Double Digit Top-Line Growth at DecisionPoint Systems,
Ken Nagy, CFA
On May 15, 2012,
DecisionPoint Systems, Inc. (
the Foothill Ranch, California based enterprise mobility and RFID
systems integrator, reported financial results for its fiscal 2012
first quarter, ended March 31, 2012.
The solid first quarter performance resulted in record revenue,
with sales jumping $5.009 million or over 39 percent year
over year to $17.810 million from $12.800 million for the three
months ended March 31, 2011.
Sequentially, first quarter revenues improved over 12 percent above
the $15.887 million from the fourth quarter fiscal 2011.
The upturn in revenues for the three months ended March 31, 2012
was driven by increased sales of field mobility solutions and
continued increases in demand from the retail sector.
Gross margin surged 290 basis points year over year from 18.2
percent in the first quarter of 2011, up to 21.1 percent for the
three months ended March 31, 2012.
The increase in gross margin was primarily a result reduced costs,
improved utilization, and the ongoing revenue mix shift towards
software and services.
Sequentially, first quarter gross margin declined 130 basis points
from 22.4 percent for the three months ended December 31, 2011,
primarily due to seasonal patterns.
Selling, general and administrative expenses in the first quarter
increased year over year by $342,033 and sequentially by $505,508
to $3.835 million,
The year over year and sequential increase in selling, general and
administrative expenses was primarily the result of costs incurred
in pursuing certain acquisition opportunities.
Adjusted EBITDA for the first quarter of 2012 improved year
over year by $1.418 million to $494,796 compared to a negative
$(923,732) for the same quarter of fiscal 2011.
Net loss before dividends improved to a net loss of $236,722 in the
first quarter of 2012 compared to a net loss of $1.622 million in
the first quarter of 2011.
Net loss attributable to common shareholders was $458,776 for the
fiscal 2012 first quarter compared to a net loss attributable to
common shareholders of $1.649 million for three months ended March
Here again, the improvement in net loss before dividends and net
loss attributable to common shareholders was driven by record
consolidated sales and improved gross margin.
Based on a weighted average number of basic and diluted shares of
7.392 million, basic and diluted net loss per share resulted in a
net loss of $0.06 per share for the first quarter of fiscal 2012.
This compared to a basic and diluted net loss per share of $0.38
based on a weighted average number of basic and diluted shares of
4.333 million during the three months ended March 31, 2011.
The Company ended the quarter with $492,665 in cash and a working
capital deficit of $4.2 million. This compares to $365,814 in cash
and a working capital deficit of $3.762 million as of December 31,
Still, cash flow from operating activities for the first quarter of
2012 was $3.0 million compared to $2.1 million for the same period
Additionally, DecisionPoint had $5.1 million available under its
revolving credit facility with Silicon Valley Bank as of March 31,
2012. Also, the Company's term loan, also with Silicon Valley
Bank, was paid down to $1.75 million from $2.0 million at December
Moreover, management stated that it continues to see its field
mobility solutions gaining traction with wireless carrier partners
and customers as well as the continued expansion of its pipeline of
opportunities in its retail and warehouse and distribution
Similarly, the Company continued to see a bounce back of its retail
Likewise, management further stated that its tablet-based assisted
shopping solution suite for in-store applications continues to gain
acceptance with existing and new retail customers and in field
mobility applications, its major wireless carrier partners are
embracing its Grapevine Push-to-Talk solution for enterprise and
small business applications.
As a result of these demands and trends, DecisionPoint continues to
anticipate revenue growth of over 25% in 2012.
Furthermore, Management anticipates current gross margins will be
sustainable going forward as a result of the Company's improving
utilization and continuing focus on cost control combined with the
ongoing shift of revenue mix in favor of software and professional
For a free copy of the full research report, please visit
DECISIONPOINT (DPSI): Free Stock Analysis
To read this article on Zacks.com click here.