TMNG Global Reports Second Quarter 2013 Financial Results OVERLAND PARK, Kan., Aug. 8, 2013 (GLOBE NEWSWIRE) -- TMNG Global (Nasdaq:TMNG), a premier provider of professional services and technical solutions to the global leaders in the communications, digital media, and technology industries, reported financial results for its 2013 second quarter ended June 29, 2013. "We made continued progress executing on our strategic plan in the second quarter, delivering year-over-year revenue growth and expanding margins, and on a year-to-date basis our bottom line results have improved substantially from the prior year," said Donald Klumb, CEO of TMNG Global. "Importantly, we are further enhancing the depth of our relationships with key customers and are continuing to innovate our technical solution offerings, which are centered on our flagship Ascertain software platform. The early momentum in this area is driving a larger proportion of our total revenue mix. We remain focused on fostering innovation and evolving our business model, while driving further operational efficiencies. In addition, our balance sheet is healthy, with a solid cash position of $11.5 million and working capital of $17.7 million." Financial Results for the Thirteen Weeks Ended June 29, 2013 Revenues in the second quarter of 2013 were $14.0 million, up 4.0% from $13.5 million in the second quarter of 2012 and flat with $14.0 million in the first quarter of 2013.During the quarter, TMNG's gross margin was 38.6%, compared with 37.4% in the second quarter of 2012 and 36.0% in the first quarter of 2013. Selling, general and administrative expenses were $5.9 million in the second quarter of 2013, compared to $5.4 million in the second quarter of 2012 and $5.2 million in the first quarter of 2013.The year-over-year increase reflects $0.3 million of legal expenses, subject to expected insurance reimbursement related to the arbitration with our prior CEO, and non-cash charges related to the issuance of new restricted stock shares, partially offset by further cost reductions. TMNG Global reported a net loss of ($0.5) million on a GAAP basis, or ($0.06) per diluted share for the second quarter of 2013, compared to a net loss of ($0.4) million or ($0.06) per diluted share in the second quarter of 2012, and net loss of ($0.2) million or ($0.02) per diluted share for the first quarter of 2013.After adjusting for the after tax impact of depreciation and amortization expense and share-based compensation expense, non-GAAP adjusted net loss was breakeven for the second quarter of 2013.The comparable non-GAAP adjusted net loss was ($0.2) million, or ($0.02) per diluted share, for the second quarter of fiscal 2012. Financial Results for the Twenty-Six Weeks Ended June 29, 2013 For the twenty-six weeks ended June 29, 2013, revenues were $28.0 million, compared with $27.3 million in the comparable period of fiscal year 2012.TMNG Global's gross margin was 37.3% during the twenty-six weeks ended June 29, 2013, compared with 37.1% in the comparable period of fiscal year 2012. Selling, general and administrative expenses were $11.0 million during the twenty-six weeks ended June 29, 2013, compared to $11.7 million in the comparable period of fiscal year 2012. Net loss for the twenty-six weeks ended June 29, 2013 was ($0.6) million or ($0.09) per diluted share, compared with a net loss of ($1.6) million or ($0.22) per diluted share in the comparable period of fiscal year 2012.After adjusting for the after tax impact of depreciation and amortization expense and share-based compensation expense, non-GAAP adjusted net income was approximately $0.1 million, or $0.01 per diluted share, for the twenty-six weeks ended June 29, 2013.The comparable non-GAAP adjusted net loss for the twenty-six weeks ended June 30, 2012 was ($1.1) million or ($0.16) per diluted share. In addition to reporting net loss and net loss per share on a GAAP basis, this press release contains certain non-GAAP adjustments which are described in the schedule entitled "Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Income (Loss)" that accompanies this press release.In making these non-GAAP adjustments, the Company took into account certain non-cash expenses and benefits, including tax effects as applicable, and the impact of certain items that are generally not expected to be on-going in nature or that are unrelated to the Company's core operations.Management believes non-GAAP financial information provides a useful basis for evaluating underlying business performance, but should not be considered in isolation and is not a substitute for GAAP financial information.The Company believes that providing such adjusted results allows investors and other users of the Company's financial statements to better understand TMNG Global's comparative operating performance for the periods presented. TMNG Global's management uses the non-GAAP financial measure in its own evaluation of the Company's performance, particularly when comparing performance to the prior year's period and on a sequential basis.TMNG Global's non-GAAP measure may differ from similar measures used by other companies, even if similar terms are used to identify such measures.Although TMNG Global's management believes the non-GAAP financial measure is useful in evaluating the performance of its business, TMNG Global acknowledges that items excluded from such measure have a material impact on the Company's net loss and net loss per share calculated in accordance with GAAP.Therefore, management uses non-GAAP measures in conjunction with GAAP results.Investors and other users of our financial information should also consider the above factors when evaluating TMNG Global's results. Conference Call The Company will host a conference call at 5:00 p.m. ET today to discuss 2013 second quarter results. The call may also include discussion of company developments, forward-looking information and other material information about business and financial matters.Investors can access the conference call via a live webcast on the Company's website, www.tmng.com, or by dialing 877-317-6789 in the United States or 412-317-6789 from international locations and referencing the TMNG Global call.A replay of the conference call will be archived on the Company's website for 90 days.Additionally, a replay of the call will be available by dialing 877-344-7529, pass code 10031684, through August 15, 2013. About TMNG Global TMNG Global (Nasdaq:TMNG) is a premier provider of professional services and technical solutions to the global leaders in the communications, digital media, and technology industries.TMNG Global and its divisions, CSMG and Cartesian, and a team of approximately 500 experts, provide strategy, operations and technology consulting services and technical solutions to more than 1,200 communications clients worldwide. The company is headquartered in Overland Park, Kansas, with offices in Boston, London, New Jersey, and Washington, D.C. For more information about the Company and its services, visit www.tmng.com. TheTMNG Globallogo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6089 Cautionary Statement Regarding Forward Looking Information This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.In particular, any statements that do not relate to historical or current facts constitute forward-looking statements, including any statements contained herein regarding expectations with respect to the Company's future business, financial condition and results of operations. Forward-looking statements are subject to known and unknown risks, uncertainties, and contingencies, many of which are beyond the Company's control, which may cause actual results, performance, or achievements to differ materially from those projected or implied in such forward-looking statements. Factors that might affect actual results, performance, or achievements include, among other things, conditions in the telecommunications industry, overall economic and business conditions (including the current economic slowdown), the demand for the Company's services (including the slowing of client decisions on proposals and project opportunities along with scope reduction of existing projects), the level of cash and non-cash expenditures incurred by the Company, technological advances and competitive factors in the markets in which the Company competes, and the factors described in this press release and in The Management Network Group's filings with the Securities and Exchange Commission, including the risks described in its periodic reports filed with the SEC, including, but not limited to, "Cautionary Statement Regarding Forward Looking Information" under Part I of its Annual Report on Form10-K for the fiscal year ended December 29, 2012 and subsequent periodic reports containing updated disclosures of such risks. These filings are available at the SEC's web site at www.sec.gov. Any forward-looking statements made in this release speak only as of the date of this release. TMNG Global does not intend to update these forward-looking statements and undertakes no duty to any person to provide any such update under any circumstances. (Please see attached financial tables) THE MANAGEMENT NETWORK GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (unaudited) Thirteen Weeks Ended Twenty-six Weeks Ended June 29, June 30, June 29, June 30, 2013 2012 2013 2012 Revenues $14,037 $13,498 $28,047 $27,344 Cost of services 8,621 8,449 17,590 17,204 Gross profit 5,416 5,049 10,457 10,140 Selling, general and administrative expenses(includes non-cash share-based compensation expense of $234 and $3 for the thirteen weeks ended June 29, 2013 5,850 5,432 11,029 11,681 and June 30, 2012, respectively and $297 and $6 for thetwenty-six weeks ended June 29, 2013 and June 30, 2012, respectively) Loss from operations (434) (383) (572) (1,541) Other income 1 5 2 7 Loss before income taxes (433) (378) (570) (1,534) Income tax provision (23) (30) (39) (60) Net loss $(456) $(408) $(609) $(1,594) Net loss per common share: Basic and diluted $(0.06) $(0.06) $(0.09) $(0.22) Weighted average shares used in calculation of net loss per basic 7,126 7,101 7,122 7,097 and diluted common share THE MANAGEMENT NETWORK GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) June 29, December 29, 2013 2012 ASSETS CURRENT ASSETS: Cash and cash equivalents $11,525 $12,177 Accounts receivable, net 12,101 12,762 Prepaid and other current assets 695 658 Total current assets 24,321 25,597 NONCURRENT ASSETS: Property and equipment, net 1,369 1,355 Goodwill 7,936 8,160 Other noncurrent assets 194 204 Total Assets $33,820 $35,316 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Trade accounts payable $1,370 $975 Accrued payroll, bonuses and related expenses 2,955 4,003 Deferred revenue 537 605 Other accrued liabilities 1,756 1,809 Total current liabilities 6,618 7,392 NONCURRENT LIABILITIES: Deferred income tax liabilities 511 472 Other noncurrent liabilities 417 441 Total noncurrent liabilities 928 913 Total stockholders' equity 26,274 27,011 Total Liabilities and Stockholders' Equity $33,820 $35,316 THE MANAGEMENT NETWORK GROUP, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED NET INCOME (LOSS) (unaudited) (in thousands, except per share data) Thirteen Weeks Ended Twenty-six Weeks Ended June 29, June 30, June 29, June 30, 2013 2012 2013 2012 Reconciliation of GAAP net loss to non-GAAP adjusted net income (loss): GAAP net loss $(456) $(408) $(609) $(1,594) Depreciation and 170 208 335 408 amortization Non-cash share based 234 4 298 7 compensation expense Tax effect of applicable 23 30 39 60 non-GAAP adjustments ^ 1 Adjustments to GAAP net loss 427 242 672 475 Non-GAAP adjusted net income $(29) $(166) $63 $(1,119) (loss) Reconciliation of GAAP net loss per diluted common share to non-GAAP adjusted net income (loss) per diluted common share: GAAP net loss per diluted $(0.06) $(0.06) $(0.08) $(0.22) common share Depreciation and 0.03 0.03 0.05 0.05 amortization Non-cash share based 0.03 0.00 0.04 0.00 compensation expense Tax effect of applicable 0.00 0.01 0.00 0.01 non-GAAP adjustments ^ 1 Adjustments to GAAP net loss 0.06 0.04 0.09 0.06 per diluted common share Non-GAAP adjusted net income (loss) per diluted common $(0.00) $(0.02) $0.01 $(0.16) share Weighted average shares used in calculation of Non-GAAP 7,126 7,101 7,177 7,097 adjusted net income (loss) per diluted common share Footnote 1: The Company calculated the tax effect of non-GAAP adjustments by applying an applicable estimated jurisdictional tax rate to each specific non-GAAP item after consideration of the Company's valuation allowance. CONTACT: Brainerd Communicators Ray Yeung (Media) email@example.com Corey Kinger (Investors) firstname.lastname@example.org 212.986.6667 The Management Network Group, Inc. Logo
TMNG Global Reports Second Quarter 2013 Financial Results
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