EXHIBIT 99.1
GTSI Delivers First Quarter Double Digit Growth in Margin, Net Income, and
- --------------------------------------------------------------------------
Earnings
- --------
Strong Bookings for Month of March
CHANTILLY, VA. - April 27, 2004 - GTSI(R) Corp. (Nasdaq: GTSI), a leading
government technology solutions provider, today announced financial results for
the quarter ended March 31, 2004, and monthly sales for March 2004 (see attached
tables).
For the first quarter 2004 GTSI reported sales of $178.6 million, a slight
decrease of 0.1% from $178.8 million during the same period a year ago. For the
seasonally weak first quarter, GTSI reported a 21.7% improvement in net income,
with a loss of $1.4 million compared to a loss of $1.8 million over the same
period last year. Earnings per share improved by 23.8% to a loss of $0.16 versus
a loss of $0.21 a year ago.
Total gross margin grew by 12.5% to $18.1 million in the first quarter 2004
versus $16.1 million a year ago.
PREPARING FOR THE PEAK SEASON
- -----------------------------
"During the quarter, we continued with several key initiatives designed to
enhance our ability to support our federal customers information technology
transformation needs. We further honed our sales compensation plans to encourage
more profitable business, and we continued to segment our customers by size
ensuring better utilization of resources," said Dendy Young, Chairman and Chief
Executive Officer of GTSI. "These changes, coupled with the improvements made in
operations, give our company a strong positioning for the federal government's
peak season in the second half of the year."
"After a weak January and a slow February, our business strengthened in March
resulting in a good bookings quarter, up almost 9% over last year," said Young.
As a company that generates 95% of its sales from the federal government, it is
important to note that GTSI generally achieves two-thirds of its sales during
the second half of the year due to the federal government fiscal year-end of
September 30th.
FIRST QUARTER HIGHLIGHTS
- ------------------------
o Created the Physical Security Alliance (PSA) bringing together 20
partners to develop an open, standard, secure, reliable, and
trusted physical security protection system solution.
o Launched `STORM' (Secure, Tough, Online/Offline, Reliable, and
Mobile), a joint solution designed in conjunction with Panasonic
Computer Solutions Company and Senforce Technologies Inc., to
support Department of Defense's Wireless Directive DoDD 8100.2 for
mobile technology usage in government agencies and organizations.
o Named Fujitsu's "Fastest Growing Service Star Alliance Reseller."
o Kicked off corporate advertising campaign with the brand promise
of "I Rely on GTSI" focusing on GTSI's ability to deliver
reliability, expertise and value to customers.
o Selected Scot T. Edwards to become GTSI's Chief Marketing Officer.
MARCH 2004 MONTHLY RESULTS
- --------------------------
Sales for March 2004 were $67.9 million, representing a 10.9% decrease of
average daily sales from March 2003 of $69.6 million. Month-end total backlog
for March was $98 million or a 35.7% increase versus $72.2 million for the
month-end March 2003. Monthly bookings for March were a record $82.8 million or
a 33.3% increase versus $56.7 million for the same period last year (see
attached table).
FINANCIAL POSITION
- ------------------
Tom Mutryn, GTSI's Senior Vice President and Chief Financial Officer, commented,
"GTSI's double digit gross margin expansion is mainly the result of higher
vendor volume incentive payments. The Company continued to maintain tight
control on headcount expenses, and the 10.1% increase in operating expense was
largely driven by increased employee expenses and outside services expenses
related to our SOX 404 efforts, our new ERP system implementation, and our "I
Rely on GTSI" marketing campaign. The company continues to enjoy a solid balance
sheet with no long-term debt and $21.5 million in cash on hand at the end of the
first quarter."
CONFERENCE CALL
- ---------------
An investor conference call to discuss first quarter 2004 is scheduled for 11:00
a.m. EST April 27, 2004. Interested parties are invited to participate by
calling 800-729-7758 or 706-643-1075, pass code 6769840. In addition, you may
access the web cast on GTSI's Investor Relations page (www.gtsi.com/ir). 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 pm EST, May 5,
2004. To access the replay, please dial 800-642-1687 or 706-645-9291, pass code
6769840.
ABOUT GTSI CORP.
- ----------------
GTSI Corp. is an information technology (IT) solutions leader, focusing
exclusively on Federal, State, and Local government customers worldwide. For two
decades, GTSI has served those customers by teaming with global IT leaders like
Panasonic, Hewlett-Packard, Microsoft, Cisco, and Sun Microsystems. Offering a
broad range of products and services, an extensive contract portfolio, and ISO
9001:2000 standard for quality management, GTSI uses its unique Technology Teams
to deliver "best of breed" solutions that help government customers do their job
more effectively. GTSI is headquartered in Northern Virginia, outside of
Washington, D.C. Further information about the Company is available at
GTSI.com/About.
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 revenue, margins, operating results and net income, and the effect of new
contracts 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 those listed in
the Company's most recent report on Form 10-K 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:
- -------------
Paul Liberty
703.502.2540
PAUL.LIBERTY@GTSI.COM
- ---------------------
### ### ###
GTSI Corp.
Unaudited Consolidated Statements of Operations
(in thousands, except per share data)
Three Months
March 31, Change from 2003
2004 2003 Actual Percentage
--------- --------- ---------- ----------
Sales $ 178,623 $ 178,858 $ (235) -0.1%
Cost of sales 160,541 162,784 (2,243) -1.4%
--------- --------- --------- ----
Gross margin 18,082 16,074 2,008 12.5%
Operating expenses 21,697 19,702 1,995 10.1%
--------- --------- --------- ----
Loss from operations (3,615) (3,628) 13 0.4%
Interest income, net 1,333 733 600 81.9%
--------- --------- --------- ----
Loss before income taxes (2,282) (2,895) 613 21.2%
Income tax benefit (901) (1,132) 231 20.4%
--------- --------- --------- ----
Net loss $ (1,381) $ (1,763) $ 382 21.7%
========= ========= ========= ====
Basic net loss per share $ (0.16) $ (0.21) $ 0.05 23.8%
========= ========= ========= ====
Diluted net loss per share $ (0.16) $ (0.21) $ 0.05 23.8%
========= ========= ========= ====
Weighted average shares outstanding:
Basic 8,556 8,564 (8) -0.1%
========= ========= ========= ====
Diluted 8,556 8,564 (8) -0.1%
========= ========= ========= ====
GTSI Corp.
Unaudited Condensed Consolidated Balance Sheets
(in thousands)
March 31, December 31, Change from % Change from
2004 2003 December 31, 2003 December 31, 2003
-------- ------------ ----------------- -----------------
ASSETS
Current assets:
Cash $ 21,563 $ 177 $ 21,386 12082.5%
Accounts receivable 129,072 181,988 (52,916) -29.1%
Merchandise inventory 57,053 55,987 1,066 1.9%
Other current assets 13,842 15,490 (1,648) -10.6%
-------- -------- -------- -------
Total current assets 221,530 253,642 (32,112) -12.7%
Property and equipment, net 11,868 10,670 1,198 11.2%
Other assets 2,063 4,449 (2,386) -53.6%
-------- -------- -------- -------
TOTAL ASSETS $235,461 $268,761 $(33,300) -12.4%
======== ======== ======== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Notes payable to banks $ -- $ 12,813 $(12,813) -100.0%
Accounts payable 133,299 152,435 (19,136) -12.6%
Accrued liabilities 11,138 11,168 (30) -0.3%
Deferred revenue 7,994 8,323 (329) -4.0%
Accrued warranties 4,495 4,555 (60) -1.3%
-------- -------- -------- -------
Total current liabilities 156,926 189,294 (32,368) -17.1%
Other liabilities 1,415 1,522 (107) -7.0%
-------- -------- -------- -------
Total liabilities 158,341 190,816 (32,475) -17.0%
Stockholders' equity 77,120 77,945 (825) -1.1%
-------- -------- -------- -------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $235,461 $268,761 $(33,300) -12.4%
-------- -------- -------- -------
GTSI Corp.
Monthly Results
Year-over- Year-over-
Year Change Month-End Monthly Year Change
Business Days Sales ($ in Average Daily Total Backlog Year-over- Bookings ($ Average Daily
in Month Millions) Sales ($ in Millions) Year Change in Millions) Bookings
------------- ----------- ------------- --------------- ----------- ------------ -------------
--
January 2002 22 $ 46.8 -- $ 72.2 -- $ 42.4 --
February 2002 19 50.3 -- 99.7 -- 77.8 --
March 2002 20 79.6 -- 93.5 -- 73.4 --
April 2002 22 46.0 -- 102.8 -- 55.3 --
May 2002 22 61.4 -- 115.3 -- 73.9 --
June 2002 20 93.6 -- 118.4 -- 96.7 --
July 2002 22 74.2 -- 121.9 -- 77.7 --
August 2002 22 82.6 -- 131.2 -- 91.9 --
September 2002 20 120.0 -- 203.6 -- 192.4 --
October 2002 23 104.5 -- 161.2 -- 62.1 --
November 2002 19 94.0 -- 106.6 -- 39.4 --
December 2002 21 81.7 -- 91.3 -- 66.4 --
January 2003 22 53.5 14.3% 92.5 28.1% 54.7 29.0%
February 2003 19 55.8 10.9% 85.1 -14.6% 48.4 -37.8%
March 2003 21 69.6 -16.7% 72.2 -22.8% 56.7 -26.4%
April 2003 22 48.3 5.0% 89.8 -12.7% 65.9 19.2%
May 2003 20 60.4 8.2% 86.8 -24.7% 57.4 -14.6%
June 2003 21 81.0 -17.6% 106.2 -10.3% 100.4 -1.1%
July 2003 22 75.5 1.8% 116.5 -4.4% 85.8 10.4%
August 2003 21 65.4 -17.1% 131.6 0.3% 80.5 -8.2%
September 2003 21 132.2 4.9% 228.3 12.1% 228.9 13.3%
October 2003 23 113.0 8.1% 192.9 19.7% 77.6 25.0%
November 2003 18 93.2 4.7% 144.0 35.1% 44.3 18.7%
December 2003 22 106.3 24.2% 102.8 12.6% 65.1 -6.4%
January 2004 21 58.4 14.4% 89.6 -3.1% 45.2 -13.4%
February 2004 19 52.3 -6.3% 83.1 -2.4% 45.8 -5.4%
March 2004 23 67.9 -10.9% 98.0 35.7% 82.8 33.3%