Beacon Enterprise Solutions Reports Results for Fiscal Second Quarter 2012 -- Conference Call To Be Held Today at 10:00 A.M. Eastern Time -- PR Newswire LOUISVILLE, Ky., May 2, 2012 LOUISVILLE, Ky., May 2, 2012 /PRNewswire/ -- Beacon Enterprise Solutions Group, Inc. (OTCBB:BEAC) (www.askbeacon.com), an emerging global leader in the design, implementation and management of high performance Information Technology Systems ("ITS") infrastructure solutions, reports fiscal second quarter financial results for the period ended March 31, 2012, which are discussed below: (Logo: http://photos.prnewswire.com/prnh/20101021/DA85933LOGO) Financial Highlights for the Fiscal Second Quarter and Six Months ended March 31, 2012: oNet sales increased 4% for the six months ended to $9.3 million from $9.0 million in the corresponding year-ago period; oFor the six months ended gross profit increased 38% from $2.6 million to $3.6 million in fiscal 2011 compared to fiscal 2012; oGross profit margins increased 9 basis points to 37% from 28% in Q2 compared with the same period in 2011; oFor the six-month period, gross profit margins improved to 38% as compared with 29% in the comparable year-ago period; oTotal operating expenses for the quarter decreased 13% to $2.5 million from $2.8 million in the year-ago second quarter; oEBIT (Earnings Before Interest and Taxes) increased for both the three and six month periods in 2012 as compared with 2011, improving 15% for the quarter and 59% for the six months ended. "While we have experienced a challenging most recent quarter, I am very proud of the leadership team we have in place," commented Bruce Widener, Chairman and CEO of Beacon. "Our recently announced leadership and positioning changes do not represent a radical shift in how we go to market. These changes represent a continuation of the building process we began two years ago to move from a tactical vendor, used on an as-needed basis, to a strategic business partner of our Fortune 1000 clients. Beacon is now better positioned to continue to grow its business, strengthen our client relationships and expand our capabilities despite the challenges in the global market place." "Today we have a stronger Beacon team and an impressive customer base that expects nothing less than consistent and reliable execution," stated Paris Arey, Executive Vice President Sales and Marketing. "The Beacon Solution's portfolio will enable the infrastructure layer to become business relevant by increasing IT implementation and accelerating their business impact. Beacon is leveraging our 5-year history of cost-effectively managing the IT infrastructure and proven service capabilities for organic growth. Market dynamics are requiring CIOs to play a larger roll in business responsiveness and decisions in which the IT infrastructure supports. I am optimistic the second half of the year (fiscal 2012) will be better than the first half of the year. We expect progress in all areas of our business and anticipate year-over-year improvements. This will position Beacon for a strong 2013." "Enterprises around the world are becoming more in tune with the fact the physical IT infrastructure is the first step in enabling any enterprise service change," added Michael Martin, Executive Vice President Global Services. "The impact we've had with our existing client base is they value Beacon's focus on simplifying the challenges associated with the delivery of physical infrastructure. This unique offering allows predictable, consistent standards implementation on a global scale, reducing design and deployment time to accelerate the delivery of business solutions." "Despite the challenging revenue environment we experienced in the second quarter, we have positioned the Company to be profitable and cash flow positive in the future," stated S. Scott Fitzpatrick, Vice President Corporate Controller and Treasurer. "Our comparisons with the previous fiscal year for the six-month periods remain favorable for revenue, margin percent and operating expenses. We will continue to maintain our capacity to grow in order to take advantage of the measures we have implemented over the past year for sustained profitability as we achieve our revenue goals." "For the prior quarter and six months, gross profit margins increased 9 basis points to 37 and 38 respectively for each period," concluded Mr. Fitzpatrick. "We expect our improvements in gross margin to remain consistent in the second half of the year. We continue to address our cost structure and realized an improvement in operating costs equating to a 13% reduction. It should also be pointed out that our cash position remained neutral and consistent with the year-end2012 levels." Earnings Conference Call Today, Wednesday, May 2, 2012 @ 10:00 a.m. EDT: Beacon's Management will hold a conference call today, Wednesday, May 2, 2012 at 10:00 a.m. EDT to discuss its fiscal second quarter 2012 financial results for the period ending March 31, 2012. Participants on the call will include Bruce Widener, Chairman and CEO; Paris Arey, Executive Vice President Sales and Marketing; Michael Martin, Executive Vice President Global Services and S. Scott Fitzpatrick, Vice President Corporate Controller and Treasurer. The teleconference can be accessed by calling 888-495-3916 and entering conference ID # 74625231. Participants outside of the U.S. and Canada can join by calling 706-634-7530 and entering the same conference ID. Please dial in 15 minutes prior to the beginning of the call. The conference call will be simultaneously webcast and available on the company's website, http://www.askbeacon.com, under the "Investor Relations" tab. A digital recording of the conference call will be available for replay two hours after the end of the call's completion until 11:59 p.m. EDT on Friday, May 4, 2012 by calling 404-537-3406 and entering conference ID # 74625231. About Beacon Enterprise Solutions Group, Inc. Beacon Enterprise Solutions Group is an emerging global leader in the design, implementation and management of high performance Information Technology Systems ("ITS") infrastructure solutions. Beacon offers fully integrated, turnkey IT infrastructure solutions capable of fully servicing the largest companies in the world as they increasingly outsource to reduce costs while optimizing critical IT design and infrastructure management. Beacon is headquartered in Louisville, Kentucky, with regional headquarters in Cincinnati, Ohio, Dublin, Ireland, Prague, Czech Republic and personnel located throughout the United States and Europe. For additional information, please visit Beacon's corporate website: www.askbeacon.com This press release may contain "forward-looking statements." Expressions of future goals and similar expressions reflecting something other than historical fact are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. These forward-looking statements may include, without limitation, statements about our market opportunity, strategies, competition, expected activities and expenditures as we pursue our business plan. Although we believe that the expectations reflected in any forward looking statements are reasonable, we cannot predict the effect that market conditions, customer acceptance of products, regulatory issues, competitive factors, or other business circumstances and factors described in our filings with the Securities and Exchange Commission may have on our results. The company undertakes no obligation to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this press release. -- Financial Tables Follow -- Beacon Enterprise Solutions Group, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (all amounts in 000's except share data) March 31, September 30, 2012 2011 ASSETS (unaudited) Current assets: Cash and cash equivalents $ 893 $ 861 Accounts receivable, net 2,985 3,752 Inventory, net - - Prepaid expenses and other current assets 2,048 1,345 Total current assets 5,926 5,958 Property and equipment, net 268 249 Goodwill 2,792 2,792 Other intangible assets, net 2,776 2,905 Other assets 40 18 Total assets $ 11,802 $ 11,922 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Bridge note - related party $ 100 $ 100 Note payable 300 - Current portion of long-term debt 94 180 Senior secured notes payable 4,196 2,952 Accounts payable 2,427 3,204 Accrued expenses and other current 2,326 1,691 liabilities Total current liabilities 9,443 8,127 Long-term debt, less current portion - 24 Deferred tax liability 241 212 Total liabilities 9,684 8,363 Commitments and contingencies (Note 6) Stockholders' equity Preferred Stock: $0.01 par value, 5,000,000 shares authorized, 1,598 and 1,491 shares outstanding in the following classes: Series A convertible preferred stock, $1,000 stated value, 4,500 shares authorized, 30 shares issued and outstanding at March 31, 2012 and September 30, 2011 respectively, (liquidation preference $99) 30 30 Series A-1 convertible preferred stock, $1,000 stated value, 1,000 shares authorized, 311 shares issued and outstanding at March 31, 2012 and September 30, 2011 respectively, (liquidation preference $492) 311 311 Series B convertible preferred stock, $1,000 stated value, 4,000 shares authorized, 700 shares issued and outstanding at March 31, 2012 and September 30, 2011 respectively, (liquidation preference $1,048) 700 700 Series C-1 convertible preferred stock, $1,500 stated value, 400 shares authorized, 350 issued and outstanding at March 31, 2012 and September 30, 2011, respectively (liquidation preference $724) 525 525 Series C-2 convertible preferred stock, $1,500 stated value, 2,000 shares authorized, 100 issued and outstanding at March 31, 2012 and September 30, 2011, respectively (liquidation preference $204) 150 150 Series C-3 convertible preferred stock, $1,500 stated value, 110 shares authorized, 107 issued and outstanding at March 31, 2012 (liquidation 160 - preference $211) Common stock, $0.001 par value 70,000,000 shares authorized 37,611,396 and 37,376,396 shares issued and outstanding at March 31, 2012 and September 30, 38 38 2011, respectively. Additional paid in capital 38,840 38,342 Accumulated deficit (38,747) (36,583) Accumulated other comprehensive income 111 46 Total stockholders' equity 2,118 3,559 Total liabilities and stockholders' $ 11,802 $ 11,922 equity Beacon Enterprise Solutions Group, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited) (all amounts in 000's except share and per share data) For the For the For the Six For the Six Three Three Months Months Months Months Ended Ended Ended Ended March 31, March 31, March 31, March 31, 2012 2011 2012 2011 Net sales $ $ $ $ 3,317 5,003 9,319 8,977 Cost of goods sold 41 350 118 626 Cost of services 2,034 3,253 5,642 5,776 Total cost of sales and 2,075 3,603 5,760 6,402 services Gross profit 1,242 1,400 3,559 2,575 37% 28% 38% 29% Operating expenses Salaries and 1,433 1,863 2,897 3,538 benefits Selling, general and 1,042 980 1,824 1,868 administrative Total operating 2,475 2,843 4,721 5,406 expenses Loss from operations (1,233) (1,443) (1,162) (2,831) Other expenses Interest expense (159) (77) (291) (133) Effect of foreign 57 88 (170) (14) currency transaction Amortization of deferred (167) (69) (399) (84) finance fees Other expenses (24) (207) (39) (319) Total other expenses (293) (265) (899) (550) Net loss before income (1,526) (1,708) (2,061) (3,381) taxes Income tax (expense) 2 (126) (30) (88) benefit Loss from continuing (1,524) (1,834) (2,091) (3,469) operations Income from discontinued - - - 7,892 operations Net (loss) income (1,524) (1,834) (2,091) 4,423 Preferred Stock: Contractual dividends (44) (19) (73) (38) Net (loss) income $ $ $ $ available to common (1,568) (1,853) (2,164) 4,385 stockholders Net loss per share to common stockholders - basic and diluted Net loss per share from $ $ $ $ continuing operations (0.04) (0.05) (0.06) (0.09) Net (loss) income per share from discontinued - - - 0.21 operations $ $ $ $ (0.04) (0.05) (0.06) 0.12 Weighted average shares outstanding basic and diluted 37,611,396 37,376,396 37,611,396 37,376,396 Other comprehensive income, net of tax Net (loss) income $ $ $ $ (1,568) (1,853) (2,164) 4,385 Foreign currency 99 (43) 99 545 translation adjustment Comprehensive (loss) $ $ $ $ income (1,469) (1,896) (2,065) 4,930 Income (loss) from (1,233) (1,443) (1,162) (2,831) operations Depreciation and 111 126 223 258 amortization EBITDA (1,122) (1,317) (939) (2,573) Other Adjustments Non-cash investor 67 22 132 81 relations Non-cash share based 247 257 499 533 compensation Non-recurring costs 38 191 111 370 Adjusted EBITDA $ $ $ $ (771) (847) (197) (1,589) SOURCE Beacon Enterprise Solutions Group, Inc.
Beacon Enterprise Solutions Reports Results for Fiscal Second Quarter 2012
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