Search the web
Welcome, Guest
[Sign Out, My Account]
EDGAR_Online

Quotes & Info
Enter Symbol(s):
e.g. YHOO, ^DJI
Symbol Lookup | Financial Search
ICLD > SEC Filings for ICLD > Form 10-Q on 15-May-2013All Recent SEC Filings

Show all filings for INTERCLOUD SYSTEMS, INC. | Request a Trial to NEW EDGAR Online Pro

Form 10-Q for INTERCLOUD SYSTEMS, INC.


15-May-2013

Quarterly Report


Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion of our financial condition and results of operation for the three months ended March 31, 2013 and 2012 should be read in conjunction with the unaudited consolidated financial statements and the notes to those statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the Item 1A. Risk Factors appearing in our Annual Report on Form 10-K for the year ended December 31, 2012 as previously filed on April 1, 2013 with the Securities and Exchange Commission. We use words such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should," "could," and similar expressions to identify forward-looking statements.

Overview

We are a single-source provider of value-added services for both corporate enterprises and service providers. We offer cloud and managed services, professional consulting services and voice, data and optical solutions to assist our customers in meeting their changing technology demands. Our engineering, design, installation and maintenance services support the build-out and operation of some of the most advanced enterprise, fiber optic, Ethernet and wireless networks. .

The following discussions compare our consolidated financial results for the three months ended March 31, 2013 compared to the three months ended March 31, 2012 and our liquidity and capital resources as of March 31, 2013.

Results of Operations

Revenues:

             Three months ended March 31,                   Change
                 2013               2012           Dollars         Percentage

Revenues   $     12,401,933      $ 1,520,035     $ 10,881,898              716 %

Revenues for the three-month periods ended March 31, 2013 increased by $10.9 million, or 716%, to $12.4 million as compared to $1.5 million in 2012, which resulted primarily from our inclusion of revenues from our acquisitions of ADEX, ERFS and TNS in 2012. The acquisitions of TNS, ERFS and ADEX accounted for $11.6 million, or 94% of the revenue in the three months ended March 31, 2013, as compared to $0 in the three months ended March 31, 2012. During the three months ended March 31, 2012, substantially all of our revenue was derived from our specialty contracting services, while for the three months ended March 31, 2013, 17% of revenues were derived from specialty contracting services, 74% were derived from our telecommunication staffing services and 9% were derived from our environmental remediation services.


Cost of revenue and gross profit:

                    Three months ended March 31,                   Change
                        2013                2012          Dollars        Percentage
Cost of Revenue   $      8,766,303       $  864,680     $ 7,901,623              914 %

Gross Profit      $      3,635,630       $  655,355     $ 2,980,275              455 %

Cost of revenues for the three-month periods ended March 31, 2013 and 2012 primarily consisted of direct labor provided by employees, services provided by subcontractors, direct material and other related costs. For a majority of the contract services we perform, our customers provide all necessary materials and we provide the personnel, tools and equipment necessary to perform installation and maintenance services. Cost of revenues increased by $7.9 million, or 914%, for the three months ended March 31, 2013 to $8.8 million, as compared to $0.9 million for the same period in 2012. Costs of revenues as a percentage of sales were 71% for the three months in 2013, as compared to 57% for the same period in 2012. The increase was due to the acquisitions completed in the year ended December 31, 2012. For the three months ended March 31, 2012, all of our operations were in the specialty contracting services business. For the three months ended March 31, 2013, we had a revenue mix of 17% specialty contracting services, as compared to telecommunications staffing of 74% and environmental remediation of 9%, due to change in service offerings primarily as a result of our acquisition of ADEX.

Our gross profit percentage was 29% for the three months ended March 31, 2013, as compared to 43% for the comparable period in 2012. This was a result of the acquisitions we completed in 2012. The gross margin on our telecommunications staffing services, which was our largest service sector, were 20% for the three months ended March 31, 2013, which decreased our overall gross margin. It is expected that as the telecommunications staffing services portion of our revenue increases, our overall gross margin percentage will continue to decline, while the gross margin dollars will increase.

Salaries and wages:

                          Three months ended March 31,                   Change
                              2013                2012          Dollars        Percentage
Salaries and wages      $      1,661,769       $  453,829     $ 1,207,940              266 %
Percentage of revenue                 13 %             30 %

For the three month periods ended March 31, 2013, salaries and wages increased $1.2 million to $1.7 million as compared to approximately $.5 million for the same period in 2012. The increase was due to the acquisitions we completed in 2012. Salaries and wages were 13% of revenue in the three months ended March 31, 2013, as compared to 30% for the same period in 2012. The decrease in percentage was a result of the increase in revenues. Our salaries and wages will not increase proportionally to the increase in revenue.

General and Administrative:

                               Three months ended March 31,                  Change
                                   2013                2012         Dollars       Percentage
General and Administrative   $      1,275,826       $  430,830     $ 844,996              196 %
Percentage of revenue                      10 %             28 %

General and administrative costs include all of our corporate costs, as well as costs of our subsidiaries management personnel and administrative overhead. These costs consist of office rental, legal, consulting and professional fees, travel costs and other costs that are not directly related to performance of our services under customer contracts. General and administrative expenses increased $.8 million, or 193%, to $1.3 million in the three months ended March 31, 2013, as compared to $0.4 million in the comparable period of 2012. The increases were primarily the result of increased overhead expenses relating to the acquisitions we completed in the year ended December 31, 2012. General and administrative expenses decreased to 10% of revenues in the three months ended March 31, 2013 from 28% in the comparable period of 2012. This decrease in percentage was a result of the increased revenue, which did not cause a corresponding percentage increase in general and administrative expenses.


Interest Expense:

Three months ended March 31,
2013 2012
Interest expense $ 1,336,579 $ 61,330

Interest expense increased by $1.28 million to $1.3 million for the three month period ended March 31, 2013, from the three month period ended March 31, 2013 also included $.5 million of loan restructuring fees paid to MidMarket. Interest in the three month period ended March 31, 2013 also included interest on debt converted to equity of $.4 million.

Net Loss Attributable to our Common Stockholders.

Net loss attributable to our common stockholders was $1.1 million for three months ended March 31, 2013, as compared to $.3 million for the three months ended March 31, 2012.

  Add ICLD to Portfolio     Set Alert         Email to a Friend  
Get SEC Filings for Another Symbol: Symbol Lookup
Quotes & Info for ICLD - All Recent SEC Filings
Sign Up for a Free Trial to the NEW EDGAR Online Pro
Detailed SEC, Financial, Ownership and Offering Data on over 12,000 U.S. Public Companies.
Actionable and easy-to-use with searching, alerting, downloading and more.
Request a Trial      Sign Up Now


Copyright © 2014 Yahoo! Inc. All rights reserved. Privacy Policy - Terms of Service
SEC Filing data and information provided by EDGAR Online, Inc. (1-800-416-6651). All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.