NEWPORT BEACH, CA--(Marketwired - Oct 29, 2014) - DynTek, Inc. (PINKSHEETS: DYNE), a leading provider of professional technology services, today announced results for its fiscal year 2015 first quarter ended September 30, 2014. 

DynTek reported revenues of $43,560,000 for the first fiscal quarter ended September 30, 2014, an increase of $13,746,000 or 46%, from $29,814,000 in the prior first quarter ended September 30, 2014. Gross profit increased to $7,305,000 for the first fiscal quarter ended September 30, 2014, an increase of $1,820,000 or 33%, from $5,485,000 in the prior year first quarter ended September 30, 2013. This revenue and gross profit growth is attributable to several multi-million dollar deals with government and education customers in the Northeast district, and a large education customer in the Southwest district.

Total operating expenses were $5,361,000 in the first fiscal quarter ended September 30, 2014, an increase of $617,000 or 13%, as compared to $4,744,000 in the prior year first quarter ended September 30, 2013. This increase quarter over prior year quarter is primarily due to higher selling expenses associated with higher revenues and increased marketing efforts to support several growing geographies. 

DynTek reported EBITDA of $2,032,000 for the first fiscal quarter ended September 30, 2014, an increase of $1,220,000 or 150%, as compared to $812,000 in the prior year first quarter. Net income was $970,000 for the first fiscal quarter of 2015, or $0.42 per diluted share, an increase of $487,000, 101% and $0.20 per diluted share, over the net income of $483,000 and $0.22 per diluted share in the first fiscal quarter of 2014. 

New Lending Facility 
On July 1, 2014, DynTek closed a new three year $20,000,000 revolving line of credit agreement and commercial banking relationship with Opus Bank, a major commercial bank based in California. The new line of credit structure is intended to provide DynTek with increased flexibility to support the Company's strategic initiatives and investments. The initial proceeds from this new line of credit were used to pay off the prior line of credit and allow for an early repayment of a $5,000,000 subordinated promissory note.

"Our team had an excellent quarter -- our second best in company history -- driven by a focus on large scale opportunities in our public sector business, measurable growth in commercial accounts and excellent technical delivery across the board," said Ron Ben-Yishay, DynTek's chief executive officer. "Our strategy is centered on uncovering and developing new opportunities in our current customer base across the full breadth of our technology portfolio, and acquiring net new clients in our established territories. Over the past several quarters, we have also developed new geographic footprints in opportunistic and adjacent territories primarily led by needs of our customers and manufacturer partners. We are also very excited to begin our new relationship with OPUS Bank. They are a valued partner in our future success and their confidence in our financial condition, management team, and future prospects is an important validation."

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.

About DynTek
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

About Opus Bank
Opus Bank is an FDIC insured California-chartered commercial bank with over $4.7 billion of total assets, $3.7 billion of total loans, and $3.5 billion in total deposits as of September 30, 2014. Opus Bank provides high-value, relationship-based banking products, services, and solutions to its clients through its Retail Bank, Commercial Bank, Merchant Bank, and Correspondent Bank. Opus Bank offers a suite of treasury and cash management and depository solutions and a wide range of loan products, including commercial business, healthcare, technology, multifamily residential, commercial real estate, and structured finance, and is an SBA preferred lender. Opus Bank is an Equal Housing Lender. Opus Bank operates 58 banking offices, including two in the Phoenix metropolitan area of Arizona, 32 in California and 24 in the Seattle/Puget Sound region in Washington. Visit for more information.

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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.

(EBITDA presentation)  
(Unaudited, in thousands, except share and per share data)  
    Quarter Ended September 30,     Quarter Ended September 30,  
    2014     2013  
  Product revenues   $ 35,385     $ 21,576  
  Service revenues     8,174       8,238  
  TOTAL REVENUES     43,560       29,814  
COST OF REVENUES                
  Cost of products     29,680       17,857  
  Cost of services     6,575       6,472  
  TOTAL COST OF REVENUES     36,255       24,329  
GROSS PROFIT     7,305       5,485  
OPERATING EXPENSES                
  Selling     4,185       3,781  
  General and administrative     1,144       946  
  Depreciation and amortization     32       17  
  TOTAL OPERATING EXPENSES     5,361       4,744  
INCOME FROM OPERATIONS     1,944       741  
EBITDA     2,032       812  
OTHER INCOME (EXPENSE)                
  Interest expense     (328 )     (215 )
TOTAL OTHER EXPENSE     (328 )     (215 )
INCOME BEFORE INCOME TAXES     1,616       526  
  Income tax provision     (646 )     (43 )
NET INCOME   $ 970     $ 483  
NET INCOME PER SHARE:                
  Basic   $ 0.45     $ 0.23  
  Diluted   $ 0.42     $ 0.22  
  Basic     2,171,352       2,125,934  
  Diluted     2,325,617       2,152,732  

Contact Information:

For more information, contact:
Linda Ford
DynTek, Inc.