FTE NETWORKS REPORTS FIRST QUARTER REVENUE OF $5.1MM WITH THIRD
CONSECUTIVE QUARTER OF GROWTH IN OPERATING INCOME
143% Increase in Revenue for the Period Ending March 31, 2017
compared to March 31, 2016
NAPLES, Fla. (May 25, 2017 -- InvestorsHub NewsWire) FTE
Networks, Inc. (OTCQX: FTNW) (FTE or the Company), a leading
network infrastructure solutions provider in the technology and
communications industries, today announced its financial results
for the three months ended March 31, 2017, and provided an update
on its recent acquisition of Benchmark Builders, Inc. (Benchmark).
The Companys results do not include Benchmark, as the acquisition
closed after the quarter ended.
March 31, 2017, Financial Highlights
- Telecom revenue of $5.1MM versus $2.1MM for same period 2016, a
143% increase
- Telecom segment gross profit of $2.4MM versus $780,000 for same
period 2016, a 207% increase
- Gross margin increase of 100 basis points to 47% versus 37% for
the period ending March 31, 2016
Recent Business Highlights
- Launched transformative Edge Computing Technology, considered a
4th utility for industry segments such as commercial real estate
developers and owners
- Closed 100% acquisition of Benchmark on April 20, 2017
- Benchmark Quality of Earnings from top registered account firm
reported:
- Revenue of $389MM for full-year 2016;
- $40.4MM proforma adjusted EBITDA with an adjusted EBITDA margin
of 10.4% for full-year 2016
- The acquisition has immediately created a combined $261MM
project backlog for FTE and Benchmark for 2017, as of April 20,
2017
- Implemented key hires to deliver on execution of aggressive
growth plan and realize synergies between FTE and Benchmark,
initially in the technology and real estate sectors
- Continuing efforts to list on major stock exchange
First Quarter 2017 Financial Results
For the three months ended March 31, 2017, total revenues were
$5.1MM compared to $2.1MM in the same period of 2016, a 143%
increase. Company management continued to strategically expand its
telecom revenue and Inside Plant segment, contributing to a gross
margin increase of 10% over the same period in 2016. Further, the
Company continues to expand its footprint and services to Fortune
100/500 clients. A net loss of $3.9MM, compared to the prior year
three months $1.11MM loss, was largely the result of the noncash
warrant valuation adjustment and one time M&A costs. The
Company expects to release audited consolidated 2016 financial
results for the combined Benchmark and FTE entities on or about the
end of June 2017.
Benchmark Builders Transaction
FTE completed the acquisition of privately held Benchmark, a
leading provider of construction management services based in New
York, for $75MM on April 20, 2017. Benchmark has an Unaudited
Independent Valuation of Quality of Earnings from a top independent
registered accounting firm, which verifies 2016 revenues of $389MM,
$40.4MM pro forma adjusted EBITDA and an EBITDA margin of 10.4% for
2016. As of April 20, 2017, FTE and Benchmark had a combined
nine-month backlog of $261MM. The Company expects this backlog to
increase significantly as it progresses on its growth strategy. The
completion of the transaction and the strength of the combined
entity provides for an immediate platform to uplist to a major
stock exchange.
FTE and Benchmark continue to integrate accretive synergies and
support the expansion of their service offerings nationally.
Benchmark, a wholly owned subsidiary of FTE, is offering FTEs
transformational compute to the edge technology to the commercial
property developers and owners in New York City and the surrounding
region. Further, the transaction enables FTE to expand
infrastructure services for Inside Plant (ISP) through the current
and future Benchmark client base. Benchmark gives FTE access to
major developers including the real estate investment trusts
(REITs) as potential CrossLayer technology clients. Additionally,
the transaction strengthens the opportunity to win contracts from
Fortune 100/500 companies and enables Benchmark to access more
clients as a public company. Benchmark will operate as a wholly
owned subsidiary, without disruption to customers or stakeholders,
enabling FTE to leverage the expertise of the Benchmark team and
expand its footprint in New York City.
We continue to build on our industry-leading position with our
partnership with Benchmark, a growing pipeline, and several
upcoming contracts expected to close over the quarter, said Michael
Palleschi, chairman and CEO of FTE. The first quarter of 2017 is
now the third consecutive quarter in which we have reported
positive operating income. We are pleased with our progress and
expect this momentum to continue throughout 2017 and beyond, as we
continue to control expenses and improve margins, Mr. Palleschi
added.
About FTE Networks, Inc.
FTE Networks, Inc., and its subsidiaries provide end-to-end
design, build, and support solutions for state-of-the-art network
and commercial properties, creating the most advanced and
transformative smart platforms and buildings. Working with some of
the worlds leading Fortune 100/500 corporations and communications
service providers, FTEs businesses are predicated on smart design
and consistent standards that reduce deployment costs and
accelerate delivery of innovative projects and services. FTE
Networks and its subsidiaries operate 8 Lines of Business,
including Data Center Infrastructure, Fiber Optics, Wireless
Integration, Network Engineering, Internet Service Provider,
Construction Management, General Contracting, and Pre-Construction
Services. With approximately 200+ employees, FTE and its entities
have operations in 17 states. For more information, please visit
www.ftenet.com.
Forward-Looking Statements
This release may contain forward-looking statements within the
meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Statements other than
historical facts are forward-looking statements, which can be
identified by the use of words such as: believes, expects,
opportunity, strategy, upcoming, intend, plan and similar
expressions and/or references to future periods. Examples of
forward-looking statements include, among others, Implemented key
hires to deliver on execution of aggressive growth plan; The
Company expects to release audited consolidated 2016 financial
results for the combined Benchmark and FTE entities on or about the
end of June 2017; The Company expects this backlog to increase
significantly as it progresses on its growth strategy; The
completion of the transaction and the strength of the combined
entity provides for an immediate platform to uplist to a major
stock exchange; Additionally, the transaction strengthens the
opportunity to win contracts from Fortune 100/500 companies and
enables Benchmark to access more clients as a public company; We
continue to build on our industry-leading position with our
partnership with Benchmark, a growing pipeline, and several
upcoming contracts expected to close over the quarter; and We are
pleased with our progress and expect this momentum to continue
throughout 2017 and beyond, as we continue to control expenses and
improve margins.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
FTEs current expectations, beliefs and assumptions regarding future
developments and their potential effects on FTE. These statements
involve risks and uncertainties that may cause actual results to
differ materially from those anticipated, believed, estimated, or
expected. These risks and uncertainties are described in detail in
our filings with the Securities and Exchange Commission.
Furthermore, there is no assurance that future developments
affecting FTE will be those anticipated by FTE. FTE undertakes no
obligation to publicly update or revise any forward-looking
statements, whether written or oral, that may be made from
time-to-time, whether as a result of new information, future
events, or otherwise, except as required under applicable
securities laws.
Media and Investor Relations:
FTE Networks, Inc.
999 Vanderbilt Beach Rd., Suite 601
Naples, FL 23108
(877) 850-4308
ir@ftenet.com
OTCQX:FTNW