WidePoint Corporation Announces Fourth Quarter and FYE 2011 Results

PR Newswire
Thursday, March 29th 2012

Reports Positive Net Income for the Fourth Quarter and Calendar Year; Company Positioned for Strong Performance in 2012

WASHINGTON, March 29, 2012 /PRNewswire/ -- WidePoint Corporation (NYSE Amex: WYY), a specialist in communications management and cybersecurity solutions, today announced financial results for the three months and year ending December 31, 2011.

Fourth Quarter 2011 Highlights

  • Net revenue for the quarter ended December 31, 2011 decreased 4.6% sequentially to $10.2 million from $10.7 million at September 30, 2011 driven by decreases in Communications Management and CyberSecurity Solutions, partially offset by a lesser increase in the IT Consulting Services and Products segment. Delay's in the awarding of task orders negatively affected revenue performance during the 4th qtr of 2011.  
  • Gross margin decreased in the fourth quarter on a sequential basis to approximately 21% compared to 24% in the third quarter 2011 as a result of a smaller mix of revenues from our higher margin services during the 4th qtr of 2011.
  • Net income for the quarter was approximately $132,000 when compared sequentially to net income of $218,000 in the third quarter of 2011.

Full Year 2011 Financial Highlights

  • Net revenue for the year ended December 31, 2011 was $41.4 million, a decline of $9.4 million from $50.8 million in last year's comparable period. The decline was materially a result of the deferral of anticipated awards in 2011 due to federal government budget and debt ceiling matters that were resolved during our fiscal year 2011, along with a reduction in billable calling minutes as we started to shift our revenue mix towards higher margin managed services.  We remain focused on the continued retention and expansion of our services to our existing customers, while focusing on winning new customers within the state and local municipal and commercial marketplaces.
  • Gross profit for the full year ended December 31, 2011 was $9.2 million, representing a 22.3% gross margin, compared to $13.3 million, representing 26.1% gross margin, last year. The percentage of gross profit was lower for the full year of 2011 as compared to the same period of 2010 as a result of a lower percentage of higher margin revenues from our CyberSecurity segment in 2011.  
  • Total operating expenses for the full year ended December 31, 2011, decreased approximately $1.3 million, or 12.6%, to $9.1 million, compared to $10.5 million for the year-ago period. The decline is primarily attributable to a decrease in targeted sales and marketing activities as well as internal efforts to centralize certain functions to support a growing infrastructure and optimize our sales and marketing expenses.
  • WidePoint reported operating income of approximately $105,000 for the 2011 year as compared to operating income of $2.8 million in the year ago period. Net income was approximately $247,000, which included a $199,000 income tax benefit, as compared to net income of approximately $6.4 million in the year-ago period, which included a $3.7 million income tax benefit.

Steve Komar, WidePoint's CEO commented, "Despite the lingering short-term hurdles that impacted our revenues throughout much of the year, we accomplished several strategic objectives that broadened our addressable business horizons in 2012, that included: