WidePoint Reports Second Quarter 2020 Financial Results
Fairfax, VA – August 13, 2020 – WidePoint Corporation (NYSE American: WYY), the leading provider of Trusted Mobility Management (TM2) specializing in Telecommunications Lifecycle Management, Identity Management and Digital Billing & Analytics solutions, today reported results for the second quarter ended June 30, 2020.
Second Quarter 2020 and Recent Operational Highlights:
- Secured $42 million in federal contract wins, exercised option periods, and contract extensions during the second quarter of 2020
- Awarded a new contract from the Virginia Alcoholic Beverage Control Authority (Virginia ABC) for telecom expense management (TEM) services
- Secured $1.5 million in commercial TM2 contracts during the second quarter of 2020
- Increased the number of devices managed for the United States Census 2020 by over 50% to approximately 680,000 devices
- Announced a strategic vendor agreement with SYNNEX Corporation (NYSE: SNX), potentially expanding channels for reselling credentials
Second Quarter 2020 Financial Highlights (results compared to the same year-ago period):
- Revenues increased 148% to $54.8 million
- Managed Services revenue increased 22% to $9.8 million
- Gross profit increased 25% to $5.1 million
- Net income totaled $489,000
- EBITDA, a non-GAAP financial measure, increased 230% to $1.0 million
- Adjusted EBITDA, a non-GAAP financial measure, increased 107% to $1.2 million
Six Month 2020 Financial Highlights (results compared to the same year-ago period):
- Revenues increased 115% to $94.4 million
- Managed Services revenue increased 37% to $21.4 million
- Gross profit increased 21% to $10.0 million
- Net income totaled $973,000
- EBITDA, a non-GAAP financial measure,increased 73% to $2.2 million
- Adjusted EBITDA, a non-GAAP financial measure, increased 62% to $2.7 million
Second Quarter 2020 Financial Summary
|(in millions, except per share amounts)||June 30, 2020||March 30, 2019|
|Gross Profit Margin||9.2%||18.4%|
|Income (Loss) from Operations||$0.6||$(0.3)|
|Net Income (Loss)||$0.5||$0.4|
|Basic and Diluted Earnings per Share (EPS)||$0.01||$0.00|
Six Month 2020 Financial Summary
|(in millions, except per share amounts)||June 30, 2020||June 30, 2019|
|Gross Profit Margin||10.6%||18.9%|
|Income from Operations||$1.4||$0.3|
|Basic and Diluted Earnings per Share (EPS)||$0.01||$0.00|
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.
For the fiscal year ending December 31, 2020, the company is reiterating its revenue guidance of $185 million to $195 million, which at the midpoint of the range, would represent 87% growth. The company is also reiterating its EBITDA guidance of $3.0 million to $3.4 million, which at the midpoint, represents a 13% increase relative to fiscal 2019.The EBITDA forecast takes into consideration the company’s planned strategic investments in sales and marketing and product development in the second half of 2020. The company’s financial outlook is based on current expectations.
“Despite the challenging operating environment that persisted through the second quarter of 2020, we continued to build on the positive trends we established at the start of the year and produced one of the most successful quarter’s in our company’s history,” said WidePoint’s CEO, Jin Kang. “Our revenues increased considerably to $54.8 million, largely driven by our increased work on the U.S. Census 2020 as well as expansions with other federal government customers who rely on our services to help them navigate the increasing complexities of the mobile landscape. Although the Census project contains a large amount of Carrier Services revenues, which negatively impact our margin profile, we still earned $489,000 in net income and approximately $1.0 million in EBITDA as our high margin Managed Services revenues increased 22% to $9.8 million in the second quarter.
“As the number of mobile and IoT devices continues to expand, the need for effective management and top-tier security, which simplifies complexity and generates cost savings, is only increasing. Given those trends and our strong financial position, we remain optimistic about our prospects for the second half of the year and our ability to continue profitably growing the business over the long term.”
WidePoint management will hold a conference call today (August 13, 2020) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results.
WidePoint 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: 844-407-9500
International number: 862-298-0850
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.
A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through August 27, 2020.
Toll-free replay number: 877-481-4010
International replay number: 919-882-2331
Replay ID: 36035
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, 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 income to EBITDA is included on the schedules attached hereto.
Safe Harbor Statement
The information contained in any materials that may be accessed above was, to the best of WidePoint Corporations’ knowledge, timely and accurate as of the date and/or dates indicated in such materials. However, the passage of time can render information stale, and you should not rely on the continued accuracy of any such materials. WidePoint Corporation has no responsibility to update any information contained in any such materials. In addition, you should refer to periodic reports filed by WidePoint Corporation with the Securities and Exchange Commission for information regarding the risks and uncertainties to which forward-looking statements made in such materials are subject. Such risks and uncertainties may cause WidePoint Corporation’s actual results to differ materially from those described in the forward-looking statements.
Gateway Investor Relations
Matt Glover or Charlie Schumacher