DELRAY BEACH, Fla.--(BUSINESS WIRE)--DecisionPoint Systems, Inc. (NYSE American: DPSI), the leading mobility-first enterprise services and solutions company and a leading provider of retail in-store solutions and services centered on Point-of-Sale systems, today announced first quarter 2024 financial results for the period ended March 31, 2024.
Steve Smith, chief executive officer of DecisionPoint Systems, commented: "Our first quarter results were impacted by the absence of any large project business on the hardware solutions side of the business. However, our gross margin improved with the mix shift towards services and software. We also reduced our debt by over $1.6 million and increased cash by $1.5 million.
"With our continued focus on services, our investments in 2023 are already starting to pay off, and we anticipate our Mobile Managed Services strategy will drive sales of our newer offerings throughout this year. During the first quarter, we continued to build out this part of the business by introducing PointCare services, which include existing and new services. This offering served as the foundation for an early win, as we secured a large managed services opportunity with a leading C-store chain to provide store-level, on-site services to maintain several in-store technologies and devices. This win was a significant add to our managed services recurring revenue backlog. It also represents an exciting opportunity to expand from providing mobile managed services for devices to delivering managed services for an entire store or site with a much larger TAM versus discrete device-level services. We will formally launch these new service offerings in the second quarter under the StoreCare and SiteCare brands.
"Given our impending transaction with Graham and Barcoding, which was at a 27% premium to our closing price the night before the announcement, we will not be hosting a conference call this quarter as we focus on running the business and preparing for the shareholder vote, with the goal of closing the transaction in July. We think this deal strikes the right balance of rewarding our public shareholders with positioning DecisionPoint for the next evolution as a Company."
About DecisionPoint Systems
DecisionPoint Systems Inc. delivers mobility-first enterprise managed services, in-store retail solutions centered around point-of-sale technologies, deployment, integration and support services to retail, supply chain, hospitality, healthcare and other verticals, enabling customers to make better and faster decisions in the moments that matter-the decision points. Our mission is to help businesses consistently deliver on those moments-improving customer service, accelerating growth, improving worker productivity and lowering risks and costs. For more information about DecisionPoint Systems, Inc., visit https://www.decisionpt.com.
Forward-Looking Statements
In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words "believe," "anticipate," "expect," "plan," "intend," "estimate, "target" and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described in our most recent report on SEC Form 10-K (under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations"), which may be revised or supplemented in subsequent reports on SEC Forms 10-Q and 8-K. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.
DecisionPoint Systems, Inc. Consolidated Balance Sheets (in thousands, except par value) | ||||||||
March 31, | December 31, | |||||||
2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 5,834 | $ | 4,300 | ||||
| Accounts receivable, net of allowance of $324 and $267 as of March 31, 2024 and December 31, 2023, respectively | 19,292 | 23,768 | ||||||
| Inventory, net | 1,193 | 2,133 | ||||||
| Deferred costs | 4,158 | 3,826 | ||||||
| Prepaid expenses and other current assets | 598 | 630 | ||||||
| Total current assets | 31,075 | 34,657 | ||||||
| Operating lease assets | 3,208 | 3,392 | ||||||
| Property and equipment, net | 2,889 | 2,973 | ||||||
| Deferred costs, net of current portion | 3,744 | 3,689 | ||||||
| Deferred tax assets, net | 1,475 | 1,161 | ||||||
| Intangible assets, net | 7,317 | 7,815 | ||||||
| Goodwill | 22,204 | 22,081 | ||||||
| Other assets | 172 | 172 | ||||||
| Total assets | $ | 72,084 | $ | 75,940 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 14,575 | $ | 16,857 | ||||
| Accrued expenses and other current liabilities | 5,607 | 6,566 | ||||||
| Deferred revenue | 9,222 | 8,066 | ||||||
| Current portion of earnout consideration | 5,550 | 5,370 | ||||||
| Current portion of long-term debt | 1,003 | 1,003 | ||||||
| Current portion of operating lease liabilities | 888 | 874 | ||||||
| Total current liabilities | 36,845 | 38,736 | ||||||
| Deferred revenue, net of current portion | 5,298 | 5,307 | ||||||
| Revolving line of credit | - | 1,300 | ||||||
| Long-term debt, net of current portion | 3,388 | 3,639 | ||||||
| Noncurrent portion of operating lease liabilities | 2,862 | 3,093 | ||||||
| Long-term portion of earnout consideration | 4,692 | 4,316 | ||||||
| Other liabilities | 6 | 6 | ||||||
| Total liabilities | 53,091 | 56,397 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued or outstanding | - | - | ||||||
| Common stock, $0.001 par value; 50,000 shares authorized; 7,681 and 7,680 shares issued and outstanding, respectively | 8 | 8 | ||||||
| Additional paid-in capital | 39,184 | 38,902 | ||||||
| Accumulated deficit | (20,199 | ) | (19,367 | ) | ||||
| Total stockholders' equity | 18,993 | 19,543 | ||||||
| Total liabilities and stockholders' equity | $ | 72,084 | $ | 75,940 | ||||
DecisionPoint Systems, Inc. Consolidated Statements of Income and Comprehensive Income (in thousands, except per share data) | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2024 | 2023 | |||||||
| Net sales: | ||||||||
| Product | $ | 15,317 | $ | 22,166 | ||||
| Service | 10,301 | 4,873 | ||||||
| Net sales | 25,618 | 27,039 | ||||||
| Cost of sales: | ||||||||
| Product | 12,488 | 17,885 | ||||||
| Service | 7,119 | 3,104 | ||||||
| Cost of sales | 19,607 | 20,989 | ||||||
| Gross profit | 6,011 | 6,050 | ||||||
| Operating expenses: | ||||||||
| Sales and marketing expense | 2,813 | 2,368 | ||||||
| General and administrative expenses | 4,096 | 2,494 | ||||||
| Total operating expenses | 6,909 | 4,862 | ||||||
| Operating (loss) income | (898 | ) | 1,188 | |||||
| Interest expense, net | (248 | ) | (13 | ) | ||||
| (Loss) income before income taxes | (1,146 | ) | 1,175 | |||||
| Income tax benefit (expense) | 314 | (309 | ) | |||||
| Net (loss) income and comprehensive (loss) income attributable to common stockholders | $ | (832 | ) | $ | 866 | |||
| Net (loss) income per share attributable to stockholders: | ||||||||
| Basic | $ | (0.11 | ) | $ | 0.12 | |||
| Diluted | $ | (0.11 | ) | $ | 0.11 | |||
| Weighted average common shares outstanding | ||||||||
| Basic | 7,681 | 7,417 | ||||||
| Diluted | 7,889 | 7,789 | ||||||
DecisionPoint Systems, Inc. Consolidated Statements of Cash Flows (in thousands) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
2024 | 2023 | |||||||
| Cash flows from operating activities | ||||||||
| Net (loss) income | $ | (832 | ) | $ | 866 | |||
| Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | 743 | 564 | ||||||
| Share-based compensation expense | 279 | 196 | ||||||
| Deferred income taxes, net | (314 | ) | 10 | |||||
| Provision for credit losses | 57 | 68 | ||||||
| Provision for inventory obsolescence | (6 | ) | 45 | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 4,419 | (9,413 | ) | |||||
| Inventory, net | 946 | (1,551 | ) | |||||
| Deferred costs | (387 | ) | (212 | ) | ||||
| Prepaid expenses and other current assets | 32 | (75 | ) | |||||
| Accrued expenses and other current liabilities | (526 | ) | (1,871 | ) | ||||
| Operating lease liabilities | (33 | ) | (24 | ) | ||||
| Deferred revenue | 1,147 | 6,394 | ||||||
| Net cash provided by (used in) operating activities | 3,243 | (1,496 | ) | |||||
| Cash flows from investing activities | ||||||||
| Purchases of property and equipment | (161 | ) | (176 | ) | ||||
| Net cash used in investing activities | (161 | ) | (176 | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from term loan | - | 5,000 | ||||||
| Repayment of term debt | (251 | ) | (1 | ) | ||||
| Line of credit, net | (1,300 | ) | 7,000 | |||||
| Proceeds from exercise of stock options | 3 | 6 | ||||||
| Net cash (used in) provided by financing activities | (1,548 | ) | 12,005 | |||||
| Change in cash | 1,534 | 10,333 | ||||||
| Cash, beginning of period | 4,300 | 7,642 | ||||||
| Cash, end of period | $ | 5,834 | $ | 17,975 | ||||
Contacts
Investor Relations Contact:
Brian Siegel, IRC, MBA
Senior Managing Director, Hayden IR
(346) 396-8696
Brian@haydenir.com
