MCLEAN, Va., Aug. 14, 2017 /PRNewswire/ -- WidePoint
Corporation (NYSE Mkt: WYY), a leading provider of Managed Mobility
Services (MMS) specializing in Cybersecurity and Telecommunications
Lifecycle Management (TLM) solutions, today announced financial
results for the second quarter ended June
30, 2017.
Recent Highlights
- Appointed Jin Kang as new CEO
and President of WidePoint Corporation on July 1st, 2017
- Implemented major costs reductions during July, adding to
reductions taken in the second quarter of 2017, to improve
operational profitability outlook for the second half of 2017,
stabilizing the financial condition of the business
- Extinguished all remaining long-term debt and established a new
$5 million dollar credit facility
with zero borrowings outstanding
- Launched Trusted Mobility Management offering, or TM2,
consolidating platforms, improving operational efficiency, and
creating a unique and improved value proposition for customers
- Reorganized credentialing operations and initiated several new
sales and marketing campaigns, including search engine
optimization, to improve revenue growth and financial
performance
- Added, re-negotiated, and eliminated several channel partners
as part of a repositioning of the Company's new TM2 value
proposition to the marketplace
- Secured several new contracts and successfully expanded
wallet-share with several current customers that provides
additional services
- Entered into standstill agreement with Nokomis Capital and
added two new independent directors
Second Quarter 2017 Financial Highlights
- Net revenue was approximately $18.9
million compared to $17.5
million in the second quarter of 2016
- Gross profit was approximately $3.3
million compared to $3.4
million in the second quarter of 2016
- Operating expenses were approximately $4.5 million compared to $4.2 million in the second quarter of 2016
- Operating loss was approximately $(1.3
million) compared to $(0.9
million) in the second quarter of 2016
- Net loss was approximately $(1.3
million), or $(0.02) per basic
and diluted share, compared to a loss of $(0.9 million), or $(0.01) per basic and diluted share
- Adjusted EBITDA loss was approximately $(0.4 million) compared to approximately
$(0.5 million) in the second quarter
of 2016.
Six Months 2017 Financial Highlights
- Net revenue was approximately $37.5
million compared to $38.0
million in the six months of 2016
- Gross profit was approximately $6.7
million compared to $7.6
million in the six months of 2016
- Operating expenses were approximately $9.2 million compared to $9.1 million in the six months of 2016
- Operating loss was approximately $(2.4
million) compared to $(1.5
million) in the six months of 2016
- Net loss was approximately $(2.5
million), or $(0.03) per basic
and diluted share, compared to a loss of $(1.6 million), or $(0.02) per basic and diluted share
- Adjusted EBITDA loss was approximately $(1.2 million) compared to approximately
$(0.6 million) in the six months of
2016
- Cash and cash equivalents was approximately $5.5 million as of June
30, 2017.
- Long-term debt was zero and a new credit facility for
$5.0 million was established with no
borrowings.
"In the second quarter of 2017 we refocused our efforts on
optimizing operations, reducing expenses, and growing our pipeline
of business," stated CEO and President Jin
Kang. "We also launched our TM2 vision with a new focus on
improving current, high margin, high probability revenue
opportunities while expanding overall cross utilization of
operational personnel to drive economies of scale and reduce
operational costs. We remain focused on improving our finance
performance and our return to profitability."
James McCubbin, WidePoint's Chief
Financial Officer, added, "The recent reductions in expenses should
create a leaner and more nimble organization, driving improved
financial performance in the second half of 2017. Coupling that
with the payoff of our remaining long-term debt and our new
untouched credit facility for up to $5
million provides us with the financial room to navigate our
way through and support our growth plans that we have recently put
into place."
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 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 Time, on
Tuesday, August 15, 2017. Anyone
interested in listening to our earnings call should call
1-888-724-9516 if calling within the
United States or 1-719-457-2627 if calling internationally.
There will be a playback available until August 29, 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 9187516 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=125768.
About WidePoint
WidePoint is a leading provider of secure, cloud-delivered,
enterprise-wide information technology-based solutions that can
enable enterprises and agencies to deploy fully compliant IT
services in accordance with government mandated regulations and
advanced system requirements. WidePoint has several major
government and commercial contracts. 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.
-tables follow-
WIDEPOINT
CORPORATION
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
JUNE
30,
|
|
DECEMBER
31,
|
|
2017
|
|
2016
|
|
(Unaudited)
|
ASSETS
|
CURRENT
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
5,472,363
|
|
$
9,123,498
|
Accounts receivable,
net of allowance for doubtful accounts
|
|
|
|
of $75,521 and
$344,411 in 2017 and 2016, respectively
|
8,648,612
|
|
5,153,093
|
Unbilled accounts
receivable
|
6,048,130
|
|
8,112,690
|
Inventories
|
142,587
|
|
123,287
|
Prepaid expenses and
other assets
|
587,091
|
|
385,388
|
Income taxes
receivable
|
-
|
|
42,896
|
|
|
|
|
Total current
assets
|
20,898,783
|
|
22,940,852
|
|
|
|
|
NONCURRENT
ASSETS
|
|
|
|
Land and building
held for sale
|
-
|
|
594,376
|
Property and
equipment, net
|
976,552
|
|
736,678
|
Intangibles,
net
|
3,988,662
|
|
4,298,902
|
Goodwill
|
18,555,578
|
|
18,555,578
|
Deposits and other
assets
|
93,911
|
|
52,456
|
|
|
|
|
TOTAL
ASSETS
|
$
44,513,486
|
|
$
47,178,842
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
Short term note
payable
|
$
34,975
|
|
$
131,761
|
Accounts
payable
|
7,066,408
|
|
8,665,449
|
Accrued
expenses
|
9,379,319
|
|
7,872,557
|
Deferred
revenue
|
1,261,880
|
|
1,190,558
|
Income taxes
payable
|
51,856
|
|
5,141
|
Current portion of
long-term debt
|
-
|
|
94,868
|
Current portion of
deferred rent
|
26,207
|
|
40,397
|
Current portion of
capital lease obligations
|
18,027
|
|
4,097
|
|
|
|
|
Total current
liabilities
|
17,838,672
|
|
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
|
61,119
|
|
-
|
Deferred rent, net of
current portion
|
100,380
|
|
86,198
|
Deferred
revenue
|
13,333
|
|
-
|
Deferred income
taxes
|
386,360
|
|
398,985
|
|
|
|
|
Total
liabilities
|
18,399,864
|
|
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
|
94,083,209
|
|
93,920,095
|
Accumulated other
comprehensive loss
|
(181,337)
|
|
(309,369)
|
Accumulated
deficit
|
(67,871,197)
|
|
(65,416,805)
|
|
|
|
|
Total stockholders'
equity
|
26,113,622
|
|
28,276,651
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$
44,513,486
|
|
$
47,178,842
|
WIDEPOINT
CORPORATION
|
CONSOLIDATED
STATEMENT OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
SIX MONTHS
ENDED
|
|
|
|
|
JUNE 30,
|
|
JUNE 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
(Unaudited)
|
REVENUES
|
$
18,880,506
|
|
$
17,539,666
|
|
$
37,492,745
|
|
$
38,048,306
|
COST OF REVENUES (including amortization and
depreciation of $294,803, $288,277, $576,627, and $580,635,
respectively)
|
15,589,330
|
|
14,179,119
|
|
30,771,965
|
|
30,482,781
|
|
|
|
|
|
|
|
|
|
|
|
GROSS
PROFIT
|
3,291,176
|
|
3,360,547
|
|
6,720,780
|
|
7,565,525
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
Sales and
Marketing
|
628,319
|
|
702,465
|
|
1,177,178
|
|
1,441,514
|
|
General and Administrative Expenses (including
share-based compensation of $134,062, $48,447, $219,079
and $136,326, respectively)
|
3,789,980
|
|
3,441,984
|
|
7,622,220
|
|
7,199,930
|
|
Product
Development
|
56,426
|
|
1,000
|
|
207,799
|
|
258,383
|
|
Depreciation and
Amortization
|
71,189
|
|
89,719
|
|
142,939
|
|
184,197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating
Expenses
|
4,545,914
|
|
4,235,168
|
|
9,150,136
|
|
9,084,024
|
|
|
|
|
|
|
|
|
|
|
|
LOSS FROM
OPERATIONS
|
(1,254,738)
|
|
(874,621)
|
|
(2,429,356)
|
|
(1,518,499)
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE)
|
|
|
|
|
|
|
|
|
Interest
Income
|
2,566
|
|
3,433
|
|
9,593
|
|
7,606
|
|
Interest
Expense
|
(12,849)
|
|
(19,828)
|
|
(22,417)
|
|
(40,158)
|
|
Other (Expense)
Income
|
(875)
|
|
5,377
|
|
3,299
|
|
7,345
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Other Income
(Expense)
|
(11,158)
|
|
(11,018)
|
|
(9,525)
|
|
(25,207)
|
|
|
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME
TAX PROVISION
|
(1,265,896)
|
|
(885,639)
|
|
(2,438,881)
|
|
(1,543,706)
|
INCOME TAX
PROVISION
|
34,279
|
|
11,291
|
|
15,511
|
|
12,734
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
$
(1,300,175)
|
|
$
(896,930)
|
|
$
(2,454,392)
|
|
$
(1,556,440)
|
|
|
|
|
|
|
|
|
|
|
|
BASIC EARNINGS PER
SHARE
|
$
(0.02)
|
|
$
(0.01)
|
|
$
(0.03)
|
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
WEIGHTED-AVERAGE SHARES OUTSTANDING
|
82,845,449
|
|
82,730,134
|
|
82,843,631
|
|
82,644,978
|
|
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER
SHARE
|
$
(0.02)
|
|
$
(0.01)
|
|
$
(0.03)
|
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
DILUTED
WEIGHTED-AVERAGE SHARES OUTSTANDING
|
82,845,449
|
|
82,730,134
|
|
82,843,631
|
|
82,644,978
|
WIDEPOINT
CORPORATION
|
ADJUSTED EARNINGS
BEFORE INTEREST, TAXES,
|
DEPRECIATION AND
AMORTIZATION
|
|
|
THREE MONTHS
ENDED
|
|
SIX MONTHS
ENDED
|
|
|
|
|
JUNE 30,
|
|
JUNE 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
$
(1,300,200)
|
|
$
(896,900)
|
|
$
(2,454,400)
|
|
$
(1,556,400)
|
Adjustments to GAAP
net income (loss):
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
366,200
|
|
377,900
|
|
719,800
|
|
764,600
|
|
Income tax provision
(benefit)
|
34,300
|
|
11,300
|
|
15,500
|
|
12,700
|
|
Interest
income
|
(2,600)
|
|
(3,400)
|
|
(9,600)
|
|
(7,600)
|
|
Interest
expense
|
12,800
|
|
19,900
|
|
22,400
|
|
40,200
|
|
Other (expense)
income
|
900
|
|
(5,300)
|
|
(3,300)
|
|
(7,300)
|
|
Provision for
doubtful accounts
|
17,100
|
|
(6,800)
|
|
31,200
|
|
(13,400)
|
|
Gain on sale of
assets held for sale
|
(66,700)
|
|
-
|
|
(66,700)
|
|
|
|
Loss on disposal of
leasehold improvements
|
176,700
|
|
-
|
|
172,800
|
|
-
|
|
Severance and exit
costs
|
187,500
|
|
-
|
|
187,500
|
|
|
|
Stock-based
compensation expense
|
134,100
|
|
48,400
|
|
136,300
|
|
136,300
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
(439,900)
|
|
$
(454,900)
|
|
$
(1,248,500)
|
|
$
(630,900)
|
For More Information:
Brett Maas or David
Fore
Hayden IR
(646) 536-7331
brett@haydenir.com
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SOURCE WidePoint Corporation