COLUMBIA, Md., Aug. 14 /PRNewswire-FirstCall/ -- Fortress International Group (Nasdaq: FIGI), holding company for Total Site Solutions (TSS), a company providing comprehensive services for the planning, design and development of mission critical facilities and information infrastructure, today announced financial results for the 2007 second quarter.
For the second quarter ended June 30, 2007 , the Company reported on a pro
forma basis revenue of
For the six months ended June 30, 2007 , the Company reported pro forma
combined revenues of
Commenting on the quarter and six month period, CEO Tom Rosato said, "We
continue to make strides in growing our company. The increased costs incurred
to become a public company and more importantly to pursue and capture new
business has greatly increased our selling, general and administrative
expenses over historic levels and combining that with lower than expected
revenues, we experienced a loss for the quarter and six months ended June 30,
2007 . Our public company infrastructure is now in place and operating and
should not require any significant increase in costs. Our sales, marketing and
proposal activity produced a large increase in backlog and our new proposals
pipeline remains strong. We closed
In order to assist investors in better understanding the changes in our business between the three and six months ended June 30, 2007 and June 30, 2006 , we discussed above pro forma results of operations for the Company and TSS/Vortech for the three and six months ended June 30, 2007 and June 30, 2006 as if the acquisition of TSS/Vortech occurred on January 1, 2007 and January 1, 2006 , respectively. We derived the pro forma results of operations from (i) the unaudited consolidated financial statements of TSS/Vortech for the period from December 31, 2006 to January 19, 2007 (the date of the acquisition) and the six months ended June 30, 2006 , and (ii) our unaudited consolidated financial statements for the six months ended June 30, 2007 and June 30, 2006 .
The Company will conduct a conference call and webcast to discuss its financial results on Wednesday, August 15 at 8:30 a.m. ET . The call may be accessed live by dialing (877) 704-5391 five minutes before the start of the
call. An accompanying slide presentation will be available via the Internet at:
http://www.thefigi.comThe webcast and conference call will be archived after its completion and will remain available through August 22, 2007 by dialing (888) 203-1112 and entering replay passcode 9643657.
ABOUT TOTAL SITE SOLUTIONS
Total Site Solutions (TSS) plans, designs, builds and maintains specialized facilities such as data centers, trading floors, call centers, network operation centers, communication facilities, laboratories and secure facilities. For more than a quarter-century, the TSS team has pioneered building robust and scalable infrastructure into mission-critical facilities. The firm offers unsurpassed expertise in the infrastructure systems (electrical, mechanical, telecommunications, security, fire protection and building automation) that are the critical facility's lifeblood. TSS's comprehensive portfolio of services and multi-disciplinary expertise provide customers a highly respected single source for critical services that bridge the gap between IT and facilities.
Headquartered in the Baltimore-Washington corridor, TSS provides complete turnkey facility services from the initial planning stages, to construction, to ongoing maintenance of the completed project. Its clients include the world's most demanding mission-critical organizations, including Fortune 500 firms and US government agencies. For more information, visit http://www.totalsiteteam.com or call 888-321-4TSS (4877).
FORWARD-LOOKING STATEMENTS
This document may contain "forward-looking statements" -- that is, statements related to future -- not past -- events, plans, and prospects. In this context, forward-looking statements may address matters such as our expected future business and financial performance, and often contain words such as "guidance," "expects," "anticipates," "intends," "plans," "believes," "seeks," "should," or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For Fortress, particular uncertainties that could adversely or positively affect the Company's future results include: the Company's reliance on a significant portion of its revenues from a limited number of customers; the uncertainty as to whether the Company can replace its declining backlog; risks involved in properly managing complex projects; risks relating to revenues under customer contracts, many of which can be canceled on short notice; risks related to the implementation of the Company's strategic plan, including the ability to make acquisitions and the performance and future integration of acquired businesses; and other risks and uncertainties disclosed in the Company's filings with the Securities and Exchange Commission. These uncertainties may cause the Company's actual future results to be materially different than those expressed in the Company's forward-looking statements. The Company does not undertake to update its forward-looking statements.
FORTRESS INTERNATIONAL GROUP, INC. Consolidated Balance Sheet (Successor) (Predecessor) June 30, December 31, January 19, December 31, 2007 2006 2007 2006 (unaudited) (audited) (unaudited) (audited) Assets Current Assets Cash and cash equivalents $21,106,976 $7,347 $1,322,317 $2,361,838 Contract and other receivables, net 8,977,676 - 6,261,988 9,960,851 Prepaid expenses and other current assets 746,264 3,750 233,894 125,276 Costs and estimated earnings in excess of billings on uncompleted contracts 1,400,868 - 1,559,045 480,540 Income tax recoverable 840,000 - - - Due from affiliated entities - - - 201,670 Total Current Assets 33,071,784 11,097 9,377,244 13,130,175 Investments held in trust - 44,673,994 - - Property and equipment, net 924,363 - 904,689 810,747 Goodwill 14,912,946 - - - Intangible assets, net 19,185,065 - - - Deferred acquisition costs - 869,853 - - Other assets 371,823 - 64,158 21,190 Deferred tax assets - 490,675 - - Total Assets $68,465,981 $46,045,619 $10,346,091 $13,962,112 FORTRESS INTERNATIONAL GROUP, INC. Consolidated Balance Sheets-Continued (Successor) (Predecessor) June 30, December 31, January 19, December 31, 2007 2006 2007 2006 (unaudited) (audited) (unaudited) (audited) Liabilities and Stockholders' Equity Current Liabilities Notes payable - current portion $64,359 $- $72,808 $76,934 Accounts payable and accrued expenses 7,909,827 913,222 6,641,718 8,503,024 Advances from stockholder - 20,000 - - Income taxes payable - 586,283 - - Billings in excess of costs and estimated earnings on uncompleted contracts 1,072,911 - 1,662,718 1,243,042 Deferred compensation payable - - - 643,571 Total Current Liabilities 9,047,097 1,519,505 8,377,244 10,466,571 Notes payable 10,055,523 - 79,524 81,679 Total Liabilities 19,102,620 1,519,505 8,456,768 10,548,250 Common stock, subject to possible redemption 1,559,220 shares - 8,388,604 - - Interest income on common stock subject to possible redemption - 541,735 - - Total common stock subject to redemption - 8,930,339 - - Commitments and Contingencies - - - - Stockholders' Equity Preferred stock -- $.0001 par value; 1,000,000 shares authorized; no shares issued or outstanding - - - - Common stock -- $.0001 par value, 100,000,000 shares authorized; 11,856,545 and 9,550,000 issued; 11,856,545 and 9,550,000 outstanding, respectively (which includes 0 and 1,559,220 shares subject to possible redemption, respectively) 1,185 955 - - Additional paid-in capital 52,864,132 34,819,062 - - Treasury stock, at cost 133,775 and 0 shares (successor); (686,743) - - - Retained earnings (2,815,213) 775,758 - - Members' equity - - 1,889,323 3,732,115 Note receivable from affiliate - - - (318,253) Total Stockholders' Equity 49,363,361 35,595,775 1,889,323 3,413,862 Total Liabilities and Stockholders' Equity $68,465,981 $46,045,619 $10,346,091 $13,962,112 FORTRESS INTERNATIONAL GROUP, INC. Pro Forma Consolidated Statements of Operations (Successor) (Successor) (Predecessor) (Proforma) For the For the For the For the Three Three Three Three Months Months Months Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2007 2006 2006 2006 Revenue $10,862,307 $- $18,445,839 $18,445,839 Cost of Revenue 9,424,029 114,075 15,507,437 15,621,512 Gross Profit 1,438,278 (114,075) 2,938,402 2,824,327 Operating costs and expenses Selling, general and administrative 3,424,040 121,753 1,598,894 1,720,647 Depreciation and amortization 97,245 - 82,275 82,275 Amortization of intangible assets 567,108 567,108 - 567,108 Total operating costs and expenses 4,088,393 688,861 1,681,169 2,370,030 Operating income (2,650,115) (802,936) 1,257,233 454,297 Other Income (Expense) Interest income 423,898 410,904 - 410,904 Interest (expense) (150,431) (150,431) (4,733) (155,164) Income (Loss) Before Income Taxes (2,376,648) (542,463) 1,252,500 710,037 As a Percentage of Revenue Revenue 100.0% - 100.0% 100.0% Cost of Revenue 86.8% - 84.1% 84.7% Gross Profit 13.2% - 15.9% 15.3% Operating costs and expenses Selling, general and administrative 31.5% - 8.7% 9.3% Depreciation and amortization 0.9% - 0.4% 0.4% Amortization of intangible assets 5.2% - 0.0% 3.1% Total operating costs and expenses 37.6% 0.0% 9.1% 12.8% Operating income -24.4% 0.0% 6.8% 2.5% Other Income (Expense) Interest income 3.9% 100.0% 0.0% 2.2% Interest (expense) -1.4% -36.6% 0.0% -0.8% FORTRESS INTERNATIONAL GROUP, INC. Pro Forma Consolidated Statements of Operations (Predecessor) For the Proforma (Successor) period from combined For the Six January 1, For the Six Months 2007 Months Ended through Ended June 30, January 19, June 30, 2007 2007 2007 Revenue $19,539,244 1,412,137 20,951,381 Cost of Revenue 16,629,595 1,108,276 17,737,871 Gross Profit 2,909,649 303,861 3,213,510 Operating costs and expenses Selling, general and administrative 6,061,980 555,103 6,617,083 Depreciation and amortization 152,676 33,660 186,336 Amortization of intangible assets 1,007,562 - 1,007,562 Total operating costs and expenses 7,222,218 588,763 7,810,981 Operating income (4,312,569) (284,902) (4,597,471) Other Income (Expense) Interest income 640,069 4,117 644,186 Interest (expense) (267,797) (368) (268,165) Income (Loss) Before Income Taxes (3,940,297) (281,153) (4,221,450) As a Percentage of Revenue Revenue 100.0% 100.0% 100.0% Cost of Revenue 85.1% 78.5% 84.7% Gross Profit 14.9% 21.5% 15.3% Operating costs and expenses Selling, general and administrative 31.0% 39.3% 31.6% Depreciation and amortization 0.8% 2.4% 0.9% Amortization of intangible assets 5.2% 0.0% 4.8% Total operating costs and expenses 37.0% 41.7% 37.3% Operating income -22.1% -20.2% -21.9% Other Income (Expense) Interest income 3.3% 0.3% 3.1% Interest (expense) -1.4% 0.0% -1.3% Proforma (Successor) (Predecessor) combined For the Six For the Six For the Six Months Months Months Ended Ended Ended June 30, June 30, June 30, 2006 2006 2006 Revenue $- $34,726,161 $34,726,161 Cost of Revenue 202,673 28,719,264 28,921,937 Gross Profit (202,673) 6,006,897 5,804,224 Operating costs and expenses Selling, general and administrative 297,955 3,207,944 3,505,899 Depreciation and amortization - 126,000 126,000 Amortization of intangible assets 1,007,562 - 1,007,562 Total operating costs and expenses 1,305,517 3,333,944 4,639,461 Operating income (1,508,190) 2,672,953 1,164,763 Other Income (Expense) Interest income 772,465 - 772,465 Interest (expense) (266,302) (9,698) (276,000) Income (Loss) Before Income Taxes (1,002,027) 2,663,255 1,661,228 As a Percentage of Revenue Revenue - 100.0% 100.0% Cost of Revenue - 82.7% 83.3% Gross Profit - 17.3% 16.7% Operating costs and expenses Selling, general and administrative - 9.2% 10.1% Depreciation and amortization - 0.4% 0.4% Amortization of intangible assets - 0.0% 2.9% Total operating costs and expenses - 9.6% 13.4% Operating income 0.0% 7.7% 3.4% Other Income (Expense) Interest income 100.0% 0.0% 2.2% Interest (expense) -34.5% 0.0% -0.8% Company Contact: Investor Relations: Thomas P Rosato John McNamara CEO Cameron Associates Fortress International Group (212) 245-8800 Ext. 205 Phone: 410.312.9988 x 222 [email protected]SOURCE Fortress International Group
