HANOVER, Md., Feb. 1, 2012 (GLOBE NEWSWIRE) -- The KEYW Holding Corporation (Nasdaq:KEYW) announces revenue for 2011 of $191 million as compared to $108 million in FY 2010, an increase of 77%. Net Income for 2011 was $0.5 million after increasing our Research and Development (R&D) spending to $2.3 million for the year. Earnings Per Share (EPS) (diluted) for 2011 were $0.02 as compared to $0.51 in 2010. Our Adjusted EBITDA (as described below) increased to $20.6 million or 10.8% of revenue for 2011 up from $9.0 million or 8.4% of revenue for 2010. Cash from Operations was $10.3 million for 2011 as compared to cash used in operations of ($1.6) million for 2010.
"2011 was another year of significant growth and accomplishment for KEYW," commented Leonard Moodispaw, CEO and President of KEYW Corporation. "During 2011 we acquired 3 companies and fully integrated all of the acquisitions that we have made since starting operations. We expanded our core capabilities, particularly in our geospatial intelligence business area, to become a Multi-INT innovator and solution provider. We have created an Integrated Solutions Sector, significantly growing our products and solutions business area, which will be reported as a separate segment beginning this year. I am proud of the intelligence and cyber focused business that we have created and excited by the breadth of opportunities to continue making a difference for our intelligence and defense customers as well as our stakeholders. We have significantly more opportunities now than we had just one year ago. We have the right team, resources, and market focus for this to be an exceptional year of performance. For KEYW, 2012 is about delivering on the enormous potential that I see in this Company."
For Q4 of 2011, KEYW generated $50.1 million in revenue versus $29.3 million in the same period of 2010. Net income was $0.3 million versus $1.2 million for the fourth quarters of 2011 and 2010, respectively. EPS for these same periods were $0.01 (diluted) in 2011 and $0.04 (diluted) in 2010. Gross margin (including both integrated solutions and services) in Q4 2011 was 32.4% versus 29.1% for the same period in 2010. In addition, KEYW was awarded new work totaling over $65 million in contract value.
KEYW's Adjusted EBITDA for 2011 increased by 128% as compared to 2010. Adjusted EBITDA, as defined by KEYW, is a non-GAAP measure that is calculated as GAAP net income plus other non-recurring expenses, interest expense, income taxes, and depreciation and amortization. We have provided Adjusted EBITDA because we use the measurement internally to evaluate performance. Our Board of Directors and management use Adjusted EBITDA:
- As a measure of operating performance;
- To determine a significant portion of management's incentive compensation;
- For planning purposes, including the preparation of our annual operating budget; and
- To evaluate the effectiveness of our business strategies.
Adjusted EBITDA is not a recognized term under U.S. GAAP and does not purport to be an alternative to net income as a measure of operating performance or the cash flows from operating activities as a measure of liquidity. Please refer to the table below that reconciles GAAP net income to Adjusted EBITDA.
|
Year ended December 31, 2011 |
Year ended December 31, 2010 |
Three months ended December 31, 2011 |
Three months ended December 31, 2010 |
|
| (Unaudited and in thousands) | ||||
| Net Income | $ 535 | $ 10,906 | $ 318 | $ 1,159 |
| Depreciation | 2,082 | 760 | 944 | 220 |
| Intangible Amortization | 13,410 | 6,440 | 5,304 | 1,986 |
| Initial Public Offering and Acquisition Costs | 588 | 2,080 | 139 | 415 |
| Stock Compensation Amortization | 2,829 | 1,920 | 660 | 851 |
| Interest Expense (Income) | 907 | 1,661 | 364 | (17) |
| Tax Expense | 218 | 7,814 | 233 | 948 |
| Other Non-Recurring Items | -- | (22,550) | -- | (4,200) |
| Adjusted EBITDA | $ 20,569 | $ 9,031 | $ 7,962 | $ 1,362 |
In addition to these traditional financial metrics, we believe that the total number of KEYW employees will provide investors with insight into our business and growth. At the close of FY 2011, we had 827 employees, approximately 80% of whom hold the highest level clearances.
| THE KEYW HOLDING CORPORATION AND SUBSIDIARIES | |||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
| (In thousands, except share and per share amounts) | |||||
|
Three months ended December 31, 2011 |
Three months ended December 31, 2010 |
Year ended December 31, 2011 |
Year ended December 31, 2010 |
||
| (Unaudited) | (Unaudited) | (Audited) | |||
| Revenues | |||||
| Services | $ 37,770 | $ 27,739 | $ 159,748 | $ 95,665 | |
| Integrated Solutions | 12,300 | 1,598 | 30,839 | 12,323 | |
| Total | 50,070 | 29,337 | 190,587 | 107,988 | |
| Costs of Revenues | |||||
| Services | 27,526 | 19,935 | 115,343 | 69,312 | |
| Integrated Solutions | 6,334 | 878 | 18,607 | 7,132 | |
| Total | 33,860 | 20,813 | 133,950 | 76,444 | |
| Gross Profit | |||||
| Services | 10,244 | 7,804 | 44,405 | 26,353 | |
| Integrated Solutions | 5,966 | 720 | 12,232 | 5,191 | |
| Total | 16,210 | 8,524 | 56,637 | 31,544 | |
| Operating Expenses | |||||
| Operating expenses | 9,837 | 8,617 | 41,399 | 27,264 | |
| Intangible amortization expense | 5,304 | 1,986 | 13,410 | 6,440 | |
| Total | 15,141 | 10,603 | 54,809 | 33,704 | |
| Operating Income (Loss) | 1,069 | (2,079) | 1,828 | (2,160) | |
| Non-Operating Expense (Income), net | 517 | (4,186) | 1,075 | (20,880) | |
| Income before Income Taxes | 552 | 2,107 | 753 | 18,720 | |
| Income Tax Expense, net | (234) | (948) | (218) | (7,814) | |
| Net Income | $ 318 | $ 1,159 | $ 535 | $ 10,906 | |
| Weighted Average Common Shares Outstanding | |||||
| Basic | 26,139,832 | 24,803,792 | 25,991,914 | 17,581,887 | |
| Diluted | 28,001,472 | 28,489,852 | 28,903,869 | 21,275,487 | |
| Earnings per Share | |||||
| Basic | $ 0.01 | $ 0.05 | $ 0.02 | $ 0.62 | |
| Diluted | $ 0.01 | $ 0.04 | $ 0.02 | $ 0.51 | |
| THE KEYW HOLDING CORPORATION AND SUBSIDIARIES | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (In thousands, except per share amounts) | ||
|
December 31, 2011 |
December 31, 2010 |
|
| ASSETS | (Unaudited) | (Audited) |
| Current assets: | ||
| Cash and cash equivalents | $ 1,294 | $ 5,795 |
| Receivables | 40,630 | 30,406 |
| Inventories, net | 7,242 | 5,183 |
| Prepaid expenses | 2,511 | 1,950 |
| Income tax receivable | 27 | 55 |
| Deferred tax asset, current | 1,193 | 1,475 |
| Total current assets | 52,897 | 44,864 |
| Property and equipment, net | 8,707 | 3,306 |
| Goodwill | 165,997 | 130,374 |
| Other intangibles, net | 39,002 | 22,716 |
| Deferred tax asset | 2,348 | 3,772 |
| Other assets | 211 | 232 |
| TOTAL ASSETS | $ 269,162 | $ 205,264 |
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable | $ 4,136 | $ 6,292 |
| Accrued expenses | 5,901 | 5,847 |
| Accrued salaries & wages | 9,644 | 5,442 |
| Revolver | 49,500 | -- |
| Deferred income taxes | 1,591 | 578 |
| Total current liabilities | 70,772 | 18,159 |
| Long-term liabilities: | ||
| Non-current deferred tax liability | 17,430 | 11,869 |
| Other non-current liabilities | 301 | 125 |
| TOTAL LIABILITIES | 88,503 | 30,153 |
| Commitments and contingencies | -- | -- |
| Stockholders' equity: | ||
| Preferred stock, $0.001 par value; 5 million shares authorized, none issued | -- | -- |
| Common stock, $0.001 par value; 100 million shares authorized, 25,770,795 and 25,554,533 shares issued and outstanding | 26 | 26 |
| Additional paid-in capital | 173,371 | 168,358 |
| Retained earnings | 7,262 | 6,727 |
| Total stockholders' equity | 180,659 | 175,111 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 269,162 | $ 205,264 |
| THE KEYW HOLDING CORPORATION AND SUBSIDIARIES | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (In thousands) | ||
|
Year ended December 31, 2011 |
Year ended December 31, 2010 |
|
| (Unaudited) | (Audited) | |
| Net income | $ 535 | $ 10,906 |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
| Stock compensation | 2,829 | 1,920 |
| Depreciation/Amortization | 15,492 | 7,200 |
| Loss on disposal of equipment | -- | 10 |
| Non-cash interest expense | -- | 585 |
| Non-cash impact of TAGG earn-out reduction | -- | (21,950) |
| Windfall tax benefit from option exercise | (144) | -- |
| Deferred taxes | (2,036) | 7,668 |
| Decrease (increase) in balance sheet items: | ||
| Receivables | (1,784) | (7,294) |
| Inventory | (1,903) | (848) |
| Prepaid expenses | 1,288 | (911) |
| Accounts payable | (2,694) | (419) |
| Accrued expenses | (1,554) | 1,708 |
| Other balance sheet changes | 274 | (213) |
| Net cash provided by (used in) operating activities | 10,303 | (1,638) |
| Cash flows from investing activities: | ||
| Acquisitions, net of cash acquired | (58,573) | (92,008) |
| Purchase of property and equipment | (3,508) | (1,909) |
| Proceeds from sale of equipment | -- | 128 |
| Net cash used in investing activities | (62,081) | (93,789) |
| Cash flows from financing activities: | ||
| Proceeds from stock issuances | -- | 88,823 |
| Proceeds from term note | -- | 5,000 |
| Proceeds from revolver | 79,500 | 19,600 |
| Proceeds from subordinated debt | -- | 8,250 |
| Repayment of debt | (30,000) | (32,850) |
| Repurchase of stock | (3,079) | -- |
| Windfall tax benefit from option exercise | 144 | -- |
| Proceeds from option and warrant exercises | 712 | 5,066 |
| Net cash provided by financing activities | 47,277 | 93,889 |
| Net decrease in cash and cash equivalents | (4,501) | (1,538) |
| Cash and cash equivalents at beginning of period | 5,795 | 7,333 |
| Cash and cash equivalents at end of period | $ 1,294 | $ 5,795 |
KEYW has scheduled a conference call to discuss these results today, February 1, 2012, at 5:00 pm (EST). Interested parties will be able to connect to our Webcast via the Investor page on our website, http://investors.keywcorp.com. Interested parties may also listen to the conference call by calling 1-877-853-5645. The International Dial-In access number will be 1-408-940-3868.
An archive of the Webcast will be available on our webpage following the call. In addition, a dial-up replay of the call will be available at approximately 7:00 p.m. (EST) on February 1, 2012, and will remain available through March 1, 2012. To access the dial-up replay, call 1-855-859-2056, Conference ID 45516010. In addition, a podcast of our conference call will be available for download from our Investors page of our website at approximately the same time as the dial-up replay. International callers may access the replay by calling 1-404-537-3406, with the same Conference ID.
About KEYW: KEYW provides agile cyber superiority, cybersecurity, and geospatial intelligence solutions primarily for U.S. Government intelligence and defense customers. We create our solutions by combining our services and expertise with hardware, software, and proprietary technology to meet our customers' requirements. For more information contact KEYW Corporation, 1334 Ashton Road, Hanover, Maryland 21076; Phone 443-270-5300; Fax 443-270-5301; E-mail investors@keywcorp.com, or on the Web at www.keywcorp.com.
Forward-Looking Statements: Statements made in this press release that are not historical facts constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include but are not limited to statements about our future expectations, plans and prospects, and other statements containing the words "estimates," "believes," "anticipates," "plans," "expects," "will," "potential," "opportunities", and similar expressions, Our actual results, performance or achievements or industry results may differ materially from those expressed or implied in these forward-looking statements. These statements involve numerous risks and uncertainties, including but not limited to those risk factors set forth in our Annual Report on Form 10-K, dated and filed March 29, 2011 with the Securities and Exchange Commission (SEC as required under the Securities Act of 1934, and other filings that we make with the SEC from time to time. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements. KEYW is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.