Delaware
|
98-0204758
|
(State
or other jurisdiction of incorporation or
organization)
|
(IRS
Employer Identification No.)
|
One
East Uwchlan Avenue, Suite 301
Exton,
Pennsylvania
(Address
of principal executive office)
|
19341
(Postal
Code)
|
(610)
903-0400
(Issuer's telephone
number)
|
|
|
Title of each
class
|
Name of each
exchange on which registered
|
Common Stock,
$0.0001 par value
|
The NASDAQ Stock
Market LLC
(NASDAQ Global
Market)
|
Large
accelerated filer o
|
Accelerated
filer o
|
Non-accelerated
filer o
|
Smaller
reporting company x
|
(Do
not check if a smaller reporting company)
|
PAGE
|
|||||
PART I
|
|||||
Item 1.
|
Description
of Business
|
3
|
|||
Item 1A.
|
Risk
Factors
|
8
|
|||
Item 1B.
|
Unresolved
Staff Comments
|
13
|
|||
Item 2.
|
Properties
|
13
|
|||
Item 3.
|
Legal Proceedings
|
13
|
|||
Item 4.
|
Submission of Matters to a Vote of Security
Holders
|
13
|
|||
PART II
|
|||||
Item 5.
|
Market for Registrant’s Common
Equity, Related Stockholder Matters
and Issuer Purchases of Equity
Securities
|
14
|
|||
Item 6.
|
Selected
Financial Data
|
14
|
|||
Item 7.
|
Management’s Discussion
and Analysis of Financial Condition and Results of
Operations
|
15
|
|||
Item 7A.
|
Quantitative and Qualitative Disclosures about
Market Risk
|
25
|
|||
Item 8.
|
Financial Statements and Supplementary Data
|
F1-F31
|
|||
Item 9.
|
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosures
|
26
|
|||
Item 9A(T).
|
Controls and Procedures
|
26
|
|||
Item 9B.
|
Other
Information
|
26
|
|||
PART III
|
|||||
Item 10.
|
Directors, Executive
Officers and Corporate
Governance
|
27
|
|||
Item 11.
|
Executive Compensation
|
30
|
|||
Item 12.
|
Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters
|
35
|
|||
Item 13.
|
Certain Relationships and Related
Transactions, and Director
Independence
|
37
|
|||
Item 14.
|
Principal Accountant Fees
and Services
|
37
|
|||
PART IV
|
|||||
Item 15.
|
Exhibits
and Financial Statement
Schedules
|
38
|
|||
Signatures
|
42
|
Legal
Name
|
Old
Name
|
Referred
As
|
WPCS
International – Auburn, Inc.
|
Clayborn
Contracting Group, Inc.
|
Auburn
Operations
|
WPCS
International – Sacramento, Inc.
|
Gomes
and Gomes, Inc. dba Empire Electric
|
Sacramento
Operations
|
WPCS
International – St. Louis, Inc.
|
Heinz
Corporation
|
St. Louis
Operations
|
WPCS
International – Seattle, Inc.
|
Major
Electric, Inc.
|
Seattle
Operations
|
WPCS
International – Houston, Inc.
|
Max
Engineering LLC
|
Houston
Operations
|
WPCS
International – Portland, Inc.
|
Midway
Electric Company
|
Portland
Operations
|
WPCS
International – Hartford, Inc.
|
New
England Communications Systems, Inc.
|
Hartford
Operations
|
WPCS
International – Lakewood, Inc.
|
Quality
Communications & Alarm Company, Inc.
|
Lakewood
Operations
|
WPCS
International – Sarasota, Inc.
|
Southeastern
Communication Service, Inc.
|
Sarasota
Operations
|
WPCS
International – Trenton, Inc.
|
Voacolo
Electric Incorporated
|
Trenton
Operations
|
WPCS
International – Suisun City, Inc.
|
Walker
Comm, Inc.
|
Suisun
City Operations
|
WPCS
International – Brendale, Pty Ltd.
|
RL
& CA MacKay Pty Ltd. dba Energize Electrical
|
Brendale
Operations
|
WPCS
International – Brisbane, Pty Ltd.
|
James
Design Pty Ltd
|
Brisbane
Operations
|
|
·
|
Public
services. We provide communications infrastructure for
public services (which includes police, fire and emergency systems),
public utilities (which includes water treatment and sewage), education,
military and transportation infrastructure. In the
public services, according to a report from First Research, there are
30,000 state and local municipalities in the U.S. that are scheduled to
spend approximately $7 billion per year on communications infrastructure
and it is a market that has received federal funding support through the
fiscal stimulus package legislated in February
2009.
|
|
·
|
Healthcare. We
provide communications infrastructure for hospitals, medical centers and
healthcare networks. In the
healthcare market, according to a report from Market Research, the aging
population and the need to reduce labor costs through the implementation
of advanced communications technology is driving projected expenditures of
$3 billion per year over the next few
years.
|
|
·
|
Energy. We
provide communications infrastructure for petrochemical, natural gas,
electric utilities and alternative energy (solar and wind). According
to a report from the Energy Information Administration of the U.S.
Department of Energy, the need to deliver more efficient basic energy and
new alternative energy is creating communications infrastructure demand at
an estimated $2 billion per year in
expenditures.
|
|
·
|
International. We
provide communications infrastructure internationally for a variety of
companies and government entities. China
is spending on building its internal infrastructure and Australia is
upgrading their infrastructure. Both countries are expecting
positive GDP growth rates ranging from 2% to 6% over the next few years
per China’s National Bureau of Statistics and Australia Department of
Foreign Affairs and Trade.
|
|
•
|
Provide additional services
for our customers. Each acquisition we make expands our customer
base. We seek to expand these new customer relationships by making them
aware of the diverse products and services we offer. We believe that
providing these customers the full range of our services will lead to new
revenue producing projects and increased
profitability.
|
|
•
|
Maintain and expand our focus
in strategic markets. We have designed and deployed successful and
innovative communications infrastructure solutions for multiple customers
in a number of strategic markets, such as public services, healthcare,
energy and corporate enterprise. We will continue to seek additional
customers in these targeted markets and look for new ways in which we can
design and deploy communications infrastructure for increased
productivity.
|
|
•
|
Strengthen our relationships
with technology providers. We will continue to strengthen the
relationships we have with technology providers. These companies rely on
us to deploy their technology products. We have worked with these
providers in testing new communications technology. Our technicians are
trained and maintain certifications on a variety of leading communications
technology products which exhibits our commitment in providing advanced
solutions for our customers.
|
|
•
|
Seek strategic
acquisitions. We will continue to look for additional
acquisitions of compatible businesses that can be readily assimilated into
our organization, increase our engineering capabilities, expand our
geographic coverage and add accretive earnings to our business. Our
preferred acquisition candidates will have experience in the wireless
communication, specialty construction and/or electrical power markets. A
specific goal is to expand our international operations, primarily in
Australia and China.
|
Operations
|
# of Employees
|
Union Contract expiration
date
|
St.
Louis
|
1
|
September
1, 2009
|
Portland
|
2
|
December
31, 2009
|
Suisun
City
|
8
|
December
31, 2009
|
Suisun
City
|
69
|
January
1, 2010
|
Trenton
|
39
|
May
1, 2010
|
St.
Louis
|
1
|
May
5, 2010
|
Sacramento
|
32
|
May
31, 2010
|
Seattle
|
62
|
May
31, 2010
|
St.
Louis
|
3
|
October
31, 2010
|
Total
Union Employees
|
217
|
|
•
|
the
timing and size of design-build projects and technology upgrades by our
customers;
|
|
•
|
fluctuations
in demand for outsourced design-build
services;
|
|
•
|
the
ability of certain customers to sustain capital resources to pay their
trade accounts receivable balances and required changes to our allowance
for doubtful accounts based on periodic assessments of the collectability
of our accounts receivable
balances;
|
|
•
|
reductions
in the prices of services offered by our
competitors;
|
|
•
|
our
success in bidding on and winning new business;
and
|
|
•
|
our
sales, marketing and administrative cost
structure.
|
|
•
|
quarterly
variations in operating results;
|
|
•
|
announcements
of new services by us or our
competitors;
|
|
•
|
the
gain or loss of significant
customers;
|
|
•
|
changes
in analysts’ earnings estimates;
|
|
•
|
rumors
or dissemination of false
information;
|
|
•
|
pricing
pressures;
|
|
•
|
short
selling of our common stock;
|
|
•
|
impact
of litigation;
|
|
•
|
general
conditions in the market;
|
|
•
|
changing
the exchange or quotation system on which we list our common stock for
trading;
|
|
•
|
political
and/or military events associated with current worldwide conflicts;
and
|
|
•
|
events
affecting other companies that investors deem comparable to
us.
|
|
•
|
changes
in the region’s economic, social and political conditions or government
policies;
|
|
•
|
changes
in trade laws, tariffs and other trade restrictions or
licenses;
|
|
•
|
changes
in foreign exchange regulation in China may limit our ability to freely
convert currency to make dividends or other payments in U.S.
dollars;
|
|
•
|
fluctuation
in the value of the RMB (Chinese Yuan) could adversely affect the value of
our investment in China;
|
|
•
|
adverse
changes in tax laws and
regulations;
|
|
•
|
difficulties
in managing or overseeing our China operations, including the need to
implement appropriate systems, policies, benefits and compliance programs;
and
|
|
•
|
different
liability standards and less developed legal systems that may be less
predictable than those in the United
States.
|
Lease
|
Annual
|
|||||
Location
|
Operations
|
Expiration
Date
|
Rent
|
|||
Exton,
Pennsylvania
|
WPCS
Corporate headquarters
|
February
1, 2011
|
$ | 53,869 | ||
Auburn,
California (1)
|
Auburn
|
Month-to-month
|
$ | 55,263 | ||
West
Sacramento, California
|
Sacramento
|
July
31, 2010
|
$ | 77,097 | ||
Brendale,
Queensland, Australia
|
Brendale
|
August
17, 2011
|
$ | 31,209 | ||
St.
Louis, Missouri
|
St.
Louis
|
August
31, 2010
|
$ | 70,177 | ||
Exton,
Pennsylvania
|
St.
Louis
|
July
31, 2009
|
$ | 2,268 | ||
West
Chester, Pennsylvania
|
St.
Louis
|
May
31, 2010
|
$ | 14,850 | ||
Buranda,
Queensland, Australia
|
Brisbane
|
July
31, 2012
|
$ | 57,940 | ||
Woodinville,
Washington
|
Seattle
|
May
31, 2010
|
$ | 9,720 | ||
Houston,
Texas
|
Houston
|
August
31, 2009
|
$ | 6,895 | ||
Hempstead,
Texas
|
Houston
|
March
31, 2010
|
$ | 8,250 | ||
Moline,
Illinois
|
Houston
|
October
31, 2011
|
$ | 32,000 | ||
Windsor,
Connecticut
|
Hartford
|
April
30, 2014
|
$ | 87,038 | ||
Chicopee,
Massachusetts
|
Hartford
|
August
31, 2009
|
$ | 3,000 | ||
West
Greenwich, Rhode Island
|
Hartford
|
November
30, 2009
|
$ | 10,153 | ||
Lakewood,
New Jersey
|
Lakewood
|
August
31, 2010
|
$ | 129,600 | ||
Sarasota,
Florida
|
Sarasota
|
July
31, 2011
|
$ | 55,714 | ||
Trenton,
New Jersey (2)
|
Trenton
|
April
30, 2010
|
$ | 66,000 | ||
Suisun
City, California (3)
|
Suisun
City
|
February
28, 2011
|
$ | 93,660 | ||
Lincoln,
California
|
Suisun
City
|
December
31, 2011
|
$ | 56,040 | ||
Rocklin,
California
|
Suisun
City
|
January
31, 2010
|
$ | 23,355 | ||
Reno,
Nevada
|
Suisun
City
|
May
31, 2010
|
$ | 4,290 | ||
San
Leandro, California
|
Suisun
City
|
July
31, 2011
|
$ | 14,139 | ||
St. Helens, Oregon | Portland |
May
11, 2010
|
$ | 26,225 |
|
|
(1)
|
The
lease for our Auburn, California location is month to month; therefore the
minimum annual rental price assumes we rent the property for the entire
year.
|
(2) | We lease our Trenton, New Jersey location from Voacolo Properties LLC, of which the former shareholders of Voacolo Electric, Inc. (Trenton Operations) are the members. |
(3) | We lease our Suisun City, California location from a trust, of which Gary Walker, one of our Directors, is the trustee. |
We believe that our existing facilities are suitable and adequate to meet our current business requirements. |
Period
|
High
|
Low
|
||||||
Fiscal
Year Ended April 30, 2009:
|
||||||||
First
Quarter
|
$ | 7.60 | $ | 5.25 | ||||
Second
Quarter
|
6.08 | 2.05 | ||||||
Third
Quarter
|
3.38 | 1.63 | ||||||
Fourth
Quarter
|
2.13 | 1.32 | ||||||
Fiscal
Year Ended April 30, 2008:
|
||||||||
First
Quarter
|
$ | 14.25 | $ | 11.14 | ||||
Second
Quarter
|
12.37 | 9.51 | ||||||
Third
Quarter
|
11.67 | 8.05 | ||||||
Fourth
Quarter
|
8.96 | 5.15 |
|
·
|
Public
services. We provide communications infrastructure for
public services (which includes police, fire and emergency systems),
public utilities (which includes water treatment and sewage), education,
military and transportation infrastructure. In the
public services, according to a report from First Research, there are
30,000 state and local municipalities in the U.S. that are scheduled to
spend approximately $7 billion per year on communications infrastructure
and it is a market that has received Federal funding support through the
fiscal stimulus package legislated in February
2009.
|
|
·
|
Healthcare. We
provide communications infrastructure for hospitals, medical centers and
healthcare networks. In the
healthcare market, according to a report from Market Research, the aging
population and the need to reduce labor costs through the implementation
of advanced communications technology is driving projected expenditures of
$3 billion per year over the next few
years.
|
|
·
|
Energy. We
provide communications infrastructure for petrochemical, natural gas,
electric utilities and alternative energy (solar and wind). According
to a report from the Energy Information Administration of the U.S.
Department of Energy, the need to deliver more efficient basic energy and
new alternative energy is creating communications infrastructure demand at
an estimated $2 billion per year in
expenditures.
|
|
·
|
International. We
provide communications infrastructure internationally for a variety of
companies and government entities. China
is spending on building its internal infrastructure and Australia is
upgrading their infrastructure. Both countries are expecting
positive GDP growth rates ranging from 2% to 6% over the next few years
per China’s National Bureau of Statistics and Australia Department of
Foreign Affairs and Trade.
|
·
|
Over
the past fiscal year, current economic conditions have adversely affected
certain markets of our business, primarily related to the public services
sector of our business. General spending has temporarily slowed
at the state and local government level due to a decrease in tax revenue
and credit impediments as well as a pull back in bid solicitations due to
uncertainty regarding Federal funding that would be made available through
the legislation of the Federally funded stimulus package. This
slowdown has caused our revenue to be lower than expected, resulting in
net income and earnings per share for the year to be lower than
expected.
|
|
·
|
Although
general spending is currently down at the state and local government level
for public services projects, we believe the demand for communications
infrastructure remains high, which is indicated by our backlog and bids
discussed below. Now that the new presidential administration
has recently passed the Federally funded stimulus package, $90 billion has
been set aside for public services, which includes transportation,
education and communications infrastructure projects. As a
result, we are beginning to see an increase in bid solicitations based on
the evidence of Federal government funding support.
In
the healthcare market, we continue to receive bid requests and complete
new projects, as the primary drivers in this market continue to be the
need to provide healthcare infrastructure for an aging population and to
cut costs through healthcare reform. The Federal stimulus
package also provides $32 billion for healthcare infrastructure
spending.
In
the energy market, we continue to receive bid solicitations and complete
new projects as oil, gas, water and electric utility companies continue to
upgrade their communications infrastructure, while in alternative energy
the growth in wind and solar power development is expected to
continue. The Federal stimulus package also provides $20
billion for energy infrastructure spending.
Our
opportunity to obtain work related to the Federal stimulus package depends
on the timing of funding allocations and our ability to receive bid
requests and be awarded new projects; however, we believe that our
experience in performing work in each of these sectors will result in
increased bid activity in the near future. In this
regard, we retained most of our project managers and engineers to respond
to this expected increased bid activity.
|
|
·
|
We continue to focus on expanding
our international presence in China and Australia, and we believe that
these markets have not been as impacted by recent economic
conditions. In China, our focus is primarily in the energy
market, and in Australia primarily on the corporate enterprise
market. Although our international operations represent
approximately 6% of total revenue year-to-date, positive economic growth
rate estimates for these countries may lead to a greater percentage of our
future revenue being generated
internationally.
|
|
|
·
|
We
believe our engineering service focus on public services, healthcare and
energy infrastructure will create additional opportunities both
domestically and internationally for us to design and deploy
communications infrastructure solutions. We believe that the ability to
provide comprehensive communications infrastructure design-build services
including wireless communication, specialty construction and electrical
power gives WPCS a competitive advantage.
This
trend is supported by our backlog and bid list, which are our two most
important economic indicators for measuring our future revenue producing
capability and demand for our services. At April 30, 2009, our
backlog of unfilled orders was approximately $38 million. Of
the backlog of projects awarded and in process, approximately 68%, 20% and
3% were represented by the public services, healthcare, and energy
markets, respectively, and the balance represented by corporate
enterprise. Our bid list, which represents project bids under
proposal for new and existing customers, was approximately $169
million. With regards to the bid list, approximately 60%, 7%
and 4% are represented by the public services, healthcare and energy
markets, respectively.
|
|
·
|
Although
we continue to search for acquisitions, our current goal is to identify
smaller companies which are performing well financially which can enhance
our existing engineering capabilities, and can be integrated easily within
our existing subsidiaries.
|
|
·
|
We
continue to maintain a healthy balance sheet with approximately $21.0
million in working capital, net of credit facility borrowings of
approximately $5.6 million. The ratio of credit facility borrowings to
working capital is approximately 27%. We believe this is an
important measure of our current financial strength. We expect to use our
working capital and availability under the credit facility to fund our
continued growth.
|
Year
Ended
|
||||||||||||||||
April
30,
|
||||||||||||||||
2009
|
2008
|
|||||||||||||||
REVENUE
|
$ | 107,101,360 | 100.0 | % | $ | 101,431,128 | 100.0 | % | ||||||||
COSTS
AND EXPENSES:
|
||||||||||||||||
Cost of revenue | 78,334,115 | 73.2 | % | 73,084,310 | 72.0 | % | ||||||||||
Selling, general and administrative expenses | 23,052,464 | 21.5 | % | 19,302,773 | 19.0 | % | ||||||||||
Depreciation and amortization | 2,578,824 | 2.4 | % | 2,398,603 | 2.4 | % | ||||||||||
Total costs and expenses | 103,965,403 | 97.1 | % | 94,785,686 | 93.4 | % | ||||||||||
OPERATING
INCOME
|
3,135,957 | 2.9 | % | 6,645,442 | 6.6 | % | ||||||||||
OTHER
EXPENSE (INCOME):
|
||||||||||||||||
Interest expense | 421,022 | 0.4 | % | 522,984 | 0.5 | % | ||||||||||
Interest income | (53,947 | ) | (0.1 | %) | (511,122 | ) | (0.5 | %) | ||||||||
Minority interest | 108,228 | 0.1 | % | (22,115 | ) | 0.0 | % | |||||||||
INCOME
BEFORE INCOME TAX PROVISION
|
2,660,654 | 2.5 | % | 6,655,695 | 6.6 | % | ||||||||||
Income
tax provision
|
989,027 | 0.9 | % | 2,577,348 | 2.5 | % | ||||||||||
NET
INCOME
|
$ | 1,671,627 | 1.6 | % | $ | 4,078,347 | 4.1 | % |
Page
|
||
Report
of Independent Registered Public Accounting Firm
|
F-2
|
|
Consolidated
Balance Sheets as of April 30, 2009 and 2008
|
F-3
– F-4
|
|
Consolidated
Statements of Income for the years ended April
30, 2009 and 2008
|
F-5
|
|
Consolidated
Statements of Shareholders' Equity for the years ended April 30, 2009 and
2008
|
F-6
– F-7
|
|
Consolidated
Statements of Cash Flows for the years ended April
30, 2009 and 2008
|
F-8
– F-10
|
|
Notes
to Consolidated Financial Statements
|
F-11
–
F-31
|
April
30,
|
April
30,
|
|||||||
ASSETS
|
2009
|
2008
|
||||||
CURRENT
ASSETS:
|
||||||||
Cash
and cash equivalents
|
$ | 6,396,810 | $ | 7,449,530 | ||||
Accounts
receivable, net of allowance of $155,458 and $98,786 at April 30, 2009 and
April 30, 2008, respectively
|
25,662,784 | 29,092,488 | ||||||
Costs
and estimated earnings in excess of billings on uncompleted
contracts
|
5,229,043 | 3,887,152 | ||||||
Inventory
|
2,481,383 | 2,791,782 | ||||||
Prepaid
expenses and other current assets
|
1,674,952 | 1,002,993 | ||||||
Prepaid
income taxes
|
295,683 | 122,342 | ||||||
Deferred
tax assets
|
70,413 | 35,939 | ||||||
Total
current assets
|
41,811,068 | 44,382,226 | ||||||
PROPERTY
AND EQUIPMENT, net
|
6,668,032 | 6,828,162 | ||||||
OTHER
INTANGIBLE ASSETS, net
|
1,983,879 | 2,929,937 | ||||||
GOODWILL
|
32,549,186 | 28,987,501 | ||||||
OTHER
ASSETS
|
132,948 | 820,315 | ||||||
Total
assets
|
$ | 83,145,113 | $ | 83,948,141 | ||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
April
30,
|
April
30,
|
||||||
2009
|
2008
|
|||||||
CURRENT
LIABILITIES:
|
||||||||
Current
portion of loans payable
|
$ | 89,210 | $ | 1,272,112 | ||||
Borrowings
under line of credit
|
5,626,056 | 750,000 | ||||||
Current
portion of capital lease obligations
|
96,001 | 91,491 | ||||||
Accounts
payable and accrued expenses
|
8,997,296 | 9,305,791 | ||||||
Billings
in excess of costs and estimated earnings on uncompleted
contracts
|
2,511,220 | 3,602,422 | ||||||
Deferred
revenue
|
507,650 | 602,560 | ||||||
Due
to shareholders
|
2,951,008 | 2,300,083 | ||||||
Total
current liabilities
|
20,778,441 | 17,924,459 | ||||||
Borrowings
under line of credit
|
- | 4,376,056 | ||||||
Loans
payable, net of current portion
|
71,634 | 156,978 | ||||||
Capital
lease obligations, net of current portion
|
151,425 | 215,780 | ||||||
Deferred
tax liabilities
|
1,467,971 | 1,173,786 | ||||||
Total
liabilities
|
22,469,471 | 23,847,059 | ||||||
Minority
interest in subsidiary
|
1,440,078 | 1,331,850 | ||||||
COMMITMENTS
AND CONTINGENCIES
|
||||||||
SHAREHOLDERS'
EQUITY:
|
||||||||
Preferred
stock - $0.0001 par value, 5,000,000 shares authorized, none
issued
|
- | - | ||||||
Common
stock - $0.0001 par value, 25,000,000 shares authorized, 6,942,266 and
7,251,083 shares issued and outstanding at April 30, 2009 and April 30,
2008, respectively
|
694 | 725 | ||||||
Additional
paid-in capital
|
50,175,479 | 50,775,938 | ||||||
Retained
earnings
|
9,381,189 | 7,709,562 | ||||||
Accumulated
other comprehensive (loss) income on foreign currency
translation
|
(321,798 | ) | 283,007 | |||||
Total
shareholders' equity
|
59,235,564 | 58,769,232 | ||||||
Total
liabilities and shareholders' equity
|
$ | 83,145,113 | $ | 83,948,141 | ||||
Year
Ended
|
||||||||
April
30,
|
||||||||
2009
|
2008
|
|||||||
REVENUE
|
$ | 107,101,360 | $ | 101,431,128 | ||||
COSTS
AND EXPENSES:
|
||||||||
Cost
of revenue
|
78,334,115 | 73,084,310 | ||||||
Selling,
general and administrative expenses
|
23,052,464 | 19,302,773 | ||||||
Depreciation
and amortization
|
2,578,824 | 2,398,603 | ||||||
Total
costs and expenses
|
103,965,403 | 94,785,686 | ||||||
OPERATING
INCOME
|
3,135,957 | 6,645,442 | ||||||
OTHER
EXPENSE (INCOME):
|
||||||||
Interest
expense
|
421,022 | 522,984 | ||||||
Interest
income
|
(53,947 | ) | (511,122 | ) | ||||
Minority
interest
|
108,228 | (22,115 | ) | |||||
INCOME
BEFORE INCOME TAX PROVISION
|
2,660,654 | 6,655,695 | ||||||
Income
tax provision
|
989,027 | 2,577,348 | ||||||
NET
INCOME
|
$ | 1,671,627 | $ | 4,078,347 | ||||
Basic
net income per common share
|
$ | 0.23 | $ | 0.58 | ||||
Diluted
net income per common share
|
$ | 0.23 | $ | 0.52 | ||||
Basic
weighted average number of common shares outstanding
|
7,131,967 | 7,090,789 | ||||||
Diluted
weighted average number of common shares outstanding
|
7,154,285 | 7,848,341 |
Accumulated
|
||||||||||||||||||||||||||||||||
Additional
Paid-In Capital
|
Other
Compre-
|
Total
Shareholders' Equity
|
||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Retained
|
hensive
|
|||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Earnings
|
Income
(Loss)
|
|||||||||||||||||||||||||||
BALANCE,
MAY 1, 2007
|
- | $ | - | 6,971,698 | $ | 697 | $ | 47,901,159 | $ | 3,631,215 | $ | (1,088 | ) | $ | 51,531,983 | |||||||||||||||||
Net
issuance of common stock, acquisitions
|
||||||||||||||||||||||||||||||||
of
Beijing, Trenton, Seattle and Houston Operations
|
- | - | 269,554 | 27 | 2,760,462 | - | - | 2,760,489 | ||||||||||||||||||||||||
Fair
value of stock options granted to employees
|
- | - | - | - | 51,717 | - | - | 51,717 | ||||||||||||||||||||||||
Proceeds
from exercise of stock options
|
- | - | 9,831 | 1 | 60,531 | - | - | 60,532 | ||||||||||||||||||||||||
Equity
issuance cost
|
- | - | - | - | (13,931 | ) | - | - | (13,931 | ) | ||||||||||||||||||||||
Excess
tax benefit from exercise of stock options
|
- | - | - | - | 16,000 | - | - | 16,000 | ||||||||||||||||||||||||
Accumulated
other comprehensive income
|
- | - | - | - | - | - | 284,095 | 284,095 | ||||||||||||||||||||||||
Net
income
|
- | - | - | - | - | $ | 4,078,347 | - | 4,078,347 | |||||||||||||||||||||||
BALANCE,
APRIL 30, 2008
|
- | $ | - | 7,251,083 | $ | 725 | $ | 50,775,938 | $ | 7,709,562 | $ | 283,007 | $ | 58,769,232 |
Accumulated
|
||||||||||||||||||||||||||||||||
Other
Compre-
|
Total
|
|||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Retained
|
hensive
|
Shareholders'
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Paid-In
Capital
|
Earnings
|
Income
(Loss)
|
Equity
|
|||||||||||||||||||||||||
BALANCE,
MAY 1, 2008
|
- | $ | - | 7,251,083 | $ | 725 | $ | 50,775,938 | $ | 7,709,562 | $ | 283,007 | $ | 58,769,232 | ||||||||||||||||||
Fair
value of stock options granted to employees
|
- | - | - | - | 134,240 | - | - | 134,240 | ||||||||||||||||||||||||
Equity
issuance cost
|
- | - | - | - | (5,000 | ) | - | - | (5,000 | ) | ||||||||||||||||||||||
Repurchase
of common stock
|
- | - | (308,817 | ) | (31 | ) | (729,699 | ) | - | - | (729,730 | ) | ||||||||||||||||||||
Accumulated
other comprehensive loss
|
- | - | - | - | - | - | (604,805 | ) | (604,805 | ) | ||||||||||||||||||||||
Net
income
|
- | - | - | - | - | 1,671,627 | - | 1,671,627 | ||||||||||||||||||||||||
BALANCE,
APRIL 30, 2009
|
- | $ | - | 6,942,266 | $ | 694 | $ | 50,175,479 | $ | 9,381,189 | $ | (321,798 | ) | $ | 59,235,564 |
Year
Ended
|
||||||||
April
30,
|
||||||||
2009
|
2008
|
|||||||
OPERATING
ACTIVITIES :
|
||||||||
Net
income
|
$ | 1,671,627 | $ | 4,078,347 | ||||
Adjustments
to reconcile net income to net cash provided by (used in) operating
activities:
|
||||||||
Depreciation
and amortization
|
2,578,824 | 2,398,603 | ||||||
Fair
value of stock options granted to employees
|
134,240 | 51,717 | ||||||
Provision
for doubtful accounts
|
131,743 | - | ||||||
Amortization
of debt issuance costs
|
12,266 | - | ||||||
Excess
tax benefit from exercise of stock options
|
- | (16,000 | ) | |||||
Minority
interest
|
108,228 | (22,115 | ) | |||||
Loss
(gain) on sale of fixed assets
|
29,649 | (4,668 | ) | |||||
Deferred
income taxes
|
(126,583 | ) | 11,668 | |||||
Changes
in operating assets and liabilities, net of effects of
acquisitions:
|
||||||||
Accounts
receivable
|
3,260,420 | (5,378,553 | ) | |||||
Costs
and estimated earnings in excess of billings on uncompleted
contracts
|
(1,393,027 | ) | 170,020 | |||||
Inventory
|
299,260 | (397,020 | ) | |||||
Prepaid
expenses and other current assets
|
(514,494 | ) | (115,019 | ) | ||||
Other
assets
|
560,890 | (536,157 | ) | |||||
Accounts
payable and accrued expenses
|
(294,564 | ) | (452,234 | ) | ||||
Billings
in excess of costs and estimated earnings on uncompleted
contracts
|
(1,148,341 | ) | (328,318 | ) | ||||
Deferred
revenue
|
(94,953 | ) | 97,934 | |||||
Income
taxes payable
|
(176,998 | ) | (803,479 | ) | ||||
NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
5,038,187 | (1,245,274 | ) |
INVESTING
ACTIVITIES:
|
||||||||
Acquisition
of property and equipment, net
|
(1,233,829 | ) | (715,849 | ) | ||||
Acquisition
of Hartford Operations, net of cash received
|
- | (3,534 | ) | |||||
Acquisition
of Sarasota Operations, net of cash received
|
- | 60,892 | ||||||
Acquisition
of Trenton Operations, net of cash received
|
(2,500,000 | ) | (69,601 | ) | ||||
Acquisition
of Seattle Operations, net of cash received
|
240,565 | (4,268,320 | ) | |||||
Acquisition
of Houston Operations, net of cash received
|
(709,540 | ) | (524,572 | ) | ||||
Acquisition
of Sacramento Operations, net of cash received
|
(7,521 | ) | (2,427,999 | ) | ||||
Acquisition
of Brisbane Operations, net of cash received
|
(287,735 | ) | (922,763 | ) | ||||
Acquisition
of Brendale Operations, net of cash received
|
(195,170 | ) | (1,605,868 | ) | ||||
Acquisition
of Portland Operations, net of cash received
|
(333,368 | ) | - | |||||
NET
CASH USED IN INVESTING ACTIVITIES
|
(5,026,598 | ) | (10,477,614 | ) | ||||
FINANCING
ACTIVITIES:
|
||||||||
Net
proceeds from exercise of stock options
|
- | 60,532 | ||||||
Repurchase
of common stock
|
(729,730 | ) | - | |||||
Excess
tax benefit from exercise of stock options
|
- | 16,000 | ||||||
Equity
issuance costs
|
(5,000 | ) | (13,931 | ) | ||||
Borrowings
under lines of credit
|
3,250,000 | 4,726,056 | ||||||
Repayments
under lines of credit
|
(2,750,000 | ) | (6,540,991 | ) | ||||
Repayments
under loans payable, net
|
(1,273,179 | ) | (921,779 | ) | ||||
Borrowings
of amounts due to shareholders
|
581,642 | 350,259 | ||||||
Repayments
of capital lease obligations
|
(88,069 | ) | (107,558 | ) | ||||
NET
CASH USED IN FINANCING ACTIVITIES
|
(1,014,336 | ) | (2,431,412 | ) | ||||
Effect
of exchange rate changes on cash
|
(49,973 | ) | 45,091 | |||||
NET
DECREASE IN CASH AND CASH EQUIVALENTS
|
(1,052,720 | ) | (14,109,209 | ) | ||||
CASH
AND CASH EQUIVALENTS, BEGINNING OF YEAR
|
7,449,530 | 21,558,739 | ||||||
CASH
AND CASH EQUIVALENTS, END OF YEAR
|
$ | 6,396,810 | $ | 7,449,530 |
April
30, 2009
|
April
30, 2008
|
|||||||
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
|
||||||||
Cash
paid during the period for:
|
||||||||
Interest
|
$ | 408,752 | $ | 522,984 | ||||
Income
taxes
|
1,284,710 | $ | 2,049,667 | |||||
SCHEDULE
OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
|
||||||||
Issuance
of common stock for net non-cash assets received in
acquisition
|
$ | 0 | $ | 2,760,489 | ||||
Issuance
of notes for property and equipment
|
$ | 28,244 | $ | 172,532 |
Wireless
|
Specialty
|
Electrical
|
||||||||||||||
Communication
|
Construction
|
Power
|
Total
|
|||||||||||||
Beginning
balance, May 1, 2007
|
$ | 10,926,178 | $ | 4,320,115 | $ | 5,223,315 | $ | 20,469,608 | ||||||||
Trenton
Operations acquisition
|
- |