DPSI DecisionPoint Systems Inc

DecisionPoint Systems, Inc. (NYSE American: DPSI), the leading mobility-first enterprise services and solutions company and a leading provider of retail in-store solutions and services centered on Point-of-Sale systems, today announced first quarter 2024 financial results for the period ended March 31, 2024.

Steve Smith, chief executive officer of DecisionPoint Systems, commented: “Our first quarter results were impacted by the absence of any large project business on the hardware solutions side of the business. However, our gross margin improved with the mix shift towards services and software. We also reduced our debt by over $1.6 million and increased cash by $1.5 million.

“With our continued focus on services, our investments in 2023 are already starting to pay off, and we anticipate our Mobile Managed Services strategy will drive sales of our newer offerings throughout this year. During the first quarter, we continued to build out this part of the business by introducing PointCare services, which include existing and new services. This offering served as the foundation for an early win, as we secured a large managed services opportunity with a leading C-store chain to provide store-level, on-site services to maintain several in-store technologies and devices. This win was a significant add to our managed services recurring revenue backlog. It also represents an exciting opportunity to expand from providing mobile managed services for devices to delivering managed services for an entire store or site with a much larger TAM versus discrete device-level services. We will formally launch these new service offerings in the second quarter under the StoreCare and SiteCare brands.

“Given our impending transaction with Graham and Barcoding, which was at a 27% premium to our closing price the night before the announcement, we will not be hosting a conference call this quarter as we focus on running the business and preparing for the shareholder vote, with the goal of closing the transaction in July. We think this deal strikes the right balance of rewarding our public shareholders with positioning DecisionPoint for the next evolution as a Company.”

About DecisionPoint Systems

DecisionPoint Systems Inc. delivers mobility-first enterprise managed services, in-store retail solutions centered around point-of-sale technologies, deployment, integration and support services to retail, supply chain, hospitality, healthcare and other verticals, enabling customers to make better and faster decisions in the moments that matter—the decision points. Our mission is to help businesses consistently deliver on those moments—improving customer service, accelerating growth, improving worker productivity and lowering risks and costs. For more information about DecisionPoint Systems, Inc., visit https://www.decisionpt.com.

Forward-Looking Statements

In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words "believe," "anticipate," "expect," "plan," "intend," "estimate, "target" and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described in our most recent report on SEC Form 10-K (under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations"), which may be revised or supplemented in subsequent reports on SEC Forms 10-Q and 8-K. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.

DecisionPoint Systems, Inc.

Consolidated Balance Sheets

(in thousands, except par value)

 

March 31,

December 31,

2024

2023

ASSETS Current assets: Cash $

5,834

 

$

4,300

 

Accounts receivable, net of allowance of $324 and $267 as of March 31, 2024 and December 31, 2023, respectively

19,292

 

23,768

 

Inventory, net

1,193

 

2,133

 

Deferred costs

4,158

 

3,826

 

Prepaid expenses and other current assets

598

 

630

 

Total current assets

31,075

 

34,657

 

Operating lease assets

3,208

 

3,392

 

Property and equipment, net

2,889

 

2,973

 

Deferred costs, net of current portion

3,744

 

3,689

 

Deferred tax assets, net

1,475

 

1,161

 

Intangible assets, net

7,317

 

7,815

 

Goodwill

22,204

 

22,081

 

Other assets

172

 

172

 

Total assets $

72,084

 

$

75,940

 

LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $

14,575

 

$

16,857

 

Accrued expenses and other current liabilities

5,607

 

6,566

 

Deferred revenue

9,222

 

8,066

 

Current portion of earnout consideration

5,550

 

5,370

 

Current portion of long-term debt

1,003

 

1,003

 

Current portion of operating lease liabilities

888

 

874

Total current liabilities

36,845

 

38,736

 

Deferred revenue, net of current portion

5,298

 

5,307

 

Revolving line of credit

-

 

1,300

 

Long-term debt, net of current portion

3,388

 

3,639

 

Noncurrent portion of operating lease liabilities

2,862

 

3,093

 

Long-term portion of earnout consideration

4,692

 

4,316

 

Other liabilities

6

 

6

Total liabilities

53,091

 

56,397

 

Commitments and contingencies Stockholders’ equity: Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued or outstanding

-

 

-

 

Common stock, $0.001 par value; 50,000 shares authorized; 7,681 and 7,680 shares issued and outstanding, respectively

8

 

8

 

Additional paid-in capital

39,184

 

38,902

 

Accumulated deficit

(20,199

)

(19,367

)

Total stockholders’ equity

18,993

 

19,543

 

Total liabilities and stockholders’ equity $

72,084

 

$

75,940

 

DecisionPoint Systems, Inc.

Consolidated Statements of Income and Comprehensive Income

(in thousands, except per share data)

 

Three Months Ended

March 31,

2024

2023

Net sales: Product $

15,317

 

$

22,166

 

Service

10,301

 

4,873

 

Net sales

25,618

 

27,039

 

Cost of sales: Product

12,488

 

17,885

 

Service

7,119

 

3,104

 

Cost of sales

19,607

 

20,989

 

Gross profit

6,011

 

6,050

 

Operating expenses: Sales and marketing expense

2,813

 

2,368

 

General and administrative expenses

4,096

 

2,494

 

Total operating expenses

6,909

 

4,862

 

Operating (loss) income

(898

)

1,188

 

Interest expense, net

(248

)

(13

)

(Loss) income before income taxes

(1,146

)

1,175

 

Income tax benefit (expense)

314

 

(309

)

Net (loss) income and comprehensive (loss) income attributable to common stockholders $

(832

)

$

866

 

Net (loss) income per share attributable to stockholders: Basic $

(0.11

)

$

0.12

 

Diluted $

(0.11

)

$

0.11

 

Weighted average common shares outstanding Basic

7,681

 

7,417

 

Diluted

7,889

 

7,789

 

DecisionPoint Systems, Inc.

Consolidated Statements of Cash Flows

(in thousands)

  Three Months Ended March 31,

2024

2023

Cash flows from operating activities Net (loss) income $

(832

)

$

866

 

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: Depreciation and amortization

743

 

564

 

Share-based compensation expense

279

 

196

 

Deferred income taxes, net

(314

)

10

 

Provision for credit losses

57

 

68

 

Provision for inventory obsolescence

(6

)

45

 

Changes in operating assets and liabilities: Accounts receivable

4,419

 

(9,413

)

Inventory, net

946

 

(1,551

)

Deferred costs

(387

)

(212

)

Prepaid expenses and other current assets

32

 

(75

)

Accrued expenses and other current liabilities

(526

)

(1,871

)

Operating lease liabilities

(33

)

(24

)

Deferred revenue

1,147

 

6,394

 

Net cash provided by (used in) operating activities

3,243

 

(1,496

)

Cash flows from investing activities Purchases of property and equipment

(161

)

(176

)

Net cash used in investing activities

(161

)

(176

)

Cash flows from financing activities Proceeds from term loan

-

 

5,000

 

Repayment of term debt

(251

)

(1

)

Line of credit, net

(1,300

)

7,000

 

Proceeds from exercise of stock options

3

 

6

 

Net cash (used in) provided by financing activities

(1,548

)

12,005

 

Change in cash

1,534

 

10,333

 

Cash, beginning of period

4,300

 

7,642

 

Cash, end of period $

5,834

 

$

17,975

 

 

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