Shares of UniTek Global Services, Inc. (UNTK) fell around 5% on Mar 31 as the company reported breakeven results for the fourth quarter of 2013 and a loss per share of $2.73 for the full year.
The fourth-quarter breakeven results, however, compared favorably with the prior-year quarter loss of 13 cents per share as well as the Zacks Consensus Estimate of a loss per share of 16 cents. UniTek Global Services’ loss of $2.73 per share in 2013 was narrower than the loss per share of $4.28 in 2012. Nevertheless, it was wider than the Zacks Consensus Estimate of a loss per share of $1.53.
UniTek Global Services reported an 11.6% year-over-year decline in revenues to $106.9 million in the fourth quarter. Revenues also lagged the Zacks Consensus Estimate of $115 million. Revenues for the year 2013 increased 7.8% year over year to $471.9 million. However, the reported figure lagged the Zacks Consensus Estimate of $477 million.
Gross profit during the quarter decreased 17% to $18 million from $21.7 million in the prior-year quarter. Consequently, gross margin contracted 110 basis points to 16.9% in the quarter.
Selling, general and administrative expenses decreased 45% year over year to $7 million. Adjusted operating profit was $11 million, compared with $8.9 million in the prior-year quarter. The company reported adjusted earnings before interest, taxes, depreciation and amortization (:EBITDA) of $11.7 million versus $9.8 million in the prior-year quarter.
Fulfillment segment: The segment reported sales of $76 million in the fourth quarter, down from $80.7 million in the year-ago quarter. The decrease in revenues was primarily owing to closure of certain low or negative margin cable markets during 2013.
Engineering and Construction segment: Net sales in the reported quarter went down 23.3% year over year to $30.9 million. The decrease was due to a reduction in wireless turf work year over year as well as lower systems integration revenues.
UniTek Global Services ended 2013 with cash and cash equivalents of $1.8 million, down from $3.8 million as of 2012-end. As of Dec 31, 2013, long-term debt increased to $174 million from $153 million as of Dec 31, 2012. Cash usage in operating activities for 2013 was $10 million versus $8.9 million in the previous year.
UniTek Global Services expects DIRECTV to be a valuable partner and provide high quality service. The company will benefited from its association with the major carrier in the wireless space. Going forward, management intends to introduce new services, gain additional businesses and extend sales endeavors to arenas that complement end-to-end telecom solutions. The company recently launched a managed services division which will diversify its customer base. Moreover, UniTek Global Services expects its debt to fall in the near term due to positive cash flow generation.
Blue Bell, PA-based UniTek is a provider of engineering, construction management, installation and technical services to the wireless and wireline telecommunications, satellite television as well as broadband cable industries in the U.S. and Canada. At present, the company is focusing on completing its financial reporting obligations.
UniTek currently carries a Zacks Rank #3 (Hold).
However, better-ranked companies in the building-heavy construction industry include Gibraltar Industries, Inc. (ROCK), USG Corporation (USG) and MasTec, Inc. (MTZ). While Gibraltar Industries sports a Zacks Rank #1 (Strong Buy), India Globalization Capital and MasTec have a Zacks Rank #3 (Hold).
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