DecisionPoint™ Systems, Inc. (OTCBB: DPSI), a leading provider and integrator of Enterprise Mobility and Wireless Applications solutions, today reported its financial results for the fourth quarter and year ended December 31, 2016.
Sales increased by 19.5% for the quarter but decreased by 8.1% for the year compared to the comparable periods in 2015. EBITDA for the year increased by $521,000 to $892,000 for 2016 and EBITDA decreased by $155,000 to $216,000 for the fourth quarter ended December 31, 2016.
Revenue from continuing operations for the fourth quarter ended December 31, 2016 was $8.7 million, versus $7.3 million for the comparable period in 2015, an increase of 19.5%. Gross profit margin for the fourth quarter of 2016 was 20.7%, compared to 24.0% for the comparable period of 2015. For the fourth quarter ended December 31, 2016, the Company reported a net income attributable to common shareholders of $861,000, or $0.14 earnings per share, which included a one-time gain of $788,000 relating to discontinued operations in Canada. For the fourth quarter ended December 31, 2015, net loss attributable to common shareholders was $1.5 million, or $57.89 of net loss per share, which included cash and imputed dividends of $1.8 million. The preferred stock outstanding at the end of 2015 has since been converted to common stock as a result of the Company’s recently completed recapitalization, and is no longer outstanding. As a result of the recapitalization, the Company now has 6,006,978 shares of common stock outstanding. The net income from continuing operations for the fourth quarter of 2016 was $344,000, compared to net income from continuing operations of $73,000 for 2015.
Revenue from continuing operations for the year ended December 31, 2016 was $31.1 million, versus $33.8 million for 2015. Gross profit margin for 2016 was 20.1%, compared to 20.8% for 2015. For the year ended December 31, 2016, the Company reported net income attributable to common shareholders of $1.7 million, or $0.28 earnings per share, which included a one-time gain of $1.3 million relating to discontinued operations in Canada. For the year ended December 31, 2015, net loss attributable to common shareholders was $5.4 million, or $210.31 of net loss per share, which included cash and imputed dividends of $1.9 million and a loss attributable to discontinued operations of $3.5 million. The preferred stock outstanding at the end of 2015 has since been converted to common stock as a result of the Company’s recently completed recapitalization and is no longer outstanding. Net income from continuing operations for 2016 was $412,000, compared to a net loss from continuing operations of $15,000 for 2015.
“We remain positioned to lead the Omni-channel business environment – getting back to the core and strength of DecisionPoint --to deliver innovative and integrated software and hardware platforms that help our customers and partners meet the needs of the changing retail, transportation, warehousing and logistics markets,” said Steve Smith, chief executive officer, DecisionPoint. “We are on a steady growth path, and we believe our turnaround will gather momentum in 2017 and keep us headed towards organic and acquisition growth.”
“We have put behind us the issues of the past with the non-core businesses which were divested in 2015 and 2016, the complete payoff of Canadian term debt and the conversion into common stock of all outstanding series of preferred stock and bridge financing debt; and are now able to focus on the fundamentals and the transformation of the business,” said Michael Roe, chief financial officer, DecisionPoint. “The Company is recapitalized, and is poised for growth. We are optimistic about 2017, as we anticipate positive results from the company's business strategies to improve the customer and partner experience. In 2017 we are planning on several programs, including investments in marketing and sales personnel, a new service portal and an internal software initiative that we expect will take our business to the next level.”
The financial statements for 2016 are posted on the Company’s website at www.decisionpt.com, as well as on third-party financial sites on the Internet under the ticker symbol DPSI.
About DecisionPoint Systems, Inc.
DecisionPoint
Systems, Inc. delivers improved productivity and operational advantages
to its clients by helping them move their business decision points
closer to their customers. We do this by making enterprise software
applications accessible to the front-line worker anytime, anywhere.
DecisionPoint utilizes all the latest wireless, mobility, and RFID
technologies. For more information about DecisionPoint Systems, Inc.,
visit www.decisionpt.com.
Forward-Looking Statements
Except
for historical information contained herein, the statements in this news
release are forward-looking statements. Forward-looking
statements involve known and unknown risks and uncertainties, which may
cause a company's actual results, performance and achievements in the
future to differ materially from forecasted results, performance, and
achievements. The Company undertakes no obligation to publicly
release the results of any revisions to its forward-looking statements
to reflect events or circumstances after the date hereof, including
without limitation unanticipated events or changes in the Company's
plans or expectations.
-FINANCIAL TABLES FOLLOW-
DECISIONPOINT SYSTEMS, INC. | ||||||||||||
| Unaudited Condensed Consolidated Balance Sheets | ||||||||||||
| (In thousands, except share and per share data) | ||||||||||||
| December 31, | ||||||||||||
| 2016 | 2015 | |||||||||||
| ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash | $ | 1,235 | $ | 821 | ||||||||
| Accounts receivable, net | 5,611 | 4,751 | ||||||||||
| Inventory, net | 428 | 307 | ||||||||||
| Deferred costs | 1,889 | 2,234 | ||||||||||
| Prepaid expenses and other current assets | 115 | 28 | ||||||||||
| Assets of business unit held for sale | - | 32 | ||||||||||
| Assets of discontinued operations | 1 | - | ||||||||||
| Total current assets | 9,279 | 8,173 | ||||||||||
| Property and equipment, net | 148 | 169 | ||||||||||
| Other assets, net | 22 | 22 | ||||||||||
| Deferred costs, net of current portion | 803 | 970 | ||||||||||
| Goodwill | 5,304 | 5,304 | ||||||||||
| Assets of business unit held for sale | - | 6 | ||||||||||
| Total assets | $ | 15,556 | # | $ | 14,644 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||||||
| Current liabilities | ||||||||||||
| Accounts payable | $ | 5,302 | $ | 7,019 | ||||||||
| Accrued expenses and other current liabilities | 1,251 | 1,690 | ||||||||||
| Lines of credit | 2,828 | 3,154 | ||||||||||
| Current portion of debt | 80 | 379 | ||||||||||
| Due to related parties | 79 | 215 | ||||||||||
| Unearned revenue | 2,760 | 3,102 | ||||||||||
| Liabilities related to business unit held for sale | - | 1,880 | ||||||||||
| Liabilities related to discontinued operations | 60 | - | ||||||||||
| Total current liabilities | 12,360 | 17,439 | ||||||||||
DECISIONPOINT SYSTEMS, INC. | ||||||||||||
Unaudited Condensed Consolidated Balance Sheets | ||||||||||||
| December 31, | ||||||||||||
| 2016 | 2015 | |||||||||||
| Long-term liabilities | ||||||||||||
| Unearned revenue, net of current portion | 1,029 | 1,355 | ||||||||||
| Debt, net of current portion and discount | 414 | - | ||||||||||
| Deferred tax liabilities | 34 | 29 | ||||||||||
| Warrant liability | - | 78 | ||||||||||
| Other long-term liabilities | 1 | 6 | ||||||||||
| Liabilities related to business unit held for sale | - | 152 | ||||||||||
| Total liabilities | 13,839 | 19,059 | ||||||||||
| STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||||||
| Cumulative Convertible Preferred stock, $0.001 par value, | ||||||||||||
| 10,000,000 shares authorized, 0 and 2,236,571 | ||||||||||||
| shares issued and outstanding, including cumulative and | ||||||||||||
| imputed preferred dividends of $ 0 and $2,403 and with a | ||||||||||||
| liquidation preference of $ 0 and $19,710 at | ||||||||||||
| December 31, 2016 and 2015, respectively | - | 14,123 | ||||||||||
| Common stock, $0.001 par value, 50,000,000 shares | ||||||||||||
| authorized, 6,006,978 issued and 25,459 outstanding | ||||||||||||
| as of December 31, 2016 and 2015 | 6 | - | ||||||||||
| Additional paid-in capital | 34,706 | 17,070 | ||||||||||
| Accumulated deficit | (33,293) | (35,646) | ||||||||||
| Unearned ESOP shares | - | (331) | ||||||||||
| Accumulated other comprehensive income | 293 | 369 | ||||||||||
| Total stockholders’ equity (deficit) | 1,712 | (4,415) | ||||||||||
| Total liabilities and stockholders' equity (deficit) | $ | 15,551 | $ | 14,644 | ||||||||
DECISIONPOINT SYSTEMS, INC. | ||||||||||||||||||||||||
Unaudited Condensed Consolidated Statements of Operations | ||||||||||||||||||||||||
| Three months ended December 31, | Years ended December 31, | |||||||||||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||||||||||
| Net sales | $ | 8,742 | $ | 7,314 | $ | 31,104 | $ | 33,838 | ||||||||||||||||
| Cost of sales | 6,929 | 5,555 | 24,844 | 26,801 | ||||||||||||||||||||
| Gross profit | 1,813 | 1,759 | 6,260 | 7,037 | ||||||||||||||||||||
| Selling, general and administrative expense | 1,539 | 1,400 | 5,416 | 7,158 | ||||||||||||||||||||
| Operating income (loss) | 274 | 359 | 844 | (121 | ) | |||||||||||||||||||
| Other expense (income): | ||||||||||||||||||||||||
| Interest expense | 141 | 88 | 433 | 387 | ||||||||||||||||||||
| Fair market value adjustment of warrant liability | - | (4 | ) | (78 | ) | (440 | ) | |||||||||||||||||
| Other expense (income), net | 67 | 1 | 62 | (17 | ) | |||||||||||||||||||
| Total other (income) expense | 208 | 85 | 417 | (70 | ) | |||||||||||||||||||
| Income (loss) from continuing operations, before income taxes | 66 | 274 | 427 | (51 | ) | |||||||||||||||||||
| Tax (benefit) provision for income taxes | (7 | ) | (70 | ) | 15 | (36 | ) | |||||||||||||||||
| Net income (loss) from continuing operations | 73 | 344 | 412 | (15 | ) | |||||||||||||||||||
| Discontinued operations: | ||||||||||||||||||||||||
| Income (loss) on sale of discontinued operations, net of tax | 149 | - | 621 | (89 | ) | |||||||||||||||||||
| Income (loss) from discontinued operations, net of tax | 639 | - | 647 | (94 | ) | |||||||||||||||||||
| Loss from business unit held for sale, net of tax | - | (10 | ) | - | (3,267 | ) | ||||||||||||||||||
| Net (loss) income | 861 | 334 | 1,680 | (3,465 | ) | |||||||||||||||||||
| Cumulative and imputed Series A and B preferred stock dividends | - | (27 | ) | - | (108 | ) | ||||||||||||||||||
| Cash and imputed dividends on Series D and Series E preferred stock | - | (1,781 | ) | - | (1,781 | ) | ||||||||||||||||||
| Net income (loss) attributable to common shareholders | $ | 861 | $ | (1,474 | ) | $ | 1,680 | $ | (5,354 | ) | ||||||||||||||
| Net income (loss) per share - | ||||||||||||||||||||||||
| Basic and diluted | $ | 0.14 | $ | (57.89 | ) | $ | 0.28 | $ | (210.31 | ) | ||||||||||||||
| Weighted-average common shares outstanding - | ||||||||||||||||||||||||
| Basic and diluted | 6,006,978 | 25,459 | 6,006,978 | 25,459 | ||||||||||||||||||||
| DECISIONPOINT SYSTEMS, INC. | |||||||||||||||
| Unaudited Condensed Consolidated Statements of Cash Flows (In thousands) | |||||||||||||||
| Years ended December 31, | |||||||||||||||
| 2016 | 2015 | ||||||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net income (loss) from continuing operations | 412 | (15 | ) | ||||||||||||
| Net income (loss) from business unit held for sale | 621 | (3,268 | ) | ||||||||||||
| Net income (loss) from discontinued operations | 647 | (183 | ) | ||||||||||||
| Adjustments to reconcile net (loss) income to net cash | |||||||||||||||
| (used in) provided by operating activities: | |||||||||||||||
| Non-cash operating items | 114 | (30 | ) | ||||||||||||
| Changes in operating assets and liabilities | (1,894 | ) | 5,797 | ||||||||||||
| Net cash (used in) provided by operating activities | (100 | ) | 2,301 | ||||||||||||
| Net cash (used in) provided by investing activities | (15 | ) | 226 | ||||||||||||
| Net cash (used in) provided by financing activities | 530 | (3,344 | ) | ||||||||||||
| Effect on cash of foreign currency translation | (1 | ) | 22 | ||||||||||||
| Net increase (decrease) in cash | 414 | (795 | ) | ||||||||||||
| Cash at beginning of period | 821 | 1,616 | |||||||||||||
| Cash at end of period | $ | 1,235 | $ | 821 | |||||||||||
| Supplemental disclosures of cash flow information: | |||||||||||||||
| Interest paid | $ | 507 | $ | 524 | |||||||||||
| Income taxes paid | 15 | 73 | |||||||||||||
Non-GAAP Financial Measures:
To supplement the Company’s consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP financial information, namely earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted EBITDA. The Company’s management believes that these non-GAAP measures provide investors with a better understanding of how the Company’s results relate to the Company’s historical performance, and reflect the essential operating activities of the Company. Non-GAAP information is not meant to be considered in isolation or as a substitute for GAAP information. A reconciliation of our GAAP financial measures to our non-GAAP financial measures appears below:
| Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||||||||
| EBITDA Reconciliation: | ||||||||||||||||||||||
| Net income (loss) from continuing operations | $ | 73 | $ | 344 | $ | 412 | $ | (15 | ) | |||||||||||||
| Depreciation and amortization | $ | 9 | $ | 9 | $ | 34 | $ | 37 | ||||||||||||||
| Interest expense | $ | 141 | $ | 88 | $ | 433 | $ | 387 | ||||||||||||||
| Income tax provision (benefit) | $ | (7 | ) | $ | (70 | ) | $ | 15 | $ | (36 | ) | |||||||||||
| EBITDA | $ | 216 | $ | 371 | $ | 894 | $ | 373 | ||||||||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20170331005865/en/
Contacts:
Michael Roe, 949-465-0065 ext.
7025
Chief Financial Officer
