WPCS International Incorporated (NASDAQ: WPCS) announced financial results for the fiscal year 2013 first quarter ended July 31, 2012 on Friday, September 14th, after market hours.
Highlights:
- EBITDA of approximately $695,000 compared to an EBITDA loss of $7.1 million in preceding quarter ended April 30, 2012.
- Net income of approximately $994,000 or $0.14 per diluted shared which includes income from discontinued operations of approximately $1.7 million, or $0.24 per diluted share related to the asset sales of the Hartford and Lakewood Operations. This compares to a net loss of approximately $35,000 or $0.01 per diluted share for the same period a year ago, which includes a loss from discontinued operations of approximately $189,000, or $0.03 per diluted share.
- $13.4 million in revenues for the first quarter compared to $18.6 million for the same period in the prior year.
Recently announced contracts have been scheduled for later in the year, therefore these project delays caused the reported revenue to be lower than planned. However, the delayed project revenue is expected to be recognized in the quarters ahead:
WPCS International received approximately $22M in new contracts, including projects to be completed with:
- San Francisco General Hospital
- University of the Pacific
- Oakland Airport
- Kaiser Permanente
- Trane
- Siemens
- Sutter Health
- Yakima Valley Community College
- Mulkiteo School District
In Australia:
- Nambour General Hospital
- Toowoomba Base Hospital
- Caboolture Mental Health Unit
- Rockhampton South Medicare
- Wondai State School
- Mackay Northern Beaches State High School
In China:
- Taian Gas Group
- Sichuan Oil and Gas Construction
At the company’s conference call, Andrew Hidalgo, CEO of WPCS, stated:
WPCS has significantly improved its balance sheet and income statement from our last reported quarter. In regards to the balance sheet, the previous quarter showed a negative working capital due to the project losses incurred this past fiscal year. In the first quarter, the company has returned to positive working capital of $1.4 million. However, managing cash flow is still a challenge. Due to the project losses in fiscal year 2012, we are in default on financial covenants with Sovereign Bank, they have reduced the credit facility to $2 million, and they reserve the right to terminate the credit facility.
For the last 4 months the company’s management have been working on the alternative for the Sovereign’s credit facility. We remain very optimistic for the potential deal with a new lender.
WPCS International Incorporated
One East Uwchlan Avenue
Exton, PA 19341
Tel: 610.903.0400
WPCS is a design-build engineering company that focuses on the implementation requirements of communications infrastructure. The company provides its engineering capabilities including wireless communication, specialty construction and electrical power to the public services, healthcare, energy and corporate enterprise markets worldwide.