DecisionPoint Systems Announces First Quarter 2023 Results

Revenue increased 37% to $27 million

DecisionPoint™ Systems, Inc. (NYSE:DPSI), a mobility-first enterprise services and solutions company, today announced first quarter 2023 financial results ended March 31, 2023.

Steve Smith, chief executive officer of DecisionPoint commented: "Our momentum from 2022 carried into the first quarter of 2023 as we continued to execute on our proven growth model. We saw strong contributions from select projects in retail, along with a boost to our run-rate business realized from the upside synergies associated with our M&A and cross-selling activities.

"In addition to this strength in retail, we saw our mobility-first enterprise services and solutions strategy yield increases in our services and consumables businesses, which grew 18% and 27%, respectively. We also used this across-the-board strength in our business to reinvest internally in initiatives with higher margin potential, including our Vision portal and additional sales and business development resources. While this restrained our profitability growth near-term, we believe these investments will drive strong outcomes from a medium to longer-term perspective."

First Quarter Highlights (2023 versus 2022)

• Revenue increased 37.1% to $27.0 million;
• Gross Profit increased 29.4% to $6.1 million;
• GAAP Operating Income increased 399% to $1.2 million;
• GAAP Net Income and diluted EPS increased slightly to $0.9 million and $0.11, respectively;
• Non-GAAP Net Income and non-GAAP diluted EPS increased slightly to $1.3 million and $0.16, respectively;
• Adjusted EBITDA increased 97.9% to $2.2 million;

Balance Sheet and Liquidity as of March 31, 2022

Cash and cash equivalents were $18.0 million, compared to $7.6 million on December 31, 2022. Short-term and long-term debt were $1.0 million and $11.1 million, respectively. The increase in cash and debt related to the Company drawing down on its credit facilities in order close the acquisition of Macro Integration Services (MIS) on April 1, 2023.

2023 Commentary and Second Quarter Guidance (ending 6/30/23)

"Looking to the second quarter, we closed the MIS acquisition, which aligned with our strategic objectives of adding a higher mix of services, adding new solutions, filling geographic gaps and bringing new retail and hospitality customer relationships on the first day of the quarter. We expect the acquisition, combined with the continued fulfillment of the large retail customer orders, to drive higher revenue and gross margin sequentially and year over year. As a result, from the second quarter through the remainder of the year, we now expect MIS to incrementally add at least $12 million in revenue and over $1.2 million in adjusted EBITDA at an above-company average gross margin, as roughly 70% of MIS' revenue comes from services," concluded Smith.

Conference Call and Webcast Information

Management will host an earnings conference call and webcast at 11:00 a.m. Eastern Time. Q&A with investors will follow management's presentation of the results, outlook and strategy.

Live Call Information:

Date: May 15, 2023

Time: 11:00 a.m. Eastern Time

Toll-Free: 1-877-407-3982

Toll/International: 1-201-493-6780

Call me™: Click Call me Link for instant telephone access to the event (Call me™ link will be made active 15 minutes prior to scheduled start time).

Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1614929&tp_key=6c8b18f619

Replay Information:

Toll-Free: 1-844-512-2921

Toll/International: 1-412-317-6671

Replay Pin Number: 13738732

Replay Start: Monday, May 15, 2023, 12:00 p.m. ET

Replay Expiry: Monday, May 22, 2023 at 11:59 p.m. ET

About DecisionPoint Systems

DecisionPoint Systems Inc. delivers mobility-first managed service and integration solutions to healthcare, supply chain, and retail customers, enabling them 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—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.

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements presented on a GAAP basis, we have provided non-GAAP financial information, namely non-GAAP Net Income, non-GAAP diluted EPS and Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization adjusted for transaction-related and non-recurring items). We believe that these non-GAAP measures provide investors with a better understanding of how the results relate to our historical performance as well as when comparing our results to other publicly-traded companies. The additional adjusted information is not meant to be considered in isolation or as a substitute for GAAP financials. Management believes that these adjusted measures reflect the essential operating activities of the Company. A reconciliation of non-GAAP financial information appears below:

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