EX-99.2 3 v463384_ex99-2.htm EXHIBIT 99.2

 

Exhibit 99.2

 

 

 

For More Information:

 

 

Brett Maas or David Fore

Hayden IR

(646) 536-7331

brett@haydenir.com

 

 

WidePoint Corporation Reports Full Year 2016 Financial Results

 

McLean, VA, March 30, 2017 – 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 fourth quarter and full-year ended December 31, 2016.

 

Recent Business Highlights

 

·Board of Directors appointed Jeffrey O. Nyweide as the Chief Executive Officer and President and Director

 

·Added a major telecommunication consolidator as a new channel partner for TLM

 

·Added two major resellers as channel partners for credentialing solutions

 

·Realigned sales and marketing to improve lead generation activities

 

·Initiated consolidation of physical and logical infrastructure to eliminate redundant overheads and reduce costs

 

Full Year 2016 Financial Highlights

 

·Net revenue was approximately $78.4 million compared to $70.8 million in 2015

 

·Gross profit was approximately $14.0 million compared to $13.2 million in 2015

 

·Net loss of approximately ($4.1 million) compared to ($5.5 million) in 2015, or basic and diluted loss per share of $0.05 per share compared to $0.07 in 2015

 

·Adjusted EBITDA loss of approximately ($2.0 million) compared to approximately ($3.5 million in 2015

 

Fourth Quarter 2016 Financial Highlights

 

·Net revenue was approximately $18.3 million compared to $18.7 million in the fourth quarter of 2015

 

·Gross profit was approximately $2.4 million compared to $3.2 million in the fourth quarter of 2015

 

 

 

 

 

·Net loss was approximately ($2.4 million) compared to ($1.1 million) in the fourth quarter of 2015, or basic and diluted loss per share of $0.03 per share compared to $0.01 in the fourth quarter of 2015.

 

·Adjusted EBITDA loss was approximately ($1.7 million) compared to approximately ($0.9 million) in fourth quarter of 2015. Included in our 4th quarter 2016 expenses were also approximately $1.2 million in non-recurring charges.

 

·Cash and cash equivalents was approximately $9.1 million as of December 31, 2016. Working capital was approximately $5.0 million.

 

“Over the past three months, I’ve conducted a strategic review of our business to gain a deep understanding of our products and services, our employees and management, our clients and partners. I see a lot of opportunities ahead for WidePoint,” stated Jeffrey O. Nyweide, WidePoint’s Chief Executive Officer and President. “As a company, we are committed to capitalizing on our foundation of core expertise and innovation to pursue high growth opportunities in both mobile telecommunications and cybersecurity. Throughout 2017, we will continue to streamline and consolidate our infrastructure to support an organization that can scale both revenues and profitability.”

 

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 Thursday, March 30, 2017. Anyone interested in listening to our analyst call should call 1-888-791-4305 if calling within the United States or 1-913-312-1378 if calling internationally. There will be a playback available until April 13, 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 4711433 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=123277.

 

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, 2015 filed with the SEC on March 15, 2016.

 

-tables follow-

 

 

 

 

WIDEPOINT CORPORATION

CONSOLIDATED BALANCE SHEETS

 

 

   DECEMBER 31, 
   2016   2015 
         
ASSETS
CURRENT ASSETS          
Cash and cash equivalents  $9,123,498   $7,930,303 
Accounts receivable, net of allowance for doubtful accounts  of $344,411 and $73,378 in 2016 and 2015, respectively   5,153,093    10,565,113 
Unbilled accounts receivable   8,112,690    6,637,587 
Inventories   123,287    28,400 
Prepaid expenses and other assets   385,388    435,300 
Income taxes receivable   42,896    - 
Deferred income taxes   48,826    30,889 
           
Total current assets   22,989,678    25,627,592 
           
NONCURRENT ASSETS          
Assets held for sale   594,376    - 
Property and equipment, net   736,678    1,513,307 
Intangibles, net   4,298,902    5,101,523 
Goodwill   18,555,578    18,555,578 
Deposits and other assets   52,456    60,471 
           
TOTAL ASSETS  $47,227,668   $50,858,471 
           
LIABILITIES AND STOCKHOLDERS' EQUITY
           
CURRENT LIABILITIES          
Short term note payable  $131,761   $131,953 
Accounts payable   8,665,449    7,812,226 
Accrued expenses   7,872,557    6,687,054 
Deferred revenue   1,190,558    2,007,970 
Income taxes payable   5,141    37,684 
Current portion of long-term debt   94,868    893,706 
Current portion of deferred rent   40,397    28,071 
Current portion of capital lease obligations   4,097    28,752 
           
Total current liabilities   18,004,828    17,627,416 
           
NONCURRENT LIABILITIES          
Long-term debt related to assets held for sale, net of current portion   412,180    - 
Long-term debt, net of current portion   -    431,756 
Capital lease obligation, net of current portion   -    11,962 
Deferred rent, net of current portion   86,198    123,923 
Deferred revenue   -    24,937 
Deferred income taxes   447,811    447,811 
           
Total liabilities   18,951,017    18,667,805 
           
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; 82,730,134 and 82,520,696 shares issued  and outstanding, respectively   82,730    82,521 
Additional paid-in capital   93,920,095    93,661,178 
Accumulated other comprehensive loss   (309,369)   (270,140)
Accumulated deficit   (65,416,805)   (61,282,893)
           
Total stockholders’ equity   28,276,651    32,190,666 
           
Total liabilities and stockholders’ equity  $47,227,668   $50,858,471 

 

 

 

 

 

WIDEPOINT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

 

   YEAR ENDED   THREE MONTHS ENDED 
   DECEMBER 31,   DECEMBER 31, 
   2016   2015   2016   2015 
           (Unaudited) 
REVENUES  $78,420,864   $70,838,017   $18,257,719   $18,714,846 
COST OF REVENUES (including amortization and depreciation of $1,204,858 and $1,183,143, respectively)   64,410,468    57,605,357    15,850,877    15,477,768 
                     
GROSS PROFIT   14,010,396    13,232,660    2,406,842    3,237,078 
                     
OPERATING EXPENSES                    
Sales and Marketing   2,667,808    3,030,249    600,813    697,210 
General and Administrative Expenses (including share-based compensation of $310,989 and $299,337, respectively)   14,448,270    14,608,014    3,797,573    3,100,705 
Product Development   699,013    673,093    437,982    673,093 
Depreciation and Amortization   358,559    383,265    89,603    100,054 
                     
Total Operating Expenses   18,173,650    18,694,621    4,925,971    4,571,062 
                     
LOSS FROM OPERATIONS   (4,163,254)   (5,461,961)   (2,519,129)   (1,333,984)
                     
OTHER INCOME (EXPENSE)                    
Interest Income   14,591    23,031    3,973    5,107 
Interest Expense   (72,231)   (142,497)   (11,163)   (31,244)
Other Income   13,536    33,009    2,412    (4,814)
                     
Total Other Income (Expense)   (44,104)   (86,457)   (4,778)   (30,951)
                     
LOSS BEFORE PROVISION FOR INCOME TAXES   (4,207,358)   (5,548,418)   (2,523,907)   (1,364,935)
INCOME TAX BENEFIT   (73,446)   (81,811)   (94,475)   (228,998)
                     
NET LOSS  $(4,133,912)  $(5,466,607)  $(2,429,432)  $(1,135,937)
                     
BASIC EARNINGS PER SHARE  $(0.05)  $(0.07)  $(0.03)  $(0.01)
                     
BASIC WEIGHTED-AVERAGE SHARES OUTSTANDING   82,687,789    82,228,974    82,730,134    79,039,745 
                     
DILUTED EARNINGS PER SHARE  $(0.05)  $(0.07)  $(0.03)  $(0.01)
                     
DILUTED WEIGHTED-AVERAGE SHARES OUTSTANDING   82,687,789    82,228,974    82,730,134    79,039,745 

 

 

 

 

 

 

WIDEPOINT CORPORATION

ADJUSTED EARNINGS BEFORE INTEREST, TAXES,

DEPRECIATION AND AMORTIZATION

 

   FISCAL YEAR ENDED   THREE MONTHS ENDED 
   DECEMBER 31,   DECEMBER 31, 
   2016   2015   2016   2015 
   Unaudited) 
                 
NET LOSS  $(4,133,900)  $(5,466,607)  $(2,429,400)  $(1,135,900)
Adjustments to GAAP net loss:                    
Depreciation and amortization   1,563,400    1,566,400    406,600    409,500 
Amortization of deferred financing costs   -    10,300    -    1,600 
Income tax provision (benefit)   (73,400)   (81,800)   (94,400)   (229,000)
Interest income   (14,600)   (23,000)   (4,000)   (5,100)
Interest expense   72,200    132,200    11,100    20,900 
Other (expense) income   (13,500)   (33,000)   (2,400)   4,800 
Provision for doubtful accounts   253,400    18,100    261,300    (38,800)
Stock-based compensation expense   311,000    299,300    106,600    91,200 
                     
Adjusted EBITDA  $(2,035,400)  $(3,578,107)  $(1,744,600)  $(880,800)