Willdan Group, Inc. ("Willdan") (NASDAQ:WLDN), today announced
financial results for its first quarter ended April 1, 2011.
For the first quarter of 2011, Willdan reported total contract revenue
of $22.7 million and a net loss of $0.3 million, or $0.04 per share.
Tom Brisbin, Willdan's Chief Executive Officer, stated: "Our first
quarter was a slow quarter, and our results reflect that. We continue to
see solid growth opportunities across our businesses and we are
investing in key personnel and technology so we are positioned to
capitalize on them. As previously reported, based on our planned
investments in the first half of 2011, we expect stronger profitability
in the second half of the year."
First Quarter 2011 Results
For the first quarter of fiscal 2011, revenue was $22.7 million, up $5.8
million, or 34.2%, from revenue of $17.0 million for the comparable
period last year. On a sequential basis, revenue was up $2.8 million, or
14.4%, from the fourth quarter of 2010. Loss from operations was $0.3
million for the first quarter of fiscal 2011, as compared to income from
operations of $0.4 million for the comparable period last year. On a
sequential basis, loss from operations was down $0.3 million from income
from operations of $30,000 for the fourth quarter of 2010.
Net loss was $0.3 million for the first quarter of fiscal 2011, as
compared to net income of $0.4 million for the comparable period last
year and net income of $0.3 million for the fourth quarter of 2010.
Basic and diluted loss per share for the first quarter of fiscal 2011
was $0.04 as compared to earnings per share of $0.05 for the comparable
period last year.
Willdan generated $0.7 million in cash flow from operations in the first
quarter of fiscal 2011.
Three Months Ended
April 1,
April 2,
In thousands (except per share data)
2011
2010
Revenue
$
22,742
$
16,951
(Loss) income from operations
(280
)
385
Interest income
2
5
Interest expense
(18
)
(8
)
Other, net
5
10
Income tax expense
--
--
Net (loss) income
$
(291
)
$
392
Basic and diluted (loss) earnings per share
$
(0.04
)
$
0.05
Weighted average shares outstanding:
Basic
7,251
7,223
Diluted
7,251
7,230
Use of Non-GAAP Financial Measures
Adjusted EBITDA is a supplemental measure used by Willdan's management
to measure its operating performance. Willdan defines Adjusted EBITDA as
net (loss) income plus net interest expense, depreciation and
amortization, lease abandonment (recapture) and gain on sale of assets.
Willdan's definition of Adjusted EBITDA may differ from those of many
companies reporting similarly named measures. This measure should be
considered in addition to, and not as a substitute for or superior to,
other measures of financial performance prepared in accordance with U.S.
generally accepted accounting principles, or GAAP, such as net income.
Willdan believes Adjusted EBITDA enables management to separate unusual
or infrequent income and expense items from its results of operations to
provide a more normalized and consistent view of operating performance
on a period-to-period basis. Willdan uses Adjusted EBITDA to evaluate
its performance for, among other things, budgeting, forecasting and
incentive compensation purposes. Willdan also believes Adjusted EBITDA
is useful to investors, research analysts, investment bankers and
lenders because it removes from its operational results the impact of
certain unusual or infrequent income and expense items, which may
facilitate comparison of its results from period to period.
Adjusted EBITDA is not a recognized term under GAAP and does not purport
to be an alternative to income from operations or net income as an
indicator of operating performance or any other GAAP measure.
Adjusted EBITDA decreased $0.6 million to $10,000 for the three months
ended April 1, 2011 from $0.6 million for the comparable period last
year.
The following is a reconciliation of net (loss) income to Adjusted
EBITDA:
Three Months Ended
April 1,
April 2,
In thousands
2011
2010
Net (loss) income
$
(291
)
$
392
Interest income
(2
)
(5
)
Interest expense
18
8
Gain on sale of assets
(2
)
(6
)
Depreciation and amortization
274
271
Lease abandonment (recapture)
13
(11
)
Adjusted EBITDA
$
10
$
649
Liquidity and Capital Resources
Willdan had $7.2 million in cash and cash equivalents at April 1, 2011,
compared with $6.6 million at December 31, 2010. Willdan has a $5.0
million bank revolving line of credit, with $1.2 million in outstanding
borrowings at the quarter's end.
Conference Call and Webcast
Chief Executive Officer Thomas Brisbin and Chief Financial Officer
Kimberly Gant plan to host a conference call on May 12, 2011 at 5:00
p.m. Eastern/2:00 p.m. Pacific, to further discuss the Company's
financial results.
Interested parties may participate in the conference call by dialing
800-762-8779 (480-629-9771 for international callers). When prompted,
ask for the "Willdan Group, Inc., First Quarter 2011 Conference Call."
The conference call will be webcast simultaneously on Willdan's website
at www.willdan.com
under Investors: Events.
The telephonic replay of the conference call may be accessed
approximately two hours after the call through May 26, 2011, by dialing
800-406-7325 (303-590-3030 for international callers). The replay access
code is 4437628. The webcast replay will be archived for 12 months.
About Willdan Group, Inc.
Founded over 45 years ago, Willdan is a provider of professional
technical and consulting services to small and mid-sized public
agencies, large public utilities and, to a lesser extent, private
industry primarily located in California, New York and Arizona. Willdan
provides a broad range of services to clients, including civil
engineering and planning, energy efficiency and sustainability, economic
and financial consulting, and homeland security and communications and
technology. For additional information, visit Willdan's website at www.willdan.com.
Forward-Looking Statements
Safe Harbor Statement: Statements in this press release which are not
purely historical, including statements regarding Willdan's intentions,
hopes, beliefs, expectations, representations, projections, estimates,
plans or predictions of the future are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The
forward-looking statements involve risks and uncertainties including,
but not limited to, the risk that Willdan will not be able to expand its
services or meet the needs of customers in markets in which it operates.
It is important to note that Willdan's actual results could differ
materially from those in any such forward-looking statements. Factors
that could cause actual results to differ materially include, but are
not limited to, a slowdown in the local and regional economies of the
states where Willdan conducts business and the loss of or inability to
hire additional qualified professionals. Willdan's business could be
affected by a number of other factors, including the risk factors listed
from time to time in Willdan's SEC reports including, but not limited
to, the Form 10-K annual report for the year ended December 31, 2010
filed on March 29, 2011. Willdan cautions investors not to place undue
reliance on the forward-looking statements contained in this press
release. Willdan disclaims any obligation to, and does not undertake to,
update or revise any forward-looking statements in this press release.
WILLDAN GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
April 1,
December 31,
2011
2010
(unaudited)
Assets
Current assets:
Cash and cash equivalents
$
7,185,000
$
6,642,000
Accounts receivable, net of allowance for doubtful accounts of
$685,000 and $959,000 at April 1, 2011 and December 31, 2010,
respectively
13,745,000
14,484,000
Costs and estimated earnings in excess of billings on uncompleted
contracts
11,973,000
11,343,000
Other receivables
110,000
176,000
Prepaid expenses and other current assets
1,538,000
1,714,000
Total current assets
34,551,000
34,359,000
Equipment and leasehold improvements, net
1,540,000
1,496,000
Goodwill
12,475,000
12,475,000
Other intangible assets, net
82,000
95,000
Other assets
397,000
407,000
Deferred income taxes, net of current portion
622,000
622,000
Total assets
$
49,667,000
$
49,454,000
Liabilities and Stockholders' Equity
Current liabilities:
Excess of outstanding checks over bank balance
$
1,106,000
$
1,223,000
Borrowings under line of credit
1,208,000
1,000,000
Accounts payable
4,630,000
5,380,000
Accrued liabilities
6,224,000
5,985,000
Billings in excess of costs and estimated earnings on uncompleted
contracts
1,846,000
1,041,000
Current portion of notes payable
79,000
90,000
Current portion of capital lease obligations
193,000
173,000
Current portion of deferred income taxes
1,407,000
1,407,000
Total current liabilities
16,693,000
16,299,000
Notes payable, less current portion
130,000
131,000
Capital lease obligations, less current portion
131,000
96,000
Deferred lease obligations
746,000
766,000
Total liabilities
17,700,000
17,292,000
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, 10,000,000 shares authorized, no
shares issued and outstanding
--
--
Common stock, $0.01 par value, 40,000,000 shares authorized:
7,257,000 and 7,246,000 shares issued and outstanding at April 1,
2011 and December 31, 2010, respectively
72,000
72,000
Additional paid-in capital
33,861,000
33,765,000
Accumulated deficit
(1,966,000
)
(1,675,000
)
Total stockholders' equity
31,967,000
32,162,000
Total liabilities and stockholders' equity
$
49,667,000
$
49,454,000
WILLDAN GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
April 1,
April 2,
2011
2010
Contract revenue
$
22,742,000
$
16,951,000
Direct costs of contract revenue:
Salaries and wages
6,371,000
5,014,000
Subconsultant services
7,226,000
1,937,000
Other direct costs, net
(34,000
)
1,342,000
Total direct costs of contract revenue
13,563,000
8,293,000
Gross profit
9,179,000
8,658,000
General and administrative expenses:
Salaries and wages, payroll taxes and employee benefits
5,561,000
4,442,000
Facilities and facilities related
1,078,000
1,094,000
Stock-based compensation
54,000
80,000
Depreciation and amortization
257,000
271,000
Other
2,509,000
2,386,000
Total general and administrative expenses
9,459,000
8,273,000
(Loss) income from operations
(280,000
)
385,000
Other (expense) income, net:
Interest income
2,000
5,000
Interest expense
(18,000
)
(8,000
)
Other, net
5,000
10,000
Total other (expense) income, net
(11,000
)
7,000
(Loss) income before income taxes
(291,000
)
392,000
Income tax expense (benefit)
--
--
Net (loss) income
$
(291,000
)
$
392,000
(Loss) earnings per share:
Basic and diluted
$
(0.04
)
$
0.05
Weighted-average shares outstanding:
Basic
7,251,000
7,223,000
Diluted
7,251,000
7,230,000
WILLDAN GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
April 1,
April 2,
2011
2010
Cash flows from operating activities:
Net (loss) income
$
(291,000
)
$
392,000
Adjustments to reconcile net (loss) income to net cash provided by
(used in) operating activities:
Depreciation and amortization
274,000
271,000
Lease abandonment expense (recovery), net
13,000
(11,000
)
Gain on sale of equipment
(2,000
)
(6,000
)
Provision for doubtful accounts
10,000
39,000
Stock-based compensation
54,000
80,000
Changes in operating assets and liabilities:
Accounts receivable
729,000
1,442,000
Costs and estimated earnings in excess of billings on uncompleted
contracts
(630,000
)
(3,793,000
)
Other receivables
66,000
24,000
Prepaid expenses and other current assets
176,000
(407,000
)
Other assets
10,000
(17,000
)
Accounts payable
(750,000
)
(517,000
)
Accrued liabilities
239,000
1,387,000
Billings in excess of costs and estimated earnings on uncompleted
contracts
805,000
(145,000
)
Deferred lease obligations
(33,000
)
(83,000
)
Net cash provided by (used in) operating activities
670,000
(1,344,000
)
Cash flows from investing activities:
Purchase of equipment and leasehold improvements
(201,000
)
(140,000
)
Proceeds from sale of equipment
1,000
8,000
Net cash used in investing activities
(200,000
)
(132,000
)
Cash flows from financing activities:
Changes in excess of outstanding checks over bank balance
(117,000
)
328,000
Payments on notes payable
(35,000
)
(15,000
)
Proceeds from notes payable
23,000
--
Borrowings under line of credit
7,237,000
1,943,000
Repayments on line of credit
(7,029,000
)
(1,943,000
)
Principal payments on capital lease obligations
(48,000
)
(37,000
)
Proceeds from sales of common stock under employee stock purchase
plan
42,000
47,000
Net cash provided by financing activities
73,000
323,000
Net increase (decrease) in cash and cash equivalents
543,000
(1,153,000
)
Cash and cash equivalents at beginning of the period
6,642,000
8,445,000
Cash and cash equivalents at end of the period
$
7,185,000
$
7,292,000
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest
$
23,000
$
10,000
Income taxes
--
2,000
Supplemental disclosures of noncash investing and financing
activities:
Equipment acquired under capital lease obligations
$
103,000
$
38,000
Willdan Group, Inc. Kimberly Gant Chief Financial Officer Tel:
714-940-6300 kgant@willdan.com or Financial
Profiles, Inc. Moira Conlon Tel: 310-478-2700 x11 mconlon@finprofiles.com
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