of $6,258,000 partially offset by cash provided by operating activities of $4,569,000. See the Company’s Condensed Consolidated Cash Flow Statements for further details regarding the change in cash.

Inventory was $21,827,000 and $15,565,000 as of September 30, 2022 and December 31, 2021, respectively, increasing $6,262,000 or 40.2%. The increase is mainly the result of the purchase of inventory to ensure enough materials on hand because of the challenging supply chain environment and significantly increased costs.

Other Current Assets were $4,615,000 on September 30, 2022, compared to $2,533,000 as of December 31, 2021, increasing $2,082,000 or 82.2%. The increase is mainly the result of the prepayment of annual business insurance premiums for the upcoming annual period.

Accrued Compensation was $2,897,000 on September 30, 2022, compared to $7,008,000 on December 31, 2021, decreasing $4,111,000 or 58.7%. A significant portion of the liability that existed at the previous year end related to incentive compensation earned in 2021. As is customary, the liability was then paid during the first quarter of the following year, or 2022, thus diminishing the balance. In the current year there was a decrease in the incentive compensation liability to align with the changes in the executive management team. The liability now represents amounts earned during the current year.

Accrued Commissions and Sales Incentives were $4,765,000 and $7,183,000 as of September 30, 2022 and December 31, 2021, respectively, decreasing $2,418,000 or 33.7%. A portion of the decrease relates to a lower level of sales during the current quarter in comparison to the fourth quarter of the previous year, and the resulting commissions and sales incentives that are earned. Additionally, a portion of the sales incentives have an annual component which accumulates during the year and are then paid during the first quarter of the following year.

Other Liabilities were $7,079,000 and $4,864,000 as of September 30, 2022 and December 31, 2021, respectively. The increase of $2,215,000 or 45.5% mainly relates to accruals for legal and product liability matters which the Company continues to vigorously defend.

Retained earnings were $58,005,000 and $50,053,000 as of September 30, 2022 and December 31, 2021, respectively, increasing $7,952,000 or 15.9%. The increase was primarily due to net income during the year, as provided on the Company’s Condensed Consolidated Statements of Income, partially offset by dividends declared during 2022, as discussed in detail in Note 8, Shareholders’ Equity, to the Condensed Consolidated Financial Statements included in this report.

The Company reported comparative results from operations for the three months ended September 30, 2022 and 2021 as follows:

Net Sales. The Company’s 2022 third quarter sales of $31,629,000 decreased $96,000 or 0.3% compared to the third quarter of 2021, which generated sales of $31,725,000. Although sales are consistent with the previous period, sales unit volumes were lower. The effect of the lower sales volumes was largely offset by pricing actions to offset material cost pressure and to protect margins.

Gross Profit. The Company’s gross profit margins were 62.5% and 63.2% for the three months ended September 30, 2022 and 2021, respectively.

Selling Expenses. Selling expenses consist primarily of employee salaries and associated overhead costs, commissions, and the cost of marketing programs such as advertising, trade shows and related communication costs, and freight. Selling expense was $5,261,000 and $4,876,000 for the three months ended September 30, 2022 and 2021, respectively, representing an increase of $385,000 or 7.9%. The increases mostly related to commissions, staffing related expenses, and costs for resumption of travel and other marketing efforts, which were lower in the 2021 period due to the pandemic, partially offset by lower freight. Selling expenses increased as a percent of net sales compared to last year, being 16.6% for the three months ended September 30, 2022, and 15.4% for the three months ended September 30, 2021.

General and Administrative Expenses. General and administrative expenses consist primarily of employee salaries, benefits for administrative, executive and finance personnel, legal and accounting, and corporate general and administrative services. General and administrative expenses were $4,754,000 and $5,724,000 for the three months ended September 30, 2022 and 2021, respectively, thus decreasing by $970,000 or 16.9%. There was a decrease in the incentive compensation component which is aligned with profitability of $1,774,000 to align with the changes in the executive management team. There also was a reduction in stock-based compensation expense which moves in relation to the Company’s stock price, as detailed in Note 6, Stock-Based Compensation Plans, to the Condensed Consolidated Financial Statements included in this report. Higher items include product liability reserves and expenses, associated primarily with one pending case, which the Company continues to vigorously defend, and staffing related expenses. As a percentage of sales, general and administrative expenses decreased to 15.0% for the three months ended September 30, 2022 from 18.0% for the three months ended September 30, 2021.

Engineering Expense. Engineering expenses consist of development expenses associated with the development of new products and enhancements to existing products, and manufacturing engineering costs. Engineering expenses were $1,101,000 and $1,113,000 for the three months ended September 30, 2022 and 2021, respectively, decreasing by $12,000 or 1.1%. Engineering expenses as a percentage of sales were 3.5% for the three months ended September 30, 2022 and 2021.

Operating Profits. Reflecting all of the factors mentioned above, operating profits were $8,641,000 and $8,326,000 for the three months ended September 30, 2022 and 2021, respectively, increasing by $315,000 or 3.8%.

Interest Income. Interest income is recorded on cash investments, and interest expense is recorded at times when the Company has debt amounts outstanding on its line of credit. The Company recorded $32,000 of interest income for the three months ended September 30, 2022 and $10,000 for the three months ended September 30, 2021.

Other Income (Expense). Other income (expense) primarily consists of foreign currency exchange gains (losses) on transactions settled in currencies other than the Company’s local currency, typically related to the Company’s foreign U.K. subsidiaries. There were losses of $210,000 and $19,000 recorded during the three months ended September 30, 2022 and 2021 respectively. The British Pound had weakened during each of the third quarters of 2022 and 2021. As a percentage of sales, other expenses increased to 0.7% for the three months ended September 30, 2022 from 0.1% for the three months ended September 30, 2021.

Income Tax Expense. Income tax expense was $1,924,000 for the three months ended September 30, 2022, compared to $2,160,000 for the same period in 2021, decreasing $236,000 or 10.9%, mostly because of the reduction of non-deductible incentive compensation to align with the changes in the executive management team.

The Company reported comparative results from operations for the nine months ended September 30, 2022 and 2021 as follows:

Net Sales. The Company’s sales for the first nine months of 2022 of $94,670,000 increased $116,000 or 0.1% compared to the first nine months of 2021, which generated sales of $94,554,000. Although sales are consistent with the previous period, sales unit volumes were lower. The effect of the lower sales volumes was largely offset by pricing actions to offset material cost pressure and to protect margins.

Gross Profit. The Company’s gross profit margins were 63.0% and 62.7% for the nine months ended September 30, 2022 and 2021, respectively.

Selling Expenses. Selling expenses consist primarily of employee salaries and associated overhead costs, commissions, and the cost of marketing programs such as advertising, trade shows and related communication costs, and freight. Selling expense was $16,545,000 and $14,625,000 for the nine months ended September 30, 2022 and 2021, respectively, representing an increase of $1,920,000 or 13.1%. The increases primarily related to costs for resumption of travel and other marketing efforts, which were lower in the 2021 period due to the pandemic. Commissions and staffing related expenses were also higher. Commissions increased partly because of a shift of shipments from third party warehouses, whose shipments are subject to commission, compared to those directly from the manufacturing facilities, whose shipments are not subject to commission. Selling expenses increased as a percent of net sales compared to last year, being 17.5% for the nine months ended September 30, 2022, and 15.5% for the nine months ended September 30, 2021.

General and Administrative Expenses. General and administrative expenses consist primarily of employee salaries, benefits for administrative, executive and finance personnel, legal and accounting, and corporate general and administrative services. General and administrative expenses were $16,257,000 and $16,281,000 for the nine months ended September 30, 2022 and 2021, respectively, thus decreasing by $24,000 or 0.1%. There was a decrease in the incentive compensation component which is aligned with profitability of $2,167,000 to align with the changes in the executive management team and there was a reduction in stock-based compensation expense which moves in relation to the Company’s stock price, as detailed in Note 6, Stock-Based Compensation Plans, to the Condensed Consolidated Financial Statements included in this report. Higher items higher product liability reserves and expenses of $2,159,000 associated primarily with two pending cases, which the Company continues to vigorously defend, and staffing related expenses. As a percentage of sales, general and administrative expenses were 17.2% for the nine months ended September 30, 2022 and 2021.

Engineering Expense. Engineering expenses consist of development expenses associated with the development of new products and enhancements to existing products, and manufacturing engineering costs. Engineering expenses were $3,514,000 and $3,326,000 for the nine months ended September 30, 2022 and 2021, respectively, increasing by $188,000 or 5.7%, mainly associated with increases in experimental materials and travel. Engineering expenses increased as a percentage of sales, being 3.7% for the nine months ended September 30, 2022, and 3.5% for the same period in 2021.

Operating Profits. Reflecting all of the factors mentioned above, operating profits were $23,349,000 and $25,064,000 for the nine months ended September 30, 2022 and 2021, respectively, decreasing by $1,715,000 or 6.8%.

Interest Income. Interest income is recorded on cash investments, and interest expense is recorded at times when the Company has debt amounts outstanding on its line of credit. The Company recorded $52,000 and $27,000 of interest income during the first nine months of 2022 and 2021, respectively.

Other Income (Expense). Other Income (Expense) primarily consists of foreign currency exchange gains (losses) on transactions settled in currencies other than the Company’s local currency, typically related to the Company’s foreign U.K. subsidiaries. There was a loss of $374,000 recorded during the first nine months of 2022, but a gain of $6,000 during the first nine months of 2021. The British Pound had weakened during the first nine months of 2022. As a percentage of sales, other expenses increased to 0.4% for the nine months ended September 30, 2022.

Income Tax Expense. Income Tax Expense was $5,558,000 for the first nine months of 2022, compared to $6,441,000 for the same period in 2021, decreasing $883,000 or 13.7%, because of the decrease in income before taxes and from the reduction of non-deductible incentive compensation to align with the changes in the executive management team.

Our discussion and analysis of our financial condition and results of operations are based upon our Condensed Consolidated Financial Statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. We evaluate our estimates on an on-going basis. Estimates are used for, but not limited to, revenue recognition and related sales incentives, provisions for credit losses, inventory reserves, valuation of goodwill, product liability reserves, valuation of phantom stock, and accounting for income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We believe our judgments related to these accounting estimates are appropriate. Actual results may differ from these estimates under different assumptions or conditions.

The Company’s accounting policy relating to revenue recognition reflects the impact of the adoption of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”), which is discussed further in the Notes to the Condensed Consolidated Financial Statements. As a result of the adoption of ASC 606, the Company records revenue based upon a five-step approach. The Company sells goods on typical, unmodified free on board (FOB) shipping point terms. As the seller, it can be determined that the shipped goods meet the agreed-upon specifications in the contract or customer purchase order (e.g. items, quantities, and prices) with the buyer, so customer acceptance would be deemed a formality, as noted in ASC 606-10-55-86. As a result, the Company has a legal right to payment upon shipment of the goods. Based upon the above, the Company has concluded that transfer of control substantively transfers to the customer upon shipment. Other than standard product warranty provisions, the sales arrangements provide for no other post-shipment obligations. The Company offers rebates and other sales incentives, promotional allowances, or discounts to certain customers, typically related to purchase volume, and are classified as a reduction of revenue and recorded at the time of sale. The Company periodically evaluates whether an allowance for sales returns is necessary. Historically, the Company has experienced minimal sales returns. If it is believed there are to be material potential sales returns, the Company will provide the necessary provision against sales.

The Company maintains allowances for credit losses, which represent an estimate of expected losses over the remaining contractual life of its receivables considering current market conditions and estimates for supportable forecasts when appropriate. The estimate is a result of the Company’s ongoing assessments and evaluations of collectability, historical loss experience, and future expectations in estimating credit losses in its receivable portfolio. For accounts receivables, the Company uses historical loss experience rates and applies them to a related aging analysis while also considering customer and/or economic risk where appropriate. Determination of the proper amount of allowances requires management to exercise judgment about the timing, frequency and severity of credit losses that could materially affect the provision for credit losses and, as a result, net earnings. The allowances consider numerous quantitative and qualitative factors that include receivable type, historical loss experience, delinquency trends, collection experience, current economic conditions, estimates for supportable forecasts, when appropriate, and credit risk characteristics. Changes in allowances may occur in the future as the above referenced quantitative and qualitative factors change.

Inventories are valued at the lower of cost or net realizable value. The cost of inventories is determined by the first-in, first-out (FIFO) method. The Company generally considers inventory quantities beyond two years of usage, measured on a historical usage basis, to be excess inventory and reduces the carrying value of inventory accordingly. These reductions to the inventory carrying values are estimates, which could vary significantly, either favorably or unfavorably, from actual amounts if future economic conditions, sales levels, or competitive conditions change.

In accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 350, Intangibles – Goodwill and Other (ASU 2017-04), using the simplified method as adopted, the Company performed an annual impairment test as of December 31, 2021. This test did not indicate any impairment of goodwill as the Company’s estimated fair value of the reporting unit exceeded carrying value. The test may be performed more frequently if we believe indicators of impairment might exist. These indicators may include changes in macroeconomic and industry conditions, overall financial performance, and other relevant entity-specific events.

Product liability reserves represent the estimated unpaid amounts under the Company’s insurance policies with respect to existing claims. The Company uses the most current available data to estimate claims. As explained more fully under Note 5, Commitments and Contingencies, to the Condensed Consolidated Financial Statements included in this report for various product liability claims covered under the Company’s general liability insurance policies, the Company must pay certain defense and settlement costs within its deductible or self-insured retention limits, ranging primarily from $25,000 to $3,000,000 per claim, depending on the terms of the policy in the applicable policy year, up to an aggregate amount. The Company is vigorously defending against all known claims. It is possible that the Company may incur increased litigation costs in the future due to a variety of factors, including a higher number of claims, higher legal costs, and higher insurance deductibles or retentions. Litigation is subject to many uncertainties and management is unable to predict the outcome of the pending suits and claims. From time to time, depending upon the nature of a particular case, the Company may decide to spend more than a deductible or retention to enable more discretion regarding the defense, although this is not common. It is possible that the results of operations or liquidity of the Company, as well as the Company’s ability to procure reasonably priced insurance, could be adversely affected by the pending litigation, potentially materially. The Company is currently unable to estimate the ultimate liability, if any, that may result from the pending litigation, or potential litigation from future claims or claims that have not yet come to our attention, and accordingly, the liability in the Condensed Consolidated Financial Statements primarily represents an accrual for legal costs for services previously rendered, settlements for Claims not yet paid, and anticipated settlements for claims within the Company’s remaining retention under its insurance policies.

In 2006, the Company adopted a Phantom Stock Plan (the “Plan”), which allows the Company to grant phantom stock units (“Units”) to certain key employees, officers, or directors. The Units each represent a contractual right to payment of compensation in the future based upon the market value of the Company’s common stock and are accordingly recorded as liabilities. The Units follow a vesting schedule over three years from the grant date and are then paid upon maturity. In accordance with FASB ASC Topic 718, Compensation - Stock Compensation (“Topic 718”), the Company uses the Black-Scholes option pricing model as its method for determining the fair value of the Units. The liabilities for the Units are adjusted to market value over time from the grant dates to the related maturity dates. The Company recognizes the reversal of any previously recognized compensation expense on forfeited nonvested Units in the period the Units are forfeited.

The Plan has been amended and restated, for all grants made starting January 1, 2023, to set the vesting method to three-year cliff vesting following the grant date, with full value paid upon maturity. Additionally, for grants made starting January 1, 2023, upon retirement at age 67 or greater, and with one year of continuous service prior to retirement, vesting of the issued grant(s) would accelerate on a pro-rata basis, 1/3 per year from the grant date.

Further details of the Plan are provided in Note 6, Stock-Based Compensation Plans, to the Condensed Consolidated Financial Statements included in this report. Any significant changes in the Company’s stock price may have a material impact upon the valuation of the Units.

The Company accounts for tax liabilities in accordance with the FASB ASC Topic 740, Income Taxes. Under this method the Company recorded tax expense and related deferred taxes and tax benefits.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will either expire before the Company is able to realize the benefit, or that future deductibility is uncertain. The Company’s accounting for deferred tax consequences represents the best estimate of those future events. Changes in estimates, due to unanticipated events or otherwise, could have a material effect on the financial condition and results of operations of the Company. The Company continually evaluates its deferred tax assets to determine if a valuation allowance is required.

Historically, the Company’s primary cash needs have been related to working capital items, which the Company has largely funded through cash generated from operations.

As of September 30, 2022, the Company had a cash balance of $30,569,000. Additionally, the Company has a $15,000,000 line of credit available, as discussed in detail in Note 4, which had no borrowings outstanding upon it on September 30, 2022. On December 31, 2021, the Company had a cash balance of $32,913,000, with no borrowings against the line of credit.

Cash provided or used by operating activities is net income adjusted for certain non-cash items and changes in certain assets and liabilities, such as those included in working capital.

For the nine months ended September 30, 2022, the Company’s operating activities provided cash of $4,569,000, compared to the nine months ended September 30, 2021 which provided cash of $13,164,000, a difference of $8,595,000. For details of the operating cash flows refer to the Condensed Consolidated Statements of Cash Flows in Part I – Financial Information on page eight.

As a general trend, the Company tends to deplete or generate lower amounts of cash early in the year, as significant payments are typically made for accrued promotional incentives and incentive compensation. Cash has then historically shown a tendency to be restored and accumulated during the latter portion of the year.

Cash used in investing activities during the nine months ended September 30, 2022 and 2021 was $817,000 and $720,000, respectively for capital expenditures.

All financing activities relate to dividend payments, which are detailed in Note 8, Shareholders’ Equity. Dividend payments through the first nine months of 2022 and 2021 amounted to $6,258,000 and $8,809,000, respectively.

We believe our existing cash and cash equivalents, along with our borrowing capacity, will be sufficient to meet our anticipated cash needs for at least the next twelve months. Our future capital requirements will depend upon many factors including our rate of revenue growth, the timing and extent of any expansion efforts, and the potential for investments in, or the acquisition of any complementary products, businesses, or supplementary facilities for additional capacity.

The Company does not engage in the purchase or trading of market risk sensitive instruments. The Company does not presently have any positions with respect to hedge transactions such as forward contracts relating to currency fluctuations. No market risk sensitive instruments are held for speculative or trading purposes.

At the end of the fiscal third quarter of 2022, the Company evaluated the effectiveness of the design and operation of its disclosure controls and procedures. The Company’s disclosure controls and procedures are designed to ensure that the Company records, processes, summarizes, and reports in a timely manner the information required to be disclosed in the periodic reports filed by the Company with the Securities and Exchange Commission. The Company’s management, including the chief executive officer and chief financial officer, have conducted an evaluation of the effectiveness of the design and operation of the Company’s Disclosure Controls and Procedures as defined in the Rule 13a-15(e) of Securities Exchange Act of 1934. Based on that evaluation, the chief executive officer and chief financial officer have concluded that, as of the date of this report, the Company’s disclosure controls and procedures are effective to provide reasonable assurance of achieving the purposes described in Rule 13a-15(e), and no changes are required at this time.

There was no change in the Company’s “internal control over financial reporting” (as defined in rule 13a-15(f) of the Securities Exchange Act of 1934) identified in connection with the evaluation required by Rule 13a-15(d) of the Securities Exchange Act of 1934 that occurred during the nine month period covered by this Report on Form 10-Q that has materially affected or is reasonably likely to materially affect the Company’s internal control over financial reporting subsequent to the date the chief executive officer and chief financial officer completed their evaluation.

See legal proceedings disclosure in Note 5, Commitments and Contingencies, to the Condensed Consolidated Financial Statements included in this report.

Risk factors are discussed in detail in the Company’s December 31, 2021 Form 10-K. There are no additional risks attributable to the quarter.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

i 451 Creamery Way, i Exton, i PA		i 19341
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbol		Name of each exchange on which registered
i Common Stock, par value $0.01 per share		i OFLX		i NASDAQ Global Market


	September 30, 2022			December 31, 2021
		(unaudited)
ASSETS
Current Assets:
Cash and Cash Equivalents	$	i 30,569		$	i 32,913
Accounts Receivable - less allowances of $ i 1,229 and $ i 1,410, respectively		i 19,043			i 20,726
Inventories - Net		i 21,827			i 15,565
Other Current Assets		i 4,615			i 2,533
Total Current Assets		i 76,054			i 71,737

Right-Of-Use Assets - Operating		i 3,095			i 3,374
Property and Equipment - Net		i 8,558			i 8,569
Goodwill - Net		i 3,526			i 3,526
Deferred Taxes		i 206			i 7
Other Long Term Assets		i 1,584			i 1,702
Total Assets	$	i 93,023		$	i 88,915

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts Payable	$	i 2,576		$	i 3,355
Accrued Compensation		i 2,897			i 7,008
Accrued Commissions and Sales Incentives		i 4,765			i 7,183
Dividends Payable		i 3,230			-
Taxes Payable		-			i 1
Lease Liability - Operating		i 431			i 383
Other Liabilities		i 7,079			i 4,864
Total Current Liabilities		i 20,978			i 22,794

Lease Liability - Operating, net of current portion		i 2,668			i 2,990
Deferred Taxes		i 13			i 427
Tax Payable Long Term		i 427			i 493
Other Long Term Liabilities		i 914			i 1,670
Total Liabilities		i 25,000			i 28,374

Commitments and Contingencies (Note 5)		-

Shareholders’ Equity:
Omega Flex, Inc. Shareholders’ Equity:
Common Stock – par value $ i i 0.01 / share: authorized i i 20,000,000 / shares: i i 10,153,633 / shares issued and i i 10,094,322 / shares outstanding as of September 30, 2022 and December 31, 2021, respectively		i 102			i 102
Treasury Stock		( i 1	)		( i 1	)
Paid-in Capital		i 11,025			i 11,025
Retained Earnings		i 58,005			i 50,053
Accumulated Other Comprehensive Loss		( i 1,287	)		( i 827	)
Total Omega Flex, Inc. Shareholders’ Equity		i 67,844			i 60,352
Noncontrolling Interest		i 179			i 189

Total Shareholders’ Equity		i 68,023			i 60,541

Total Liabilities and Shareholders’ Equity	$	i 93,023		$	i 88,915


	For the nine months ended
	September 30,
	2022			2021
	(unaudited)
Cash Flows from Operating Activities:
Net Income	$	i 17,469		$	i 18,656
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Non-Cash Compensation		i 51			i 579
Depreciation and Amortization		i 812			i 697
Provision for Losses on Accounts Receivable, net of write-offs and recoveries		( i 183	)		i 105
Deferred Taxes		( i 613	)		i 303
Provision for Inventory Reserves		( i 409	)		i 303
Changes in Assets and Liabilities:
Accounts Receivable		i 1,625			( i 2,165	)
Inventories		( i 6,474	)		( i 1,671	)
Right-Of-Use Assets		i 380			i 201
Other Assets		( i 1,975	)		( i 1,309	)
Accounts Payable		( i 679	)		( i 605	)
Accrued Compensation		( i 4,078	)		( i 235	)
Accrued Commissions and Sales Incentives		( i 2,401	)		i 1,148
Lease Liabilities		( i 376	)		( i 209	)
Other Liabilities		i 1,420			( i 2,634	)
Net Cash Provided by Operating Activities		i 4,569			i 13,164

Cash Flows from Investing Activities:
Capital Expenditures		( i 817	)		( i 720	)
Net Cash Used in Investing Activities		( i 817	)		( i 720	)

Cash Flows from Financing Activities:
Dividends Paid		( i 6,258	)		( i 8,809	)
Net Cash Used in Financing Activities		( i 6,258	)		( i 8,809	)

Net (Decrease) Increase in Cash and Cash Equivalents		( i 2,506	)		i 3,635
Translation effect on cash		i 162			( i 23	)
Cash and Cash Equivalents – Beginning of Period		i 32,913			i 23,633
Cash and Cash Equivalents – End of Period	$	i 30,569		$	i 27,245

Supplemental Disclosure of Cash Flow Information:
Cash paid for Income Taxes	$	i 7,226		$	i 7,455
Declared Dividends	$	i 9,489		$	i 9,011

Supplemental Schedule of Non-Cash Investing and Financing Activities:
Additions to Right-Of-Use Assets obtained from new operating Lease Liabilities	$	i 644		$	i 3,261

	●	carrying fuel gases within residential and commercial buildings;

	●	carrying gasoline and diesel gasoline products (both above and below the ground) in a double containment piping to contain any possible leaks, which is used in automotive and marina refueling, and fueling for back-up generation;

	●	using copper-alloy corrugated piping in medical or health care facilities to carry medical gases (oxygen, nitrogen, vacuum) or pure gases for pharmaceutical applications; and

	●	industrial applications where the customer requires the piping to have both a degree of flexibility and/or an ability to carry corrosive compounds or mixtures, or to carry at both very high and very low (cryogenic) temperatures.

Omega Flex, Inc. – ‘10-Q’ for 9/30/22

On: Monday, 11/7/22, at 3:30pm ET · For: 9/30/22 · Accession #: 1493152-22-30807 · File #: 0-51372

Previous ‘10-Q’: ‘10-Q’ on 8/5/22 for 6/30/22 · Next: ‘10-Q’ on 5/5/23 for 3/31/23 · Latest: ‘10-Q’ on 11/3/23 for 9/30/23 · 3 References:

Quarterly Report — Form 10-Q

Filing Table of Contents

‘10-Q’ — Quarterly Report

Document Table of Contents

This is an HTML Document rendered as filed. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference

3 Subsequent Filings that Reference this Filing

PART I - FINANCIAL INFORMATION	Page No.

Item 1 – Financial Statements

Condensed Consolidated Balance Sheets at September 30, 2022 (unaudited) and December 31, 2021	3

Condensed Consolidated Statements of Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)	4

Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)	5

Condensed Consolidated Statements of Shareholders’ Equity for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)	6

Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2022 and 2021 (unaudited)	8

Notes to the Condensed Consolidated Financial Statements (unaudited)	9

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	26

Item 3 – Quantitative and Qualitative Information About Market Risks	36

Item 4 – Controls and Procedures	36

PART II - OTHER INFORMATION

Item 1 – Legal Proceedings	36

Item 1A – Risk Factors	36

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	37

Item 3 – Defaults Upon Senior Securities	37

Item 4 – Mine Safety Disclosures	37

Item 5 – Other Information	37

Item 6 - Exhibits	37

SIGNATURES	38

	●	Identification of the contract, or contracts, with a customer — a contract with a customer exists when the Company enters into an enforceable contract with a customer, typically a purchase order initiated by the customer, that defines each party’s rights regarding the goods to be transferred and identifies the payment terms related to these goods.

	●	Identification of the performance obligations in the contract — performance obligations promised in a contract are identified based on the goods that will be transferred to the customer that are distinct, whereby the customer can benefit from the goods on their own or together with other resources that are readily available from third parties or from us. Persuasive evidence of an arrangement for the sale of product must exist. The Company ships product in accordance with the purchase order and standard terms as reflected within the Company’s order acknowledgments and sales invoices.

	●	Determination of the transaction price —the transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods to the customer. This would be the agreed upon quantity and price per product type in accordance with the customer purchase order, which is aligned with the Company’s internally approved pricing guidelines.

	●	Allocation of the transaction price to the performance obligations in the contract — if the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. This applies to the Company as there is only one performance obligation to ship the goods.

	●	Recognition of revenue when, or as, the Company satisfies a performance obligation — the Company satisfies performance obligations at a point in time when control of the goods transfers to the customer. Determining the point in time when control transfers requires judgment. Indicators considered in determining whether the customer has obtained control of a good include:

	■	The Company has a present right to payment
	■	The customer has legal title to the goods
	■	The Company has transferred physical possession of the goods
	■	The customer has the significant risks and rewards of ownership of the goods
	■	The customer has accepted the goods

	●	Contract Costs - costs to obtain a contract (e.g. customer purchase order) include sales commissions. Under Topic 606, these costs may be expensed as incurred for contracts with a duration of one year or less. The majority of the Company’s customer purchase orders are fulfilled (e.g. goods are shipped) within two days of receipt.

	●	Warranties - the Company does not offer a warranty as a separate component for customers to purchase. A warranty is generally included with each purchase, providing assurance that the goods comply with agreed-upon specifications, and the cost is therefore accrued accordingly, but contracts do not include any requirement for additional distinct services. Therefore, there is not a separate performance obligation, and there is no impact of warranties under Topic 606 upon the financial reporting of the Company.

	●	Returned Goods - from time to time, the Company provides authorization to customers to return goods. If deemed to be material, the Company would record a “right of return” asset for the cost of the returned goods which would reduce cost of sales.

	●	Volume Rebates (Promotional Incentives) - volume rebates are variable (dependent upon the volume of goods purchased by our eligible customers) and, under Topic 606, must be estimated and recognized as a reduction of revenue as performance obligations are satisfied (e.g. upon shipment of goods). Also under Topic 606, to ensure that the related revenue recognized would not be probable of a significant reversal, the four following factors are considered:

	■	The amount of consideration is highly susceptible to factors outside the Company’s influence.
	■	The uncertainty about the amount of consideration is not expected to be resolved for a long period of time.
	■	The Company’s experience with similar types of contracts is limited.
	■	The contract has a large number and broad range of possible consideration amounts.

	1.	The lease transfers ownership of the underlying asset to the lessee by the end of the lease term.
	2.	The lease grants the lessee an option to purchase the underlying asset that the lessee is reasonably certain to exercise.
	3.	The lease term is for the major part of the remaining economic life of the underlying asset.
	4.	The present value of the sum of lease payments and any residual value guaranteed by the lessee equals or exceeds substantially all of the fair value of the underlying asset.
	5.	The underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term.


	September 30,		December 31,
	2022		2021
	(in thousands)

Finished Goods	$	i 8,538	$	i 5,903
Raw Materials		i 13,289		i 9,662
Inventories - Net	$	i 21,827	$	i 15,565

	■	ownership interest in the Company
	■	shareholder voting rights
	■	other incidents of ownership to the Company’s common stock

	Units			Weighted Average Grant Date Fair Value
Number of Phantom Stock Unit Awards:
Nonvested on December 31, 2021		i 8,358		$	i 100.93
Granted		i 3,493		$	i 137.97
Vested		( i 5,198	)	$	i 89.78
Forfeited		—			—
Canceled		—			—
Nonvested on September 30, 2022		i 6,653		$	i 129.09
Phantom Stock Unit Awards Expected to Vest		i 6,653		$	i 129.09

Twelve Months Ending September 30,	Operating Leases
		(in thousands)

2023	$	i 431
2024		i 411
2025		i 270
2026		i 240
2027		i 226
Thereafter		i 1,521
Total Minimum Lease Payments	$	i 3,099

	Three months ended September 30, (in thousands)

		2022	2022			2021	2021
		($000)	%			($000)	%
Net Sales	$	31,629	100.0	%	$	31,725	100.0	%
Gross Profit	$	19,757	62.5	%	$	20,039	63.2	%
Operating Profit	$	8,641	27.3	%	$	8,326	26.2	%

	Nine months ended September 30, (in thousands)

		2022	2022			2021	2021
		($000)	%			($000)	%
Net Sales	$	94,670	100.0	%	$	94,554	100.0	%
Gross Profit	$	59,665	63.0	%	$	59,296	62.7	%
Operating Profit	$	23,349	24.7	%	$	25,064	26.5	%

Exhibit No.	Description

10.20	Omega Flex, Inc. 2006 Phantom Stock Plan, as amended and restated effective as of January 1, 2023.

10.21	Form of Phantom Stock Agreement between Omega Flex, Inc., and the applicable grantee, for grants on or after January 1, 2023.

31.1	Certification of Chief Executive Officer of Omega Flex, Inc. pursuant to Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended.

31.2	Certification of Chief Financial Officer of Omega Flex, Inc. pursuant to 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended.

32.1	Certification of Chief Executive Officer and Chief Financial Officer of Omega Flex, Inc., pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


	OMEGA FLEX, INC.
	(Registrant)

Date: November 7, 2022	By:	/S/ Matthew F. Unger
		Matthew F. Unger
		Vice President – Finance
		and Chief Financial Officer

This ‘10-Q’ Filing	Date	Other Filings

	1/1/23
	12/31/22
	12/1/22
Filed on:	11/7/22
	10/24/22
For Period end:	9/30/22	8-K
	8/19/22	4
	7/5/22
	7/1/22
	6/24/22
	4/25/22
	3/29/22	8-K
	2/22/22	4
	1/5/22
	1/1/22
	12/31/21	10-K, 11-K, 5, SD
	12/30/21
	12/9/21	8-K
	10/4/21
	9/30/21	10-Q
	9/15/21	8-K
	7/6/21
	7/1/21
	6/9/21	8-K
	4/14/21
	3/24/21	8-K
	1/5/21
	1/1/21
	12/15/20
	12/11/20	8-K
	3/12/20
	12/1/17	8-K
	4/4/14
	4/1/06
		List all Filings