COLUMBIA, Md., Nov. 12 /PRNewswire/ -- GSE Systems, Inc.
(Nasdaq-NNM: GSES), a leading global provider of integrated enterprise
software and information solutions to the energy, process and manufacturing
industries, today announced third quarter and nine month results for the
periods ended September 30, 1997.
GSE Systems, Inc. incurred a net loss in the third quarter of 1997 of
$906,000, compared with net income of $1.2 million in the corresponding
quarter of 1996. The 1997 third quarter loss was $.18 per share, versus
earnings of $.23 per share for the same period in 1996. Revenues were
$19.0 million and $23.5 million for the third quarter of 1997 and 1996,
respectively.
The net loss for the nine months ended September 30, 1997 was
$3.9 million, or a loss of $.78 per share, compared with earnings of
$2.7 million, or net income of $.53 per share, for the same period of 1996.
Revenues for the 1997 nine month period were $59.0 million, versus
$72.0 million for the same period of 1996. The results for the first nine
months of 1997 included a severance charge of $1.1 million before taxes for a
restructuring plan.
Christopher M. Carnavos, Senior Executive Vice President, stated, "We
continue to see improvement and are realizing the benefits from our
restructuring plan. However, the Company was not able to achieve the revenue
anticipated for the third quarter and continues to operate at a loss. On a
positive note, we are pleased with the contract awards announced during the
third quarter, particularly those from the Power industry."
The Company's products are used in over 700 applications, representing
over 250 customers in 30 countries, in the following industries: specialty
chemical, food & beverage, petroleum refining, oil & gas, pharmaceutical,
fossil and nuclear power generation, metals, electrical distribution and water
treatment. GSE Systems is headquartered in Columbia, Maryland with offices in
Augusta, GA, Baton Rouge, LA, Houston, TX, Phoenix, AZ, Pittsburgh, PA, Salt
Lake City, UT and Shelby, NC, and its global operations include offices in
Belgium, Japan, Korea, Singapore, Sweden, and Taiwan.
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.
To receive additional information on GSE Systems, Inc., via fax at no
charge, dial 1-800-PRO-INFO and enter ticker symbol GSES.
GSE SYSTEMS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(in thousands, except share and per share data)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
1997 1996 1997 1996
Contract revenue $19,021 $23,500 $58,978 $71,971
Cost of revenue 13,527 15,874 41,825 48,471
Gross profit 5,494 7,626 17,153 23,500
Operating expenses:
Selling, general and administrative 6,068 5,188 19,257 16,638
Depreciation and amortization 675 571 1,875 1,561
Business combination costs -- -- -- 1,105
Employee severance and
termination costs (225) -- 1,124 --
Total operating expenses 6,518 5,759 22,256 19,304
Operating (loss) income (1,024) 1,867 (5,103) 4,196
Interest expense 207 92 566 346
Other (income) expense (83) 2 30 (275)
(Loss) income before income taxes (1,148) 1,773 (5,699) 4,125
(Benefit from) provision for
income taxes-242607-1,7671,442
Net (loss) income ($906) $1,166 ($3,932) $2,683
(Loss) earnings per common share ($0.18) $0.23 ($0.78) $0.53
Weighted average common shares
outstanding 5,065,700 5,066,000 5,065,700 5,077,000
GSE SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
September 30, December 31,
1997 1996
Cash and cash equivalents $1,124 $2,450
Contract receivables 24,618 27,457
Other current assets 6,793 7,693
Total current assets 32,535 37,600
Property and equipment, net 4,181 5,318
Software development costs, net 7,505 5,176
Goodwill and other intangible assets, net 1,924 2,059
Other assets 2,962 853
Total assets $49,107 $51,006
Total current liabilities $27,703 $23,733
Notes payable 172 202
Obligations under capital lease 221 420
Billings in excess of revenues earned -- 803
Other liabilities 580 1,155
Stockholders' equity 20,431 24,693
Total liabilities & stockholders' equity $49,107 $51,006
SOURCE GSE Systems, Inc.
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CONTACT:
Christopher M. Carnavos, Sr. Executive Vice
President of GSE Systems, 410-312-3600; or Doug DeLieto, general,
or Marty Gitlin, media, 212-661-8030, or Julie Creed, analysts,
312-266-7800, all of The Financial Relations Board for GSE
Systems, Inc.
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