WidePoint Corporation Reports 2Q17 Financial Results

MCLEAN, Va., Aug. 14, 2017

Recent Highlights

• Appointed Jin Kang as new CEO and President of WidePoint Corporation on July 1^st, 2017
• Implemented major costs reductions during July, adding to reductions taken in the second quarter of 2017, to improve operational profitability outlook for the second half of 2017, stabilizing the financial condition of the business
• Extinguished all remaining long-term debt and established a new $5 million dollar credit facility with zero borrowings outstanding
• Launched Trusted Mobility Management offering, or TM2, consolidating platforms, improving operational efficiency, and creating a unique and improved value proposition for customers
• Reorganized credentialing operations and initiated several new sales and marketing campaigns, including search engine optimization, to improve revenue growth and financial performance
• Added, re-negotiated, and eliminated several channel partners as part of a repositioning of the Company's new TM2 value proposition to the marketplace
• Secured several new contracts and successfully expanded wallet-share with several current customers that provides additional services
• Entered into standstill agreement with Nokomis Capital and added two new independent directors

Second Quarter 2017 Financial Highlights

• Net revenue was approximately $18.9 million compared to $17.5 million in the second quarter of 2016
• Gross profit was approximately $3.3 million compared to $3.4 million in the second quarter of 2016
• Operating expenses were approximately $4.5 million compared to $4.2 million in the second quarter of 2016
• Operating loss was approximately $(1.3 million) compared to $(0.9 million) in the second quarter of 2016
• Net loss was approximately $(1.3 million), or $(0.02) per basic and diluted share, compared to a loss of $(0.9 million), or $(0.01) per basic and diluted share
• Adjusted EBITDA loss was approximately $(0.4 million) compared to approximately $(0.5 million) in the second quarter of 2016.

Six Months 2017 Financial Highlights

• Net revenue was approximately $37.5 million compared to $38.0 million in the six months of 2016
• Gross profit was approximately $6.7 million compared to $7.6 million in the six months of 2016
• Operating expenses were approximately $9.2 million compared to $9.1 million in the six months of 2016
• Operating loss was approximately $(2.4 million) compared to $(1.5 million) in the six months of 2016
• Net loss was approximately $(2.5 million), or $(0.03) per basic and diluted share, compared to a loss of $(1.6 million), or $(0.02) per basic and diluted share
• Adjusted EBITDA loss was approximately $(1.2 million) compared to approximately $(0.6 million) in the six months of 2016
• Cash and cash equivalents was approximately $5.5 million as of June 30, 2017.
• Long-term debt was zero and a new credit facility for $5.0 million was established with no borrowings.

"In the second quarter of 2017 we refocused our efforts on optimizing operations, reducing expenses, and growing our pipeline of business," stated CEO and President Jin Kang. "We also launched our TM2 vision with a new focus on improving current, high margin, high probability revenue opportunities while expanding overall cross utilization of operational personnel to drive economies of scale and reduce operational costs. We remain focused on improving our finance performance and our return to profitability."

James McCubbin, WidePoint's Chief Financial Officer, added, "The recent reductions in expenses should create a leaner and more nimble organization, driving improved financial performance in the second half of 2017. Coupling that with the payoff of our remaining long-term debt and our new untouched credit facility for up to $5 million provides us with the financial room to navigate our way through and support our growth plans that we have recently put into place."

Non-GAAP Financial Measures