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GSE Systems Announces Third Quarter 2018 Financial Results

Nov 14, 2018 | 2018

COLUMBIA, MD – November 14, 2018– GSE Systems, Inc. (“GSE” or “the Company”) (Nasdaq: GVP), a leading provider of professional and technical engineering, staffing services, and simulation software to clients in the power and process industries, today announced financial results for the third quarter (Q3) ended September 30, 2018.

Q3 2018 vs. Q3 2017 OVERVIEW

  • Revenue increased 42% to $21.8 million from $15.4 million.
  • Gross profit rose 28% to $5.4 million from $4.2 million.
  • Net loss decreased 14% to $(0.5) million, or $(0.03) per diluted share, compared to $(0.6) million, or $(0.03) per diluted share.
  • Adjusted net income1 grew 26% to $0.8 million, or $0.04 per diluted share, from $0.6 million, or $0.03 per diluted share.
  • Adjusted EBITDA1 rose 68% to $1.5 million from $0.9 million.
  • New orders increased 203% to $27.9 million from $9.2 million.

At September 30, 2018

  • Cash, cash equivalents and restricted cash of $9.8 million.
  • Total debt of $9.0 million.
  • Working capital of $11.9 million and current ratio of 1.6x.
  • Backlog of $74.0 million.

1 Refer to the non-GAAP reconciliation tables at the end of this press release for a definition of “adjusted EBITDA” and “adjusted net income”.

Kyle J. Loudermilk, GSE’s President and Chief Executive Officer, said, “On a year-over-year basis, GSE’s third quarter 2018 revenue increased 42% to $21.8 million, adjusted EBITDA grew 68% to $1.5 million and adjusted net income rose 26% to $0.8 million. We are excited to see continuing momentum in operating leverage via Adjusted EBITDA and expect this to accelerate as we scale. In addition, new orders were the highest since the first quarter of 2016. Our acquisitions of Absolute Consulting and True North Consulting helped drive this quarter’s strong performance, demonstrating the significant potential of our strategy to scale GSE and create value through rolling up a fractured vendor ecosystem in the nuclear power industry.  We continue to evaluate and pursue a robust pipeline of additional potential value-creating strategic acquisitions.”

About GSE Systems, Inc.

GSE Systems, Inc. is a leading provider of professional and technical engineering, staffing services, and simulation software to clients in the power and process industries.  GSE’s products and services are tailored to help customers achieve performance excellence in design, training, compliance, and operations.  The Company has over four decades of experience, more than 1,100 installations, and hundreds of customers in over 50 countries spanning the globe.  GSE Systems is headquartered in Sykesville (Baltimore), Maryland, with offices in Columbia, Maryland, Navarre, Florida, Montrose, Colorado, and Beijing, China.  Information about GSE Systems is available at www.gses.com.

Forward-Looking Statements

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.

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