GP Strategies Reports Q3 2009 Financial Results
ELKRIDGE, Md. -- GP Strategies Corporation (NYSE:GPX), a global provider of training, e-Learning solutions, management consulting, engineering and technical services through its principal operating subsidiary General Physics Corporation, today reported financial results for the third quarter ended September 30, 2009.
Revenue for the third quarter of 2009 was $54.1 million compared to $66.0 million for the third quarter of 2008 and $53.8 million for the second quarter of 2009. Gross profit was $8.9 million, or 16.4% of revenue, for the third quarter of 2009 compared to $10.1 million, or 15.3% of revenue, for the same period in 2008. Operating income was $3.7 million for the third quarter of 2009 compared to $5.0 million for the third quarter of 2008, and consistent with second quarter 2009 operating income of $3.7 million. EBITDA for the third quarter of 2009 was $4.5 million compared to $6.0 million for the third quarter of 2008. Net income was $2.0 million for the third quarter of 2009, or $0.13 per diluted share, compared to net income of $2.9 million for the third quarter of 2008, or $0.18 per diluted share.
"I am pleased with our strong performance in the third quarter, which allowed us to continue investing in strategic initiatives, open a new office in Bellevue, Washington to support our expanding work in the global software industry and continue our global acquisition program with Milsom Industrial Designs," commented Scott N. Greenberg, Chief Executive Officer of GP Strategies. "Our EBITDA and gross profit in the quarter clearly demonstrate that we have substantially mitigated the effects of the economic downturn. We believe that our business model gives us the flexibility to capitalize on opportunities as they arise, as demonstrated by recent wins in the software, technology and pharmaceutical sectors, and to provide award-winning services, which were recognized recently by an award to us from Chief Learning Officer magazine and to our customer from American Society of Training & Development. GP Strategies is positioned to capture new customers, continue to fund organic growth and execute on strategic acquisitions to enhance shareholder value. We are building a strong platform and are very excited about our future."
Balance Sheet and Cash Flow Highlights
As of September 30, 2009, the Company had cash and cash equivalents of $4.1 million compared to $4.0 million as of December 31, 2008. The Company had $1.3 million of short-term borrowings outstanding and $21.5 million of available borrowings under its revolving credit facility as of September 30, 2009. Cash provided by operating activities was $10.1 million for the nine months ended September 30, 2009. As of October 30, 2009, the Company had approximately $7.9 million of cash and cash equivalents and no borrowings outstanding under its revolving credit facility.
Investor Call
The Company has scheduled an investor conference call for 10:00 a.m. ET on November 5, 2009. In addition to prepared remarks from management, there will be a question and answer session on the call. The dial-in numbers for the live conference call are 888-633-3324 or 973-935-8549, using conference ID number 39248256. A telephone replay of the call will also be available beginning at 11:00 a.m. on November 5th and will remain available through midnight on November 19th. To listen to the replay, dial 800-642-1687 or 706-645-9291, using conference ID number 39248256. A replay will also be available on GP Strategies' website shortly after the conclusion of the call.
Presentation of Non-GAAP Information
This press release contains non-GAAP financial measures, including Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization) and Free Cash Flow. The Company believes these non-GAAP financial measures are useful to investors in evaluating the Company's results. These measures should be considered in addition to, and not as a replacement for, or superior to, either net income, as an indicator of the Company's operating performance, or cash flow, as a measure of the Company's liquidity. In addition, because Adjusted EBITDA and Free Cash Flow may not be calculated identically by all companies, the presentation here may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-GAAP financial measures to the most comparable GAAP equivalent, see the Non-GAAP reconciliations, along with related footnotes, below.
About GP Strategies Corporation
GP Strategies, whose principal operating subsidiary is General Physics Corporation (GP), is a NYSE-listed company (GPX). GP is a global performance improvement solutions provider of sales and technical training, e-Learning solutions, management consulting and engineering services. GP's solutions improve the effectiveness of organizations by delivering innovative and superior training, consulting and business improvement services, customized to meet the specific needs of its clients. Clients include Fortune 500 companies, manufacturing, process and energy industries, and other commercial and government customers. Additional information may be found at www.gpworldwide.com.