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8-K - FORM 8-K - GTSI CORP | c24780e8vk.htm |
Exhibit 99.1
GTSI Reports Third Quarter Results
HERNDON, VA., November 15, 2011 GTSI Corp. (NASDAQ: GTSI), a systems integration, solutions
and services provider to federal, state and local governments, today announced its financial
results for the three months and nine months ended September 30, 2011.
Reported Results
For the third quarter of 2011, GTSI reported revenue of $95.8 million compared to $237.4 million
for the third quarter of 2010, a revenue decline of 59.6%. Gross margin for the third quarter of
2011 decreased to $17.3 million from $29.8 million, a reduction of 41.9%, from the same period in
2010. Gross Margin percent for the third quarter was 18.1% compared to 12.5% for the same quarter
last year. Operating expenses declined $2.9 million or 14.1% to $17.7 million compared to $20.6
million for the third quarter of 2010. The resulting loss from Operations of $0.4 million is a $9.6
million decline from the $9.2 million income from operations reported for the third quarter of
2010. Equity earnings from our investment in Eyak Technology LLC (EyakTek) declined $1.5 million.
The decline is primarily a result of recognizing a partial period due to the sale of our EyakTek
equity interest to EyakTek on August 19th. As a result of the sale, GTSI recognized a
gain on the EyakTek investment of $7.3 million in the third quarter. The net income for the third
quarter of 2011 was $4.3 million, compared to net income of $5.9 million for the same period in
2010. Earnings per share declined $0.18 per share or 29% compared to the same quarter last year.
For the nine months ended September 30, 2011, GTSI reported revenue of $247.4 million compared to
$474.2 million for the same period in 2010, a decline of 47.8%. Gross margin for the nine months
ended September 30, 2011 decreased $16.3 million to $44.5 million, or 26.8% when compared to the
first nine months of 2010. Gross Margin percent for this period is 18.0% compared to 12.8% for the
same period last year. Operating expenses declined $10.8 million or 16.8% to $53.7 million compared
to $64.5 million for the first three quarters of 2010. The loss from Operations increased for the
nine months ended September 30, 2011 by $5.5 million compared to the first nine months of 2010.
Equity earnings from our EyakTek investment declined $3.0 million or 49.6% to $3.0 million for the
first nine months of 2011. After recognizing the $7.3 million gain from the sale of our EyakTek
equity interest, our total net income for the nine months ended September 30, 2011 was $139
thousand, compared to net income of $110 thousand for the same period in 2010. Earnings per share
for both the nine months ended 2011 and 2010 is $0.01.
GTSI ended the quarter with $56.4 million in cash on hand. The Company had no long-term debt and
no borrowings under its credit facility. As of September 30, 2011, GTSI had stockholders equity
of $96.5 million or $9.99 per outstanding share.
Conference Call
An investor conference call to discuss third quarter results is scheduled for 11:00 a.m. Eastern
Time November 15, 2011. Interested parties are invited to participate by calling 800-593-9034 or
334-323-7224, pass code is GTSI. In addition, you may access the webcast on GTSIs Investor
Relations page (www.gtsi.com/ir). Webcast will be available for replay through January 14, 2012.
To listen to the live call on the Internet, go to the web site at least 15 minutes early to
register, download and install any necessary audio software. A replay will be available following
the conclusion of the call until 6:00 p.m. eastern, January 14, 2012. To access the replay, please
dial 877-919-4059 or 334-323-7226, pass code 61391114.
About GTSI Corp.
GTSI (NASDAQ: GTSI) is a leading provider of technology solutions and professional services to
federal, state and local governments. Founded in 1983, the company has helped meet the unique IT
needs of
more than 1,700 governmental agencies nationwide. GTSI professionals draw on their deep knowledge,
strategic partnerships, customer service and more than 740 industry certifications to guide
agencies in selecting the most cost-effective technology available. GTSI has extensive capabilities
and past performance in software development, data center, networking, collaboration, security and
cloud computing solutions. In addition, GTSIs advanced engineering, integration, support and
financial services and broad portfolio of contracts ease the planning, purchasing and
deployment of solutions, and facilitates the management of mission-critical IT throughout the
lifecycle. Headquartered in Herndon, Va., GTSI has approximately 500 employees. For more
information visit the companys website at www.gtsi.com.
Forward Looking Statements
Except for historical information, all of the statements, expectations, beliefs and assumptions
contained in the foregoing are forward-looking statements (within the meaning of the Private
Securities Litigation Reform Act of 1995) that involve a number of risks and uncertainties. It is
possible that the assumptions made by management, including, but not limited to, those relating to
sales, margins, operating results and net income, and the effect of new contracts and lender
agreements, as well as new vendor relationships may not materialize. Actual results may differ
materially from those projected or implied in any forward-looking statements. In addition to the
above factors, other important factors that could cause actual results to differ materially are
discussed in the Companys most recent annual report on Form 10K and included from time to time
in other documents filed by the Company with the Securities and Exchange Commission.
GTSI and GTSI.com are registered trademarks of GTSI Corp. in the U.S. and other countries. All
trade names are the property of their respective owners.
GTSI Contact:
Peter Whitfield
Senior Vice President & Chief Financial Officer
703.502.2954
peter.whitfield@gtsi.com
Peter Whitfield
Senior Vice President & Chief Financial Officer
703.502.2954
peter.whitfield@gtsi.com
All press releases are available in the News Room on GTSI.com
GTSI Corp. Unaudited Condensed Consolidated Statements of Operations
(In thousands, expect per share data)
(In thousands, expect per share data)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
SALES |
||||||||||||||||
Product |
$ | 80,408 | $ | 208,797 | $ | 205,375 | $ | 418,456 | ||||||||
Service |
13,951 | 15,907 | 32,273 | 38,581 | ||||||||||||
Financing |
1,423 | 12,663 | 9,752 | 17,191 | ||||||||||||
95,782 | 237,367 | 247,400 | 474,228 | |||||||||||||
COST OF SALES |
||||||||||||||||
Product |
69,412 | 189,092 | 178,123 | 378,833 | ||||||||||||
Service |
8,742 | 10,968 | 21,398 | 25,571 | ||||||||||||
Financing |
309 | 7,519 | 3,415 | 9,068 | ||||||||||||
78,463 | 207,579 | 202,936 | 413,472 | |||||||||||||
GROSS MARGIN |
17,319 | 29,788 | 44,464 | 60,756 | ||||||||||||
SELLING, GENERAL &
ADMINISTRATIVE EXPENSES |
17,681 | 20,592 | 53,651 | 64,452 | ||||||||||||
(LOSS) GAIN FROM OPERATIONS |
(362 | ) | 9,196 | (9,187 | ) | (3,696 | ) | |||||||||
INTEREST AND OTHER INCOME, NET |
||||||||||||||||
Interest and other income |
29 | 57 | 93 | 131 | ||||||||||||
Equity income from EyakTek |
7,930 | 2,170 | 10,317 | 6,029 | ||||||||||||
Interest expense |
(147 | ) | (160 | ) | (443 | ) | (516 | ) | ||||||||
Interest and other income, net |
7,812 | 2,067 | 9,967 | 5,644 | ||||||||||||
INCOME BEFORE INCOME TAXES |
7,450 | 11,263 | 780 | 1,948 | ||||||||||||
INCOME TAX EXPENSE |
3,185 | 5,329 | 641 | 1,838 | ||||||||||||
NET INCOME |
$ | 4,265 | $ | 5,934 | $ | 139 | $ | 110 | ||||||||
EARNINGS PER SHARE |
||||||||||||||||
Basic |
$ | 0.44 | $ | 0.62 | $ | 0.01 | $ | 0.01 | ||||||||
Diluted |
$ | 0.44 | $ | 0.62 | $ | 0.01 | $ | 0.01 | ||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING |
||||||||||||||||
Basic |
9,676 | 9,603 | 9,655 | 9,604 | ||||||||||||
Diluted |
9,690 | 9,629 | 9,677 | 9,653 | ||||||||||||
GTSI Corp. Unaudited Condensed Consolidated Balance Sheets
(In thousands)
(In thousands)
September 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 56,350 | $ | 4,049 | ||||
Accounts receivable, net |
102,001 | 154,891 | ||||||
Inventory, net |
10,309 | 13,708 | ||||||
Deferred costs |
3,657 | 6,991 | ||||||
Other current assets |
2,460 | 2,462 | ||||||
Total current assets |
174,777 | 182,101 | ||||||
Depreciable assets, net |
5,255 | 7,452 | ||||||
Long-term receivables and other assets |
3,962 | 14,291 | ||||||
Other intangible assets, net |
4,370 | | ||||||
Goodwill |
7,718 | | ||||||
TOTAL ASSETS |
$ | 196,082 | $ | 203,844 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 58,472 | $ | 50,870 | ||||
Accounts payable floor plan |
20,291 | 35,172 | ||||||
Accrued liabilities |
14,693 | 14,887 | ||||||
Deferred revenue |
3,168 | 3,661 | ||||||
Total current liablilites |
96,624 | 104,590 | ||||||
Other liabilities |
2,979 | 3,044 | ||||||
Total liabilities |
99,603 | 107,634 | ||||||
Total stockholders equity |
96,479 | 96,210 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |
$ | 196,082 | $ | 203,844 | ||||