NEWPORT BEACH, CA — (Marketwired) — 01/28/15 — In the news release, “DynTek Announces Results for the Second Quarter and Year-to-Date Period Ended December 31, 2014,” issued earlier today by DynTek Services, Inc. (OTC PINK: DYNE), we are advised by the company that the first sentence of the second paragraph should read “DynTek reported revenues of $40,194,000 for the second fiscal quarter ended December 31, 2014, a decrease of $10,272,000 or 20%, from $50,466,000 in the prior second quarter ended December 31, 2013” rather than “DynTek reported revenues of $40,194,000 for the second fiscal quarter ended December 31, 2014, a decrease of $10,272,000 or 20%, from $50,466,000 in the prior second quarter ended December 31, 2014” as originally issued. Complete corrected text follows.
NEWPORT BEACH, CA — January 28, 2015 — (OTC PINK: DYNE), a leading provider of , today announced results for its fiscal year 2015 second quarter and the six months ended December 31, 2014.
DynTek reported revenues of $40,194,000 for the second fiscal quarter ended December 31, 2014, a decrease of $10,272,000 or 20%, from $50,466,000 in the prior second quarter ended December 31, 2013. Gross profit was $6,226,000 for the second fiscal quarter ended December 31, 2014, a decrease of $1,879,000 or 23%, from $8,105,000 in the prior year second quarter ended December 31, 2013. This quarter over quarter revenue and gross profit decrease is attributable to several one-time multi-million dollar deals that positively impacted the second quarter of fiscal year 2014.
Total operating expenses were $5,119,000 in the second fiscal quarter ended December 31, 2014, a decrease of $520,000 or 9%, as compared to $5,639,000 in the prior year second quarter ended December 31, 2013. This decrease quarter over prior year quarter is primarily due to lower selling and general and administrative expenses associated with lower revenues and earnings, respectively.
DynTek reported EBITDA of $1,187,000 for the second fiscal quarter ended December 31, 2014, a decrease of $1,368,000 or 54%, as compared to $2,555,000 in the prior year second quarter. Net income was $473,000 for the second fiscal quarter of 2015, or $0.21 per diluted share, a decrease of $487,000, 77% and $0.74 per diluted share, over the net income of $2,079,000 and $0.95 per diluted share in the second fiscal quarter of 2014.
DynTek reported revenues of $83,754,000 for the six months ended December 31, 2014, an increase of $3,474,000 or 4%, from $80,280,000 in the prior six months ended December 31, 2013. Gross profit of $13,530,000 declined slightly for the six months ended December 31, 2014 as compared to $13,590,000 in the prior year six months period ended December 31, 2013.
Total operating expenses were $10,480,000 in the six months ended December 31, 2014, an increase of $98,000 or 1%, as compared to $10,382,000 in the prior year six months ended December 31, 2013. This increase over prior year to date is primarily due to higher selling expenses associated with higher revenues.
DynTek reported EBITDA of $3,219,000 for the six months ended December 31, 2014, a decrease of $148,000 or 4%, as compared to $3,367,000 in the prior year six month period. Net income was $1,443,000 for the six months ended December 31, 2014, or $0.64 per diluted share, a decrease of $1,119,000, 44% and $0.54 per diluted share, over the net income of $2,562,000 and $1.18 per diluted share in the six months ended December 31, 2013, primarily due to a lower non-cash deferred income tax provision in fiscal year to date 2014.
“Our results in the second quarter of fiscal year 2014 were exceptionally high and set a challenging bar for this fiscal year,” said Ron Ben-Yishay, DynTek–s chief executive officer. “I am very happy with the results we posted this quarter and the strong pipeline growth across our technical specialties and geographical regions year to date. We are seeing strong demand for transformational services in the areas of cloud computing and managed service delivery, as well as increasing demand for our core IT solutions such as data center, networking, security and storage and virtualization. The DynTek team is also continuing to receive strong validation from our vendor partners and we were recently named the McAfee 2014 Solution Provider of the Year award for government, healthcare and education markets in the United States for the fifth consecutive year.”
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 principles (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.
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 and to and , DynTek provides professional technology solutions across the three core areas of our customers– technical environment: , , . DynTek–s multidisciplinary approach allows our clients to turn to a single source for their most critical technology requirements. For more information, visit .
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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.
Linda Ford
DynTek, Inc.
949-271-6705
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