Versar, Inc. Announces Third Quarter Fiscal 2014 Results - Hawaii News Now - KGMB and KHNL

Versar, Inc. Announces Third Quarter Fiscal 2014 Results

Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact pressreleases@worldnow.com.

SOURCE Versar, Inc.

SPRINGFIELD, Va., May 8, 2014 /PRNewswire/ -- Versar, Inc. (NYSE MKT: VSR) today announced financial results for the fiscal third quarter and nine months ended March 28, 2014. 

Gross revenue for the third quarter of fiscal year 2014 decreased 9% to $28.2 million, compared to revenues of $31.0 million during the third quarter of the last fiscal year.  Consolidated revenue performance was impacted by delayed funding for government contracts related to sequestration.  Sequentially, revenues were essentially flat as compared to the second quarter of 2014. 

The Company reported a reduction in gross margins for the quarter, primarily due to the decrease in gross profit related to the wind down of its Title II work in Afghanistan, which is anticipated to conclude in the summer of 2014 as well as higher direct costs due to the September 2013 acquisition of Geo-Marine (GMI).  Additionally, gross profit from the Company's Professional Services Group (PSG) declined as a result of contracts shifting to small business programs.  Versar recorded a net loss of $131,000 or a loss of $0.01 per  share in the third quarter of 2014 (which included a loss of $0.02 from continuing operations and income of $0,01 from discontinued operations) as compared to net income of $1 million or $0.11 on a fully diluted basis (which included a loss of $0.16 from discontinued operations) in the same period of 2013. 

Nine month gross revenue increased 10% to $85.4 million, as compared to gross revenue of $77.5 million in the first nine months of fiscal 2013.  The increase in revenue was primarily attributable to the acquisition of GMI.  Gross margin decreased to 8% as compared to 17.6% in the first nine months of 2013 for similar reasons to those described above.  Versar recorded net income of $627,000 or $0.07 per share on a fully diluted basis (which includes $0.03 from discontinued operations) in the first nine months of fiscal 2014 as compared to net income of $2.8 million or $0.30 per share on a fully diluted basis (which includes a loss of $0.20 from discontinued operations) for the first nine months of fiscal 2013.        

As of March 28, 2014, Versar recorded funded backlog of approximately $119 million, an increase of 10% compared to $108 million of funded backlog at the end of fiscal year 2013.

Versar closed the fiscal third quarter of 2014 with a cash balance of approximately $6.6 million and stockholders' equity of $38.5 million.

Tony Otten, CEO of Versar said, "In the third quarter, we continued to see delayed funding for government contracts related to last fall's government shut down and sequestration.  Despite the 2014 appropriations deal, we have not seen the expected increase in funding, although we do expect more money to be obligated by the end of September.  As with many in our sector, the slow down has weighed on both our revenues and our margins.  That said, our backlog remains strong and we enhanced it with the acquisition of Lime Energy's Facility Repair and Renewal business, which represents five task orders with total revenue of between $6 million and $10 million.  Additionally, we received an extension to our personal services contract in Iraq.  Following the close of the quarter, we announced that the Army Corps of Engineers had awarded an environmental services IDIQ contract to our joint venture with Cardno TEC, which has a maximum capacity of $27.5 million.  Additionally, we were awarded a $2.39 million design/build contract for the replacement of a gas line at Hanscom Air Force Base.  We are optimistic about our pipeline for future projects as we enter into the May through September time period, typically the busiest season for government contract awards."     

Mr. Otten continued, "Our integration of GMI continues to progress, but not as quickly as anticipated.  Strategically, GMI is a valuable asset to Versar and we are seeing its positive impact in terms of technical capabilities, geography and hence projects we are bidding on.  However, the slow down has particularly impacted GMI given their specialty, and we now anticipate that GMI will be accretive in fiscal 2015 as opposed to the first quarter of fiscal 2015 as previously stated."   

Conference Call:

The Company will hold a conference call at 2:00 PM Eastern Time today, Thursday, May 8 to discuss the Company's operational performance and financial results for its quarter ended March 28, 2014. 

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 will be available on Versar's website, www.versar.com  

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 the construction management, environmental services, munitions response, and professional services market areas.

VERSAR operates a number of web sites, including the corporate web sites, www.versar.com, www.geomet.com, www.viap.com, www.dtaps.com, www.adventenv.com, www.charronconsulting.com, and www.ppsgb.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 28, 2013, 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.

 

Versar, Inc.

 

Contact:

David Gray

John Nesbett or Jennifer Belodeau


Director of Financial Reporting

Institutional Marketing Services (IMS)


Versar, Inc.

(203) 972-9200


(703) 642-6888

 jnesbett@institutionalms.com dgray@versar.com

Logo - http://photos.prnewswire.com/prnh/20120806/NE52646LOGO

 

VERSAR, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)



As of



March 28,
2014
(Unaudited)


June 28,
2013

ASSETS





Current assets





Cash and cash equivalents

$

6,630

$

8,728

Accounts receivable, net


31,695


29,342

Inventory


1,156


1,225

Prepaid expenses and other current assets


1,425


1,074

Deferred income taxes


2,083


2,314

Income tax receivable


2,446


1,764

Total current assets


45,435


44,447

Property and equipment, net


2,242


2,108

Deferred income taxes, non-current


1,614


622

Goodwill


9,454


7,515

Intangible assets, net


3,096


1,798

Other assets


1,014


887

Total assets

$

62,855

$

57,377






LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities





Accounts payable

$

12,432

$

10,788

Accrued salaries and vacations


2,326


3,042

Other current liabilities


5,174


3,304

Notes payable, current


1,301


333

Total current liabilities


21,333


17,467

Notes payable, non-current


396


333

Deferred income taxes


1,489


849

Other long-term liabilities


1,092


1,104

Total liabilities


24,310


19,753

Commitments and contingencies





Stockholders' equity





Common stock, $.01 par value; 30,000,000 shares authorized;
9,962,885 shares issued and 9,658,107 shares outstanding
as of December 27, 2013
9,849,773 shares issued and 9,579,753 shares outstanding
as of June 28, 2013


100


99

Capital in excess of par value


30,247


29,758

Retained earnings


9,994


9,366

Treasury stock, at cost


(1,396)


(1,224)

Accumulated other comprehensive loss;
foreign currency translation


(400)


(375)

Total stockholders' equity


38,545


37,624

Total liabilities and stockholders' equity

$

62,855

$

57,377

 

VERSAR, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Unaudited-in thousands, except per share amounts)




For the Three Months Ended


For the Nine Months Ended



March 28,
2014


March 29,
2013


March 28,
2014


March 29,
2013










GROSS REVENUE

$

28,225

$

30,981

$

85,383

$

77,499

   Purchased services and materials, at cost


14,322


15,304


43,091


32,540

   Direct costs of services and overhead


12,770


9,453


35,874


31,298

GROSS PROFIT


1,133


6,224


6,418


13,661










   Selling, general and administrative expenses


1,946


1,877


6,231


6,051

   Other income


(327)


-


(327)


-

OPERATING (LOSS) INCOME


(486)


4,347


514


7,610










OTHER (INCOME) EXPENSE









   Interest income


(1)


(3)


(14)


(4)

   Interest expense


36


21


103


66

 (LOSS) INCOME BEFORE INCOME TAXES,
from continuing operations


(521)


4,329


425


7,548










   Income tax (benefit) expense


(301)


1,776


63


2,868










NET (LOSS) INCOME  FROM CONTINUING OPERATIONS


(220)


2,553


362


4,680

Income (Loss) from discontinued operations, net of tax (expense) benefit of $60 and $121 and $(45) and $174


89


(1,511)


265


(1,867)

NET INCOME

$

(131)

$

1,042

$

627

$

2,813










NET (LOSS) INCOME PER SHARE-BASIC and DILUTED









   Continuing operations

$

(0.02)


0.27

$

0.04


0.50

   Discontinued operations


0.01


(0.16)


0.02


(0.20)

NET INCOME PER SHARE-BASIC and DILUTED

$

(0.01)

$

0.11

$

0.06

$

0.30










WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING-BASIC


9,702


9,545


9,645


9,482

WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING-DILUTED


9,758


9,575


9,703


9,512

 

©2012 PR Newswire. All Rights Reserved.