KBS, a Subsidiary of Digirad Corporation, Announces Signing of Phase 2 of its Previously Announced $5.2 Million Contract to M...
July 20 2020 - 7:30AM
Digirad Corporation (Nasdaq: DRAD; DRADP) (“Digirad” or the
“Company”), a diversified holding company with three divisions:
Healthcare, Building & Construction, and Real Estate &
Investments, announced today that KBS Builders, Inc. (“KBS”) has
signed Phase 2 of its previously announced $5.2 million project
with Tocci Building Corporation (“Tocci”), a Massachusetts-based
general contractor and construction management company.
For Phase 2 of this project, valued at $4.4
million, KBS will manufacture 84 building modules. Phase 1,
valued at $0.8 million for the manufacturing of 14 building
modules, commenced in June. This $5.2 million project in
total will result in the production of 22 single-family and
townhouse units for the U.S. Army Natick Soldier Systems Center in
Natick, MA. Deliveries for both phases are expected to
be completed before the end of the year. All 98 modular units
are being manufactured at KBS’s plant in South Paris, ME, which has
a production capacity of 500 to 600 building modules per year.
As previously announced, the federal government may exercise
its option for Phase 3, which would increase the total project size
by an additional 26 building modules and 6 living units, bringing
the total potential project revenue for KBS to $6.7
million.
Jeff Eberwein, Digirad’s Chairman, noted, “KBS
started the third quarter on a strong note with the recent
commencement of two significant commercial projects – the $5.2
million contract to manufacture living units for the U.S. Army and
the $2.0 million contract to manufacture housing units for military
veterans. Additionally, KBS continues to be involved in
discussions on numerous other commercial construction projects for
the New England market that we expect will be awarded later this
year. KBS recently increased its work force by over 20% to
meet the higher manufacturing requirements for these two commercial
projects as well as the future growth we expect. Furthermore,
if KBS grows as expected in 2020, it will explore re-opening its
Oxford, Maine plant, which we believe is capable of producing an
additional 500 to 600 building modules per year at full
capacity.”
About Digirad
CorporationDigirad Corporation is a diversified holding
company with three divisions: Healthcare, Building &
Construction, and Real Estate & Investments.
Healthcare Division (Digirad
Health)Digirad Health designs, manufactures, and
distributes diagnostic medical imaging products and services.
Digirad Health operates in three businesses: Diagnostic
Imaging, Diagnostic Services, and Mobile Healthcare. The
Diagnostic Imaging business designs, manufactures, and sells
proprietary solid-state gamma cameras. It also services the
installed base of these proprietary cameras. The Diagnostic
Services business offers imaging and monitoring services to
healthcare providers as an alternative to purchasing equipment or
outsourcing procedures. The Mobile Healthcare business
provides contract diagnostic imaging, including computerized
tomography (“CT”), magnetic resonance imaging (“MRI”), positron
emission tomography (“PET”), PET/CT, and nuclear medicine and
healthcare expertise through a convenient, mobile service.
Building & Construction Division
(ATRM)ATRM Holdings, Inc. (“ATRM”) manufactures modular
housing units for commercial and residential real estate projects.
ATRM operates in two businesses: (i) modular building
manufacturing and (ii) structural wall panel and wood foundation
manufacturing, including building supply retail operations.
The modular building manufacturing business is operated by
KBS Builders, Inc. (“KBS”), the structural wall panel and wood
foundation manufacturing segment is operated by EdgeBuilder, Inc.
(“EdgeBuilder”), and the retail building supplies are sold through
Glenbrook Building Supply, Inc. (“Glenbrook”). KBS,
EdgeBuilder, and Glenbrook are all wholly-owned subsidiaries of
ATRM, which is a wholly-owned subsidiary of Digirad.
Real Estate & Investments
DivisionThis business division manages the Company’s real
estate assets and investments.
Forward-Looking Statements Disclaimer
Statement“Safe Harbor” Statement under the Private
Securities Litigation Reform Act of 1995: This release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements in
this release that are not statements of historical fact are hereby
identified as “forward-looking statements” for the purpose of the
safe harbor provided by Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking Statements include, without limitation,
statements regarding (i) the plans and objectives of management for
future operations, including plans or objectives relating to
acquisitions and related integration, development of commercially
viable products, novel technologies, and modern applicable
services, (ii) projections of income (including income/loss),
EBITDA, earnings (including earnings/loss) per share, free cash
flow (FCF), capital expenditures, cost reductions, capital
structure or other financial items, (iii) the future financial
performance of Digirad Corporation or acquisition targets and (iv)
the assumptions underlying or relating to any statement described
above. Moreover, forward-looking statements necessarily involve
assumptions on the Company’s part. These
forward-looking statements generally are identified by the words
“believe”, “expect”, “anticipate”, “estimate”, “project”, “intend”,
“plan”, “should”, “may”, “will”, “would”, “will be”, “will
continue” or similar expressions. Such forward-looking
statements are not meant to predict or guarantee actual results,
performance, events or circumstances and may not be realized
because they are based upon the Company's current projections,
plans, objectives, beliefs, expectations, estimates and assumptions
and are subject to a number of risks and uncertainties and other
influences, many of which the Company has no control over.
Actual results and the timing of certain events and circumstances
may differ materially from those described above as a result of
these risks and uncertainties. Factors that may influence or
contribute to the inaccuracy of forward-looking statements or cause
actual results to differ materially from expected or desired
results may include, without limitation, the substantial amount of
debt of the Company and the Company’s ability to repay or refinance
it or incur additional debt in the future; the Company’s need for a
significant amount of cash to service and repay the debt and to pay
dividends on the Company’s preferred stock; the restrictions
contained in the debt agreements that limit the discretion of
management in operating the business; legal, regulatory, political
and economic risks in markets and public health crises that reduce
economic activity and cause restrictions on operations (including
the recent coronavirus COVID-19 outbreak); the length of time
associated with servicing customers; losses of significant
contracts or failure to get potential contracts being discussed;
disruptions in the relationship with third party vendors; accounts
receivable turnover; insufficient cash flows and resulting lack of
liquidity; the Company's inability to expand the Company's
business; unfavorable changes in the extensive governmental
legislation and regulations governing healthcare providers and the
provision of healthcare services and the competitive impact of such
changes (including unfavorable changes to reimbursement policies);
high costs of regulatory compliance; the liability and compliance
costs regarding environmental regulations; the underlying condition
of the technology support industry; the lack of product
diversification; development and introduction of new technologies
and intense competition in the healthcare industry; existing or
increased competition; risks to the price and volatility of the
Company’s common stock and preferred stock; stock volatility and in
liquidity; risks to preferred stockholders of not receiving
dividends and risks to the Company’s ability to pursue growth
opportunities if the Company continues to pay dividends according
to the terms of the Company’s preferred stock; the Company’s
ability to execute on its business strategy (including any cost
reduction plans); the Company’s failure to realize expected
benefits of restructuring and cost-cutting actions; the Company’s
ability to preserve and monetize its net operating losses; risks
associated with the Company’s possible pursuit of acquisitions; the
Company’s ability to consummate successful acquisitions and execute
related integration, including to successfully integrate ATRM’s
operations and realize the synergies from the acquisition of ATRM,
as well as factors related to the Company’s business (including
ATRM) including economic and financial market conditions generally
and economic conditions in the Company’s markets; failure to keep
pace with evolving technologies and difficulties integrating
technologies; system failures; losses of key management personnel
and the inability to attract and retain highly qualified management
and personnel in the future; and the continued demand for and
market acceptance of the Company’s services. For a detailed
discussion of cautionary statements and risks that may affect the
Company’s future results of operations and financial results,
please refer to the Company’s filings with the Securities and
Exchange Commission, including, but not limited to, the risk
factors in the Company’s most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. This release reflects management’s
views as of the date presented.
All forward-looking statements are necessarily
only estimates of future results, and there can be no assurance
that actual results will not differ materially from expectations,
and, therefore, you are cautioned not to place undue reliance on
such statements. Further, any forward-looking statement speaks only
as of the date on which it is made, and we undertake no obligation
to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events.
For
more information contact: |
|
Digirad Corporation |
The Equity Group |
Jeffrey E. Eberwein |
Lena Cati |
Chairman of the Board |
The Equity Group |
203-489-9501 |
212-836-9611 |
ir@digirad.com |
lcati@equityny.com |
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