UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 


 

FORM 8-K

 


 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): August 8, 2013

 


 

WILLDAN GROUP, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-33076

 

14-1951112

(State of other jurisdiction
of incorporation)

 

(Commission File Number)

 

(IRS Employer
Identification No.)

 

2401 East Katella Avenue, Suite 300, Anaheim, California 92806

(Address of Principal Executive Offices)

 

Registrant’s telephone number, including area code: (800) 424-9144

 

Not Applicable

(Former name or former address, if changed since last report)

 


 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).

 

o            Soliciting material pursuant to Rule 14A-12 under the Exchange Act (17 CFR 240.14a-12)

 

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR.14d-2(b))

 

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 2.02.                                        Results of Operation and Financial Condition

 

Willdan Group, Inc. (“Willdan”) issued a press release on August 8, 2013. The press release announced its financial results for the second quarter ended June 28, 2013. The press release is filed as Exhibit 99.1 and is hereby incorporated by reference in its entirety. The information in this Form 8-K and the exhibit attached hereto is being furnished (not filed) under Item 2.02 of Form 8-K.

 

Item 9.01                                           Financial Statements and Exhibits

 

(d)                                 Exhibits.

 

99.1                        Press Release of Willdan Group, Inc. dated August 8, 2013 (financial results for the second quarter ended June 28, 2013).

 

2



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

WILLDAN GROUP, INC.

 

 

 

 

Date: August 8, 2013

By:

/s/ Kimberly D. Gant

 

 

Kimberly D. Gant

 

 

Chief Financial Officer, Senior Vice President,

 

 

and Treasurer

 

3



 

EXHIBIT INDEX

 

Exhibit No.

 

Document

 

 

 

99.1

 

Press Release of Willdan Group, Inc. dated August 8, 2013 (Financial results for the second quarter ended June 28, 2013)

 

4


Exhibit 99.1

 

 

Willdan Reports Second Quarter 2013 Financial Results

 

ANAHEIM, Calif., August 8, 2012 (BUSINESS WIRE) — Willdan Group, Inc. (“Willdan”) (NASDAQ:WLDN), today announced financial results for its second quarter ended June 28, 2013.

 

For the second quarter of 2013, Willdan reported total contract revenue of $20.5 million and net income of $0.7 million, or $0.09 per share.

 

Tom Brisbin, Willdan’s Chief Executive Officer, stated: “While our second quarter revenue was lower than last year, I’m pleased to report that we generated positive cash flow and earnings for the quarter. Lower revenue was due to continued declines in our energy segment, offset by gains in all of our other business lines. Our energy projects began to ramp up during the second quarter as planned and we expect revenue growth and higher levels of profitability in the second half of 2013.”

 

Second Quarter 2013 Results

 

For the second quarter of fiscal 2013, revenue was $20.5 million, down $3.0 million, or 12.7%, from revenue of $23.5 million for the comparable period last year. On a sequential basis, revenue was down $0.9 million, or 4.2%, from the first quarter of 2013. Income from operations was $0.7 million for the second quarter of fiscal 2013, as compared to a loss from operations of $19.6 million for the comparable period last year. On a sequential basis, income from operations was $0.7 million as compared to $0.5 million for the first quarter of 2013.

 

Net income was $0.7 million for the second quarter of fiscal 2013, as compared to a net loss of $17.0 million for the comparable period last year and net income of $0.4 million for the first quarter of 2013.

 

Basic and diluted earnings per share for the second quarter of fiscal 2013 were $0.09 as compared to a basic and diluted loss per share of $2.33 for the comparable period last year.

 

Willdan generated $1.4 million in cash flow from operations in the second quarter of fiscal 2013.

 

1



 

Six Months 2013 Results

 

For the six months ended June 28, 2013, revenue was $41.9 million, as compared to $48.9 million in the comparable period last year. Income from operations was $1.2 million for the six months ended June 28, 2013 as compared to a loss from operations of $21.9 million for the comparable period last year. Net income was $1.1 million for the six months ended June 28, 2013 as compared to a net loss of $18.4 million for the comparable period last year.

 

Basic and diluted earnings per share for the six months ended June 28, 2013 were $0.15 as compared to a basic and diluted loss per share of $2.52 for the comparable period last year.

 

Willdan generated $2.4 million in cash flow from operations in the six months ended June 28, 2013.

 

 

 

Three Months Ended

 

Six Months Ended

 

In thousands (except per share data)

 

June 28,
2013

 

June 29,
2012

 

June 28,
2013

 

June 29,
2012

 

Revenue

 

$

20,496

 

$

23,481

 

$

41,881

 

$

48,949

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

718

 

(19,583

)

1,175

 

(21,900

)

Interest income

 

2

 

1

 

5

 

2

 

Interest expense

 

(50

)

(30

)

(77

)

(52

)

Other, net

 

10

 

(21

)

25

 

(21

)

Income tax (benefit) expense

 

(8

)

(2,657

)

41

 

(3,584

)

Net income (loss)

 

$

688

 

$

(16,976

)

$

1,087

 

$

(18,387

)

 

 

 

 

 

 

 

 

 

 

Basic and diluted earnings (loss) per share

 

$

0.09

 

$

(2.33

)

$

0.15

 

$

(2.52

)

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

7,353

 

7,297

 

7,336

 

7,294

 

Diluted

 

7,401

 

7,297

 

7,383

 

7,294

 

 

Use of Non-GAAP Financial Measures

 

Adjusted EBITDA is a supplemental measure used by Willdan’s management to measure its operating performance. Willdan defines Adjusted EBITDA as net income (loss) plus net interest expense, income tax expense (benefit), depreciation and amortization, goodwill impairment, lease abandonment expense, net and other non-recurring income and expense items occurring in such period. Willdan’s definition of Adjusted EBITDA may differ from those of many companies reporting similarly named measures. This measure should be considered in addition to, and not as a substitute for or superior to, other measures of financial performance prepared in accordance with U.S. generally accepted accounting principles, or GAAP, such as net income. Willdan believes Adjusted EBITDA enables management to separate non-recurring income and expense items from its results of operations to provide a more normalized and consistent view of operating performance on a period-to-period basis. Willdan uses Adjusted EBITDA to evaluate its performance for, among other things, budgeting, forecasting and incentive compensation purposes. Willdan also believes Adjusted EBITDA is useful to investors, research analysts, investment bankers and lenders because it removes the impact of certain non-recurring income and expense items from its operational results, which may facilitate comparison of its results from period to period.

 

2



 

Adjusted EBITDA is not a recognized term under GAAP and does not purport to be an alternative to income from operations or net income as an indicator of operating performance or any other GAAP measure.

 

Adjusted EBITDA increased $7.8 million to $1.5 million for the six months ended June 28, 2013 from $(6.3) million for the comparable period last year.

 

The following is a reconciliation of net income (loss) to Adjusted EBITDA:

 

 

 

Six Months Ended

 

In thousands

 

June 28,
2013

 

June 29,
2012

 

Net income (loss)

 

$

1,087

 

$

(18,387

)

Interest income

 

(5

)

(2

)

Interest expense

 

77

 

52

 

Income tax expense (benefit)

 

41

 

(3,584

)

Loss on sale of assets

 

 

22

 

Depreciation and amortization

 

310

 

387

 

Impairment of goodwill

 

 

15,208

 

Lease abandonment expense, net

 

13

 

30

 

Adjusted EBITDA

 

$

1,523

 

$

(6,274

)

 

Liquidity and Capital Resources

 

Willdan had $8.5 million in cash and cash equivalents at June 28, 2013, compared with $10.0 million at December 28, 2012. Willdan has a $5.0 million revolving line of credit with Wells Fargo Bank, National Association, with no outstanding borrowings at June 28, 2013.

 

Conference Call and Webcast

 

Chief Executive Officer Thomas Brisbin and Chief Financial Officer Kimberly Gant plan to host a conference call on August 8, 2013 at 5:00 p.m. Eastern/2:00 p.m. Pacific, to discuss Willdan’s financial results.

 

Interested parties may participate in the conference call by dialing 877-941-2332 (480-629-9867 for international callers). When prompted, ask for the “Willdan Group, Inc., Second Quarter 2013 Conference Call.” The conference call will be webcast simultaneously on Willdan’s website at www.willdan.com under Investors: Events.

 

3



 

The telephonic replay of the conference call may be accessed approximately two hours after the call through August 22, 2013, by dialing 800-406-7325 (303-590-3030 for international callers).  The replay access code is 4633799. The webcast replay will be archived for 12 months.

 

About Willdan Group, Inc.

 

Founded in 1964, Willdan is a provider of professional technical and consulting services to public agencies at all levels of government, public and private utilities and commercial and industrial firms. Willdan provides a broad range of services to clients throughout the United States, including engineering and planning, energy efficiency and sustainability, economic and financial consulting, and national preparedness and interoperability. For additional information, visit Willdan’s website at www.willdan.com.

 

Forward-Looking Statements

 

Safe Harbor Statement: Statements in this press release which are not purely historical, including statements regarding Willdan’s intentions, hopes, beliefs, expectations, representations, projections, estimates, plans or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties including, but not limited to, the risk that Willdan will not be able to expand its services or meet the needs of customers in markets in which it operates. It is important to note that Willdan’s actual results could differ materially from those in any such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, a slowdown in the local and regional economies of the states where Willdan conducts business and the loss of or inability to hire additional qualified professionals. Willdan’s business could be affected by a number of other factors, including the risk factors listed from time to time in Willdan’s SEC reports including, but not limited to, the Annual Report on Form 10-K for the year ended December 28, 2012 filed on March 26, 2013 and the Quarterly Report on Form 10-Q for the quarter ended March 29, 2013 filed on May 9, 2013. Willdan cautions investors not to place undue reliance on the forward-looking statements contained in this press release. Willdan disclaims any obligation to, and does not undertake to, update or revise any forward-looking statements in this press release.

 

4



 

WILLDAN GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

June 28,
2013

 

December 28,
2012

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

8,475,000

 

$

10,006,000

 

Accounts receivable, net of allowance for doubtful accounts of $512,000 and $303,000 at June 28, 2013 and December 28, 2012, respectively

 

11,040,000

 

15,484,000

 

Costs and estimated earnings in excess of billings on uncompleted contracts

 

10,241,000

 

9,860,000

 

Other receivables

 

68,000

 

95,000

 

Prepaid expenses and other current assets

 

1,222,000

 

1,782,000

 

Total current assets

 

31,046,000

 

37,227,000

 

 

 

 

 

 

 

Equipment and leasehold improvements, net

 

762,000

 

979,000

 

Other intangible assets, net

 

 

12,000

 

Other assets

 

298,000

 

307,000

 

Deferred income taxes, net of current portion

 

3,452,000

 

3,452,000

 

Total assets

 

$

35,558,000

 

$

41,977,000

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Excess of outstanding checks over bank balance

 

$

818,000

 

$

1,188,000

 

Borrowings under line of credit

 

 

3,000,000

 

Accounts payable

 

3,440,000

 

6,983,000

 

Accrued liabilities

 

5,110,000

 

5,306,000

 

Billings in excess of costs and estimated earnings on uncompleted contracts

 

3,559,000

 

3,419,000

 

Current portion of notes payable

 

169,000

 

628,000

 

Current portion of capital lease obligations

 

136,000

 

152,000

 

Current portion of deferred income taxes

 

3,452,000

 

3,452,000

 

Total current liabilities

 

16,684,000

 

24,128,000

 

 

 

 

 

 

 

Capital lease obligations, less current portion

 

74,000

 

124,000

 

Deferred lease obligations

 

237,000

 

374,000

 

Total liabilities

 

16,995,000

 

24,626,000

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Preferred stock, $0.01 par value, 10,000,000 shares authorized, no shares issued and outstanding

 

 

 

Common stock, $0.01 par value, 40,000,000 shares authorized: 7,353,000 and 7,335,000 shares issued and outstanding at June 28, 2013 and December 28, 2012, respectively

 

74,000

 

73,000

 

Additional paid-in capital

 

34,547,000

 

34,423,000

 

Accumulated (deficit) earnings

 

(16,058,000

)

(17,145,000

)

Total stockholders’ equity

 

18,563,000

 

17,351,000

 

Total liabilities and stockholders’ equity

 

$

35,558,000

 

$

41,977,000

 

 

5



 

WILLDAN GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 28,

 

June 29,

 

June 28,

 

June 29,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Contract revenue

 

$

20,496,000

 

$

23,481,000

 

$

41,881,000

 

$

48,949,000

 

 

 

 

 

 

 

 

 

 

 

Direct costs of contract revenue (exclusive of depreciation and amortization shown separately below):

 

 

 

 

 

 

 

 

 

Salaries and wages

 

6,129,000

 

5,976,000

 

11,972,000

 

11,933,000

 

Subconsultant services and other direct costs

 

5,309,000

 

11,140,000

 

11,500,000

 

22,377,000

 

Total direct costs of contract revenue

 

11,438,000

 

17,116,000

 

23,472,000

 

34,310,000

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses:

 

 

 

 

 

 

 

 

 

Salaries and wages, payroll taxes and employee benefits

 

4,948,000

 

5,839,000

 

10,486,000

 

12,267,000

 

Facilities and facilities related

 

1,149,000

 

1,240,000

 

2,337,000

 

2,435,000

 

Stock-based compensation

 

38,000

 

77,000

 

88,000

 

131,000

 

Depreciation and amortization

 

127,000

 

181,000

 

276,000

 

355,000

 

Lease abandonment, net

 

 

26,000

 

13,000

 

30,000

 

Impairment of goodwill

 

 

15,208,000

 

 

15,208,000

 

Other

 

2,078,000

 

3,377,000

 

4,034,000

 

6,113,000

 

Total general and administrative expenses

 

8,340,000

 

25,948,000

 

17,234,000

 

36,539,000

 

Income (loss) from operations

 

718,000

 

(19,583,000

)

1,175,000

 

(21,900,000

)

 

 

 

 

 

 

 

 

 

 

Other income (expense), net:

 

 

 

 

 

 

 

 

 

Interest income

 

2,000

 

1,000

 

5,000

 

2,000

 

Interest expense

 

(50,000

)

(30,000

)

(77,000

)

(52,000

)

Other, net

 

10,000

 

(21,000

)

25,000

 

(21,000

)

Total other expense, net

 

(38,000

)

(50,000

)

(47,000

)

(71,000

)

Income (loss) before income taxes

 

680,000

 

(19,633,000

)

1,128,000

 

(21,971,000

)

 

 

 

 

 

 

 

 

 

 

Income tax (benefit) expense

 

(8,000

)

(2,657,000

)

41,000

 

(3,584,000

)

Net income (loss)

 

$

688,000

 

$

(16,976,000

)

$

1,087,000

 

$

(18,387,000

)

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

0.09

 

$

(2.33

)

$

0.15

 

$

(2.52

)

 

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

7,353,000

 

7,297,000

 

7,336,000

 

7,294,000

 

Diluted

 

7,401,000

 

7,297,000

 

7,383,000

 

7,294,000

 

 

6



 

WILLDAN GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

 

 

 

Six Months Ended

 

 

 

June 28,
2013

 

June 29,
2012

 

Cash flows from operating activities:

 

 

 

 

 

Net income (loss)

 

$

1,087,000

 

$

(18,387,000

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

310,000

 

387,000

 

Deferred income taxes

 

 

(3,584,000

)

Impairment of goodwill

 

 

15,208,000

 

Lease abandonment expense, net

 

13,000

 

30,000

 

Loss on sale of equipment

 

(6,000

)

22,000

 

Provision for doubtful accounts

 

162,000

 

432,000

 

Stock-based compensation

 

88,000

 

131,000

 

Changes in operating assets and liabilities:

 

 

 

 

 

Accounts receivable

 

4,282,000

 

(5,498,000

)

Costs and estimated earnings in excess of billings on uncompleted contracts

 

(381,000

)

10,066,000

 

Other receivables

 

27,000

 

89,000

 

Prepaid expenses and other current assets

 

560,000

 

231,000

 

Other assets

 

9,000

 

34,000

 

Accounts payable

 

(3,543,000

)

2,826,000

 

Accrued liabilities

 

(196,000

)

(2,045,000

)

Billings in excess of costs and estimated earnings on uncompleted contracts

 

140,000

 

1,063,000

 

Deferred lease obligations

 

(150,000

)

(86,000

)

Net cash provided by operating activities

 

2,402,000

 

919,000

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchase of equipment and leasehold improvements

 

(86,000

)

(220,000

)

Proceeds from sale of equipment

 

11,000

 

8,000

 

Net cash used in investing activities

 

(75,000

)

(212,000

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Changes in excess of outstanding checks over bank balance

 

(370,000

)

(448,000

)

Payments on notes payable

 

(459,000

)

(489,000

)

Borrowings under line of credit

 

266,000

 

11,663,000

 

Repayments on line of credit

 

(3,266,000

)

(8,919,000

)

Principal payments on capital lease obligations

 

(66,000

)

(88,000

)

Proceeds from sales of common stock under employee stock purchase plan

 

37,000

 

75,000

 

Net cash (used in) provided by financing activities

 

(3,858,000

)

1,794,000

 

Net increase in cash and cash equivalents

 

(1,531,000

)

2,501,000

 

Cash and cash equivalents at beginning of the period

 

10,006,000

 

3,001,000

 

Cash and cash equivalents at end of the period

 

$

8,475,000

 

$

5,502,000

 

 

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

Interest

 

$

81,000

 

$

51,000

 

Income taxes

 

155,000

 

45,000

 

 

 

 

 

 

 

Supplemental disclosures of noncash investing and financing activities:

 

 

 

 

 

Equipment acquired under capital lease obligations

 

$

7,000

 

$

10,000

 

 

7



 

SOURCE:  Willdan Group, Inc.

 

Contact:

Willdan Group, Inc.

Kimberly Gant

Chief Financial Officer

Tel: 714-940-6300

kgant@willdan.com

 

or

 

Financial Profiles, Inc.

Moira Conlon

Tel: 310-478-2700 x11

mconlon@finprofiles.com

 

8