World News: 21:15 GMT Wednesday 15th May 2019. [Evolving Systems, Inc. via Globe Newswire via SPi World News]
ENGLEWOOD, Colo., May 15, 2019 (GLOBE NEWSWIRE) -- a leader in real-time digital engagement, today reported financial results for its first quarter ended March 31, 2019.
“Our 2019 first-quarter results, although lower than prior quarters, were in line with expectations as we continue to execute on our transformation through further investment in research and development as well as marketing and sales-related initiatives to service our existing clients better and reach new ones. We are focused on strengthening our offerings and expanding our business. During the quarter, we launched critical components of our future success; Evolution was unveiled at Mobile World Congress and, prior to that global showcase, our new website went live. All of us at Evolving Systems remain focused on enhancing our business and creating long-term and sustainable shareholder value,” said Matthew Stecker, Chief Executive Officer and Executive Chairman of Evolving Systems.
Total operating expenses of $5.4 million in the quarter ended March 31, 2019 increased by approximately $0.9 million, as compared to $4.5 million in the corresponding year-ago period. The increase was primarily related to our increased focus on product development and growing our global business development team. Further, there were approximately $0.3 million of one-time charges, associated with complexities in the completion of our year end audit and other accounting services related to updating our global transfer pricing policies to include the acquired companies and fees for the submission of R&D tax credits refunded to our United Kingdom subsidiary.
The Company reported operating loss of $0.7 million as compared to $0.8 million operating income in the quarter ended March 31, 2019 and March 31, 2018, respectively. Net income per share, both basic and diluted, was a negative $0.09 for the quarter ended March 31, 2019 as compared to net income per share, both basic and diluted, of $0.04 in the comparable year-ago period. The Company reported Adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) of negative $0.3 million in the first quarter of 2019 as compared to $1.4 million EBITDA in the first quarter of 2018.
Cash and cash equivalents as of March 31, 2019 was $5.6 million, a decrease of 17.4% compared to $6.7 million as of December 31, 2018. Contract receivables, net of allowance for doubtful accounts, were $7.7 million, a decrease of $0.1 million compared to December 31, 2018. Unbilled work-in-progress, net of allowance for doubtful accounts, was $3.0 million for the periods ended March 31, 2019 and December 31, 2018, respectively. Working capital as of March 31, 2019 decreased to $4.7 million as compared to $8.1 million as of December 312018 due to the decrease in our cash and cash equivalents accounts from the payments of our outstanding debt and interest. Also, an increase in our current liabilities of $0.4 million related to the adoption of Accounting Standards Update “ASU” 2016-2 on Topic 842 for the accounting of operating leases. In addition, we reclassed $2.0 million from long term debt to short term debt related to the Company’s noncompliance with bank covenants while we are negotiating the restructuring of our terms. There was not sufficient time to properly negotiate new terms with our lenders prior to the filing deadline. The Company has made every loan repayment in full as originally scheduled within our loan agreement and anticipates making all future payments. We believe there is ample cash on hand and liquidity in the working capital to fund our business and continued strategic investments.
Matthew Stecker concluded: “2019, in particular the first half of the year, will be focused on the transformation of Evolving Systems. Continued investment in our product solutions and in our staff to enable us to better support our global customers is still required. We are very clear that the key to future revenues lies in driving innovation and finding new opportunities in our existing customer base while, in parallel, winning new engagements. We have a very strong customer footprint and decades of proven performance that gives us a significant head-start. In the second half of this year we expect to begin capitalizing on these advantages. At the same time, we continue to selectively seek new opportunities whether through potential accretive acquisitions, joint ventures, or strategic partnerships to drive both top- and bottom-line performance and over the long-term to bring our shareholders long term value.”
* The estimated income tax for non-GAAP net income is adjusted by the amount of additional expense that we would accrue if we used non-GAAP results instead of GAAP results in the calculation of our tax liability, taking into account which tax jurisdiction each of the above adjustments would be made and the tax rate in that jurisdiction.
Globe Newswire: 21:15 GMT Wednesday 15th May 2019
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