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8-K - FORM 8-K - GLOBAL POWER EQUIPMENT GROUP INC.d8k.htm
1
Exhibit 99.1
Investor Presentation


2
This
presentation
contains
"forward-looking
statements"
within
the
meaning
of
that
term
set
forth
in
the
Private
Securities
Litigation
Reform
Act
of
1995.
These
statements
reflect
our
current
views
of
future
events
and
financial
performance
and
are
subject
to
a
number
of
risks
and
uncertainties.
Our
actual
results,
performance
or
achievements
may
differ
materially
from
those
expressed
or
implied
in
the
forward-looking
statements.
Risks
and
uncertainties
that
could
cause
or
contribute
to
such
material
differences
include,
but
are
not
limited
to,
decreased
demand
for
new
gas
turbine
power
plants,
reduced
demand
for,
or
increased
regulation
of,
nuclear
power,
loss
of
any
of
our
major
customers,
cost
increases
and
project
cost
overruns,
unforeseen
schedule
delays,
poor
performance
by
our
subcontractors,
cancellation
of
projects,
competition
for
the
sale
of
our
products
and
services,
shortages
in,
or
increases
in
prices
for,
energy
and
materials
such
as
steel
that
we
use
to
manufacture
our
products,
damage
to
our
reputation,
warranty
or
product
liability
claims,
increased
exposure
to
environmental
or
other
liabilities,
failure
to
comply
with
various
laws
and
regulations,
failure
to
attract
and
retain
highly-qualified
personnel,
volatility
of
our
stock
price,
deterioration
or
uncertainty
of
credit
markets,
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,
the
banking
environment
or
monetary
policy.
Other
important
factors
that
may
cause
actual
results
to
differ
materially
from
those
expressed
in
the
forward-looking
statements
are
discussed
in
our
filings
with
the
Securities
and
Exchange
Commission,
including
the
section
of
our
Registration
Statement
on
Form
10
titled
"Risk
Factors."
Except
as
may
be
required
by
applicable
law,
we
undertake
no
obligation
to
publicly
update
or
revise
any
forward-looking
statements,
whether
as
a
result
of
new
information,
future
events or otherwise, and we caution you not to rely upon them unduly.
Forward-Looking Statements


3
Market Overview
Market Overview
1.
Power Generation equipment and service is one of the largest industries worldwide
2.
Technology is stable
owners are conservative due to the large capital investments
3.
Economics
of
power
generation
plants
are
dynamic
due
to
fluctuating
fuel
prices
and
environmental compliance costs
4.
Service market is stable / slow growth and consistently profitable
5.
OEM / new equipment market is global, cyclical and generates higher risks and earnings
swings
Global Power
Mission Statement
Mission Statement
We will safely provide superior engineered products and services
that exceed
customer standards while affording employees opportunities for career growth and
earning our investors a superior rate of return on their investment.


4
Global Power
What we do
Global
Power
Equipment
Group
Inc.
is
a
comprehensive
provider
of
power
generation
equipment
and
maintenance
services
for
customers
in
the
domestic
and
international
energy,
power
infrastructure
and
service
industries.


5
Global Power
Executive management
Tracy Pagliara
General Counsel, Secretary &
VP Business Development
25 yrs experience
David Willis
CFO & SVP
17 yrs experience
Ken Robuck
SVP & President of Services
28 yrs experience
Dean Glover
SVP & President of Products
20 yrs experience
David Keller
President & CEO
30 yrs experience


6
A Global Presence
Cost effective / low risk OEM model takes us worldwide


7
Financial Overview
6/30/10 Snapshot
Market cap (9/9/10):
$232
million
Total unrestricted cash:
$66 million
Cash position net of term loan:
$42 million
Total backlog:
$298 million
Fully diluted shares:
16.2 million
Operating revenues:
$282 million
Net income:
$22 million
Earnings per fully diluted share:
$1.35
Consolidated operating EBITDA:
$26 million
Year to Date
6/30/10
As of 6/30/10
EBITDA is a non-GAAP measure; see appendix for reconciliation to net income


8
Snapshot of Backlog
66%
51%
38%
37%
33%
34%
49%
62%
63%
67%
2007
2008
2009
1Q10
2Q10
Products
Services
Historical Backlog
Historical Backlog
$377
$332
$314
$267
$298
Services
62%
Products
38%
Segment
Cost
Plus
90%
Fixed
Price
10%
Contract Type
Services
(Williams)
Fixed
Price
100%
Contract Type
Products
(Braden/Deltak)
Backlog (6/30/10)
Backlog (6/30/10)


9
Blue Chip Customer Base
Bad debt expense and warranty claims represent 0.166%
of
revenues from top 10 customers from 2007 –
2009.
1) As of August 2010
2) Bond issue rating
Credit
% of GPEG
Bad Debt
Warranty
Relationship
Rating ¹
Revenue
Exp
Claims
Tenure
($ in 000's)
($ in 000's)
1.
General Electric
AA+ / stable
42 years
2.
Southern Company
A / stable
40 years
3.
Tennessee Valley Authority
A / stable ²
34 years
4.
Florida Power & Light Group
A- / stable
34 years
5.
Energy Northwest
AA / stable ²
5 years
6.
Siemens
A+ / stable
39 years
7.
Entergy
BBB / stable
1 year
8.
Jacksonville Electric Authority
A+ / stable ²
19 years
9.
Alstom
BBB+ / Neg
18 years
10.
Mitsubishi
A / stable
16 years
    Subtotal - Top Customers
79%
43
$          
1,705
$     
All Others
21%
    Total Revenue
100%
Customer
2007 - 2009


10
Strategic Overview
Where we have been
Global Power has strengthened and repositioned itself over the last four years
Exited large-scale  HRSG
product line
Divested foreign subsidiary
Successfully exited Chapter 11
Additional equity capital
Commenced trading under
“GLPW”
on Pink Sheets
Entered into $150m exit
facility:
-
$90m term loan
-
$60m revolver facility
New management
Successfully re-listed on NASDAQ to
capitalize on strong performance and
position company for growth
Solid financials/Operating Performance
(across 2008-10)
-
Unrestricted cash of $66.3m
-
Term loan balance reduced from
$90m to $24.6m
Improving management systems and
controls


11
Strategic Overview
Where we are going
Organic Outlook
Organic Outlook
Products
OEM market expected to stabilize in 2011 with industry consensus view of recovery in 2012 of gas
turbine power projects
-
2011 revenues: potential growth range of mid-single digits compared to 2010
-
2011 gross margins anticipated to be mid-single digits lower than 2010 as current prospects are
booking
at
lower
margins
compared
to
1
st
half
2010
results
Services
is positioned to pursue more capital projects; shift in mix from maintenance and modification    
work could result in “lumpy”
bookings activity
-
2011 revenues anticipated to be flat to mid-single digit decline compared to 2010 due to the
completion of a large site security project
-
2011
margins
anticipated
to
stabilize
at
historical
run
rates
of
10%
-
13%
Consolidated operating expenses expected to stabilize at more predictable levels in 2011
One time non-recurring expenses: re-listing
/ SOX audit preparation


12
Strategic Overview
Where we are going (cont’d)
Acquisition Prospects
Acquisition Prospects
Products
acquisition targets include:
-
Bolt-on product lines
-
Product offerings that complement existing markets or broaden exposure beyond OEM
gas turbine cycle
Services
acquisitions targets include:
-
Specialty services that enhance our current capabilities
-
Engineering
and
design
capabilities
open
additional
EPC
project
opportunities
(we
currently participate in this space through alliances with engineering firms or through
subcontract relationships)
Opportunities will be prioritized based on a disciplined valuation approach, strategic fit and
timeline for accretion to shareholders


13
Global Power
Strong fundamental structure for a growing industry
Strong commercial risk / reward profile
Flexible manufacturing model
Geographic and end-market diversity
Long-standing relationships with a blue-chip customer base
Strong free cash flow generation
Favorable end-market dynamics
Acquisition growth opportunities


14
Industry


15
Poised For Growth
In a changing industry
Source: DOE Annual Energy Outlook, December, 2009
Hydropower*
10%
Nuclear
10%
Other
Renewables
4%
Other
12%
Coal
31%
Natural Gas
33%
2008 Capacity
Nuclear
3%
Other
Renewables
37%
Other 
1%
Natural Gas
46%
Coal
13%
Hydropower*
0.4%
Capacity Additions 2008 to 2035
* Includes storage
1,008
Gigawatts
250
Gigawatts
Natural
gas-fired
plants
utilizing
gas
turbine
power
generation
equipment
are
expected
to account for 46% of capacity additions through 2035
Environmental concerns favor gas-fired generation, especially in countries with a high
dependence on coal-fired output


16
Comparative Economics
Source: Compiled by FERC staff from various sources
FERC forecast data demonstrates gas is expected to be a compelling fuel source for power
generation capacity additions
Nuclear
Conventional Coal
IGCC Coal
Combined Cycle (Gas)
Combustion Turbine (Gas)
Wind
2003-04
Geothermal
2008
Concentrated Solar
$/kw
$6,000
$7,000
$8,000
$0
$1,000
$2,000
$3,000
$4,000
$5,000


17
United
States
currently
has
104
operating
nuclear
reactors
at
65
plant
sites
that
generate
about
20%
of
electricity used in the US. These plants have been in operation for an average of 30 years and are
operating at close to 90% capacity.
In 2000, the NRC issued the first license renewal to a nuclear power plant, extending its license for an
additional 20 years beyond its original 40-year license.
Capacity Factor Trend
Source: Department of Energy
Maintenance:  A Multi-Billion Dollar Industry
Aging nuclear fleet that requires extensive ongoing services


18
Services Spectrum 2010
Nuclear Power
Plant
Maintenance
Fossil Fuel,
Hydroelectric
Power Plant
Maintenance
Industrial
Painting and
Coatings
Insulation
Roofing
Systems
Abatement
Valve Services
What it is
Performed during
outages,
decommissioning
services
Routine maintenance,
repair and capital project
services
Clearing, surface
preparation, coatings
application, quality
control and inspection
testing
Industrial insulation
services commonly
packaged with industrial
coatings projects
Replace, repair and
upgrade industrial facility
roofing systems
Removal of asbestos
and heavy metal based
coatings such as lead
paint
Inspection, preventative
maintenance, repair of
valves and actuators
Nature of
contract award
Primarily Cost Plus
Primarily Cost Plus
Cost Plus
Cost Plus
Cost Plus
Cost Plus
Cost Plus/Fixed Price
Key Players
Bartlett,
Day
&
Zimmerman,
Shaw
Group,
URS
Alstom,
Babcock
&
Wilcox,
Foster
Wheeler,
Jingoli,
Kiweit,
Matrix,
Shaw
Group,
Southern
Industrial,
URS,
WW
Gay,
Yates
Brock,
K2
Industrial,
Manta
Brock,
K2
Industrial,
LVI,
Shook
and
Fletcher,
Vulcan
Brock,
Denard,
K2
Industrial
K2
Industrial,
LVI,
Shook
and
Fletcher,
Vulcan
Day
&
Zimmerman,
Ames,
Crane


19
Products Spectrum 2010
Filter Houses
Inlet Systems
Exhaust Systems
Diverter Dampers
HRSGs
Specialty Boilers
What it is
Cleans debris and dirt from
air that enters gas turbine
Connects the filter house to
gas turbine and provides
noise control
Directs hot exhaust from the
turbine to the atmosphere
Diverts hot exhaust from
the gas turbine into a HRSG
at a CCS facility, or into
exhaust stack at a simple
cycle facility
Boiler that creates steam to
drive a steam turbine used
for industrial processing
Highly customized system
to capture waste heat and
convert it to steam
Nature of
contract award
Fixed Price
Fixed Price
Fixed Price
Fixed Price
Fixed Price
Fixed Price
Key Players
AAF,
BHA/Altair,
Camfill
Farr
Eng,
Donaldson,
J&G
Steel,
Bilfinger
&
Burger,
G&H
AAF,
BHA/Altair,
Camfill
Farr
Eng,
Donaldson,
J&G
Steel,
Bilfinger
&
Burger
AAF,
Atco/Higgot
Kane,
Bachmann,
Camfill
Farr
Eng,
G&H,
NEM
Power
Systems,
Peerless
Bachmann,
Camfill
Farr
Eng,
Donaldson,
NEM
Power
Systems,
Stejasa
EIT,
Vogt,
Aalborg,
NEM
Power
Systems,
Nooter
Erikson
Rentech,
NEM
Power
Systems,
Technotherm


20
Operating Divisions


21
Braden
Headquarters in Tulsa, OK and
Herleen, The Netherlands
Global sales representatives located in
the US, The Netherlands, Egypt, Korea
and China
Braden engineers work exclusively on
gas turbine plan designs
Highly flexible outsourced
manufacturing model
-
25-30% In-house
-
70-75% Outsourced


22
Supplied Filter Houses and Exhaust
Systems for 2 X 7FA Gas Turbine Power
Plant in Florida
All fabrication completed in house by
Braden Mexico
Very stringent low noise acoustical
requirements
Two Customers:
Braden
Greenland Energy Center Project -
Florida
-
Filter Houses Supplied to Turbine OEM
-
Exhaust System supplied to the EPC


23
One of the world’s largest natural gas transmission projects; 12,000 miles across
China
71 gas turbine exhaust systems; 100% market share
Order executed in local currency using Braden Shanghai Office
Fabricated
In
China
using
local
fabrication
partners
and
locally
available
material,
100% on time
Braden
West to East Gas Pipeline Project -
China


24
Braden
The value model…attractive margins / low cost base
Proprietary designs
Extensive operating track record
High end quality
Commercial savvy
Low capital asset base
Low cost fabrication
Absence of performance
guarantees
Pricing Leverage
Attractive Profit Margins
Favorable Cost
Position


Braden
Industry
Braden primarily serves the
worldwide gas turbine market
Natural gas-fired plants expected
to account for 46% of capacity
additions, as compared with 37%
for renewables, 12% for coal-fired
power plants and 3% for nuclear
through 2035
Upwards trend on average revenue
per new unit shipped
Average Revenue per Turbine Shipped
*Information per internal company estimates; 2005 is unaudited
Source: DOE Annual Energy Outlook 2010
Braden Revenue & EBITDA
25


26
Williams
Headquarters in Tucker, GA
Seasoned Management/Project
Supervisory Staff
Top 5% in Industrial Safety Performance
Primarily Services US Nuclear Power
Plants
Multi-year Contracts for Nuclear Outage
Maintenance and Modification Work
Provider of Specialty Services at  Nuclear and
Industrial Sites
-
On 35 of 65 Nuclear Plant Sites


27
Williams
Value
proposition
Client Benefits


Williams
Industry
Williams primarily services U.S.
nuclear power plants
Nuclear power is a significant
component of the U.S. power
supply
Electricity generation from
nuclear power plants is expected
to grow from 806 billion kilowatt-
hours in 2008 to 898 billion
kilowatt-hours in 2035
The mix of future investments in
new power plants expected to
include fewer coal-fired plants
than other fuel technologies
Source: EIA Outlook, December 2009
Billion
kwh
Williams Revenue & Gross Margin
28
*2005 is unaudited; reflects results post acquisition from 4/5/05 – 12/31/05


29
Security
upgrades
for
entire
nuclear
fleet
North
and
South
Integrated design / build contract
ENERCON has design scope
Williams has construction, purchasing, and
subcontracts
Cameras, fencing, observation towers and other
security upgrades
Williams/ENERCON
Alliance for nuclear capital project


30
Williams
Energy Northwest reactor siding project
An
excellent
safety
record
with
zero
recordables
while
working
200’
in
the
air
Only
re-siding
project
in
the
world
that
was 
performed while the station was on-line
Provided the client with specialized
methods for
accessing the work area
Delivered the project under the estimated   
funding and ahead of schedule
Completed extended condition repairs to   
other buildings


31
Williams
Company information
Employees
-
Approximately 250 FT
-
Up to 6,000 Craft
-
(Average 3,000)
Work Type
-
60% maintenance
-
30% capital projects
-
10% new construction
Double-breasted
-
Union labor
-
Non-union labor
Customers
-
70% private sector
-
65% repeat business


32
Deltak
Headquarters in Plymouth, MN
Majority of manufacturing is completed 
in-house for domestic projects
Specialty boiler systems for municipal
waste incinerators and chemical processes
Mid-sized HRSGs (<85MW) for power  
applications, industrial process and  
enhanced oil recovery


33
Deltak
Industry
Industrial and utility markets which include refineries, petrochemical,
pharmaceutical, paper and pulp and steel companies, in addition to
utilities, account for the bulk of the market for cogeneration equipment
Deltak anticipates growth in the mid-sized HRSG and CHP markets
General shift towards lowering carbon off take adding momentum to
generation
Sweet spot refineries


34
Global Power
Strong fundamental structure for a growing industry
Strong commercial risk / reward profile
Flexible manufacturing model
Geographic and end-market diversity
Long-standing relationships with a blue-chip customer base
Strong free cash flow generation
Favorable end-market dynamics
Acquisition growth opportunities


35
David L. Keller
President and Chief Executive Officer
David
L.
Keller
served
as
the
President
and
Chief
Operating
Officer
of
The
Babcock
&
Wilcox
Company
(B&W),
a
wholly
owned
subsidiary
of
McDermott
International,
Inc.,
from
March
2001
until
his
retirement
in
June
2007.
B&W,
a
company
with
approximately
$2
billion
in
revenues
in
2006,
supplies
fossil-fuel
fired
boilers,
commercial
nuclear
steam
generators,
environmental
equipment
and
components,
and
boiler
auxiliary
equipment
and
provides
related
services,
including
construction
services.
Mr.
Kellers
prior
position
was
President
of
Diamond
Power
International,
Inc.,
a
wholly
owned
subsidiary
of
B&W,
from
March
1998
to
February
2001.
During
his
tenure
with
B&W,
Mr.
Keller
served
as
a
Board
Chairman
or
Director
of
subsidiaries
and
joint
ventures
in
the
Peoples
Republic
of
China,
Denmark,
the
United
Kingdom,
Australia
and
South
Africa.
He
holds
a
Bachelor
of
Science
degree
in
Mathematics
from
the
University
of
Akron.
David L. Willis
Chief Financial Officer and Senior Vice President
David
L.
Willis
has
a
broad
range
of
leadership
experience
across
a
range
of
industries:
restructuring
advisory
services,
telecommunications,
energy
companies
and
public
accounting.
From
October
2001
to
January
2008,
he
was
with
the
restructuring
practice
of
Alvarez
&
Marsal
LLC,
a
global
professional
services
firm,
where
he
served
clients
in
advisory
and
interim
management
capacities,
most
recently
as
Senior
Director,
overseeing
the
development
and
implementation
of
initiatives
to
improve
operational
and
financial
performance.
Prior
to
Alvarez
&
Marsal,
Mr.
Willis
held
positions
with
The
Williams
Communications
Group
and
Ernst
&
Young.
Mr.
Willis
received
his
Bachelor
of
Business
Administration
degree
from
the
Price
College
of
Business
at
the
University
of
Oklahoma
and
holds
an
M.B.A.
from
the
University
of
Tulsa.
He
is
a
Certified
Public
Accountant
and
has
a
Certified
Insolvency
and
Restructuring
Advisor
certification
(inactive).
Management
Years of
Experience
30
17


36
Tracy D. Pagliara
General Counsel, Secretary and VP of Business Development
Tracy
D.
Pagliara
served
as
the
Chief
Legal
Officer
of
Gardner
Denver,
Inc.,
a
leading
global
manufacturer
of
highly
engineered
compressors,
blowers,
pumps
and
other
fluid
transfer
equipment,
from
August
2000
through
August
2008.
He
also
had
responsibility
for
other
roles
during
his
tenure
with
Gardner
Denver,
including
Vice
President
of
Administration,
Chief
Compliance
Officer,
and
Corporate
Secretary.
Prior
to
joining
Gardner
Denver,
Mr.
Pagliara
held
positions
of
increasing
responsibility
in
the
legal
departments
of
Verizon
Communications/GTE
Corporation
from
August
1996
to
August
2000
and
Kellwood
Company
from
May
1993
to
August
1996,
ultimately
serving
in
the
role
of
Assistant
General
Counsel
for
each
company.
Mr.
Pagliara
has
a
B.S.
in
Accounting
and
a
J.D.
from
the
University
of
Illinois.
He
is
a
member
of
the
Missouri
and
Illinois
State
Bars
and
a
Certified
Public
Accountant.
Kenneth W. Robuck
Senior Vice President and President of the Services Division
Kenneth
W.
Robuck
originally
joined
the
Williams
Group
in
1995;
he
left
the
company
for
a
brief
period
and
returned
in
2005
to
run
Williams
Plant
Services,
LLC,
the
largest
of
the
Williams
subsidiaries,
which
is
responsible
for
all
major
maintenance
and
construction
services
work.
In
early
2006,
Mr.
Robuck
assumed
the
additional
responsibility
of
Chief
Operating
Officer
and
was
appointed
President
of
the
Williams
Group
in
October
2007.
Mr.
Robuck
has
over
27
years
experience
in
the
nuclear
power,
fossil-fuel
power,
petrochemical
and
related
industrial
industries.
Mr.
Robuck
is
a
graduate
of
Auburn
University with a B.S. in Civil Engineering.
Management
Years of
Experience
25
28


37
Dean J. Glover
Senior Vice President and President of the Products Division
Dean
J.
Glover
joined
Braden
Manufacturing
in
December
2005
as
Chief
Operating
Officer
and
was
promoted
to
his
positions
at
Global
Power
and
Deltak
in
September
2008.
Mr.
Glover
has
extensive
international
experience
having
lived
in
various
international
locations
for
most
of
his
career.
Mr.
Glover
has
over
18
years
of
commercial
and
technical
experience
in
the
power
industry.
Prior
to
joining
Global
Power,
Mr.
Glover
led
the
global
supply
chain,
including
manufacturing
for
Diebold
Inc.
Prior
to
this,
Mr.
Glover
spent
13
years
with
General
Electric
in
various
managerial
and
technical
roles
and
is
a
certified
Six
Sigma
Master
Blackbelt.
Mr.
Glover
holds
a
Bachelors
Degree
in
Mechanical
Engineering
from
the
University
of
Nebraska
and
an
M.B.A.
from
the
Kellogg
Graduate
School
of
Management,
Northwestern
University.
Management
Years of
Experience
20


38
Appendix
Company history
The Braden Group founded as Braden Steel in 1923 in Tulsa
Various owners over the next six decades, vast assortment of products spanning several industry
sectors:
-
Metal buildings, air inlet and exhaust systems, large mining trucks, pump jacks, magnetic
containment enclosures, industrial incinerators, heat recovery boilers
The Williams Group formed in 1958 as a family owned specialty painting business
The Deltak Group formed in 1969 and spun out to employees in 1972
The Braden Group sold to Jason Incorporated in 1989, which also purchased the Deltak Group in 1994,
forming Global Power’s predecessor, Jason Power Systems
GEEG Holdings L.L.C. created through leveraged buyout in 1998
-
Private
equity
sponsor
Sawmill
Capital
-
GEEG purchased by Harvest Partners in August 2000
-
Purchased Consolidated Fabricators in September 2000
Global Power Equipment Group formed through IPO in May, 2001
-
Purchased Deltak Power Equipment China (“DPEC”) in July 2004*
-
Purchased the Williams Group in April 2005
* Sold in 2007 when Deltak exited the large-scale HRSG business


39
Appendix
Balance sheet highlights
GPEG has strengthened its balance by building cash and paying down debt since the
emergence from Chapter 11 in January 2008.
Cumulative
3/31/08
12/31/08
12/31/09
6/30/10
Variances
Unrestricted Cash
36,540
57,633
103,220
$
66,283
29,743
Restricted Cash
3,006
3,013
2,018
1,019
Other Current Assets
138,092
124,154
109,774
107,949
Current Assets
177,638
184,800
215,012
175,251
Fixed Assets
12,639
12,610
12,945
12,545
Goodwill & Intangibles
98,414
96,909
95,149
94,269
Other Assets
6,227
6,720
6,114
4,196
Total Assets
294,918
301,039
329,220
286,261
Accounts Payable / Accruals
44,665
42,588
58,801
41,832
Deferred Revenue
17,895
8,695
3,006
-
Other Current Liabilities
53,222
44,174
46,311
45,285
Current Liabilities
115,782
95,457
108,118
87,117
Term Debt (including current portion)
88,750
85,000
65,325
24,633
(64,117)
$
Other Long-Term Liabilities
19,379
15,309
19,299
19,032
Total Liabilities
231,040
195,766
192,742
130,782
Stockholders Equity
71,007
105,273
136,478
155,479
84,472
Total Liabilities & Equity
302,254
$
301,039
$
329,220
$
286,261
$


40
Appendix
Operations highlights
Over this period, GPEG’s Products and Services platforms have balanced one another
through the recent cycle in the gas turbine OEM space
Actual
Actual
Six Months
Ended
2008
2009
6/30/10
Revenue
556,764
$    
540,610
$    
281,810
$    
Cost of Sales
456,784
     
460,185
     
232,406
     
Gross Profit
99,980
       
80,425
       
49,404
       
% of Revenue
18.0%
14.9%
17.5%
Operating Expenses
50,418
       
46,664
       
24,788
       
% of Revenue
9.1%
8.6%
8.8%
Operating Profit (Loss)
49,562
       
33,761
       
24,616
       
% of Revenue
8.9%
6.2%
8.7%
EBITDA
53,354
$     
37,912
$     
25,728
$     
% of Revenue
9.6%
7.0%
9.1%
Revenue Mix
Products
56%
36%
26%
Services
44%
64%
74%
EBITDA is a non-GAAP measure; see following page for reconciliation to net income.


41
Appendix
Reconciliation of EBITDA to net income
Actual
Actual
Six Months
ended
2008
2009
6/30/10
EBITDA
53,354
$     
37,912
$     
25,728
$     
Less:
  Income tax provision
(3,151)
(5,282)
(1,778)
  Interest expense
(11,667)
(9,667)
(3,276)
  Depreciation and amortization
(3,792)
(4,151)
(2,052)
  Reorganization items
(23,574)
(1,030)
-
Add:
  Income from discontinuted operations
23,668
10,105
3,164
Net Income
34,838
$     
27,877
$     
21,786
$