Delaware
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001-14785
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52-1868008
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(State of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification Number)
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6940 Columbia Gateway Dr., Suite 470, Columbia MD, 21046
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(Address of principal executive offices and zip code)
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☐
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d - 2(b))
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☐
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e - 4 (c))
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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||
Common Stock, $.01 Par Value
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GVP
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The NASDAQ Capital Market
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![]() |
Form 8-K
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Item 2.02 |
Results of Operations and Financial Condition
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Item 9.01 |
Financial Statements and Exhibits
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GSE SYSTEMS, INC.
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|
Date: August 14, 2023
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/s/ Emmett Pepe
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Emmett Pepe
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|
Senior Vice President and Chief Financial Officer
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Exhibit No.
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Description
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Press release of GSE Systems, Inc. dated August 14, 2023 announcing the financial results for the three months ended June 30, 2023.
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• |
Strong revenue growth from Performance Engineering, with a 30% increase over Q1 of 2023 and 16% improvement from Q2 of 2022.
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• |
Software and support sales were $1.1 million in Q2 of 2023 bringing our YTD total to $2.3 million, an increase of 20% over the six months ended Q2 2022.
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|
• |
Backlog at June 30, 2023, was $34.4 million, including $26.9 million of Performance Improvement Solutions backlog, and $7.5 million of Workforce Solutions backlog.
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• |
Ended Q2 with cash, cash equivalents and restricted cash of $3.4 million, including restricted cash of $1.6 million.
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Company Contact
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Investor Contact
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|
Kyle Loudermilk
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Lytham Partners
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|
Chief Executive Officer
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Adam Lowensteiner, Vice President
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|
GSE Systems, Inc.
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(646) 829-9702
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(410) 970-7800
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gvp@lythampartners.com
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Three Months ended
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Six Months ended
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|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
|||||||||||||
Revenue
|
$
|
12,387
|
$
|
12,745
|
$
|
23,260
|
$
|
25,020
|
||||||||
Cost of revenue
|
9,172
|
9,573
|
17,650
|
19,421
|
||||||||||||
Gross profit
|
3,215
|
3,172
|
5,610
|
5,599
|
||||||||||||
Selling, general and administrative
|
3,653
|
4,410
|
8,441
|
8,917
|
||||||||||||
Research and development
|
154
|
182
|
335
|
324
|
||||||||||||
Depreciation
|
53
|
72
|
101
|
144
|
||||||||||||
Amortization of definite-lived intangible assets
|
131
|
231
|
292
|
491
|
||||||||||||
Total operating expenses
|
3,991
|
4,895
|
9,169
|
9,876
|
||||||||||||
Operating loss
|
(776
|
)
|
(1,723
|
)
|
(3,559
|
)
|
(4,277
|
)
|
||||||||
Interest expense, net
|
(767
|
)
|
(358
|
)
|
(1,053
|
)
|
(506
|
)
|
||||||||
Change in fair value of derivative instruments, net
|
171
|
695
|
240
|
114
|
||||||||||||
Other income, net
|
(98
|
)
|
(72
|
)
|
(88
|
)
|
(56
|
)
|
||||||||
Loss before income taxes
|
(1,470
|
)
|
(1,458
|
)
|
(4,460
|
)
|
(4,725
|
)
|
||||||||
Provision for (benefit from) income taxes
|
28
|
(57
|
)
|
(11
|
)
|
110
|
||||||||||
Net loss
|
$
|
(1,498
|
)
|
$
|
(1,401
|
)
|
$
|
(4,449
|
)
|
$
|
(4,835
|
)
|
||||
Net (loss) income per common share - basic and diluted
|
$
|
(0.06
|
)
|
$
|
(0.07
|
)
|
$
|
(0.19
|
)
|
$
|
(0.23
|
)
|
||||
Weighted average shares outstanding - basic and diluted
|
24,188,265
|
21,033,447
|
23,564,133
|
21,006,910
|
June 30, 2023
|
December 31, 2022
|
|||||||
(unaudited)
|
(audited)
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
1,775
|
$
|
2,789
|
||||
Restricted cash, current
|
500
|
1,052
|
||||||
Contract receivables, net of allowance for credit loss
|
10,190
|
10,064
|
||||||
Prepaid expenses and other current assets
|
830
|
2,165
|
||||||
Total current assets
|
13,295
|
16,070
|
||||||
Equipment, software and leasehold improvements, net
|
682
|
772
|
||||||
Software development costs, net
|
646
|
574
|
||||||
Goodwill
|
6,299
|
6,299
|
||||||
Intangible assets, net
|
1,395
|
1,687
|
||||||
Restricted cash - long term
|
1,080
|
535
|
||||||
Operating lease right-of-use assets, net
|
609
|
506
|
||||||
Other assets
|
42
|
53
|
||||||
Total assets
|
$
|
24,048
|
$
|
26,496
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
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||||||||
Current liabilities:
|
||||||||
Current portion of long-term note
|
851
|
3,038
|
||||||
Accounts payable
|
1,719
|
1,262
|
||||||
Accrued expenses
|
2,490
|
2,084
|
||||||
Accrued compensation
|
1,842
|
1,071
|
||||||
Billings in excess of revenue earned
|
3,157
|
4,163
|
||||||
Accrued warranty
|
276
|
370
|
||||||
Income taxes payable
|
1,731
|
1,774
|
||||||
Derivative liabilities
|
1,718
|
603
|
||||||
Other current liabilities
|
483
|
1,286
|
||||||
Total current liabilities
|
14,267
|
15,651
|
||||||
Long-term note, less current portion
|
1,670
|
310
|
||||||
Operating lease liabilities noncurrent
|
358
|
160
|
||||||
Other noncurrent liabilities
|
214
|
144
|
||||||
Total liabilities
|
16,509
|
16,265
|
||||||
Commitments and contingencies (Note 16)
|
||||||||
Stockholders' equity:
|
||||||||
Preferred stock $0.01 par value; 2,000,000 shares authorized; no shares issued and outstanding
|
-
|
-
|
||||||
Common stock $0.01 par value; 60,000,000 shares authorized, 26,401,207 and 24,046,806 shares issued, 24,802,296 and 22,447,895 shares outstanding, respectively
|
264
|
240
|
||||||
Additional paid-in capital
|
84,641
|
82,911
|
||||||
Accumulated deficit
|
(74,433
|
)
|
(69,927
|
)
|
||||
Accumulated other comprehensive income
|
66
|
6
|
||||||
Treasury stock at cost, 1,598,911 shares
|
(2,999
|
)
|
(2,999
|
)
|
||||
Total stockholders' equity
|
7,539
|
10,231
|
||||||
Total liabilities and stockholders' equity
|
$
|
24,048
|
$
|
26,496
|
Three Months ended
June 30, |
Six Months ended
June 30, |
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
|||||||||||||
Net loss
|
$
|
(1,498
|
)
|
$
|
(1,401
|
)
|
$
|
(4,449
|
)
|
$
|
(4,835
|
)
|
||||
Interest expense, net
|
767
|
358
|
1,053
|
506
|
||||||||||||
(Benefit from) provision for income taxes
|
28
|
(57
|
)
|
(11
|
)
|
110
|
||||||||||
Depreciation and amortization
|
267
|
387
|
560
|
802
|
||||||||||||
EBITDA
|
(436
|
)
|
(713
|
)
|
(2,847
|
)
|
(3,417
|
)
|
||||||||
Stock-based compensation expense
|
246
|
693
|
531
|
1,101
|
||||||||||||
Change in fair value of derivative instruments, net
|
(171
|
)
|
(695
|
)
|
(240
|
)
|
(114
|
)
|
||||||||
Adjusted EBITDA
|
$
|
(361
|
)
|
$
|
(715
|
)
|
$
|
(2,556
|
)
|
$
|
(2,430
|
)
|
Three Months ended
|
Six Months ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
|||||||||||||
Net loss
|
(1,498
|
)
|
(1,401
|
)
|
$
|
(4,449
|
)
|
$
|
(4,835
|
)
|
||||||
Stock-based compensation expense
|
246
|
693
|
531
|
1,101
|
||||||||||||
Change in fair value of derivative instruments, net
|
(171
|
)
|
(695
|
)
|
(240
|
)
|
(114
|
)
|
||||||||
Amortization of intangible assets related to acquisitions
|
131
|
231
|
292
|
491
|
||||||||||||
Adjusted net loss
|
(1,292
|
)
|
(1,172
|
)
|
$
|
(3,866
|
)
|
$
|
(3,357
|
)
|
||||||
Adjusted loss per common share – Diluted
|
(0.05
|
)
|
(0.06
|
)
|
(0.16
|
)
|
(0.16
|
)
|
||||||||
Weighted average shares outstanding – diluted(1)
|
24,188,265
|
21,033,447
|
23,564,133
|
21,006,910
|