GSE Systems Announces Third Quarter 2016 Financial Results
Q3 2016 OVERVIEW
- Revenue totaled $14.4 million, compared to $14.8 million in Q3 2015.
- Selling, general and administrative expenses decreased 20% to $3.0 million, or 21% of revenue, from $3.8 million, or 26% of revenue, in Q3 2015.
- Adjusted EBITDA increased to approximately $605,000 from approximately $75,000 in Q3 2015.
- Operating income rose to $0.4 million, which included restructuring charges of approximately $85,000, from an operating loss of $3.6 million, which included including restructuring charges of $1.6 million and write-down of capitalized software development costs of $1.5 million, in Q3 2015.
- Net income grew to $0.2 million, or $0.01 per diluted share, compared to a net loss of $3.8 million, or $(0.21) per diluted share, in Q3 2015.
- Adjusted net income, excluding the impact of gain/loss from the change in fair value of contingent consideration, restructuring charges, stock-based compensation expense and consulting support for finance restructuring, increased to $0.4 million, or $0.02 per basic and diluted share, from an adjusted net loss of $1.7 million, or $(0.10) per basic and diluted share, in Q3 2015.
- New orders more than doubled to $13.8 million from $5.3 million in Q3 2015, driven by two international projects to modernize nuclear simulators in the UK and Japan.
At September 30, 2016
- Cash and equivalents of $17.4 million, or $0.94 per diluted share, including $3.3 million of restricted cash.
- Working capital of $11.9 million and current ratio of 1.5x.
- $0 long-term debt.
- Backlog totaled $69.3 million, up 45% compared to year-end 2015 backlog of $47.9 million.
- Year-to-date cash flow from operations increased 197% year over year to $3.9 million.
SYKESVILLE, MD – November 14, 2016 – GSE Systems, Inc. (“GSE” or “the Company”) (NYSE MKT: GVP), the world leader in real-time high-fidelity simulation systems and training solutions to the power and process industries, today announced financial results for the third quarter (“Q3”) ended September 30, 2016.
Kyle J. Loudermilk, GSE’s President and Chief Executive Officer, said, “We are pleased to report GSE’s fifth consecutive quarter of positive adjusted EBITDA, which grew significantly on a year over year basis in Q3 2016, driven by our efforts to increase our backlog, reduce costs and streamline operations. This quarter we continued to win important new projects, including two contracts to modernize nuclear simulators in the UK and Japan, which demonstrate the global strength of our innovative simulation solutions. Our backlog remains strong, we have enhanced our leadership team and Board, and we are actively pursuing exciting organic and inorganic growth opportunities. We are focused on generating positive revenue growth in 2017 while continuing to generate strong cash flow and improved profitability. Our increasingly strong balance sheet and operational performance put us in a great position to affect our growth strategy.”
About GSE Systems, Inc.
GSE Systems, Inc. provides professional and technical engineering, staffing services and simulation software to clients in the power and process industries. Our solutions enhance customer safety and performance across training, design & licensing, engineering, and operations and maintenance. The Company has over four decades of experience, more than 1,100 installations, and customers in over 50 countries spanning the globe. GSE Systems is headquartered in Sykesville (Baltimore), Maryland, with offices in Columbia, Maryland, Montrose, Colorado, Navarre, Florida and Beijing, China. Information about GSE Systems is available at www.gses.com.
We make statements in this press release that are considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. These statements reflect our current expectations concerning future events and results. We use words such as “expect,” “intend,” “believe,” “may,” “will,” “should,” “could,” “anticipates,” and similar expressions to identify forward-looking statements, but their absence does not mean a statement is not forward-looking. These statements are not guarantees of our future performance and are subject to risks, uncertainties, and other important factors that could cause our actual performance or achievements to be materially different from those we project. For a full discussion of these risks, uncertainties, and factors, we encourage you to read our documents on file with the Securities and Exchange Commission, including those set forth in our periodic reports under the forward-looking statements and risk factors sections. We do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.