SPRINGFIELD, Va., Feb. 16, 2016 /PRNewswire/ -- Versar, Inc.
(NYSE MKT: VSR) today announced financial results for the second
quarter and six months ended January
1, 2016.
Financial Results
Revenue for the second quarter of fiscal year 2016 increased 39%
to $47.3 million, compared to
revenues of $34.2 million during the
second quarter of the last fiscal year and by 5% sequentially as
compared to the fiscal first quarter of 2016. Gross margin
decreased to 8%, compared to 10% in the same prior year quarter,
primarily due to product mix, but increased sequentially as
compared to gross margin of 5% in the first quarter of fiscal
2016. Selling, general and administrative expenses increased
$0.4 million in the second quarter,
primarily related to an estimated $0.6
million in costs associated with the Company's acquisition
of VSS, as well as some other payroll-related items. As a
percentage of sales, SG&A expenses decreased to 7% compared to
9% in the second quarter of last year. Net income for the
quarter was $67,000 or $0.01 per share compared to net income of
$277,000 or $0.03 per share in the same period of fiscal
2015.
For the six months ended January 1,
2016, revenues increased 45% to $92.2
million compared to revenues of $63.7
million in the same period of fiscal 2015.
The Company reported a decrease in first half gross margin to 6% as
compared to gross margin of 9% in the first half of fiscal 2015,
related primarily to changes in our portfolio of contracts.
Selling, general and administrative expenses increased to
$6.2 million in the first six months
of 2016, including approximately $0.6
million in year to date costs associated with the VSS
integration, but decreased to 7% of sales as compared to SG&A
of $5.6 million or 8% of sales in the
first six months of 2015. Net loss for the first six
months of fiscal 2016 was $363,000 or
$0.04 per share as compared to net
income of $190,000 or $0.02 per share in the first six months of fiscal
2015.
Tony Otten, CEO of Versar, said,
"We delivered strong revenue growth in the second quarter of fiscal
2016, primarily driven by our Dover Air Force Base contract, a
strategically important project for us that has broadened the
Company's portfolio of capabilities. Dover is a construction
project, and as such, generates lower margins than the balance of
our revenue. Sequentially, we saw a significant increase in gross
margin with improved performance at both our Engineering &
Construction Management business and in our Environmental Services
Group. Furthermore, with the acquisition and integration of
VSS, we gained new, classified construction capabilities that
position us to more effectively compete for higher margin
projects."
Funded Backlog
As of January 1, 2016, Versar
recorded funded backlog of approximately $193 million, as compared to $179 million of funded backlog at the end of
fiscal year 2015. Mr. Otten continued, "Funded backlog of
$193 million as of January 1, 2016 represents an 8% increase as
compared to funded backlog of $179
million at the close of fiscal 2015. Our pipeline
remains strong and we continue to see marketplace interest in our
broad range of capabilities and our comprehensive, customized
solutions."
Recent Awards
During the quarter, the Company was awarded a new task order
valued at $7.1 million from the U.S.
Army Corps of Engineers (USACE) Engineering and Support Center
Huntsville, for the repair and upgrade of fire suppression systems
in hangars at Joint Base Andrews in Maryland. Additionally,
the Company's joint venture between Geo-Marine/AECOM was awarded a
$2.1 million task order under its
Naval Facilities Engineering Command (NAVFAC) Natural Resources
IDIQ contract, to develop predictive models to understand the
dynamics of and define the source of sediment/material
transportation near and adjacent to the Naval Submarine Base,
Kings Bay, Georgia.
"Our diverse capabilities enable us to serve our customers by
providing tailored solutions in challenging terrains and we've
built a solid reputation on completing difficult assignments.
As we continue to strengthen our service offerings to meet
marketplace demand, we believe we are well positioned to drive
continued revenue growth, improved margins and sustained
profitability," Mr. Otten concluded.
Conference Call
The Company will hold a conference call at 2:00 PM Eastern Time today, Tuesday, February 16, to discuss the Company's
operational performance and financial results for the fiscal
second quarter ended January 1,
2016.
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 of the teleconference will be available until March 1, 2016 and may be accessed domestically by
dialing (877) 660-6853 and international callers may dial (201)
612-7415. Callers must enter conference code number
13629617. Additionally, the replay will be available on
Versar's Investor Relations website,
http://www.versar.com/investors/corporate.html.
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
engineering and construction management, environmental, and
professional services.
VERSAR operates the following web sites, www.versar.com
and www.versarpps.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
26, 2015, 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:
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Karin
Weber
|
John Nesbett or
Jennifer Belodeau
|
|
M&A/Investor
Relations
|
Institutional
Marketing Services (IMS)
|
|
Versar,
Inc.
|
(203)
972-9200
|
|
(703)
642-6706
|
jnesbett@institutionalms.com
|
|
kweber@versar.com
|
|
|
VERSAR, INC. AND
SUBSIDIARIES
|
|
Condensed
Consolidated Balance Sheets
|
|
(In thousands, except
share amounts)
|
|
|
As of
|
|
|
January 1,
2016 (Unaudited)
|
|
June 26,
2015
|
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
3,718
|
$
|
2,109
|
|
Accounts receivable,
net
|
|
45,574
|
|
57,171
|
|
Inventory,
net
|
|
1,243
|
|
1,188
|
|
Prepaid expenses and
other current assets
|
|
2,358
|
|
1,540
|
|
Deferred income
taxes
|
|
1,412
|
|
1,366
|
|
Income tax
receivable
|
|
1,190
|
|
2,373
|
|
Total current
assets
|
|
55,495
|
|
65,747
|
|
Property and
equipment, net
|
|
1,846
|
|
2,084
|
|
Deferred income taxes,
non-current
|
|
449
|
|
414
|
|
Goodwill
|
|
34,299
|
|
16,066
|
|
Intangible assets,
net
|
|
4,134
|
|
4,643
|
|
Other
assets
|
|
49
|
|
252
|
|
Total
assets
|
$
|
96,272
|
$
|
89,206
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts
payable
|
$
|
18,965
|
$
|
35,852
|
|
Accrued salaries and
vacation
|
|
2,331
|
|
3,332
|
|
Line of
Credit
|
|
14,660
|
|
-
|
|
Other current
liabilities
|
|
5,563
|
|
1,114
|
|
Notes payable,
current
|
|
5,406
|
|
2,313
|
|
Total current
liabilities
|
|
46,925
|
|
42,611
|
|
Notes payable,
non-current
|
|
4,057
|
|
5,835
|
|
Other long-term
liabilities
|
|
6,391
|
|
1,390
|
|
Total
liabilities
|
|
57,373
|
|
49,836
|
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
Stockholders'
equity
|
|
|
|
|
|
Common stock $.01 par
value; 30,000,000 shares authorized;
10,132, 673 shares issued and 9,831,491 shares outstanding as
of January 1, 2016,
10,128,923 shares issued and 9,805,082 shares outstanding
as of June 26, 2015.
|
|
102
|
|
101
|
|
Capital in excess of
par value
|
|
30,889
|
|
30,798
|
|
Retained
earnings
|
|
10,073
|
|
10,439
|
|
Treasury stock, at
cost
|
|
(1,475)
|
|
(1,460)
|
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Accumulated other
comprehensive loss
|
|
(690)
|
|
(508)
|
|
Total stockholders'
equity
|
|
38,898
|
|
39,370
|
|
Total liabilities and
stockholders' equity
|
$
|
96,272
|
$
|
89,206
|
|
|
|
|
|
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VERSAR, INC. AND
SUBSIDIARIES
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|
Condensed Consolidated
Statements of Operations (Unaudited)
|
|
(In thousands, except
per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
Ended
|
|
For the Six Months
Ended
|
|
|
January
1, 2016
|
|
December
26, 2014
|
|
January
1, 2016
|
|
December
26, 2014
|
|
|
|
|
|
|
|
|
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|
GROSS
REVENUE
|
$
|
47,337
|
$
|
34,162
|
$
|
92,242
|
$
|
63,748
|
|
Purchased
services and materials, at cost
|
|
29,351
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|
17,031
|
|
59,118
|
|
29,258
|
|
Direct
costs of services and overhead
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14,366
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|
13,682
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|
27,192
|
|
28,434
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GROSS PROFIT
|
|
3,620
|
|
3,449
|
|
5,932
|
|
6,056
|
|
|
|
|
|
|
|
|
|
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Selling,
general and administrative expenses
|
|
3,317
|
|
2,925
|
|
6,170
|
|
5,616
|
|
Other
operating income
|
|
-
|
|
-
|
|
-
|
|
-
|
|
OPERATING INCOME
(LOSS)
|
|
303
|
|
524
|
|
(238)
|
|
440
|
|
|
|
|
|
|
|
|
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OTHER
EXPENSE
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
176
|
|
142
|
|
351
|
|
198
|
|
(LOSS) BEFORE
INCOME TAXES
|
|
127
|
|
382
|
|
(589)
|
|
242
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense (benefit)
|
|
62
|
|
105
|
|
(224)
|
|
52
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) from
continuing operations
|
$
|
65
|
$
|
277
|
$
|
(365)
|
$
|
190
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
NET INCOME
(LOSS)
|
|
67
|
|
277
|
|
(363)
|
|
190
|
|
NET INCOME (LOSS)
PER SHARE-BASIC and DILUTED
|
$
|
0.01
|
$
|
0.03
|
$
|
(0.04)
|
$
|
0.02
|
|
|
|
|
|
|
|
|
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WEIGHTED AVERAGE NUMBER
OF SHARES
OUTSTANDING-BASIC
|
|
9,850
|
|
9,775
|
|
9,831
|
|
9,742
|
|
WEIGHTED AVERAGE NUMBER
OF SHARES
OUTSTANDING-DILUTED
|
|
9,850
|
|
9,821
|
|
9,831
|
|
9,783
|
|
|
|
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SOURCE Versar, Inc.