Attached files
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| EX-99.1 - TRANSCRIPT OF CONFERENCE CALL - WIDEPOINT CORP | wyy_ex991.htm |
| 8-K - CURRENT REPORT - WIDEPOINT CORP | wyy_8k.htm |
Exhibit 99.2
WidePoint Reports Third Quarter
2018 Financial Results
Revenue up 15%, Fifth Consecutive Quarter of Positive Adjusted
EBITDA
McLean, VA – November 14, 2018 – WidePoint
Corporation (NYSE
American: WYY),
the leading provider of Trusted Mobility Management (TM2)
specializing in Telecommunications Lifecycle Management, Identity
Management and Bill Presentment & Analytics solutions, today
reported results for the third quarter and nine months ended
September 30, 2018.
Third Quarter 2018 Operational Highlights: $33.9M in contract
actions:
●
Secured
approximately $5.4 million in new contract awards, $2.8 million in
expanded services with existing customers and $10.5 million in
option year follow-on contracts with existing
customers
●
Secured new $12.0
million task order from the U.S. Coast Guard under the U.S.
Department of Homeland Security (DHS) Cellular Wireless Management
Services (CWMS) Blanket Purchase Agreement, of which up to 6% to 7%
of the total task order consists of high margin managed
services
●
Awarded $1.67
million, five-year contract for mobile communications management
services by the Centers for Disease Control and Prevention, of
which the majority consists of high margin managed
services
●
Awarded new,
one-year Blanket Purchase Agreement (BPA) task order by DHS
Headquarters valued at $1.5 million, of which up to one-third of
the task order consists of high margin managed
services
Third Quarter 2018
Financial Highlights (results compared to the same
year-ago period):
●
Revenue increased
15% to $21.3 million
●
Gross profit
increased 9% to $3.7 million
●
Net loss narrowed
to $0.1 million
●
Adjusted EBITDA, a
non-GAAP financial measure, increased to $561,000, marking the
company’s fifth consecutive quarter of positive adjusted
EBITDA
Nine Month 2018 Financial Highlights (results compared to the same
year-ago period):
●
Revenue increased
5% to $58.9 million
●
Gross profit
increased 7% to $10.8 million
●
Net loss narrowed
to $1.0 million
●
Adjusted EBITDA
totaled $768,400
Third Quarter 2018 Financial Summary
|
(in millions, except per share amounts)
|
September 30, 2018
|
September 30, 2017
|
|
Revenues
|
$21.29
|
$18.46
|
|
Gross Profit
|
$3.69
|
$3.38
|
|
Gross Profit Margin
|
17.3%
|
18.3%
|
|
Operating Expenses
|
$3.75
|
$3.66
|
|
Loss from Operations
|
$(0.06)
|
$(0.28)
|
|
Net Loss
|
$(0.11)
|
$(0.31)
|
|
Basic and Diluted Earnings per Share (EPS)
|
$(0.00)
|
$(0.00)
|
|
Adjusted EBITDA
|
$0.55
|
$0.03
|
|
Cash and Cash Equivalents
|
$3.95
|
$5.27
|
Fiscal Nine Months 2018 Financial Summary
|
(in millions, except per share amounts)
|
September 30, 2018
|
September 30, 2017
|
|
Revenues
|
$58.92
|
$55.96
|
|
Gross Profit
|
$10.78
|
$10.10
|
|
Gross Profit Margin
|
18.3%
|
18.0%
|
|
Operating Expenses
|
$11.72
|
$12.81
|
|
Loss from Operations
|
$(0.93)
|
$(2.71)
|
|
Net Loss
|
$(1.04)
|
$(2.77)
|
|
Basic and Diluted Earnings per Share (EPS)
|
$(0.01)
|
$(0.03)
|
|
Adjusted EBITDA
|
$0.77
|
$(1.10)
|
Financial Outlook
For the
fiscal year ending December 31, 2018, the company anticipates total
revenue in the range of $82.0 million to $83.0 million,
representing growth of roughly 9% year-over-year, and EBITDA of
$1.6 million as compared to $900,000 in the prior
year.
The
company’s financial outlook statements are based on current
expectations. The following statements are forward-looking, and
actual results could differ materially depending on market
conditions and the factors set forth under the “Safe Harbor
Statement” below.
Management Commentary
“The
third quarter was another strong period for WidePoint. We now have
five straight quarters of positive adjusted EBITDA and we are
continuing to build momentum toward achieving GAAP
profitability,” said company President and CEO, Jin Kang.
“Our performance in Q3 was highlighted by solid topline
growth as we successfully expanded relationships with key Federal
and enterprise customers. In addition to our strong topline
results, we also delivered another sequential improvement in
adjusted EBITDA.
“From
a business development standpoint, we continue to execute on our
strategy to maintain our customer, upsell and pursue new business.
This is evidenced by the substantial orders and large contracts we
have recently secured, including the $12 million follow-on order
from the U.S. Coast Guard as well as the $20 million in aggregate
of new contract orders from various government agencies. These
awards highlight WidePoint’s position as the premier provider
of Trusted Mobility Management services solutions to the public and
private sectors. Looking ahead, our building momentum in the new
Federal fiscal year underscores a robust pipeline of significant
opportunities.”
Conference Call
WidePoint
management will hold a conference call today (November 14, 2018) at
4:30 p.m. Eastern time (1:30 p.m. local time) to discuss these
results.
WidePoint
President and CEO Jin Kang, Chief Sales and Marketing Officer Jason
Holloway, and CFO Kito Mussa will host the conference call,
followed by a question and answer period.
U.S.
dial-in number: 877-451-6152
International
number: 201-389-0879
Please
call the conference telephone number 5-10 minutes prior to the
start time. An operator will register your name and organization.
If you have any difficulty connecting with the conference call,
please contact Liolios at 949-574-3860.
The conference call will be broadcast live and available for
replay here
and via the investor relations section
of the company’s website.
A
replay of the conference call will be available after 7:30 p.m.
Eastern time on the same day through November 28,
2018.
Toll-free
replay number: 844-512-2921
International
replay number: 412-317-6671
Replay
ID: 13684462
About WidePoint
WidePoint
Corporation (NYSE American: WYY) is a leading provider of
technology-based management solutions, including telecom
management, mobile management, access management and identity
management. For more information, visit widepoint.com.
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.
|
|
THREE
MONTHS ENDED
|
NINE
MONTHS ENDED
|
||
|
|
SEPTEMBER 30,
|
SEPTEMBER 30,
|
||
|
|
2018
|
2017
|
2018
|
2017
|
|
|
(Unaudited)
|
|||
|
NET
LOSS
|
$(110,000)
|
$(314,600)
|
$(1,044,400)
|
$(2,769,000)
|
|
Adjustments
to reconcile net loss to adjusted EBITDA:
|
|
|
|
|
|
Depreciation
and amortization
|
353,100
|
388,400
|
1,114,900
|
1,108,000
|
|
Amortization
of deferred financing costs
|
-
|
-
|
-
|
|
|
Income
tax provision (benefit)
|
24,800
|
17,200
|
45,700
|
32,700
|
|
Interest
income
|
(900)
|
(2,000)
|
(6,300)
|
(11,600)
|
|
Interest
expense
|
21,600
|
23,500
|
71,500
|
45,900
|
|
Other
(expense) income
|
-
|
1,500
|
-
|
(1,800)
|
|
Provision
for doubtful accounts
|
(300)
|
-
|
(6,100)
|
31,200
|
|
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
|
272,800
|
(81,400)
|
593,100
|
138,000
|
|
Adjusted
EBITDA
|
$561,100
|
$32,600
|
$768,400
|
$(1,133,300)
|
Safe Harbor Statement
The information contained in any materials that may be accessed
above was, to the best of WidePoint Corporations’ knowledge,
timely and accurate as of the date and/or dates indicated in such
materials. However, the passage of time can render information
stale, and you should not rely on the continued accuracy of any
such materials. WidePoint Corporation has no responsibility to
update any information contained in any such materials. In
addition, you should refer to periodic reports filed by WidePoint
Corporation with the Securities and Exchange Commission for
information regarding the risks and uncertainties to which
forward-looking statements made in such materials are subject. Such
risks and uncertainties may cause WidePoint Corporation’s
actual results to differ materially from those described in the
forward-looking statements.
Investor Relations:
Liolios
Matt
Glover or Tom Colton
949-574-3860
WYY@liolios.com
WIDEPOINT CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
SEPTEMBER 30,
|
DECEMBER
31,
|
|
|
2018
|
2017
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
CURRENT
ASSETS
|
|
|
|
Cash
and cash equivalents
|
$3,950,106
|
$5,272,457
|
|
Accounts
receivable, net of allowance for doubtful accounts
|
|
|
|
of
$96,846 and $107,618 in 2018 and 2017, respectively
|
8,022,377
|
8,131,025
|
|
Unbilled
accounts receivable
|
7,803,572
|
8,131,448
|
|
Other
current assets
|
963,649
|
767,944
|
|
|
|
|
|
Total
current assets
|
20,739,704
|
22,302,874
|
|
|
|
|
|
NONCURRENT
ASSETS
|
|
|
|
Property
and equipment, net
|
1,058,786
|
1,318,420
|
|
Intangibles,
net
|
3,284,626
|
3,671,506
|
|
Goodwill
|
18,555,578
|
18,555,578
|
|
Other
long-term assets
|
145,477
|
44,553
|
|
|
|
|
|
Total
assets
|
$43,784,171
|
$45,892,931
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
Accounts
payable
|
$6,080,686
|
$7,266,212
|
|
Accrued
expenses
|
9,064,369
|
9,796,350
|
|
Deferred
revenue
|
2,689,038
|
2,348,578
|
|
Current
portion of capital leases
|
105,712
|
101,591
|
|
Current
portion of other term obligations
|
107,109
|
203,271
|
|
|
|
|
|
Total
current liabilities
|
18,046,914
|
19,716,002
|
|
|
|
|
|
NONCURRENT
LIABILITIES
|
|
|
|
Capital
leases, net of current portion
|
151,037
|
232,109
|
|
Other
term obligations, net of current portion
|
64,006
|
78,336
|
|
Deferred
revenue
|
410,310
|
264,189
|
|
Deferred
tax liability
|
393,975
|
392,229
|
|
|
|
|
|
Total
liabilities
|
19,066,242
|
20,682,865
|
|
|
|
|
|
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; 84,062,446 and 83,031,595 shares
|
|
|
|
issued;
83,762,446 and 83,031,595 shares
|
|
|
|
outstanding,
respectively
|
83,763
|
83,032
|
|
Additional
paid-in capital
|
94,814,580
|
94,200,237
|
|
Accumulated
other comprehensive loss
|
(185,317)
|
(122,461)
|
|
Accumulated
deficit
|
(69,995,097)
|
(68,950,742)
|
|
|
|
|
|
Total
stockholders’ equity
|
24,717,929
|
25,210,066
|
|
|
|
|
|
Total
liabilities and stockholders’ equity
|
$43,784,171
|
$45,892,931
|
WIDEPOINT CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
THREE MONTHS
ENDED
|
NINE MONTHS
ENDED
|
||
|
|
SEPTEMBER
30,
|
SEPTEMBER
30,
|
||
|
|
2018
|
2017
|
2018
|
2017
|
|
|
(Unaudited)
|
|||
|
REVENUES
|
$21,294,360
|
$18,463,872
|
$58,918,317
|
$55,956,617
|
|
COST
OF REVENUES (including amortization and depreciation
|
|
|
|
|
|
of
$248,009, $318,461, $802,174, and $895,088,
respectively)
|
17,609,287
|
15,087,567
|
48,134,084
|
45,859,532
|
|
GROSS
PROFIT
|
3,685,073
|
3,376,305
|
10,784,233
|
10,097,085
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
Sales
and marketing
|
387,407
|
532,714
|
1,366,989
|
1,709,892
|
|
General
and administrative expenses (including share-based
|
|
|
|
|
|
compensation
of $272,737, ($81,043), $593,075 and
|
|
|
|
|
|
$138,036,
respectively)
|
3,257,262
|
3,046,148
|
10,037,904
|
10,668,368
|
|
Product
development
|
-
|
11,342
|
-
|
219,141
|
|
Depreciation
and amortization
|
104,914
|
69,935
|
312,763
|
212,874
|
|
Total
operating expenses
|
3,749,583
|
3,660,139
|
11,717,656
|
12,810,275
|
|
|
|
|
|
|
|
LOSS
FROM OPERATIONS
|
(64,510)
|
(283,834)
|
(933,423)
|
(2,713,190)
|
|
|
|
|
|
|
|
OTHER
(EXPENSE) INCOME
|
|
|
|
|
|
Interest
income
|
936
|
1,971
|
6,339
|
11,564
|
|
Interest
expense
|
(21,644)
|
(13,985)
|
(71,531)
|
(36,402)
|
|
Other
income (expense)
|
2
|
(1,541)
|
3
|
1,758
|
|
Total
other expense
|
(20,706)
|
(13,555)
|
(65,189)
|
(23,080)
|
|
|
|
|
|
|
|
LOSS
BEFORE INCOME TAX PROVISION
|
(85,216)
|
(297,389)
|
(998,612)
|
(2,736,270)
|
|
INCOME
TAX PROVISION
|
24,795
|
17,212
|
45,743
|
32,723
|
|
|
|
|
|
|
|
NET
LOSS
|
$(110,011)
|
$(314,601)
|
$(1,044,355)
|
$(2,768,993)
|
|
|
|
|
|
|
|
BASIC
LOSS PER SHARE
|
$(0.00)
|
$(0.00)
|
$(0.01)
|
$(0.03)
|
|
|
|
|
|
|
|
BASIC
WEIGHTED-AVERAGE SHARES OUTSTANDING
|
83,177,804
|
82,946,847
|
83,100,832
|
82,878,287
|
|
|
|
|
|
|
|
DILUTED
LOSS PER SHARE
|
$(0.00)
|
$(0.00)
|
$(0.01)
|
$(0.03)
|
|
|
|
|
|
|
|
DILUTED
WEIGHTED-AVERAGE SHARES OUTSTANDING
|
83,177,804
|
82,946,847
|
83,100,832
|
82,878,287
|