DynTek Up Via Buy, Though Losses Last
By ANDREW SIMONS
It helps to get business with the federal government.
Irvine-based DynTek Inc. nabbed the No. 3 spot on this year’s fastest-growing companies list with sales of $52.6 million for the 12 months through June, a gain of 2,530%, versus the same period in 2000.
The company got bigger in 2001 when Irvine-based TekInsight.com Inc. bought the state and local government consulting business of Reston, Va.-based DynCorp. In the process, TekInsight adopted a new name, DynTek Inc.
It had sales of just $2 million in 2000.
DynTek provides software, technology and management consulting services to state and local governments and counts 350 employees.
Despite the big three-year sales gain, DynTek’s annual sales through June 30 marked a 37% decline from 2002 as industry-wide demand for technology services and consulting fell.
And DynTek posted an annual loss of $13.8 million in the most recent 12 months, though that’s an improvement over the $19.4 million loss it reported a year earlier.
The company said it expects to produce positive cash flow in 2004.
DynTek has been shedding businesses not related to consulting. It sold its unit that provided non-emergency medical transportation for Medicaid patients to First Transit Inc. The sale netted the company $6.5 million plus up to $1.8 million more if conditions are met.
Among the services DynTek offers are systems integration, business process outsourcing, network engineering, applications development and technical support.
To bolster its consulting operations, DynTek recently bought New Orleans-based Mormar Technology Inc., a network and application security consulting company.
Mormar targets commercial businesses and government agencies for its security software, network design and implementation and security and audit evaluations.
Meanwhile, DynTek has been lining up work with some government agencies.
In June, DynTek signed a two-year contract with the State of Texas Department of Information Resources for Internet security products and services. And the Los Angeles Sheriff’s Department’s Records and Identification Bureau signed a $2.2 million deal with DynTek this summer.
