Attached files
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| 8-K - FORM 8-K - Energy Services of America CORP | tm217165d1_8k.htm |
Exhibit 99.1
Energy Services of America Announces Financial Results for the Quarter Ended December 31, 2020
Huntington, WV February 16, 2021- Energy Services of America Corporation (the “Company” or “Energy Services”) (OTC QB: ESOA) announced fiscal first quarter financial results for the quarter ended December 31, 2020. Energy Services earned revenues of $32.0 million with a net loss available to common shareholders of ($725,000) for the first quarter and generated adjusted EBITDA of $331,000 during the period.
On December 31, 2020, Energy Services completed the acquisition of West Virginia Pipeline, Inc. The acquisition is reflected in the Company’s first quarter financial statements, but it did not have a significant impact on the Company’s operating results for the period. The Company’s $60.7 million backlog at December 31, 2020 includes $5.5 million as a result of the acquisition.
Douglas Reynolds, President, commented on the announcement. “We are excited to welcome West Virginia Pipeline to Energy Services and view the acquisition an important step in our strategy of increasing our exposure in the water and natural gas distribution markets.” Reynolds continued, “At the same time, we are investing in the people and equipment needed to expand our existing business and we hope that the benefits of all these investments are clearer during the second half of fiscal year 2021.”
Below is a comparison of the Company’s unaudited operating results for the three months ended December 31, 2020 and 2019:
| Three Months Ended | Three Months Ended | |||||||
| December 31, | December 31, | |||||||
| 2020 | 2019 | |||||||
| (Unaudited) | ||||||||
| Revenue | $ | 32,009,796 | $ | 25,843,307 | ||||
| Cost of revenues | 29,166,737 | 23,486,565 | ||||||
| Gross profit | 2,843,059 | 2,356,742 | ||||||
| Selling and administrative expenses | 3,595,830 | 2,595,772 | ||||||
| Loss income from operations | (752,771 | ) | (239,030 | ) | ||||
| Other income (expense) | ||||||||
| Interest income | 151,765 | 53,249 | ||||||
| Other nonoperating expense | (52,623 | ) | (33,938 | ) | ||||
| Interest expense | (76,517 | ) | (186,845 | ) | ||||
| Gain on sale of equipment | 13,042 | 295,991 | ||||||
| 35,667 | 128,457 | |||||||
| Loss income before income taxes | (717,104 | ) | (110,573 | ) | ||||
| Income tax benefit | (69,442 | ) | (36,459 | ) | ||||
| Net loss | (647,662 | ) | (74,114 | ) | ||||
| Dividends on preferred stock | 77,250 | 77,250 | ||||||
| Net loss available to common shareholders | $ | (724,912 | ) | $ | (151,364 | ) | ||
| Weighted average shares outstanding-basic | 13,621,406 | 13,911,610 | ||||||
| Weighted average shares-diluted | 13,621,406 | 13,911,610 | ||||||
| Loss earnings per share available to common shareholders | $ | (0.053 | ) | $ | (0.011 | ) | ||
| Loss earnings per share-diluted available to common shareholders | $ | (0.053 | ) | $ | (0.011 | ) | ||
Below is a comparison of the Company’s Consolidated Balance Sheets for December 31, 2020 and September 30, 2020. Please see the Company’s Form 10-Q for December 31, 2020 for a more detailed comparison:
| December 31, | September 30, | |||||||
| Assets | 2020 | 2020 | ||||||
| (Unaudited) | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 12,345,745 | $ | 11,216,820 | ||||
| Accounts receivable-trade | 17,096,770 | 18,246,989 | ||||||
| Allowance for doubtful accounts | (70,310 | ) | (70,310 | ) | ||||
| Retainages receivable | 1,658,513 | 2,483,809 | ||||||
| Other receivables | 6,677 | 9,458 | ||||||
| Contract assets | 4,418,599 | 6,545,863 | ||||||
| Prepaid expenses and other | 2,763,189 | 3,338,943 | ||||||
| Total current assets | 38,219,183 | 41,771,572 | ||||||
| Property, plant and equipment, at cost | 56,679,946 | 53,324,843 | ||||||
| less accumulated depreciation | (37,706,313 | ) | (36,933,129 | ) | ||||
| Total fixed assets | 18,973,633 | 16,391,714 | ||||||
| Acquired intangible assets, net | 300,000 | - | ||||||
| Goodwill | 4,220,829 | - | ||||||
| Total assets | $ | 61,713,645 | $ | 58,163,286 | ||||
| Liabilities and shareholders' equity | ||||||||
| Current liabilities | ||||||||
| Current maturities of long-term debt | $ | 4,645,254 | $ | 4,028,900 | ||||
| Lines of credit and short term borrowings | 3,500,000 | 509,843 | ||||||
| Accounts payable | 5,783,559 | 5,222,222 | ||||||
| Accrued expenses and other current liabilities | 3,255,740 | 4,237,172 | ||||||
| Contract liabilities | 3,721,385 | 4,851,900 | ||||||
| Total current liabilities | 20,905,938 | 18,850,037 | ||||||
| Long-term debt, less current maturities | 13,496,506 | 11,233,705 | ||||||
| Deferred income taxes payable | 2,212,084 | 2,255,515 | ||||||
| Total liabilities | 36,614,528 | 32,339,257 | ||||||
| Shareholders' equity | ||||||||
| Preferred stock, $.0001 par value | ||||||||
| Authorized 1,000,000 shares, 206 issued at December 31, 2020 and September 30, 2020 | - | - | ||||||
| Common stock, $.0001 par value | ||||||||
| Authorized 50,000,000 shares 14,839,836 issued and 13,621,406 outstanding at December 31, 2020 and September 30, 2020 | 1,484 | 1,484 | ||||||
| Treasury stock, 1,218,430 shares at December 31, 2020 and September 30, 2020 | (122 | ) | (122 | ) | ||||
| Additional paid in capital | 60,670,699 | 60,670,699 | ||||||
| Retained deficit | (35,572,944 | ) | (34,848,032 | ) | ||||
| Total shareholders' equity | 25,099,117 | 25,824,029 | ||||||
| Total liabilities and shareholders' equity | $ | 61,713,645 | $ | 58,163,286 | ||||
Please refer to the table below that reconciles adjusted EBITDA with net loss available to common shareholders:
| Three Months Ended | Three Months Ended | |||||||
| December 31, 2020 | December 31, 2019 | |||||||
| Unaudited | Unaudited | |||||||
| Net loss income available to common shareholders | $ | (724,912 | ) | $ | (151,364 | ) | ||
| Add: Income benefit expense | (69,442 | ) | (36,459 | ) | ||||
| Add: Dividends on preferred stock | 77,250 | 77,250 | ||||||
| Add: Interest expense | 76,517 | 186,845 | ||||||
| Less: Non-operating income | (112,184 | ) | (315,302 | ) | ||||
| Add: Depreciation expense | 1,083,853 | 1,095,282 | ||||||
| Adjusted EBITDA | $ | 331,082 | $ | 856,252 | ||||
Certain statements contained in the release, including without limitation statements including the words "believes," "anticipates," "intends," "expects" or words of similar import, constitute "forward-looking statements" within the meaning of section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements of the Company expressed or implied by such forward-looking statements. Such factors include, among others, general economic and business conditions, changes in business strategy or development plans and other factors referenced in this release. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
Source: Energy Services of America Corporation
Contact: Douglas Reynolds, President
(304)-522-3868