Exhibit 99.
FOR IMMEDIATE RELEASE
Contact:
Jerome I. Feldman Scott N. Greenberg
Chairman & CEO President & CFO
(914) 249-9750 (914) 249-9729
GP Strategies Reports SECOND QUARTER INCOME
Revenue for GP Strategies' ongoing core business, General Physics increases
to $39.5 million for the Quarter ended June 30, 2004 as compared to $34.0
million for the Quarter Ended June 30, 2003 or an increase of 16%.
New York, August 13, 2004 - GP Strategies Corporation (NYSE: GPX), a global
provider of training, e-Learning solutions, management consulting, engineering
and simulation services, today announced results for the quarter and six months
ended June 30, 2004.
General Physics' net sales increased by $5.5 million in the second quarter of
2004 to $39.5 million, as compared to net sales for the second quarter of 2003
of $34.0 million, an increase of approximately 16%.
For the quarter ended June 30, 2004, net sales increased by $40.7 million to
$76.7 million, as compared to net sales of $36.0 million for the quarter ended
June 30, 2003. This increase is primarily attributable to the $5.5 million net
sales increase at General Physics and due to the consolidation of $34.9 million
of net sales of Five Star and GSE as a result of the Company's increased
ownership in October 2003 of the outstanding common stock of Five Star and GSE.
Prior to October 2003, the Company accounted for its investments in Five Star
and GSE using the equity method.
For the quarter ended June 30, 2004, income before income tax expense and
minority interest was $1.1 million as compared to a loss of $2.2 million for the
quarter ended June 30, 2003. The improvement was primarily due to increased
profitability at General Physics, reduced corporate expenses, due to an
executive compensation bonus of $1 million in the quarter ended June 30, 2003
and increased pre-tax income, as a result of the consolidation of Five Star and
GSE. Diluted net income (loss) per common share was $0.02 for the quarter ended
June 30, 2004 as compared with $(0.17) for the quarter ended June 30, 2003.
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For the six months ended June 30, 2004, net sales increased by $76.4 million to
$148.5 million, as compared to net sales of $72.1 million for the six months
ended June 30, 2003. This increase in net sales is primarily attributable to the
increase of revenue at General Physics, and to the consolidation of the results
of operations of Five Star Products Inc. and GSE Systems, Inc. Net sales of Five
Star and GSE Systems for the six months ended June 30, 2004, aggregated $69.5
million. General Physics' net sales increased by $6.7 million for the six months
ended June 30, 2004 to $74.6 million, as compared to net sales of $67.9 million
for the first six months of 2003 or an increase of approximately 10%.
For the six months ended June 30, 2004, income before income tax expense and
minority interest was $1.9 million as compared to a loss of $3.2 million for the
six months ended June 30, 2003. The improvement was primarily due to increased
profitability at General Physics, reduced corporate expenses due to an executive
compensation bonus of $1 million in the quarter ended June 30, 2003 and
increased pre-tax income, as a result of the consolidation of Five Star and GSE.
Diluted net income (loss) per common share was $0.02 for the six month ended
June 30, 2004 as compared with $(0.21) for the six months ended June 30, 2003.
As previously announced, the Company plans to spin-off certain non-core assets
to National Patent Development Corporation. Following the proposed spin-off the
Company's results will include only the results of General Physics and GSE
Systems.
The Company has scheduled an investor conference call for 10:00 A.M. EDT on
August 13. The dial-in number for the live conference call will be 800-862-9098
(785-424-1051 outside the United States) and the Conference ID is GP. A
telephone replay of the call will also be available beginning at 1:00 p.m. on
August 13. To listen to the replay, dial 800-934-4245 (402-220-1173 outside the
United States).
A question and answer session will be held at the conclusion of the
presentation. Participants can email questions at any time during the
presentation to gpcall@gpworldwide.com.
About GP Strategies Corporation
GP Strategies, whose principal operating subsidiaries are General Physics, and
GSE Systems, is a NYSE listed company (GPX). General Physics and GSE Systems are
global providers of training, e-Learning solutions, management consulting,
engineering and simulation services, improving the effectiveness of
organizations by customizing solutions to meet the specific needs of clients.
Clients include Fortune 500 companies, manufacturing, process and energy
industries, and other commercial and government customers. Additional
information about GP Strategies may be found at www.gpstrategies.com and about
General Physics at www.gpworldwide.com.
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The forward-looking statements contained herein reflect GP Strategies'
management's current views with respect to future events and financial
performance. We use words such as "expects", "intends" and "anticipates" to
indicate forward-looking statements. These forward-looking statements are
subject to certain risks and uncertainties that could cause actual results to
differ materially from those in the forward-looking statements, all of which are
difficult to predict and many of which are beyond the control of GP Strategies,
including, but not limited to, our inability to generate funds by selling any
assets that are included in the proposed spin-off, failure to continue to
attract and retain personnel, loss of business from significant customers,
failure to keep pace with technology, changing economic conditions, competition,
and those other risks and uncertainties detailed in GP Strategies' periodic
reports and registration statements filed with the Securities and Exchange
Commission.
If any one or more of these expectations and assumptions proves incorrect,
actual results will likely differ materially from those contemplated by the
forward-looking statements. Even if all of the foregoing assumptions and
expectations prove correct, actual results may still differ materially from
those expressed in the forward-looking statements as a result of factors we may
not anticipate or that may be beyond our control. While we cannot assess the
future impact that any of these differences could have on our business,
financial condition, results of operations and cash flows or the market price of
shares of our common stock, the differences could be significant. We do not
undertake to update any forward-looking statements made by us.
TABLES FOLLOW
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The following tables summarize the net sales and results of operations of GP
Strategies Corporation for the quarters and six months ended June 30, 2004 and
2003 (Unaudited - in thousands):
Quarter Ended Six Months Ended
June 30, June 30
----------------------------- -------------------------------
-------------- -------------- -------------- ----------------
2004(1) 2003 2004 (1) 2003
------- ---- -------- ----
General Physics $39,477 $33,986 $74,637 $67,857
GSE Systems 7,597 - 15,157 -
Home Improvement Distribution (2) (3) 27,302 - 54,293 -
Optical Plastics (3) 2,302 2,052 4,432 4,268
--------- --------- ---------- ---------
Net sales $76,678 $36,038 $148,519 $72,125
======= ======= ======== =======
Net sales $76,678 $ 36,038 $148,519 $72,125
Cost of sales 64,972 31,725 126,347 63,984
-------- --------- --------- --------
Gross margin 11,706 4,313 22,172 8,141
Selling, general & administrative expenses (9,829) (6,581) (19,059) (11,004)
--------- --------- ---------- --------
Operating income (loss) 1,877 (2,268) 3,113 (2,863)
Interest expense (850) (592) (1,752) (1,188)
Investment and other income 39 502 122 662
Gains on marketable securities, net 80 138 381 212
----------- ---------- ------------ ----------
Income (loss) before income taxes
and minority interest 1,146 (2,220) 1,864 (3,177)
Income tax expense (536) (646) (978) (392)
--------- ---------- ------------- ----------
Income (loss) before minority interests 610 (2,866) 886 (3,569)
Minority interests (216) - (361) -
--------- ------------- ------------- ----------
Net income (loss) $ 394 $(2,866) $ 525 $(3,569)
========= ========= =========== =========
Net income (loss) per weighted
average common share
Basic and diluted $ 0.02 $ (0.17) $ 0.03 $ (0.21)
========== =========- ============ ==========-
(1) Net sales and results of operations for the quarter and six months ended
June 30, 2004 includes the consolidation of Five Star and GSE Systems as a
result of the Company's increased ownership of the outstanding common stock of
Five Star and GSE Systems in October 2003. Net sales of Five Star and GSE
Systems for the quarter and six months ended June 30, 2004 aggregated $34.9
million and $69.5 million, respectively.
(2) Net sales of Five Star.
(3) Home Improvement Distribution and Optical Plastics are non-core businesses
that will be spun-off to National Patent Development Corporation effective
August 13, 2004.
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