WIDEPOINT CORPORATION MCLEAN, Va., Nov. 14, 2017 /PRNewswire/ -- WidePoint Corporation (NYSE: WYY), a leading provider of Trusted Mobility Management (TM2) specializing in Telecommunication Lifecycle Management (TLM) and Cybersecurity solutions, today announced financial results for the third quarter ended September 30, 2017.
Third Quarter 2017 Highlights
-- Appointed Kito Mussa Interim Chief Financial Officer
-- FEMA Task Order awarded under DHS CWMS BPA to deliver TLM services
-- Coast Guard Pilot Task Order award for TLM services
-- Secured new contracts and expanded scope of services with several
existing customers
-- Restructured credentialing service team which reduced operating expenses
by 12%
Jin Kang, WidePoint's CEO stated, "I'm pleased with the progress we made on our business initiatives to grow our pipeline of new business, the numerous contract awards announced, and reduction of our operating costs since the end of the prior quarter. Additionally, the launch of our TM2 framework and solutions were well received, and we were able to continue building our business pipeline during the third quarter. As we exit the fourth quarter of 2017, we want to ensure that we have the right mixture of clients and services to drive higher margin revenue growth, a solid pipeline of internal and external revenue growth opportunities and an effective strategy to close on these opportunities in 2018. The entire WidePoint team is committed to continue progress towards our 2018 goals of top line growth and improving profitability."
Kito Mussa, WidePoint's Interim Chief Financial Officer, added, "Our revenues declined in the third quarter due to a combination of fewer task orders for carrier services, carrier service optimizations implemented that lowered the amount of carrier services required by our customers, and timing related delays that pushed recognition of mobile accessory and reselling orders into the fourth quarter. We took additional action during the third quarter to improve our financial model by restructuring our credentialing service team, which we anticipate will reduce our annual costs significantly and help WidePoint to achieve our goal of returning to profitability."
Third Quarter 2017 Financial Highlights versus Comparative Period in Prior Year
(in millions, except per share amounts) September 30, 2017 September 30, 2016
-------------------------------------- ------------------ ------------------
Revenues $18.5 $22.1
-------- ----- -----
Gross Profit (% of Revenue) $3.4 (18%) $4.0 (18%)
-------------------------- --------- ---------
Operating Expenses $3.7 $4.2
------------------ ---- ----
Loss from Operations $(0.3) $(0.1)
-------------------- ----- -----
Net Loss $(0.3) $(0.1)
-------- ----- -----
Basic and Diluted Earnings per Share (EPS) $(0.00) $(0.00)
----------------------------------------- ------ ------
Adjusted EBITDA $0.03 $0.34
--------------- ----- -----
-- Cash and cash equivalents was approximately $6.4 million as of September
30, 2017.
-- The outstanding balance on the credit facility was approximately $0.6
million, an increase from last quarter due to short term receivable
collection timing differences.
Nine Months 2017 Financial Highlights versus Comparative Period in Prior Year
(in millions, except per share amounts) September 30, 2017 September 30, 2016
-------------------------------------- ------------------ ------------------
Net Revenue $56.0 $60.2
----------- ----- -----
Gross Profit (% of Revenue) $10.1 (18%) $11.6 (19%)
-------------------------- ---------- ----------
Operating Expenses $12.8 $13.2
------------------ ----- -----
Loss From Operations $(2.7) $(1.6)
-------------------- ----- -----
Net Loss $(2.8) $(1.7)
-------- ----- -----
Basic and Diluted EPS $(0.03) $(0.02)
--------------------- ------ ------
Adjusted EBITDA Loss $(1.13) $(0.29)
-------------------- ------ ------
Non-GAAP Financial Measures
WidePoint uses a variety of operational and financial metrics, including non-GAAP financial measures such as Adjusted EBITDA, to enable it to analyze its performance and financial condition. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. A reconciliation of GAAP Net loss to Adjusted EBITDA is included on the schedules attached hereto.
Conference Call Information
A conference call and live webcast will take place at 4:30 p.m. Eastern Standard Time today, Tuesday, November 14, 2017. Interested parties can join the live call from the United States by dialing 1-877-451-6152, or 1-201-389-0879 for international. There will be a playback available until November 28, 2017. To listen to the playback, please call 1?844-512-2921 if calling within the United States or 1-412-317-6671 if calling internationally. Please use PIN code 13673221 for the replay.
The call will also be accompanied live by webcast over the Internet and accessible at http://public.viavid.com/index.php?id=127197.
About WidePoint
WidePoint Corporation (NYSE: WYY) is a leading provider of technology-based management solutions. For more information, visit www.widepoint.com
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the Company's financing plans; (ii) trends affecting the Company's financial condition or results of operations; (iii) the company's growth strategy and operating strategy; (iv) the Company's ability to achieve profitability and positive cash flows; (v) the Company's ability to raise additional capital on favorable terms or at all; (vii) the Company's ability to gain market acceptance for its products and (viii) the risk factors disclosed in the Company's periodic reports filed with the SEC. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk factors disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC on March 30, 2017.
For More Information:
Brett Mass or Dave Fore
Hayden IR
(206) 395-2711
dave@haydenir.com
WIDEPOINT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31,
2017 2016
---- ----
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $6,423,974 $9,123,498
Accounts receivable, net of allowance for
doubtful accounts of $78,230 and $344,411 in
2017 and 2016, respectively
7,942,035 5,153,093
Unbilled accounts receivable 6,132,753 8,112,690
Inventories 313,538 123,287
Prepaid expenses and other
assets 576,402 385,388
Income taxes receivable - 42,896
Total current assets 21,388,702 22,940,852
NONCURRENT ASSETS
Land and building held for
sale - 594,376
Property and equipment, net 969,651 736,678
Intangibles, net 3,900,433 4,298,902
Goodwill 18,555,578 18,555,578
Deposits and other assets 85,094 52,456
TOTAL ASSETS $44,899,458 $47,178,842
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Line of credit advance $552,739 $ -
Short term note payable 53,650 131,761
Accounts payable 7,826,706 8,665,449
Accrued expenses 8,506,206 7,872,557
Deferred revenue 1,506,010 1,190,558
Income taxes payable 58,258 5,141
Current portion of long-term
debt - 94,868
Current portion of deferred
rent 56,894 40,397
Current portion of capital
lease obligations 20,216 4,097
Total current liabilities 18,580,679 18,004,828
NONCURRENT LIABILITIES
Long-term debt related to
assets held for sale, net of
current portion - 412,180
Capital lease obligation, net
of current portion 56,547 -
Deferred rent, net of current
portion 100,380 86,198
Deferred revenue 13,333 -
Deferred income taxes 379,894 398,985
Total liabilities 19,130,833 18,902,191
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value; 10,000,000 shares authorized; 2,045,714
shares issued and none outstanding
- -
Common stock, $0.001 par value; 110,000,000
shares authorized; 82,946,847 and 82,730,134
shares issued and outstanding, respectively
82,947 82,730
Additional paid-in capital 94,007,140 93,920,095
Accumulated other
comprehensive loss (135,664) (309,369)
Accumulated deficit (68,185,798) (65,416,805)
Total stockholders' equity 25,768,625 28,276,651
Total liabilities and
stockholders' equity $44,899,458 $47,178,842
=========== ===========
WIDEPOINT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
(Unaudited)
REVENUES $18,463,872 $22,114,839 $55,956,617 $60,163,145
COST OF REVENUES (including amortization and
depreciation of $318,461, $307,235, $895,088, and
$887,870, respectively)
15,087,567 18,076,810 45,859,532 48,559,591
---------- ---------- ---------- ----------
GROSS PROFIT 3,376,305 4,038,029 10,097,085 11,603,554
--------- --------- ---------- ----------
OPERATING EXPENSES
Sales and
Marketing 532,714 625,481 1,709,892 2,066,995
General and
Administrative
Expenses
(including
share-based
compensation of
-$81,043,
$68,088,
$138,036 and
$204,414,
respectively)
3,046,148 3,450,767 10,668,368 10,650,697
Product
Development 11,342 2,648 219,141 261,031
Depreciation and
Amortization 69,935 84,759 212,874 268,956
------
Total Operating Expenses 3,660,139 4,163,655 12,810,275 13,247,679
--------- --------- ---------- ----------
LOSS FROM OPERATIONS (283,834) (125,626) (2,713,190) (1,644,125)
OTHER INCOME (EXPENSE)
Interest Income 1,971 3,012 11,564 10,618
Interest Expense (13,985) (20,910) (36,402) (61,068)
Other (Expense)
Income (1,541) 3,779 1,758 11,124
-------
Total Other Income
(Expense) (13,555) (14,119) (23,080) (39,326)
------- ------- ------- -------
LOSS BEFORE INCOME TAX PROVISION (297,389) (139,745) (2,736,270) (1,683,451)
INCOME TAX PROVISION 17,212 8,295 32,723 21,029
------ ----- ------ ------
NET LOSS $(314,601) $(148,040) $(2,768,993) $(1,704,480)
========= ========= =========== ===========
BASIC EARNINGS PER SHARE $(0.00) $(0.00) $(0.03) $(0.02)
====== ====== ====== ======
BASIC WEIGHTED-AVERAGE SHARES
OUTSTANDING 82,946,847 82,730,134 82,878,287 82,673,570
========== ========== ========== ==========
DILUTED EARNINGS PER SHARE $(0.00) $(0.00) $(0.03) $(0.02)
====== ====== ====== ======
DILUTED WEIGHTED-AVERAGE SHARES
OUTSTANDING 82,946,847 82,730,134 82,878,287 82,673,570
========== ========== ========== ==========
WIDEPOINT CORPORATION
RECONCILIATION OF GAAP NET LOSS TO
ADJUSTED EARNINGS BEFORE INTEREST, TAXES,
DEPRECIATION AND AMORTIZATION
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
(Unaudited)
NET LOSS $(314,600) $(148,100) $(2,769,000) $(1,704,500)
Adjustments to GAAP net income (loss):
Depreciation and amortization 388,400 392,000 1,108,000 1,156,600
Amortization of deferred financing
costs 9,500 - 9,500 -
Income tax provision (benefit) 17,200 8,300 32,700 21,000
Interest income (2,000) (3,000) (11,600) (10,600)
Interest expense 14,000 20,900 36,400 61,100
Other (expense) income 1,500 (3,800) (1,800) (11,100)
Provision for doubtful accounts - 5,500 31,200 (7,900)
Gain on sale of assets held for
sale - - (66,700) -
Loss on disposal of leasehold
improvements - - 172,500 -
Severance and exit costs - - 187,500 -
Stock-based compensation expense (81,400) 68,100 138,000 204,400
--------
Adjusted EBITDA $32,600 $339,900 $(1,133,300) $(291,000)
======= ======== =========== =========
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SOURCE WidePoint Corporation
