Revenues increased by 44% and net income more than tripled year-over-year in 2020
PR Newswire
IRVINE, Calif., April 7, 2021 /PRNewswire/ — DecisionPoint Systems, Inc. (OTCQB: DPSI), today announced financial results for the fourth quarter and 2020.
Fourth Quarter 2020
- Sales for the fourth quarter of 2020 were $18.3 million, an increase of $6.2 million, or 50.7% from the fourth quarter of 2019.
- Net income for the fourth quarter of 2020 was $0.6 million, an increase of 8.3% from the fourth quarter of 2019, and earnings per diluted share for the fourth quarter of 2020 and 2019 were flat at $0.04 per diluted share.
- EBITDA increased 22.3% to $1.3 million for the fourth quarter of 2020 versus the fourth quarter of 2019.
Full Year 2020
- Sales for the full year 2020 were $63.4 million, an increase of $19.5 million, or 44.4%, from 2019.
- Net income for 2020 was $2.9 million, or $0.18 per diluted share, compared with net income of $0.9 million, or $0.06 per diluted share in 2019. For 2020, diluted earnings per share increased 200.0% versus 2019.
- EBITDA increased 92.9% to $5.1 million for 2020 versus 2019.
“2020 was a remarkable year for DecisionPoint Systems, said Steve Smith, chief executive officer. “Despite the pandemic, we grew the business to $63.4 million in 2020 and completed an acquisition during the fourth quarter of 2020 to help accelerate our geographic expansion into 2021 and beyond. This acquisition further solidifies DecisionPoint’s commitment to innovating, growing, and looking for investment opportunities that create shareholder value and make a difference for our customer’ partners and employees. DecisionPoint is committed to providing customers with the best solutions on the market that will create easy, end-to-end support for their entire global operations. Our goal is to continue bringing together the best people, applying the best processes, and combining the best products and services, so we continue to be a relevant and valued partner for our customers while preparing them to meet the demands of tomorrow’s tech-driven world. As we look ahead, we are confident our business will continue to thrive over the long-term given the progress we made over the last year and our continued and planned investments.”
Balance Sheet and Liquidity
Our cash and accounts receivable were $18.4 million at December 31, 2020, compared to $11.3 million at December 31, 2019. Cash provided by operations in 2020 was $4.2 million, as compared to $2.5 million in 2019. Overall debt is lower by $1.1 million than it was at the beginning of the year.
About DecisionPoint Systems
DecisionPoint Systems Inc. delivers mobility-first managed service and integration solutions to healthcare, supply chain, and retail customers, enabling them to make better and faster decisions in the moments that matter—the decision points. Our mission is to help businesses consistently deliver on those moments—accelerating growth, improving worker productivity, and lowering risks and costs.
For more information about DecisionPoint Systems, Inc., visit www.decisionpt.com.
Forward-Looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 that are based on management’s beliefs and assumptions and on information currently available to management. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by forward-looking statements. Forward-looking statements in this press release may include statements about our plans to obtain funding for our current and proposed operations and potential acquisition and expansion efforts; the ultimate impact of the COVID-19 pandemic, or any other health epidemic, on our business, our clientele or the global economy as a whole; debt obligations of the Company; our general history of operating losses; our ability to compete with companies producing products and services; the scope of protection we are able to establish and maintain for intellectual property rights covering our products and technology; the accuracy of our estimates regarding expenses, future revenue, capital requirements and needs for additional financing; our ability to develop and maintain our corporate infrastructure, including our internal controls; our ability to develop innovative new products; and our financial performance. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this press release, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. We qualify all of our forward-looking statements by these cautionary statements. Forward-looking statements speak only as of the date they are made, and we do not undertake to update these statements other than as required by law. You are advised, however, to review any further disclosures we make on related subjects in our periodic filings with the Securities and Exchange Commission.
Investor Relations Contact:
Carol Arakaki
[email protected]
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Current assets: |
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Cash |
$ |
2,005 |
$ |
2,620 |
||||
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Accounts receivable, net |
16,438 |
8,710 |
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Inventory, net |
884 |
3,825 |
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Deferred costs |
1,744 |
2,201 |
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Prepaid expenses and other current assets |
67 |
268 |
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Total current assets |
21,138 |
17,624 |
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Operating lease assets |
583 |
516 |
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Property and equipment, net |
751 |
239 |
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Deferred costs, net of current portion |
2,097 |
1,258 |
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Deferred tax assets |
1,973 |
2,659 |
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Intangible assets, net |
4,663 |
2,394 |
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Goodwill |
8,128 |
6,990 |
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Other assets |
22 |
19 |
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Total assets |
$ |
39,355 |
$ |
31,699 |
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Current liabilities: |
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Accounts payable |
$ |
12,852 |
$ |
10,589 |
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Accrued expenses and other current liabilities |
2,807 |
2,222 |
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Deferred revenue |
4,617 |
3,630 |
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Line of credit |
1,206 |
3,177 |
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Current portion of debt |
— |
144 |
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Due to related parties |
34 |
124 |
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Current portion of operating lease liabilities |
261 |
140 |
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Total current liabilities |
21,777 |
20,026 |
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Deferred revenue, net of current portion |
3,140 |
1,979 |
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Long-term debt |
1,361 |
390 |
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Noncurrent portion of operating lease liabilities |
340 |
388 |
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Other |
873 |
— |
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Total liabilities |
27,491 |
22,783 |
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Commitments and contingencies |
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Stockholders’ equity: |
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Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued or outstanding |
— |
— |
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Common stock, $0.001 par value; 50,000 shares authorized; 13,576 and 13,576 shares issued and outstanding, respectively |
14 |
14 |
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Additional paid-in capital |
38,229 |
38,142 |
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Accumulated deficit |
(26,379) |
(29,240) |
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Total stockholders’ equity |
11,864 |
8,916 |
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Total liabilities and stockholders’ equity |
$ |
39,355 |
$ |
31,699 |
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Net sales: |
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Product |
$ |
14,733 |
$ |
9,154 |
$ |
50,673 |
$ |
31,990 |
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Service |
3,568 |
2,994 |
12,687 |
11,899 |
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Net sales |
18,301 |
12,148 |
63,360 |
43,889 |
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Cost of sales: |
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Product |
11,550 |
7,150 |
40,129 |
25,866 |
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Service |
2,264 |
1,987 |
8,413 |
7,267 |
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Cost of sales |
13,814 |
9,137 |
48,542 |
33,133 |
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Gross profit |
4,487 |
3,011 |
14,818 |
10,756 |
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Operating expenses: |
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Sales and marketing expense |
1,586 |
1,232 |
5,587 |
4,907 |
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General and administrative expenses |
1,971 |
958 |
5,203 |
3,999 |
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Total operating expenses |
3,557 |
2,190 |
10,790 |
8,906 |
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Operating income |
930 |
821 |
4,028 |
1,850 |
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Interest expense |
87 |
77 |
319 |
649 |
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Other income |
1 |
1 |
213 |
– |
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Income before income taxes |
844 |
745 |
3,922 |
1,201 |
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Income tax expense |
244 |
191 |
1,061 |
310 |
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Net income and comprehensive income attributable to common stockholders |
$ |
600 |
$ |
554 |
$ |
2,861 |
$ |
891 |
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Earnings per share attributable to stockholders: |
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Basic |
$ |
0.04 |
$ |
0.04 |
$ |
0.21 |
$ |
0.07 |
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Diluted |
$ |
0.04 |
$ |
0.04 |
$ |
0.18 |
$ |
0.06 |
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Weighted average common shares outstanding |
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Basic |
13,576 |
13,576 |
13,576 |
13,415 |
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Diluted |
15,623 |
15,642 |
15,622 |
15,341 |
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Net income |
$ |
2,861 |
$ |
891 |
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Adjustments to reconcile net income to net cash provided by operating activities: |
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Depreciation and amortization |
891 |
809 |
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Amortization of deferred financing costs and note discount |
157 |
304 |
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Share-based compensation expense |
87 |
324 |
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Acquisition earn-out adjustment |
– |
(110) |
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Deferred income taxes, net |
686 |
265 |
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Provision for doubtful accounts |
25 |
5 |
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Changes in operating assets and liabilities: |
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Accounts receivable |
(5,853) |
(503) |
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Inventory, net |
2,945 |
(3,469) |
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Deferred costs |
(382) |
(746) |
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Prepaid expenses and other current assets |
254 |
(148) |
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Other assets, net |
(8) |
21 |
||||||
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Accounts payable |
585 |
4,047 |
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Accrued expenses and other current liabilities |
294 |
275 |
||||||
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Due to related parties |
(90) |
16 |
||||||
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Operating lease liabilities |
6 |
(163) |
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Deferred revenue |
1,738 |
717 |
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Net cash provided by operating activities |
4,196 |
2,535 |
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Purchases of property and equipment |
(93) |
(175) |
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Cash paid for acquisitions, net of cash acquired |
(3,409) |
(500) |
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Net cash used in investing activities |
(3,502) |
(675) |
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Repayment of term debt |
(646) |
(1,636) |
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Line of credit, net |
(1,971) |
(19) |
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Proceeds from issuance of term debt |
1,361 |
— |
||||||
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Debt issuance costs |
(53) |
(36) |
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Proceeds from exercise of stock options |
— |
1 |
||||||
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Net cash used in financing activities |
(1,309) |
(1,690) |
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Change in cash |
(615) |
170 |
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Cash, beginning of year |
2,620 |
2,450 |
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Cash, end of year |
$ |
2,005 |
$ |
2,620 |
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Non-GAAP Financial Measure:
This press release includes information relating to EBITDA which the Securities and Exchange Commission has defined as a “non-GAAP financial measure.” EBITDA is defined as net income before interest expense, net, income tax expense, and depreciation and amortization (EBITDA). We believe EBITDA may provide investors with useful information of how our current primary operating results relate to our historical performance. The non-GAAP financial measure provided is not meant to be considered as a substitute for GAAP financials. We caution investors that amounts presented in accordance with our definitions of EBITDA may not be comparable to similar measures disclosed by other companies, because not all companies calculate EBITDA in the same manner.
The following is a reconciliation of net income to EBITDA (unaudited and in thousands):
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Net income |
$ |
600 |
$ |
554 |
$ |
2,861 |
$ |
891 |
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Interest expense |
87 |
77 |
319 |
649 |
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Income tax expense |
244 |
191 |
1,061 |
310 |
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Depreciation and amortization (1) |
324 |
203 |
888 |
809 |
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EBITDA |
$ |
1,255 |
$ |
1,025 |
$ |
5,129 |
$ |
2,659 |
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(1) Recorded within general and administration expenses within our Unaudited Condensed Consolidated Statements of Income and Comprehensive Income. |
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SOURCE DecisionPoint Systems, Inc.
