DynTek Announces Results for First Quarter Fiscal Year 2018

NEWPORT BEACH, Calif., Oct. 31, 2017 (GLOBE NEWSWIRE) -- DynTek, Inc. (OTC:DYNE), a leading provider of professional technology services, today announced results for its first fiscal quarter ended September 30, 2017. 

First Fiscal Quarter Ended September 30, 2017

DynTek reported revenues of $47,993,000 for the first fiscal quarter ended September 30, 2017, an increase of $18,266,000 or 61.4%, from $29,727,000 in the prior first quarter ended September 30, 2016.  Gross profit was $8,639,000 for the first fiscal quarter ended September 30, 2017, an increase of $3,362,000 or 63.7%, from $5,277,000 in the prior year first quarter ended September 30, 2016.  The quarter over prior year quarter increase in revenues and gross profit is primarily attributable to the quantity of large product orders primarily in the New York district.  

Total operating expenses were $8,325,000 in the first fiscal quarter ended September 30, 2017, an increase of $3,493,000 or 72.3%, as compared to $4,832,000 in the prior year first quarter ended September 30, 2016.  This increase quarter over prior year quarter is due to higher selling expense of $1,296,000 in relation to higher revenue, and higher stock compensation expense of $1,633,000 primarily related to the Company’s stock option buyback charge of $1,389,000 in the first fiscal quarter of 2018.

DynTek reported EBITDA of $2,030,000 for the first fiscal quarter ended September 30, 2017, an increase of $1,486,000 or 272.9%, as compared to $544,000 in the prior year first quarter. After inclusion of all stock compensation charges, which were primarily related to the Company’s stock option buyback in July 2017 mentioned above, net income was $79,000 for the first fiscal quarter of 2018, or $0.03 per diluted share.  This is a decrease of $7,000 or 8.0%, over the net income of $86,000 and $0.04 per diluted share in the first fiscal quarter of 2017.

“Our team delivered a record quarter, driven by a focus on helping our customers strengthen their security posture to fight the growing cyber threat landscape,” said Ron Ben-Yishay, DynTek’s chief executive officer.   “Security, across different vectors – network, database, end point and cloud – continue to be at the forefront of our customer’s business and technical requirements.  Our team of sales, technical and sales professionals are highly trained and certified to address these challenges through a wide range of consulting, assessment, deployment and integration services.”

EBITDA
The Company defines EBITDA as net income from operations before interest, taxes, depreciation and amortization, and stock-based compensation. Other companies may calculate EBITDA differently. Although EBITDA is a widely used financial indicator of a company's ability to service debt, it is not a recognized measure for financial statement presentation under generally accepted accounting principles (GAAP). EBITDA should not be considered in isolation or as superior or as an alternative to net income or to cash flows from operating activities as determined in accordance with GAAP. Nonetheless, the Company believes that EBITDA provides useful supplemental information for investors and others to measure operating performance, especially in situations where a company has significant non-cash operating expenses that are not indicative of core business operating results. EBITDA is widely used in the IT services industry to analyze comparable company performance, and management of the Company also uses EBITDA, in addition to GAAP information, as a measure of operating performance for assessing its business units.

About DynTek
DynTek is a leading provider of professional technology services to mid-market companies, such as state and local governments, educational institutions and commercial entities in the largest IT markets nationwide. From virtualization and cloud computing to unified communications and collaboration, DynTek provides professional technology solutions across the three core areas of our customers’ technical environment: Infrastructure/Data Center, Microsoft Platforms, End Point Computing. DynTek's multidisciplinary approach allows our clients to turn to a single source for their most critical technology requirements. For more information, visit http://www.dyntek.com.

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Forward Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Investors are cautioned that forward-looking statements made in this press release, involve known and unknown risks and uncertainties that could cause actual results to materially differ from the forward-looking statements. Such risks and uncertainties  include, among others, our success in reaching target markets for services and products in a highly competitive market; our ability to maintain existing customers and attract future customers; our ability to finance and sustain operations, including our ability to comply with the terms of the revolving line of credit and the Company’s other existing and future indebtedness; our ability to achieve profitability and positive cash flow from operations; our ability to maintain business relationships with IT product vendors; the size and timing of additional significant orders for our products and services and our ability to fulfill such orders; the continuing desire of state and local governments to outsource to private contractors and the availability of budgets to place orders for our products and services; our ability to retain skilled professional staff and certain key executives; the performance of our government and commercial technology services; and the continuation of general economic and business conditions that are conducive to outsourcing of IT services. We have no obligation to publicly revise any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements.

For more information, contact:
Linda Ford
DynTek, Inc.
949-271-6705
linda.ford@dyntek.com