-- $15 million contract with a leading financial institution
-- $10 million subcontract with the Community Planning and Development
agency within the Department of Housing and Urban Development to provide
software design, implementation, development and maintenance
-- $6.8 million option extension with the Office of the Undersecretary of
Defense for Policy for information technology support services
-- $3.9 million contract with the Yonkers, New York Police Department to
implement a law enforcement records management system
-- $800,000 option extension with an ATSC law enforcement customer for
system and service administration
-- $700,000 contract with CompSource Oklahoma to provide technology
planning, consulting, and project oversight for the workers' compensation
business applications
-- Three contracts totaling $4.5 million to support ATSC public safety
customers
Major ATSC highlights and accomplishments during the quarter included:
-- Reorganization of operations from six to four customer-focused areas:
1) federal civilian agencies; 2) defense and homeland security customers;
3) public safety which predominately serves state and local customers; and
4) Appix serving our commercial clients
-- Addition of two new independent directors to the board, Ginger Lew and
George Troendle, adding significant operating and transaction experience
-- Completion of a new credit facility, expanding borrowing capacity to
$50 million
-- Appointment of Pamela Little to Chief Financial Officer, bringing 25
years of financial experience with government contractors and professional
services firms to the ATSC management team
-- Promotion of Shannon Brown and Joseph Mignogna to Senior Vice
President Federal Civilian Agencies and Senior Vice President Defense and
Homeland Security, respectively
-- Engaged an internal auditor and third-party advisor to accelerate our
Sarbanes Oxley compliance activities
-- Authorized a $500,000 warrant repurchase program under which the
Company purchased 870,533 warrants for approximately $351,000 in June and
in July the Company purchased an additional 71,322 for approximately
$29,000
ATSC President and Chief Executive Officer Dr. Edward H. Bersoff stated, "I
continue to be pleased with the accomplishments achieved since the January
2007 transaction. We generated stronger than expected profits for the
quarter because we were able to execute on a reorganization of operations
faster than planned, resulting in improved efficiency and reduced costs."
Bersoff continued, "While margins have improved, market conditions have
been challenging, leading to delays in new contract awards. We believe the
new business development team established in the first quarter has allowed
us to build a strong platform for growth as the environment improves. In
fact, we submitted several bids over the last quarter that, if awarded to
us, will significantly add to our contract backlog."
Bersoff concluded, "Another positive development for the Company was the
addition of Ginger Lew and George Troendle to ATSC's Board of Directors.
Ginger's extensive business, government, and investment experience and
George's leadership in building a successful government services company
will be tremendously valuable to ATSC as we continue to grow our Company.
Further, the addition of these two independent directors satisfies the
corporate governance requirement for a NASDAQ listing. Lastly, our
expanded borrowing base will better support our working capital
requirements and acquisition growth plans."
Conference Call
ATSC will conduct a second quarter conference call on Tuesday, August 7, at
5:00 p.m EDT. The number for the live teleconference is 888-321-3075,
conference ID #9091717. A recorded replay of the teleconference will be
available by telephone at 877-519-4471, conference ID#9091717 starting at
8.00 p.m EDT on August 7, 2007 through 11:59 p.m EDT on August 21, 2007.
A recorded replay of the teleconference will also be available on the
Company website (www.atsva.com) for one year from the conference call
date.
About ATS Corporation and Advanced Technology Systems, Inc.
ATS Corporation (formerly named Federal Services Acquisition Corporation)
operates through its subsidiaries, Advanced Technology Systems, Inc.,
Reliable Integration Services, and Appix, Inc.
Advanced Technology Systems, Inc. ("ATS") is a leading provider of systems
integration and application development, IT infrastructure management and
strategic IT consulting services to U.S. federal government agencies. Since
its founding in 1978, ATS has been recognized for its custom software
development and software integration capabilities and its deep domain
expertise in federal government financial, human resource and data
management systems. ATS has built and implemented over 100 mission-critical
systems for clients.
ATS' financial management software expertise assists clients preparing for
the government's increased financial accountability standards. ATS' data
management systems expertise allows clients to increase efficiency with
better human resource and case management tracking capabilities, while also
allowing them to organize and track information easily. Additionally, ATS'
IT outsourcing capabilities provide ATS with an opportunity to develop
long-term value added partnerships with clients that allow end-users and
government agencies to focus on core mission priorities, while reducing
expenditures on systems management.
In addition, ATSC leverages its IT services, management consulting, and
software and systems development solutions expertise into financial
institutions, insurance companies and government sponsored enterprises
through a wholly owned subsidiary, Appix, Inc. ("Appix"). Appix is one of
the largest providers of outsourced professional services at Fannie Mae and
currently serves many Fortune 500 financial services and insurance
companies. Additional information about Appix may be found at
www.appix.com.
Any statements in this press release about future expectations, plans, and
prospects for ATSC, including statements about the estimated value of the
contract and work to be performed, and other statements containing the
words "estimates," "believes," "anticipates," "plans," "expects," "will,"
and similar expressions, constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Actual
results may differ materially from those indicated by such forward-looking
statements as a result of various important factors, including: our
dependence on our contracts with federal government agencies for the
majority of our revenue, our dependence on our GSA schedule contracts and
our position as a prime contractor on government-wide acquisition contracts
to grow our business, and other factors discussed in our latest annual
report on Form 10-K filed with the Securities and Exchange Commission on
March 26, 2007. In addition, the forward-looking statements included in
this press release represent our views as of August 7, 2007. We anticipate
that subsequent events and developments will cause our views to change.
However, while we may elect to update these forward-looking statements at
some point in the future, we specifically disclaim any obligation to do so.
These forward-looking statements should not be relied upon as representing
our views as of any date subsequent to August 7, 2007.
ATS Corporation
Consolidated Balance Sheets
Successor
---------------------------
June 30, December 31,
2007 2006
(unaudited) (audited)
------------- -------------
Assets
Current Assets
Cash $ 226,275 $ 213,395
Accounts receivable 28,093,176 -
Prepaid expenses and other current assets 1,029,390 136,006
Income tax receivable 1,524,086 -
Other current assets 2,580 -
Deferred income taxes, current 1,111,515 -
------------- -------------
Total Current Assets 31,987,022 349,401
Short term investments held in Trust account - 121,024,475
Restricted Cash 1,246,488 -
Cash and cash equivalents held in trust fund - 1,332
Property and equipment, net 1,445,232 -
Goodwill 64,598,536 -
Intangible assets, net 15,575,516 -
Deferred acquisition costs - 1,361,215
Other assets 51,070 -
Deferred income tax benefit - 502,744
------------- -------------
Total Assets $ 114,903,864 $ 123,239,167
============= =============
ATS Corporation
Consolidated Balance Sheets (continued)
Successor
----------------------------
June 30, December 31,
2007 2006
(unaudited) (audited)
------------- --------------
Liabilities and Stockholders' Equity
Capital leases - current portion $ 80,963 $ -
Accounts payable and accrued expenses 7,343,583 942,146
Accrued salaries and related taxes 4,447,035 -
Accrued vacation 2,693,129 -
Income taxes payable - 310,606
Warrant liabilities - 13,860,000
Other current liabilities 434,451 -
Deferred income taxes - current portion 17,509 40,489
------------- --------------
Total Current Liabilities 15,016,670 15,153,241
Notes Payable 86,857 -
Capital leases - net of current portion 127,925 -
Other long term liabilities 325,694 -
Deferred income taxes - net of current
portion 5,831,542 -
------------- --------------
Total Liabilities 21,388,688 15,153,241
Common stock, subject to possible redemption
4,197,900 shares 23,424,282
Interest income attributable to common stock
subject to possible redemptions (net of
taxes of $0 and $561,204, respectively - 702,752
------------- --------------
Total common stock subject to possible
redemption - 24,127,034
------------- --------------
Commitments and Contingencies
Stockholders' Equity
Common stock - $.0001 par value;
100,000,000 shares authorized; 26,480,209
and 26,250,000 issued; 18,137,454 and
26,250,000 outstanding, respectively,
(which includes 0 and 4,197,900 shares
subject to possible redemption,
respectively) 2,648 2,625
Additional paid in capital 127,240,752 81,467,698
Treasury Stock, at cost 8,342,755 and 0
shares (30,272,007)
Retained Earnings (deficit) (3,456,217) 2,488,569
------------- --------------
Total Stockholders' Equity 93,515,176 83,958,892
Total Liabilities and Stockholders' Equity $ 114,903,864 $ 123,239,167
============= ==============
ATS Corporation
Consolidated Statement of Operations
Successor Successor
------------------------------- --------------
ATS Corp ATS Corp ATS Corp
3 months 3 months 6 months
ending ending ending
6/30/2007 6/30/2006 6/30/2007
--------------- -------------- --------------
Contract Revenue $ 26,247,681 $ - $ 49,725,401
Operating Costs and
Expenses
Cost of Services 18,705,377 - 35,169,594
Selling, general and
administrative 6,179,367 283,424 12,155,875
Depreciation and
Amortization 138,255 - 279,556
Amortization of
Intangible Assets 945,149 - 1,724,484
--------------- -------------- --------------
Total operating costs and
expenses 25,968,148 283,424 49,329,509
Operating Income (Loss) 279,533 (283,424) 395,892
Other Income (Expense)
Interest Income
(expense), net 7,537 1,394,201 150,988
Gain (Loss) on warrant
liabilities - 11,760,000 (6,930,000)
Other income 9,019 - 9,754
--------------- -------------- --------------
Income (Loss) Before
Income Taxes 296,089 12,870,777 (6,373,366)
Income Tax (Benefit)
Expense
Current 171,461 366,797 274,172
Deferred - 134,384 -
--------------- -------------- --------------
Income (Loss) from
Continuing Operations 124,628 12,369,596 (6,647,538)
=============== ============== ==============
Loss from Discontinued
Operations - - -
Net Income (Loss) $ 124,628 $ 12,369,596 $ (6,647,538)
=============== ============== ==============
Interest income
attributable to common
stock subject to possible
redemption. - (151,719) -
Gain on derivative
liabilities attributed to
warrants - (11,760,000) -
--------------- -------------- --------------
Net income (loss)
allocable to common
stockholders not subject
to possible redemption $ 124,628 $ 457,877 $ (6,647,538)
=============== ============== ==============
Weighted average number of
shares outstanding
-basic 18,133,828 26,250,000 19,214,534
=============== ============== ==============
-diluted 18,440,030 30,548,025 19,214,534
=============== ============== ==============
Weighted average shares
outstanding exclusive of
shares subject to
possible redemption
-basic 18,133,828 22,052,100 19,214,534
=============== ============== ==============
-diluted 18,440,030 26,350,125 19,214,534
=============== ============== ==============
Basic net income (loss)
per share
-Continuing operations $ 0.01 $ 0.47 $ (0.35)
-Discontinued
operations $ - $ - $ -
=============== ============== ==============
-Net income(loss) $ 0.01 $ 0.47 $ (0.35)
-Net income(loss)not
subject to possible
Redemption $ 0.01 $ 0.02 $ (0.35)
Diluted net income (loss)
per share
-Continuing operations $ 0.01 $ 0.40 $ (0.35)
-Discontinued
operations $ - $ - $ -
=============== ============== ==============
-Net income(loss) $ 0.01 $ 0.40 $ (0.35)
-Net income(loss)not
subject to possible
Redemption $ 0.01 $ 0.02 $ (0.35)
Successor Predecessor
-------------- ------------------------------
ATS Corp ATS I ATS I
6 months 3 months 6 months
ending ending ending
6/30/2006 4/30/2006 4/30/2006
-------------- -------------- --------------
Contract Revenue $ - $ 30,128,753 $ 56,183,094
Operating Costs and
Expenses
Cost of Services - 22,110,952 40,299,066
Selling, general and
administrative 893,621 6,692,318 13,308,189
Depreciation and
Amortization - 191,000 420,000
Amortization of
Intangible Assets - 7,292 29,167
-------------- -------------- --------------
Total operating costs and
expenses 893,621 29,001,562 54,056,422
Operating Income (Loss) (893,621) 1,127,191 2,126,672
Other Income (Expense)
Interest Income
(expense), net 2,583,913 (134,045) (184,892)
Gain (Loss) on warrant
liabilities 840,000 - -
Other income - 7,959 15,895
-------------- -------------- --------------
Income (Loss) Before
Income Taxes 2,530,292 1,001,105 1,957,675
Income Tax (Benefit)
Expense
Current 880,793 431,301 813,489
Deferred (116,052) - -
-------------- -------------- --------------
Income (Loss) from
Continuing Operations 1,765,551 569,804 1,144,186
============== ============== ==============
Loss from Discontinued
Operations - (192,531) (570,908)
Net Income (Loss) $ 1,765,551 $ 377,273 $ 573,278
============== ============== ==============
Interest income
attributable to common
stock subject to possible
redemption. (280,812) - -
Gain on derivative
liabilities attributed to
warrants (840,000) - -
-------------- -------------- --------------
Net income (loss)
allocable to common
stockholders not subject
to possible redemption $ 644,739 $ 377,273 $ 573,278
============== ============== ==============
Weighted average number of
shares outstanding
-basic 26,250,000 19,219,700 19,213,700
============== ============== ==============
-diluted 30,412,162 19,706,766 19,700,766
============== ============== ==============
Weighted average shares
outstanding exclusive of
shares subject to
possible redemption
-basic 22,052,100 19,219,700 19,213,700
============== ============== ==============
-diluted 26,214,262 19,706,766 19,700,766
============== ============== ==============
Basic net income (loss)
per share
-Continuing operations $ 0.07 $ 0.03 $ 0.06
-Discontinued
operations $ - $ (0.01) $ (0.03)
============== ============== ==============
-Net income(loss) $ 0.07 $ 0.02 $ 0.03
-Net income(loss)not
subject to possible
Redemption $ 0.03 $ 0.02 $ 0.03
Diluted net income (loss)
per share
-Continuing operations $ 0.06 $ 0.03 $ 0.06
-Discontinued
operations $ - $ (0.01) $ (0.03)
============== ============== ==============
-Net income(loss) $ 0.06 $ 0.02 $ 0.03
-Net income(loss)not
subject to possible
Redemption $ 0.02 $ 0.02 $ 0.03
ATS Corporation
Consolidated Statement of Cash Flows
Successor Predecessor
---------------------------- ------------
For the Six For the Six For the Six
Months Ended Months Ended Months
Ended
June 30, June 30, April 30,
2007 2006 2006
============ ============ ============
Cash Flows from Operating
Activities
Net income (loss) $ (6,647,538) $ 1,765,551 $ 573,278
Adjustments to reconcile net
income (loss) to net cash (used
in) provided by operating
activities:
Depreciation and amortization 279,556 -- 450,820
Amortization of intangibles 1,724,484 -- --
Deferred income taxes (1,816,378) (116,052) (1,055,675)
Deferred rent -- -- (154,328)
Loss on disposal of equipment -- -- 58,232
Stock-based compensation 709,519 -- --
Interest on notes payable 1,354 -- --
(Gain) Loss on derivative
liabilities attributable to
warrants 6,930,000 (840,000) --
Changes in assets and
liabilities, net of effects of
acquisitions:
Accounts receivable (6,497,779) -- (1,385,619)
Interest receivable -- (571,679) --
Prepaid expenses (496,748) 46,506 (7,897)
Prepaid supplies (487) 381,311
Other current assets (2,580) -- --
Income taxes payable
(receivable) 689,421 (402,592) (1,175,353)
Other assets 286,426 -- (454,758)
Accounts payable and accrued
expenses (387,770) 889,662 (1,474,515)
Accrued salaries and related
taxes (4,473,193) -- (611,766)
Accrued vacation 404,518 -- (136,543)
Other current liabilities (76,985) -- --
Other long-term liabilities (234,328) -- --
============ ============ ============
Net Cash (Used in) Provided by
Operating Activities (9,608,508) 771,396 (4,992,813)
============ ============ ============
Cash Flows from Investing
Activities
Purchase of property and
equipment (325,836) -- (166,533)
Proceeds from sale of ATSI -- -- --
Sale of U.S. government
securities held in Trust fund 121,024,475 -- --
Purchase of U.S. government
securities held in Trust fund -- (236,619,372) --
Maturities of U.S. government
securities held in Trust fund -- 235,889,812 --
Purchase of Advanced Technology
Systems Inc., net of cash
received (79,396,068) -- --
Purchase of Reliable Integration
Services, Inc., net of cash
received (997,849) -- --
Purchase of Stock Purchase
Warrants (350,722)
Deferred acquisition costs -- (614,625) --
Release of cash held in Trust
Fund 1,332 16,929 --
Restricted cash (28,706) -- --
============ ============ ============
Net Cash Provided by (Used in)
Investing Activities 39,926,626 (1,327,256) (166,533)
============ ============ ============
Cash Flows from Financing
Activities
Net borrowings on line-of-credit -- -- 3,857,330
Payments on notes payable -- -- (43,082)
Payments on capital leases (33,231) -- (16,995)
Payments to repurchase treasury
stock (30,272,007) -- (4,662)
============ ============ ============
Net Cash (Used in) Provided by
Financing Activities (30,305,238) -- 3,792,591
============ ============ ============
Net Increase (Decrease) in Cash 12,880 (555,860) (1,366,755)
Cash, beginning of period 213,395 1,855,394 1,366,755
============ ============ ============
Cash, end of period $ 226,275 $ 1,299,534 $ --
============ ============ ============
Contact Information: Company Contact: Dr. Edward H. Bersoff Chairman, President and Chief Executive Officer ATS Corporation (703) 506-0088 Joann O'Connell Vice President, Investor Relations ATS Corporation (703) 506-0088 Investor Relations Contact: Laura Kowalcyk Investor Relations CJP Communications for ATS Corporation (212) 279-3115 ext. 209 Email Contact: lkowalcyk@cjpcom.com