FTE Networks Reports Full Year 2016 Results; Provides Update on
Acquisition of Benchmark Builders
Full year revenues of $12.3MM with second consecutive quarter of
growth in operating income
Benchmark Builders reports 2016 unaudited revenue of $389MM and
adjusted EBITDA of $40.4MM
Combined nine-month project backlog of $261MM
NAPLES, FL -- May 11, 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 their financial results
for the year ended December 31, 2016 and provided and update on
their recent acquisition of Benchmark Builders, Inc.
Recent Business Highlights
- Telecom Segment Revenues: $12.2 million up 40% over 2015.
- Telecom Segment recorded Gross Profit of $3.4 million on 27%
Gross Margin, 17% growth year-over-year.
- Closed 100% acquisition Benchmark Builders (BBI) on April 20,
2017.
- BBI Quality of Earnings unaudited revenue of $389 million from
top registered accounting firm.
- $40.4 million proforma adjusted EBITDA with an adjusted EBITDA
margin of 10.4%.
- The acquisition will immediately create a combined $261MM
million project backlog for FTE and BBI for 2017.
- Implemented key hires to deliver on execution of aggressive
growth plan and realize synergies between FTE and BBI, initially in
the technology and real estate sectors.
Benchmark Builders Transaction
FTE Networks completed the acquisition of privately held
Benchmark Builders, Inc. (BBI), a leading provider of construction
management services based in New York for $75 million on April 20,
2017. The transaction will allow FTE and BBI to begin offering
services to each others clients and expanding their offerings
nationally. As a wholly owned subsidiary of FTE, BBI will continue
to operate under its current successful model while also offering
FTEs compute to the edge technology in New York City and the
surrounding region. BBI has an Unaudited Independent Valuation of
Quality of Earnings top independent registered accounting firm,
which verifies revenues of $389 million, $40.4 million pro forma
adjusted EBITDA and an EBITDA margin of 10.4% for 2016.
The transaction enables FTE to expand infrastructure services
for ISP through current and future BBI client base. BBI gives FTE
access to major developers including REITs as potential CrossLayer
technology clients. Additionally, the transaction strengthens the
opportunity to win contracts from Fortune 100/500 companies and
enables BBI to access more clients as a public company. It also
provides an immediate platform to uplist to a more senior
exchange.
We are pleased with the progress in enhancing both gross profit
and operating income for full year 2016. Gross profit margin grew
17% to 27% from 23% year over year 2016 compared to 2015 and we
delivered increased operating income for the second consecutive
quarter, said Mr. Michael Palleschi, President and CEO of FTE
Networks. FTE and Benchmark have a combined nine month backlog of
$261 Million as of April 20, 2017. The Company expects this backlog
to increase significantly as the year progresses. The combination
with Benchmark Builders is transformational for FTE. Benchmark had
2016 unaudited revenues of over $389 million, along with $40.4
million proforma adjusted EBITDA and an EBITDA margin of 10.4%.
Importantly, Benchmark will operate as a wholly owned subsidiary,
without disruption to customers or stakeholders, enabling FTE to
leverage the expertise of the BBI team and expand our footprint in
New York City.
Mr. Palleschi continued, As we look to 2017, our strategy is to
significantly grow revenue, control expenses and maximize margins
while becoming an industry leader in network infrastructure,
construction management and edge computing solutions. We expect to
focus on the integration with Benchmark and continuing to roll out
an innovative, new compute-to-the-edge technology branded
CrossLayer, a first of its kind, which will bring wireless
solutions to a new level of speed and efficiency. We will continue
to expand our experienced sales force, reflecting FTEs strategy to
hire top-tier talent to build the Companys national footprint as we
focus on deeper penetration within the existing customer base,
adding new customers, and expanding the business pipeline.
Fiscal 2016 Financial Results
Full year 2016 telecom revenues were $12.2MM compared to $8.7MM
in 2015, a 40% increase as we grew our footprint and services to
Fortune 100/500 clients in the year. An operating loss of $1.69,
net of non-recurring transaction and acquisition costs, compared to
the prior years $1.56 million loss, for the full year 2016 remained
static. The company invested in its transformative
compute-to-the-edge technology and invested in the infrastructure
necessary to complete the acquisition of Benchmark Builders. This
was due largely to our increase in telecom revenue and profit
margin, and our ability to control operating costs year over
year.
About FTE Networks, Inc.
FTE Networks, Inc., and its businesses FTE Networks Services,
CrossLayer, Inc., and Benchmark Builders, Inc. provide end-to-end
design and build and support solutions for state-of-the-art
networks and commercial properties, creating the most advanced and
transformative smart platforms and buildings. Working with some of
the worlds leading Fortune 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 eight lines of business: 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 and Europe. For more
information, please visit: www.ftenet.com.
Forward Looking Statements
This release may contain forward-looking statements relating to
the business of FTE. All statements other than historical facts are
forward-looking statements, which can be identified by the use of
forward-looking terminology such as "believes," "expects" or
similar expressions. 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. Forward-looking statements
are based on FTE's current expectations and beliefs concerning
future developments and their potential effects on FTE. 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 as a result of
new information, future events or otherwise, except as required
under applicable securities laws.
FTE Networks, Inc.
999 Vanderbilt Beach Rd., Suite 601
Naples, FL 23108
(877) 850-4308
ir@ftenet.com
OTCQX:FTNW