- First quarter 2022 revenue up 24% to $148.2
million
- Reported 24-month backlog at the end of Q1 2022 is
$2.2 Billion, which is the largest in
the history of the company
- Extended ABL maturity through July
2025
BLUE
BELL, Pa., May 17, 2022 /PRNewswire/ -- QualTek
Services Inc. ("QualTek" or the "Company") (NASDAQ: QTEK), a
leading turnkey provider of infrastructure services to the North
American 5G wireless, telecom, power grid modernization, and
renewable energy sectors, announced today strong 2022 first quarter
financial results of its subsidiary QualTek HoldCo, LLC.
For the First Quarter:
First quarter 2022 revenue was up 24.4% to $148.2 million, compared to $119.1 million for the first quarter of
2021. The increase in revenue was attributable to increased
volumes around 5G rollout in our Telecom segment and a higher
volume of events in our Renewables & Recovery segment.
Net loss from continuing operations for the first quarter 2022 was
$40.5 million compared to a net loss
from continuing operations of $19.9
million in the first quarter of 2021. The increase in
Net loss in 2022 is primarily due to transaction and public company
readiness costs along with stock compensation and other one-time
expenses associated with the public transaction. First
quarter 2022 adjusted EBITDA was $4.0
million compared to $2.9
million, inclusive of discontinued Canadian operations, for
the first quarter of 2021, a 38% increase. Backlog at the end
of the first quarter 2022 was $2.2
billion, up from year-end 2021 of $2.1 billion. Guidance for the year remains
unchanged.
Scott Hisey, QualTek's Chief
Executive Officer, said "during the first quarter, we continued to
position QualTek for what we believe to be the largest
telecommunications build in the history of our country. Our Q1
revenue was $148.2 million, an
increase of 24.4% year-over-year. We are pleased to report that we
extended our ABL for 2 additional years. This improved strength of
our balance sheet will allow us liquidity to execute on our growth
plan that we laid out when we started our transformation into a
public company. The 5G build out, coupled with significant public,
private and government-initiated fiber and power/grid build outs is
historic, and we are confident that QualTek is poised to be a major
partner to the largest service providers in these segments."
Management will hold a conference call to discuss these results
on Wednesday, May 18, 2022, at
9:00 a.m. Eastern Time. The call-in
number for the conference call is 1 (888) 330 – 2454 or 1 (240) 789
- 2714 using passcode 2965812. Additionally, the call will be
broadcast live over the Internet and can be accessed and replayed
through the investor relations section of the Company's website at
qualtekservices.com.
The following tables set forth the financial results for the
periods ended April 2, 2022, and April
3, 2021:
|
QUALTEK SERVICES
INC.
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
|
(Unaudited - in
thousands, except share and per share information)
|
|
|
|
|
|
For the Three Months
Ended
|
|
April 2,
2022
|
April 3,
2021
|
|
Revenue
|
$
148,161
|
$
119,113
|
|
Costs and
expenses:
|
|
|
|
Cost of
revenues
|
132,105
|
103,510
|
|
General and
administrative
|
22,141
|
12,527
|
|
Transaction
expenses
|
9,268
|
549
|
|
Depreciation and
amortization
|
14,766
|
12,622
|
|
Total costs and
expenses
|
178,280
|
129,208
|
|
Loss from
operations
|
(30,119)
|
(10,095)
|
|
Other income
(expense):
|
|
|
|
Gain on sale/ disposal
of property and equipment
|
1,915
|
190
|
|
Interest
expense
|
(12,343)
|
(9,955)
|
|
Total other
expense
|
(10,428)
|
(9,765)
|
|
Loss from continuing
operations
|
(40,547)
|
(19,860)
|
|
Loss
from discontinued operations
|
-
|
(1,389)
|
|
Net
loss
|
(40,547)
|
(21,249)
|
|
Less: Net loss
attributable to noncontrolling
interests
|
(35,547)
|
(21,249)
|
|
Net loss
attributable to QualTek Services Inc.
|
(5,000)
|
-
|
|
Other comprehensive
income (loss):
|
|
|
|
Foreign currency
translation adjustments
|
-
|
172
|
|
Comprehensive
loss
|
$
(5,000)
|
$
(21,077)
|
|
Earnings per
share:
|
|
|
|
February 14,
2022
through April 2, 2022
|
|
|
|
|
Net loss per share -
basic and diluted
|
$
(0.20)
|
|
|
Weighted average Class
A common shares outstanding - basic and
diluted
|
22,171,350
|
|
|
QUALTEK SERVICES
INC.
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
(Unaudited - in
thousands)
|
|
|
|
|
|
|
|
|
April 2,
2022
|
December 31,
2021
|
|
Assets
|
|
|
|
Current
assets
|
$
235,901
|
$
226,523
|
|
Property and equipment,
net
|
52,597
|
50,682
|
|
Intangible assets,
net
|
353,602
|
364,174
|
|
Goodwill
|
28,787
|
28,723
|
|
Other long-term
assets
|
1,697
|
1,657
|
|
Total
assets
|
$
672,584
|
$
671,759
|
|
Liabilities and
Deficit
|
|
|
|
Current
liabilities
|
$
149,814
|
$
267,207
|
|
Capital lease
obligations, net of current portion
|
19,793
|
19,851
|
|
Long-term debt, net of
current portion and deferred financing fees
|
485,160
|
418,813
|
|
Contingent
consideration, net of current portion
|
21,793
|
21,457
|
|
Distributions
payable
|
-
|
11,409
|
|
Warrant
liabilities
|
77
|
-
|
|
Tax Receivable
Agreement liabilities
|
34,092
|
-
|
|
Total (deficit)
equity
|
(38,145)
|
(66,978)
|
|
Total liabilities
and deficit
|
$
672,584
|
$
671,759
|
|
QUALTEK SERVICES
INC.
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
(Unaudited - in
thousands)
|
|
|
|
|
|
For the Three Months
Ended
|
|
April 2,
2022
|
April 3,
2021
|
|
Net cash used in
operating activities
|
(39,623)
|
(7,342)
|
|
Net cash provided by
(used in) investing activities
|
1,477
|
(20,646)
|
|
Net cash provided by
financing activities
|
37,600
|
28,010
|
|
Effect of foreign
currency exchange rate (translation) on cash
|
(10)
|
(8)
|
|
Net (decrease) increase
in cash
|
(556)
|
14
|
|
Cash:
|
|
|
|
Beginning of
period
|
2,151
|
169
|
|
End of
period
|
$
1,595
|
$
183
|
|
Supplemental
Disclosures and Reconciliation of Non-GAAP
Disclosures
|
|
(Unaudited - in
thousands)
|
|
|
|
|
For The Three Months
Ended
|
|
Revenue:
|
April 2,
2022
|
April 3,
2021
|
|
Telecom
|
$
132,664
|
$
106,480
|
|
Renewables and Recovery
Logistics
|
15,497
|
12,633
|
|
Total consolidated
revenue
|
$
148,161
|
$
119,113
|
|
|
|
|
|
|
|
For The Three Months
Ended
|
|
Adjusted EBITDA
Reconciliation:
|
April 2,
2022
|
April 3,
2021
|
|
Telecom adjusted
EBITDA
|
$
4,812
|
$
4,814
|
|
Renewables and Recovery
Logistics adjusted EBITDA
|
5,309
|
2,878
|
|
Corporate adjusted
EBITDA
|
(6,094)
|
(3,929)
|
|
Total adjusted
EBITDA
|
$
4,027
|
$
3,763
|
|
Less:
|
|
|
|
Management
fees
|
126
|
497
|
|
Transaction
expenses
|
9,268
|
549
|
|
Share based
compensation
|
6,711
|
-
|
|
Depreciation and
amortization
|
14,766
|
12,622
|
|
Interest
expense
|
12,343
|
9,955
|
|
Integration, public
company readiness and close out costs
|
1,360
|
-
|
|
Loss from continuing
operations
|
$
(40,547)
|
$
(19,860)
|
About QualTek
Founded in 2012, QualTek is a leading technology-driven
provider of infrastructure services to the 5G wireless, telecom,
power grid modernization, and renewable energy sectors across
North America. QualTek has a
national footprint with more than 80 operation centers across the
U.S. and a workforce of over 5,000 people. QualTek has established
a nationwide operating network to enable quick responses to
customer demands as well as proprietary technology infrastructure
for advanced reporting and invoicing. The Company will report
within two operating segments: Telecommunications and Renewables
and Recovery. For more information, please
visit qualtekservices.com.
Forward Looking Statements
This communication contains forward-looking statements for
purposes of the safe harbor provisions under the United States
Private Securities Litigation Reform Act of 1995, including
statements about the financial condition, results of operations,
earnings outlook and prospects of QualTek. Forward-looking
statements are typically identified by words such as "plan,"
"believe," "expect," "anticipate," "intend," "outlook," "estimate,"
"forecast," "project," "continue," "could," "may," "might,"
"possible," "potential," "predict," "should," "would" and other
similar words and expressions, but the absence of these words does
not mean that a statement is not forward-looking.
The forward-looking statements are based on the current
expectations of the management of QualTek and are inherently
subject to uncertainties and changes in circumstances and their
potential effects and speak only as of the date of such statement.
There can be no assurance that future developments will be those
that have been anticipated. These forward-looking statements
involve a number of risks, uncertainties or other assumptions that
may cause actual results or performance to be materially different
from those expressed or implied by these forward-looking
statements. These risks and uncertainties include, but are not
limited to, those discussed and identified in public filings made
with the SEC by QualTek.
Should one or more of the risks or uncertainties materialize or
should any of the assumptions made by the management of QualTek
prove incorrect, actual results may vary in material respects from
those projected in these forward-looking statements.
All pro forma numbers are used for illustrative purpose only,
are not forecasts and may not reflect actual results.
All subsequent written and oral forward-looking statements
concerning the matters addressed in this communication and
attributable to QualTek or any person acting on its behalf are
expressly qualified in their entirety by the cautionary statements
contained or referred to in this communication. Except to the
extent required by applicable law or regulation, QualTek undertakes
no obligation to update these forward-looking statements to reflect
events or circumstances after the date of this communication to
reflect the occurrence of unanticipated events.
Media Contact:
QualTek IR/Communications
Gianna Lucchesi
PR@qualtekservices.com
(484) 804 - 4585
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SOURCE QualTek Services Inc.
