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WidePoint Reports First Quarter 2021 Financial Results

WidePoint Corporation (NYSE American:WYY), the leading provider of Trusted Mobility Management (TM2) specializing in Telecommunications Lifecycle Management, Identity Management (IdM) and Digital Billing & Analytics solutions, today reported results for the first quarter ended March 31, 2021.

First Quarter 2021 and Recent Operational Highlights

  • Received the first task orders under the Department of Homeland Security Cellular Wireless Management Services 2.0 contract, which were valued at $86 million in aggregate
  • Successfully on-boarded the DHS Cybersecurity and Infrastructure Security Agency (CISA)
  • Recognized by the International Organization for Standardization (ISO) for quality, environmental, and occupational health and safety
  • Awarded three new Identity Management contracts, including a deployment with a Fortune Global 500 corporation, increasing WidePoint's commercial footprint as well as the Company's secure digital certificates into a new U.S. federal agency
  • Number of U.S. Department of Defense secure digital certificates issued increased 8% sequentially from the fourth quarter of 2020
  • Recognized as honorable mention vendor in the 2021 Gartner Magic Quadrant for Managed Mobility Services, Global

First Quarter 2021 Financial Highlights:

  • Revenues were $20.7 million
  • Managed Services revenue increased sequentially to $9.3 million
  • Gross margin improved to 22.8%
  • Net income improved to $585,000, or $0.06 per diluted share
  • EBITDA, a non-GAAP financial measure, was $1.0 million
  • Adjusted EBITDA, a non-GAAP financial measure, was $1.2 million
  • As of March 31, 2021, cash increased to $17.1 million

Management Commentary
"After completing what was, by many metrics, the most successful year in WidePoint's history, we entered 2021 with solid momentum and with an intense focus on maintaining and ultimately growing our profitability," said WidePoint's CEO, Jin Kang. "In the first quarter, we grew our high margin Managed Services revenues sequentially to $9.3 million, while our low margin Carrier Services revenues decreased due to our work on the 2020 Census winding down as well as the residual effects of a carrier credit from last quarter. Carrier credits occur frequently in the normal course of our business as we occasionally find that a carrier has overcharged one of our clients. In this instance, we found the miscalculation and were able to save one of our prominent clients $2.6 million in expenses, which is reflected in our results as a decrease in Carrier Services, but which has no impact on our profitability. With Carrier Services revenues decreasing and gross profit staying fairly stable at $4.7 million, we improved our gross margins to 22.8%. We also increased our cash position to $17.1 million as we generated positive cash flows from operations and leveraged our at-the-market offering in January to better prepare WidePoint for growth opportunities.

"The financial results of the first quarter demonstrate that WidePoint has a solid base from which we can continue to build and expand our profitability. With tailwinds from the increasing complex mobile landscape, the growing need to secure mobile devices, and the return to more in person work expanding our pipeline, we are optimistic that we are in a healthy and strong position to continue driving the business's profitable growth over the long-run."

First Quarter 2021 Financial Summary details available at Widepoint

Financial Outlook
Due to the large, short-term changes in WidePoint's financial performance from the 2020 Census project, the Company believes comparing 2021 expectations to 2020 results, excluding the 2020 Census project, may provide a more objective analysis of the Company's anticipated performance. For the fiscal year 2021, the Company currently expects revenues of approximately $103 million, adjusted EBITDA of $4.3 million, and EPS of $0.12 per diluted share, based on 9,128,000 shares outstanding. Excluding WidePoint's work on the 2020 Census project, the Company's expectations reflect revenue growth of approximately 16% year-over-year and adjusted EBITDA consistent with fiscal year 2020. The Company's financial outlook is based on current expectations and actual results could differ materially depending on market conditions and the factors set forth under the "Safe Harbor Statement" below.

Conference Call
WidePoint management will hold a conference call today (May 14, 2021) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results.

WidePoint's President and CEO Jin Kang, Executive Vice President and Chief Sales and Marketing Officer Jason Holloway, and Executive Vice President and CFO Kellie Kim will host the conference call, followed by a question and answer period.

U.S. dial-in number: 888-506-0062
International number: 973-528-0011
Passcode: 862059

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 May 28, 2021.

Toll-free replay number: 877-481-4010
International replay number: 919-882-2331
Replay ID: 40863

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 digital billing 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 EBITDA and 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.  

SOURCE: WidePoint Corporation


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