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.
- 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 $(0.5million) 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 $(0.6million) 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.
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.
Note: Financial table is available at www.widepoint.com