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Global Power Equipment Group Inc. Reports Earnings for the Three Months Ended March 31, 2009

Posted on: Wednesday, 20 May 2009, 15:30 CDT

TULSA, Okla., May 20 /PRNewswire-FirstCall/ -- Global Power Equipment Group Inc. (Pink Sheets: GLPW) ("Global Power") today published its unaudited financial results for the three months ended March 31, 2009. These results are available for review at www.pinksheets.com under the ticker symbol GLPW, and on the Company's website at www.globalpower.com. Additionally, the Company has made available its senior credit facility and related amendments on the Company's website.

For the three months ended March 31, 2009, the Company reported revenues of $126.0 million and net income of $13.5 million, or $0.10 per diluted share. Revenues for the three months ended March 31, 2008 were $118.2 million and a net loss of ($3.3) million, or ($0.03) per diluted share.

"We continued to achieve excellent financial and operational results during the first quarter 2009 as we completed jobs that were awarded during more robust market conditions," stated John Matheson, Global Power's president and chief executive officer. "For the period, we exceeded our overall earnings expectations primarily due to the expansion of projects within our services division."

The Company's gross profit for the first quarter 2009 totaled $26.2 million representing 20.8 percent gross margin compared to gross profit of $19.0 million, or 16.1 percent gross margin, for the first quarter 2008. EBITDAR (earnings before interest, taxes, depreciation and amortization and reorganization expense) from continuing operations was $16.7 million and $11.1 million for the three months ended March 31, 2009 and 2008, respectively. EBITDAR is a non-GAAP financial measure. A reconciliation of our net income to EBITDAR is included in the schedules attached to this press release.

Interest expense for the three months ended March 31, 2009 and 2008 was $2.7 million and $3.1 million, respectively. As of March 31, 2009, the Company had no draws under its revolving credit facility.

At March 31, 2009 the Company's backlog totaled $344 million compared to $333 million at December 31, 2008 and $417 million as of March 31, 2008. In addition, the Company had cash and cash equivalents of $74.1 million at March 31, 2009.

The Company will host a conference call on Thursday, May 21, 2009 at 2:00 PM CDT. The numbers to call for this teleconference are: within the United States and Canada (800) 870-4027, outside North America (213) 416-2975. A playback of the call will be available from 4:00 p.m. CDT on May 21, 2009 through midnight CDT on June 4, 2009, by calling: within North America (800) 675-9924, outside North America (213) 416-2185. The replay ID code is 52109.

About Global Power

Oklahoma based Global Power Equipment Group Inc. is a leading design, engineering and manufacturing firm providing a broad array of equipment and services to the global power infrastructure, energy and process industries. Through its Global Power Services Division, the Company is a leading provider of on-site specialty support and outage management services for commercial nuclear reactors in the United States and provides maintenance services to fossil and hydroelectric power plants and other industrial operations. Through its Global Power Products Division the Company designs, engineers and manufactures a comprehensive portfolio of equipment for gas turbine power plants and power-related equipment for industrial operations, with over 40 years of power generation industry experience. The Company believes, in its product lines, it has one of the largest installed bases of equipment for power generation in the world. Additional information about Global Power Equipment Group may be found at www.globalpower.com.

Forward-looking Statement Disclaimer

Statements contained in this release regarding the Company's or management's intentions, beliefs, expectations, or predictions for the future, including, but not limited to, those regarding anticipated operating results and the publication of any such results, are forward-looking statements within the meaning of U.S. federal securities laws and are subject to a number of known and unknown risks, assumptions and uncertainties that could cause the Company's actual results to differ materially from those projected, including the effects of the current financial turmoil and the associated global recession, decreased demand for new gas turbine power plants, the loss of any of our major customers, the cancellation of projects, project cost overruns, including increases in prices for energy or for materials such as steel, and unforeseen schedule delays, competition for the sale of our products or services, poor performance by our subcontractors, warranty and product liability claims and changes in the economic, social and political conditions in the United States and other countries in which we operate, including fluctuations in foreign currency exchange rates and the banking environment and monetary policy. The Company assumes no obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise.

The table below represents the operating results of the Company for the periods indicated:

GLOBAL POWER EQUIPMENT GROUP INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share amounts) Three Months Ended March 31, 2009 2008 (unaudited) Product revenues $57,425 $59,685 Service revenues 68,549 58,543 Total revenues 125,974 118,228 Cost of product revenues 39,966 47,080 Cost of service revenues 59,778 52,102 Cost of revenues 99,744 99,182 Gross profit 26,230 19,046 Selling and administrative expenses 10,524 8,929 Operating income 15,706 10,117 Change in fair value of warrants (975) - Interest expense 2,669 3,149 Reorganization expense (income) (132) 24,006 Income tax expense (benefit) 1,226 (503) Income (loss) from continuing operations 12,918 (16,535) Discontinued operations: Income from operations of discontinued operations, net of tax 615 13,230 Net income (loss) $13,533 $(3,305) Basic and dilutive earnings (loss) per weighted average common share: Income (loss) from continuing operations $0.10 $(0.15) Income from discontinued operations 0.00 0.12 Income (loss) per common share - basic and diluted $0.10 $(0.03) Weighted average number of shares of common stock outstanding - basic and diluted 134,937,931 113,459,379

GLOBAL POWER EQUIPMENT GROUP INC. SUPPLEMENTAL INFORMATION (in thousands) Three Months Ended March 31, 2009 2008 Income (loss) from continuing operations $12,918 $(16,535) Add back: Income tax provision (benefit) 1,226 (503) Interest expense 2,669 3,149 Change in fair value of warrants (975) - Depreciation and amortization 950 963 Reorganization (income) expense (132) 24,006 EBITDAR from continuing operations (a) $16,656 $11,080 (a) EBITDAR from continuing operations represents net income plus income taxes, interest, depreciation, and amortization and reorganization items. While considered the most common definition used by investors and financial analysts, the EBITDAR presented above may not be comparable to similarly titled measures reported by other companies. The Company believes that EBITDAR, while providing useful information, should not be considered in isolation or as an alternative to other financial measures determined under GAAP

GLOBAL POWER EQUIPMENT GROUP INC. AND SUBSIDIARIES HIGHLIGHTS FROM CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) March 31, December 31, 2009 2008 ASSETS Current assets: Cash and cash equivalents $74,086 $57,633 Accounts receivable, net of allowance 53,195 55,953 Inventories 6,033 4,963 Costs and estimated earnings in excess of billings 50,370 55,922 Other current assets 7,534 10,329 Total current assets 191,218 184,800 Property, plant and equipment, net 12,626 12,610 Other long-term assets 102,870 103,629 Total assets $306,714 $301,039 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current maturities of long-term debt $19,675 $19,675 Accounts payable & accrued liabilities 32,838 30,640 Billings in excess of costs and estimated earnings 28,227 36,728 Deferred revenue 8,684 8,695 Other current liabilities 20,949 19,394 Total current liabilities 110,373 115,132 Long-term deferred tax liability 11,100 11,100 Other long-term liabilities 3,605 3,605 Fair value of warrants 808 - Long-term debt, net of current maturities 64,075 65,325 Liabilities subject to compromise 584 604 Total stockholders' equity 116,169 105,273 Total liabilities and stockholders' equity $306,714 $301,039

GLOBAL POWER EQUIPMENT GROUP INC. AND SUBSIDIARIES HIGHLIGHTS FROM CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three Months Ended March 31, 2009 2008 (a) (Unaudited) Net cash provided by (used in) operating activities $19,755 $(151,783) Net cash used in investing activities (701) (1,092) Net cash provided by (used in) financing activities (1,315) 135,768 Effect of exchange rate changes on cash (1,286) 1,971 Net change in cash and cash equivalents $16,453 $(15,136) (a) For the three months ended March 31, 2008, cash flows from operating activities include payment of allowed claims pursuant to the Plan of Reorganization in addition to general working capital requirements. Cash provided by financing activities for the three months ended March 31, 2008 was comprised of proceeds from the Rights Offering and proceeds from the Exit Credit Facility, a portion of which was offset by a decrease in amounts due on the Debtor-in-Possession Facility which was paid in full upon emergence.

Company Contact: Candice Cheeseman Vice President of Administration and General Counsel Global Power Equipment Group Inc. (918) 488-0828

SOURCE Global Power Equipment Group Inc.

Source: PR Newswire

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