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Global Power Equipment Group Inc.
Reports Fourth Quarter FY2004 Results
Year-end Backlog Rises 73% to $309 Million,
Higher Steel Costs Continue to Impact Gross Margins
TULSA, Oklahoma, March 2, 2005 Global Power Equipment Group Inc. (NYSE: GEG), a leading design, engineering and manufacturing firm providing a broad array of equipment and services to the global energy, power infrastructure and process industries, today reported financial results for the fourth quarter and fiscal year ended December 31, 2004.
Global Power Equipment Group reported a loss for the fourth quarter of fiscal 2004 of ($1.9) million or ($0.04) per diluted share, on revenues of $61.8 million. This compares to net earnings of $5.1 million, or $0.11 per diluted share, on revenues of $65.4 million for the fourth quarter of fiscal 2003. For the fiscal year ended December 31, 2004, the Company reported a net loss of ($0.7) million, or ($0.02) per diluted share, on revenues of $233.7 million. This compares to net earnings for the fiscal year ending December 27, 2003 of $19.8 million, or $0.43 per diluted share, on revenues of $263.8 million. Earnings for the fourth quarter of fiscal 2004 and the twelve months of 2004 include previously announced restructuring charges related to employee severance programs and the closure of two Company-owned manufacturing facilities, one in Mexico and one in South Carolina totaling $1.4 million and $4.8 million, respectively or $0.02 and $0.06 per share, respectively, as well as additional fourth quarter expenses totaling approximately $1.1 million or $0.02 per share consisting of unrealized foreign exchange losses, additional interest expense and the write-off of debt issuance costs.
The Companys gross profit for the fourth quarter of 2004 totaled $9.2 million representing a 14.9 percent gross margin compared to a gross profit of $19.5 million and a gross margin of 29.8 percent in the fourth quarter last year. Steel costs, which more than doubled during fiscal 2004, weighed heavily on the Companys gross profit during the fourth quarter and throughout 2004. For the fiscal year ended December 31, 2004, the Companys gross profit totaled $39.3 million representing a 16.8 percent gross margin compared to $71.5 million and 27.1 percent for the prior fiscal year.
The Company generated EBITDA (earnings plus income taxes, interest, depreciation and amortization) of ($1.5) million for the fourth quarter of 2004, down from the $9.0 million recorded during the fourth quarter of 2003. The decrease in EBITDA was principally due to the lower gross margin during the fourth quarter of 2004, as well as previously announced restructuring charges. EBITDA for the full fiscal year 2004 totaled $3.7 million compared to EBITDA of $37.0 million for the 2003 fiscal year.
The Company had cash and cash equivalents of $98.7 million on hand at the end of 2004, $74.4 million of which was restricted for the previously announced acquisition of Williams Industrial Services Group, which is scheduled to close in early April 2005. Including the $69 million of convertible senior subordinated notes issued by the Company in November 2004, the Companys long-term debt totaled $78.8 million at the end of 2004. At the end of 2003, the Company had cash and cash equivalents of $51.3 million on hand and long-term debt of $25.0 million.
The following information was filed by Global Power Equipment Group Inc. (GLPW) on Monday, March 7, 2005 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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