SPRINGFIELD, Va., May 8, 2014 /PRNewswire/ -- Versar, Inc. (NYSE MKT: VSR) today announced financial results for the fiscal third quarter and nine months ended March 28, 2014.
Gross revenue for the third quarter of fiscal year 2014 decreased 9% to $28.2 million, compared to revenues of $31.0 million during the third quarter of the last fiscal year. Consolidated revenue performance was impacted by delayed funding for government contracts related to sequestration. Sequentially, revenues were essentially flat as compared to the second quarter of 2014.
The Company reported a reduction in gross margins for the quarter, primarily due to the decrease in gross profit related to the wind down of its Title II work in Afghanistan, which is anticipated to conclude in the summer of 2014 as well as higher direct costs due to the September 2013 acquisition of Geo-Marine (GMI). Additionally, gross profit from the Company's Professional Services Group (PSG) declined as a result of contracts shifting to small business programs. Versar recorded a net loss of $131,000 or a loss of $0.01 per share in the third quarter of 2014 (which included a loss of $0.02 from continuing operations and income of $0,01 from discontinued operations) as compared to net income of $1 million or $0.11 on a fully diluted basis (which included a loss of $0.16 from discontinued operations) in the same period of 2013.
Nine month gross revenue increased 10% to $85.4 million, as compared to gross revenue of $77.5 million in the first nine months of fiscal 2013. The increase in revenue was primarily attributable to the acquisition of GMI. Gross margin decreased to 8% as compared to 17.6% in the first nine months of 2013 for similar reasons to those described above. Versar recorded net income of $627,000 or $0.07 per share on a fully diluted basis (which includes $0.03 from discontinued operations) in the first nine months of fiscal 2014 as compared to net income of $2.8 million or $0.30 per share on a fully diluted basis (which includes a loss of $0.20 from discontinued operations) for the first nine months of fiscal 2013.
As of March 28, 2014, Versar recorded funded backlog of approximately $119 million, an increase of 10% compared to $108 million of funded backlog at the end of fiscal year 2013.
Versar closed the fiscal third quarter of 2014 with a cash balance of approximately $6.6 million and stockholders' equity of $38.5 million.
Tony Otten, CEO of Versar said, "In the third quarter, we continued to see delayed funding for government contracts related to last fall's government shut down and sequestration. Despite the 2014 appropriations deal, we have not seen the expected increase in funding, although we do expect more money to be obligated by the end of September. As with many in our sector, the slow down has weighed on both our revenues and our margins. That said, our backlog remains strong and we enhanced it with the acquisition of Lime Energy's Facility Repair and Renewal business, which represents five task orders with total revenue of between $6 million and $10 million. Additionally, we received an extension to our personal services contract in Iraq. Following the close of the quarter, we announced that the Army Corps of Engineers had awarded an environmental services IDIQ contract to our joint venture with Cardno TEC, which has a maximum capacity of $27.5 million. Additionally, we were awarded a $2.39 million design/build contract for the replacement of a gas line at Hanscom Air Force Base. We are optimistic about our pipeline for future projects as we enter into the May through September time period, typically the busiest season for government contract awards."
Mr. Otten continued, "Our integration of GMI continues to progress, but not as quickly as anticipated. Strategically, GMI is a valuable asset to Versar and we are seeing its positive impact in terms of technical capabilities, geography and hence projects we are bidding on. However, the slow down has particularly impacted GMI given their specialty, and we now anticipate that GMI will be accretive in fiscal 2015 as opposed to the first quarter of fiscal 2015 as previously stated."
Conference Call:
The Company will hold a conference call at 2:00 PM Eastern Time today, Thursday, May 8 to discuss the Company's operational performance and financial results for its quarter ended March 28, 2014.
The dial in number for the US and Canada is toll free, 877-407-8033. The international dial in number is 201-689-8033. Participants should call in a few minutes before 2:00 PM Eastern Time. For those unable to attend the conference call, a replay will be available on Versar's website, www.versar.com
VERSAR, INC., headquartered in Springfield, Virginia, is a publicly traded global project management company providing sustainable value oriented solutions to government and commercial clients in the construction management, environmental services, munitions response, and professional services market areas.
VERSAR operates a number of web sites, including the corporate web sites, www.versar.com, www.geomet.com, www.viap.com, www.dtaps.com, www.adventenv.com, www.charronconsulting.com, and www.ppsgb.com.
This news release contains forward-looking information. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be significantly impacted by certain risks and uncertainties described herein and in Versar's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the fiscal year ended June 28, 2013, as updated from time to time in the Company's periodic filings. The forward-looking statements are made as of the date hereof and Versar does not undertake to update its forward-looking statements.
|
Contact: |
David Gray |
John Nesbett or Jennifer Belodeau |
|
Director of Financial Reporting |
Institutional Marketing Services (IMS) | |
|
Versar, Inc. |
(203) 972-9200 | |
|
(703) 642-6888 |
Logo - http://photos.prnewswire.com/prnh/20120806/NE52646LOGO
|
VERSAR, INC. AND SUBSIDIARIES | ||||
|
As of | ||||
|
March 28, |
June 28, | |||
|
ASSETS |
||||
|
Current assets |
||||
|
Cash and cash equivalents |
$ |
6,630 |
$ |
8,728 |
|
Accounts receivable, net |
31,695 |
29,342 | ||
|
Inventory |
1,156 |
1,225 | ||
|
Prepaid expenses and other current assets |
1,425 |
1,074 | ||
|
Deferred income taxes |
2,083 |
2,314 | ||
|
Income tax receivable |
2,446 |
1,764 | ||
|
Total current assets |
45,435 |
44,447 | ||
|
Property and equipment, net |
2,242 |
2,108 | ||
|
Deferred income taxes, non-current |
1,614 |
622 | ||
|
Goodwill |
9,454 |
7,515 | ||
|
Intangible assets, net |
3,096 |
1,798 | ||
|
Other assets |
1,014 |
887 | ||
|
Total assets |
$ |
62,855 |
$ |
57,377 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
|
Current liabilities |
||||
|
Accounts payable |
$ |
12,432 |
$ |
10,788 |
|
Accrued salaries and vacations |
2,326 |
3,042 | ||
|
Other current liabilities |
5,174 |
3,304 | ||
|
Notes payable, current |
1,301 |
333 | ||
|
Total current liabilities |
21,333 |
17,467 | ||
|
Notes payable, non-current |
396 |
333 | ||
|
Deferred income taxes |
1,489 |
849 | ||
|
Other long-term liabilities |
1,092 |
1,104 | ||
|
Total liabilities |
24,310 |
19,753 | ||
|
Commitments and contingencies |
||||
|
Stockholders' equity |
||||
|
Common stock, $.01 par value; 30,000,000 shares authorized; |
100 |
99 | ||
|
Capital in excess of par value |
30,247 |
29,758 | ||
|
Retained earnings |
9,994 |
9,366 | ||
|
Treasury stock, at cost |
(1,396) |
(1,224) | ||
|
Accumulated other comprehensive loss; |
(400) |
(375) | ||
|
Total stockholders' equity |
38,545 |
37,624 | ||
|
Total liabilities and stockholders' equity |
$ |
62,855 |
$ |
57,377 |
|
VERSAR, INC. AND SUBSIDIARIES | ||||||||
|
Condensed Consolidated Statements of Operations | ||||||||
|
(Unaudited-in thousands, except per share amounts) | ||||||||
|
For the Three Months Ended |
For the Nine Months Ended | |||||||
|
March 28, |
March 29, |
March 28, |
March 29, | |||||
|
GROSS REVENUE |
$ |
28,225 |
$ |
30,981 |
$ |
85,383 |
$ |
77,499 |
|
Purchased services and materials, at cost |
14,322 |
15,304 |
43,091 |
32,540 | ||||
|
Direct costs of services and overhead |
12,770 |
9,453 |
35,874 |
31,298 | ||||
|
GROSS PROFIT |
1,133 |
6,224 |
6,418 |
13,661 | ||||
|
Selling, general and administrative expenses |
1,946 |
1,877 |
6,231 |
6,051 | ||||
|
Other income |
(327) |
- |
(327) |
- | ||||
|
OPERATING (LOSS) INCOME |
(486) |
4,347 |
514 |
7,610 | ||||
|
OTHER (INCOME) EXPENSE |
||||||||
|
Interest income |
(1) |
(3) |
(14) |
(4) | ||||
|
Interest expense |
36 |
21 |
103 |
66 | ||||
|
(LOSS) INCOME BEFORE INCOME TAXES, |
(521) |
4,329 |
425 |
7,548 | ||||
|
Income tax (benefit) expense |
(301) |
1,776 |
63 |
2,868 | ||||
|
NET (LOSS) INCOME FROM CONTINUING OPERATIONS |
(220) |
2,553 |
362 |
4,680 | ||||
|
Income (Loss) from discontinued operations, net of tax (expense) benefit of $60 and $121 and $(45) and $174 |
89 |
(1,511) |
265 |
(1,867) | ||||
|
NET INCOME |
$ |
(131) |
$ |
1,042 |
$ |
627 |
$ |
2,813 |
|
NET (LOSS) INCOME PER SHARE-BASIC and DILUTED |
||||||||
|
Continuing operations |
$ |
(0.02) |
0.27 |
$ |
0.04 |
0.50 | ||
|
Discontinued operations |
0.01 |
(0.16) |
0.02 |
(0.20) | ||||
|
NET INCOME PER SHARE-BASIC and DILUTED |
$ |
(0.01) |
$ |
0.11 |
$ |
0.06 |
$ |
0.30 |
|
WEIGHTED AVERAGE NUMBER OF SHARES |
9,702 |
9,545 |
9,645 |
9,482 | ||||
|
WEIGHTED AVERAGE NUMBER OF SHARES |
9,758 |
9,575 |
9,703 |
9,512 | ||||
SOURCE Versar, Inc.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
