COLUMBIA, Md., May 10 /PRNewswire/ -- GSE Systems, Inc. (Amex: GVP), a
leading global provider of real time simulation and process control solutions
to the energy and process industries, reported net income of $1.7 million or
$.33 per diluted share for the quarter ended March 31, 2001 versus net income
of $537,000 or $.09 per diluted share for the same period in 2000.
The Company's core Power and Process businesses recorded operating incomes
totaling $600,000. It is important to note that the Process business had an
operating income of $42,000 in the first quarter 2001 versus a loss of
$1.9 million in the first quarter of 2000 on essentially the same revenue.
This profitability was a direct result of the Company's cost cutting measures.
The overall net income was also bolstered by the previously announced
March 6, 2001 sale of the VirtualPlant assets to Avantium International BV,
which resulted in a $3.3 million pre-tax gain for the Company. This was
offset by $809,000 from corporate restructuring costs and operating losses
from VirtualPlant operations prior to the March 6, 2001 sale.
Revenue for the core Power and Process businesses for the three months
ended March 31, 2001 totaled $12.0 million, which were consistent with
revenues for the same period in 2000. Power revenues were $7.2 million and
Process revenues were $4.8 million for the first quarter of 2001. GSE's total
reported revenue for the three months ended March 31, 2001 was $12.5 million,
which compared to $15.1 million for the three months ended March 31, 2000.
Please note that the 2001 and 2000 revenues included $507,000 and $3.2 million
of VirtualPlant revenues, respectively.
Jerry Jen, President and COO had the following comments: "During the first
quarter, we delivered on our promise to be profitable in both business units.
Now that we have completed the sale of the VirtualPlant assets, and recognized
the benefits, including our 19% ownership in Avantium, our full attention is
now focused on the profitable operation of our core businesses. We are
positioning our Power business to take advantage of the immediate needs in the
domestic energy market, and we are very pleased with our recently announced
successes in that market. I've also had several meetings with key Process
customers; they are pleased we have returned the business to profitability and
with the recent new product releases and future plans."
GSE Systems, Inc. develops and delivers business and technology solutions
by applying process control, simulation software, systems and services to the
energy, process and manufacturing industries worldwide. The Company's
products are used in the following industries: specialty chemical, food and
beverage, petroleum refining, pharmaceutical, and fossil and nuclear power
generation. GSE Systems is headquartered in Columbia, Maryland with offices
in Alabama, Georgia, Louisiana, Maryland, North and South Carolina,
Pennsylvania, and Texas, and its global locations include offices in Japan,
and Sweden. Information about GSE Systems is available via the Internet's
World Wide Web at http://www.gses.com . The GSE Systems Q1 2001 conference
call is being webcast at http://www.streetevents.com on Friday, May 11 at 11 a.m.
EDT.
This news release contains forward-looking statements that involve risks
and uncertainties. The actual future results of GSE Systems may differ
materially due to a number of factors, including but not limited to delays in
introduction of products or enhancements, size and timing of individual
orders, rapid technological changes, market acceptance of new products and
competition. These and other factors are more fully discussed in the
Company's annual report on Form 10-K for the year ended December 31, 2000 as
filed with the Securities and Exchange Commission.
To receive additional information on GSE Systems, Inc., via fax at no
charge, dial 1-800-PRO-INFO and enter ticker symbol GVP.
GSE Systems, Inc.
Selected Financial Data
(In thousands, except share and per share data)
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
Three months ended
March 31
2001 2000
Contract revenue $ 12,478 $ 15,124
Cost of revenue 9,506 9,160
Gross profit 2,972 5,964
Operating expenses 3,181 4,829
Operating income (loss) (209) 1,135
Other income (expense)(a) 3,065 (233)
Income before taxes 2,856 902
Provision for income taxes 1,142 365
Net income $1,714 $537
Basic earnings per share $0.33 $0.10
Diluted earnings per share $0.33 $0.09
a) Other income (expense) for the three months ended March 31, 2001
includes a $3.3 million gain on the sale of the Company's VirtualPlant
business technology and assets.
Selected balance sheet data (unaudited)
March 31, 2001 Dec. 31, 2000
Cash and cash equivalents $ 612 $1,465
Current assets 18,411 20,368
Total assets 36,896 35,949
Current liabilities $15,279 $14,846
Long-term liabilities 11,138 12,390
Stockholders' equity 10,479 8,713
Selected segment information (unaudited)
Three months ended
March 31,
2001 2000
Revenues:
Process Solutions Business Unit (b) $5,314 $7,964
Power Systems Business Unit 7,164 7,160
$12,478 $15,124
b) Included in the Process Solutions Business Unit's revenues for the
three months ended March 31, 2001 and 2000, were revenues for the
divested VirtualPlant business of $507,000 and $3.2 million,
respectively. The 2000 VirtualPlant revenues included $2.9 million
from a software license sold to Avantium International B.V.
SOURCE GSE Systems, Inc.
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Related links:
http://www.gses.com
CONTACT:
Gill R. Grady, Sr. Vice President of GSE
Systems, Inc., 410-772-3500, or General, Laura Gedid, or
Analysts, Susan Garland, both of The Financial Relations Board
BSMG Worldwide, 212-661-8030
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