PR Newswire | Feb 16, 2021 04:06PM EST

December 31, 2020

02/16 15:05 CST

Energy Services of America Announces Financial Results for the Quarter Ended December 31, 2020 HUNTINGTON, W.Va., Feb. 16, 2021

HUNTINGTON, W.Va., Feb. 16, 2021 /PRNewswire/ -- Energy Services of America Corporation (the "Company" or "Energy Services") (OTC QB: ESOA) announced fiscal first quarter financial results for the quarter ended December 31, 2020. Energy Services earned revenues of $32.0 million with a net loss available to common shareholders of ($725,000) for the first quarter and generated adjusted EBITDA of $331,000 during the period.

On December 31, 2020, Energy Services completed the acquisition of West Virginia Pipeline, Inc. The acquisition is reflected in the Company's first quarter financial statements, but it did not have a significant impact on the Company's operating results for the period. The Company's $60.7 million backlog at December 31, 2020 includes $5.5 million as a result of the acquisition.

Douglas Reynolds, President, commented on the announcement. "We are excited to welcome West Virginia Pipeline to Energy Services and view the acquisition an important step in our strategy of increasing our exposure in the water and natural gas distribution markets." Reynolds continued, "At the same time, we are investing in the people and equipment needed to expand our existing business and we hope that the benefits of all these investments are clearer during the second half of fiscal year 2021."

Below is a comparison of the Company's unaudited operating results for the three months ended December 31, 2020 and 2019:

Three Months Ended Three Months Ended

December 31, December 31,

2020 2019

(Unaudited)

Revenue $ 32,009,796 $ 25,843,307

Cost of revenues 29,166,737 23,486,565

Gross profit 2,843,059 2,356,742

Selling and administrative expenses 3,595,830 2,595,772

Loss income from operations (752,771) (239,030)

Other income (expense)

Interest income 151,765 53,249

Other nonoperating expense (52,623) (33,938)

Interest expense (76,517) (186,845)

Gain on sale of equipment 13,042 295,991

35,667 128,457

Loss income before income taxes (717,104) (110,573)

Income tax benefit (69,442) (36,459)

Net loss (647,662) (74,114)

Dividends on preferred stock 77,250 77,250

Net loss available to common shareholders $ (724,912) $ (151,364)

Weighted average shares outstanding-basic 13,621,406 13,911,610

Weighted average shares-diluted 13,621,406 13,911,610

Loss earnings per share

available to common shareholders $ (0.053) $ (0.011)

Loss earnings per share-diluted

available to common shareholders $ (0.053) $ (0.011)

Below is a comparison of the Company's Consolidated Balance Sheets for December 31, 2020 and September 30, 2020. Please see the Company's Form 10-Q for December 31, 2020 for a more detailed comparison:

December 31, September 30,

Assets 2020 2020

(Unaudited)

Current assets

Cash and cash equivalents $ 12,345,745 $ 11,216,820

Accounts receivable-trade 17,096,770 18,246,989

Allowance for doubtful accounts (70,310) (70,310)

Retainages receivable 1,658,513 2,483,809

Other receivables 6,677 9,458

Contract assets 4,418,599 6,545,863

Prepaid expenses and other 2,763,189 3,338,943

Total current assets 38,219,183 41,771,572

Property, plant and equipment, at cost 56,679,946 53,324,843

less accumulated depreciation (37,706,313) (36,933,129)

Total fixed assets 18,973,633 16,391,714

Acquired intangible assets, net 300,000 -

Goodwill 4,220,829 -

Total assets $ 61,713,645 $ 58,163,286

Liabilities and shareholders' equity

Current liabilities

Current maturities of long-term debt $ 4,645,254 $ 4,028,900

Lines of credit and short term borrowings 3,500,000 509,843

Accounts payable 5,783,559 5,222,222

Accrued expenses and other current liabilities 3,255,740 4,237,172

Contract liabilities 3,721,385 4,851,900

Total current liabilities 20,905,938 18,850,037

Long-term debt, less current maturities 13,496,506 11,233,705

Deferred income taxes payable 2,212,084 2,255,515

Total liabilities 36,614,528 32,339,257

Shareholders' equity

Preferred stock, $.0001 par value

Authorized 1,000,000 shares, 206 issued at December 31, 2020

and September 30, 2020 - -

Common stock, $.0001 par value

Authorized 50,000,000 shares 14,839,836 issued and 13,621,406

outstanding at December 31, 2020 and September 30, 2020 1,484 1,484

Treasury stock, 1,218,430 shares at December 31, 2020 and (122) (122)

September 30, 2020

Additional paid in capital 60,670,699 60,670,699

Retained deficit (35,572,944) (34,848,032)

Total shareholders' equity 25,099,117 25,824,029

Total liabilities and shareholders' equity $ 61,713,645 $ 58,163,286

Please refer to the table below that reconciles adjusted EBITDA with net loss available to common shareholders:

Three Months Ended Three Months Ended

December 31, 2020 December 31, 2019

Unaudited Unaudited

Net loss income available to

common shareholders $ (724,912) $ (151,364)

Add: Income benefit expense (69,442) (36,459)

Add: Dividends on preferred stock 77,250 77,250

Add: Interest expense 76,517 186,845

Less: Non-operating income (112,184) (315,302)

Add: Depreciation expense 1,083,853 1,095,282

Adjusted EBITDA $ 331,082 $ 856,252

Certain statements contained in the release, including without limitation statements including the words "believes," "anticipates," "intends," "expects" or words of similar import, constitute "forward-looking statements" within the meaning of section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements of the Company expressed or implied by such forward-looking statements. Such factors include, among others, general economic and business conditions, changes in business strategy or development plans and other factors referenced in this release. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

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SOURCE Energy Services of America