WidePoint Reports Second Quarter 2019 Financial Results
WidePoint Corporation (NYSE American: WYY), the leading provider of Trusted Mobility Management (TM2) specializing in Telecommunications Lifecycle Management, Identity Management and Bill Presentment & Analytics solutions, today reported results for the second quarter ended June 30, 2019.
Second Quarter 2019 and Recent Operational Highlights:
- Awarded $5.3 million in federal government contract renewals and modifications
- Soft-ex, a WidePoint subsidiary, awarded $6.0 million contract renewal with a global communications service provider to deliver both cloud and onsite telecom solutions to government and multinational corporations
- Secured more than $1.3 million in Trusted Mobility Management (TM2) contracts, the majority of which are high-margin, commercial contracts
- Received Authority to Operate (ATO) from a major customer to implement WidePoint’s Intelligent Telecommunications Management System (ITMS™), which represents the second significant step toward achieving a FedRAMP certification
Second Quarter 2019 Financial Highlights (results compared to the same year-ago period):
- Revenues increased 26% to $22.1 million
- Gross profit increased 14% to $4.1 million
- Net loss totaled $(308,000)
- Adjusted EBITDA, a non-GAAP financial measure, increased to $0.6 million, marking the company’s eighth consecutive quarter of positive adjusted EBITDA, and in line with forecast
Six Month 2019 Financial Highlights (results compared to the same year-ago period):
- Revenues increased 17% to $44.0 million
- Gross profit increased 17% to $8.3 million
- Net income totaled $76,000
- Adjusted EBITDA totaled $1.6 million
For additional financial details please refer to www.widepoint.com
The following statements are forward-looking, and actual results could differ materially depending on market conditions and the factors set forth under the “Safe Harbor Statement” below.
Financial Outlook
For the fiscal year ending December 31, 2019, the company is reiterating its revenue guidance of $90.0 million to $93.0 million, representing growth of 8% to 12%. The company is also reiterating its adjusted EBITDA guidance of $2.75 million to $3.5 million, which represents an improvement compared to fiscal 2018. The increase in adjusted EBITDA reflects the company’s strategic investments in sales and marketing and product development to accelerate growth, as well as a $400,000 increase due to new Financial Accounting Standards Board (FASB) guidance regarding the treatment of capital lease. The company’s financial outlook is based on current expectations.
Management Commentary
“The second quarter was a continuation of the strong performance we established at the start of the year as we delivered another solid period of financial results, expanded several contracts with current customers, and continued to improve upon our already industry-leading credentials,” said WidePoint’s CEO, Jin Kang. “From a financial perspective, the quarter was highlighted by a 26% increase in revenues, a 14% increase in gross profit, and our eighth consecutive quarter of positive adjusted EBITDA.
“Operationally, we successfully re-secured and expanded several contracts with current customers in both the government and commercial sectors. These contract expansions and the positive effects they have on our financial results show that our cross-selling and upselling strategies continue to be an effective means of increasing our topline as we simultaneously remain conscientious of their effects on our bottom-line. Additionally, we received an ATO from a major customer to implement ITMS™, which is a major step toward ultimately receiving a FedRAMP certification.
“Overall, we remain confident that we will be able to continue to execute on our primary strategic initiatives throughout the course of the year to accelerate growth, improve margins, and drive higher profitability in the long-run.”
Conference Call
WidePoint management will hold a conference call today (August 14, 2019) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results. WidePoint President and CEO Jin Kang, Chief Sales and Marketing Officer Jason Holloway, and President and CEO of Soft-ex Communications and WidePoint Interim CFO Ian Sparling will host the conference call, followed by a question and answer period.
U.S. dial-in number: 844-369-8770
International number: 862-298-0840
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 949-574-3860.
The conference call will be broadcast live and available for replay here and via the investor relations section of the company’s website.
A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through August 21, 2019.
Toll-free replay number: 877-481-4010
International replay number: 919-882-2331
Replay ID: 51160
About WidePoint
WidePoint Corporation (NYSE American: WYY) is a leading provider of trusted mobility management (TM2) solutions, including telecom management, mobile management, identity management, and bill presentment and analytics. For more information, visit widepoint.com.
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 GAAP Net loss to Adjusted EBITDA is included on the schedules attached hereto.
