NEWPORT BEACH, Calif., April 19, 2018 (GLOBE NEWSWIRE) -- DynTek, Inc. (DYNE.OTC), a leading provider of professional technology services, today announced results for its third quarter ended March 31, 2018.
Financial & Business Highlights
Third Quarter 2018 Ended March 31, 2018
Nine Months Ended March 31, 2018
In our third quarter, we continued our solid performance in revenue and gross profit but had several product orders delayed due to manufacturer shortages. The reduced operating expenses reflect the lower sales in this quarter.
In our nine months year to date, we achieved significant year-on-year growth in revenue and gross profit, due in part to delivering higher volume, higher margin solutions. Our year to date EBITDA growth of 39.7% reflects control over operating expenses as revenues continue to rise.
Our net earnings for the quarter and year to date were impacted by a $.650 million non-cash tax provision for the revaluation of certain deferred tax assets at the lower tax rates from the 2018 Tax Act. The final provision will be recorded next quarter in preparation for our fiscal year end.
“The need to modernize and secure data centers and IT infrastructure in support of the new digital economy is a driving factor in our double-digit year to date growth,” said Ron Ben-Yishay, DynTek’s chief executive officer. “Cybersecurity solutions – both products and service engagements – are a de facto component of every strategy session with clients. In addition, cloud adoption continues to increase as our clients embrace hybrid cloud architecture to support critical business initiatives and improve their customer and employee experiences.”
The Company defines EBITDA as net income from operations before interest, taxes, depreciation and amortization, and stock-based compensation. Other companies may calculate EBITDA differently. Although EBITDA is a widely used financial indicator of a company's ability to service debt, it is not a recognized measure for financial statement presentation under generally accepted accounting procedures (GAAP). EBITDA should not be considered in isolation or as superior or as an alternative to net income or to cash flows from operating activities as determined in accordance with GAAP. Nonetheless, the Company believes that EBITDA provides useful supplemental information for investors and others to measure operating performance, especially in situations where a company has significant non-cash operating expenses that are not indicative of core business operating results. EBITDA is widely used in the IT services industry to analyze comparable company performance, and management of the Company also uses EBITDA, in addition to GAAP information, as a measure of operating performance for assessing its business units.
DynTek is a leading provider of professional technology services to mid-market companies, such as state and local governments, educational institutions and commercial entities in the largest IT markets nationwide. From virtualization and cloud computing to unified communications and collaboration, DynTek provides professional technology solutions across the three core areas of our customers’ technical environment: Infrastructure/Data Center, Microsoft Platforms, End Point Computing. DynTek's multidisciplinary approach allows our clients to turn to a single source for their most critical technology requirements. For more information, visit http://www.dyntek.com.
Forward Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Investors are cautioned that forward-looking statements made in this press release, involve known and unknown risks and uncertainties that could cause actual results to materially differ from the forward-looking statements. Such risks and uncertainties include, among others, our success in reaching target markets for services and products in a highly competitive market; our ability to maintain existing customers and attract future customers; our ability to finance and sustain operations, including our ability to comply with the terms of the revolving line of credit and the Company’s other existing and future indebtedness; our ability to achieve profitability and positive cash flow from operations; our ability to maintain business relationships with IT product vendors; the size and timing of additional significant orders for our products and services and our ability to fulfill such orders; the continuing desire of state and local governments to outsource to private contractors and the availability of budgets to place orders for our products and services; our ability to retain skilled professional staff and certain key executives; the performance of our government and commercial technology services; and the continuation of general economic and business conditions that are conducive to outsourcing of IT services. We have no obligation to publicly revise any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements.
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|DYNTEK, INC. AND SUBSIDIARY|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|(Unaudited, in thousands, except share and per share data)|
|Quarter Ended March 31,||Nine Months Ended March 31|
|PYQ Ended March 31,||PYTD Nine Months Ended March 31,|
|COST OF REVENUES|
|Cost of products||20,793||78,632||27,945||69,664|
|Cost of services||7,294||20,227||6,049||19,151|
|TOTAL COST OF REVENUES||28,087||98,859||33,994||88,815|
|General and administrative||1,278||5,468||1,113||2,984|
|Depreciation and amortization||34||99||42||133|
|TOTAL OPERATING EXPENSES||5,402||19,295||5,528||15,612|
|INCOME FROM OPERATIONS||1,212||2,458||1,972||2,893|
|OTHER INCOME (EXPENSE)|
|TOTAL OTHER EXPENSE||(107||)||(441||)||(424||)||(1,042||)|
|INCOME BEFORE INCOME TAXES||1,105||2,018||1,548||1,851|
|Income tax provision||(990||)||(1,354||)||(607||)||(728||)|
|NET INCOME PER SHARE:|
|WEIGHTED AVERAGE NUMBER OF SHARES:|