General Environmental Management Inc. (GEM) (OTCBB: GEVI), a
company specializing in the treatment and disposal of non-hazardous
wastewater, today announced its financial results for the three
months ended March 31, 2010. The company reported first-quarter
GAAP (generally accepted accounting principles) earnings per share
(EPS) at $0.30. For the first time in Company history, GEM has
recorded a quarterly net income. Total net income for the quarter
was calculated at $4,477,955.
Revenues for the first quarter are strictly from the Southern
California Waste Water (SCWW) subsidiary, due to the
discontinuation of all other segments of the GEM hazardous waste
business during the first quarter of 2010. Revenues topped $1.46
million, up 28% from $1.14 million for the same time period in
2009. The new company direction to a primarily non-hazardous
wastewater treatment driven business model provides the foundation
to build a strong enterprise.
First quarter gross profits for 2010 were $172,769, down from
$272,437 reported for the same time period in 2009. This reduction
in 2010 gross profits is primarily attributed to a $150,000
one-time remediation expense to improve the facility in Santa
Paula. Future quarterly results will not have recurring expenses
from the facility's improvements. Monetary gain on the sale of the
GEM Delaware facility and its subsidiaries equaled $8.687
million.
GEM operating expenses includes a non-cash charge in the first
quarter totaling $380,000 related to the issuance of S-8 shares for
business development. The current weighted average shares of common
stock outstanding, basic, and diluted is 15,057,653.
Chief Executive Officer of GEM Timothy Koziol stated, “We are
pleased with the results shown in our first quarter. For the first
time in the Company’s inception we have positive net income. I
firmly believe that the decision to pursue the non-hazardous
wastewater strategy has been a wise one and look forward to
building and developing our business model. While our financial
statements only include the revenue through SCWW as footnotes, we
expect that our 2nd quarter results will be more clearly defined as
the non-hazardous wastewater treatment becomes our sole revenue
source.”
GENERAL ENVIRONMENTAL
MANAGEMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
March 31, December 31, 2010 2009 (Unaudited) ASSETS CURRENT
ASSETS: Cash in bank $ 241,239 $ 466,891
Accounts receivable, net of
allowance for doubtful accounts of $10,000 and $10,000,
respectively
1,053,424 974,340 Prepaid expenses and other current assets 167,726
56,196 Total Current Assets 1,462,389 1,497,427
Property and Equipment – Net of accumulated depreciation
$465,470 and $153,448, respectively 12,616,260 12,662,494
Restricted cash 900,151 900,122 Permits and franchises 1,409,081
1,455,534 Deferred financing fees 163,942 158,898 Deposits 475,759
184,920 Assets of GEM Delaware held for sale - 2,922,639 Due from
buyer – MTS 1,089,341 1,089,341 TOTAL ASSETS $
18,116,923 $ 20,871,375 LIABILITIES AND
STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable $
2,115,138 $ 2,176,801 Accrued expenses 1,500,747 1,277,662 Payable
to related party 931,726 765,628 Current portion of acquisition
notes payable 564,534 1,072,974
Current portion of long-term
obligations
4,049,236 4,822,719 Current portion of financing agreement
6,777,027 4,903,775 Total Current Liabilities
15,938,408 15,019,559 LONG-TERM LIABILITIES :
Financing agreements, net of current portion - 7,558,005
Long-term obligations, net of
current portion
3,783,919 3,238,420 Acquisition Notes Payable, net of current
portion 8,171,674 7,921,674 Derivative liabilities -
2,921,552 Total Long-Term Liabilities 11,955,593
21,639,651 STOCKHOLDERS’ EQUITY Common stock, $.001
par value, 1,000,000,000 shares authorized, 21,995,153 and
14,557,653 shares issued and outstanding 22,008 14,570 Additional
paid in capital 56,247,236 54,721,872 Accumulated deficit
(66,046,322 ) (70,524,277 ) Total Stockholders' Equity (9,977,078 )
(15,787,835 ) TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY $
18,116,923 $ 20,871,375
GENERAL ENVIRONMENTAL
MANAGEMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
Three months ended March 31, 2010 March 31, 2009
REVENUES $ 1,458,706 $ - COST OF REVENUES 1,285,937
- GROSS PROFIT 172,769 - OPERATING
EXPENSES 2,588,949 2,103,598 OPERATING LOSS
(2,416,180 ) (2,103,598 ) OTHER INCOME (EXPENSE): Interest
and financing costs –net (868,880 ) (887,528 ) Other non-operating
income - 8,265 Loss on extinguishment of debt (1,800,861 ) - Gain
on extinguishment derivative financial instruments 1,709,042
552,512 LOSS FROM CONTINUING OPERATIONS (3,376,879 )
(2,430,349 ) DISCONTINUED OPERATIONS: Gain (Loss) from discontinued
operations (407,298 ) 889,114 Gain on sale of GEM Delaware
8,687,132 - 8,279,834 889,114 INCOME
(LOSS) BEFORE PROVISION FOR INCOME TAXES 4,902,955 (1,541,235 )
PROVISION FOR INCOME TAXES (425,000 ) - NET INCOME (LOSS)
4,477,955 (1,541,235 ) Net income (loss) per common
share: Basic $ .30 $ (.12 ) Weighted average shares
of common stock outstanding: Basic 15,057,653 12,691,420
About General Environmental Management, Inc.
General Environmental Management, Inc. (www.go-gem.com) owns and
operates a non-hazardous wastewater treatment facility, Southern
California Waste Water (www.scww.com), in Santa Paula, Calif., as
well as provides various environmental services and solutions. GEM
is headquartered in Pomona, Calif.
FORWARD-LOOKING STATEMENTS
This press release may include "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical facts,
included in this press release that address activities, events or
development that the company expects, believes or anticipates will
or may occur in the future are forward-looking statements. These
statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the Company,
which may cause the Company's actual results to differ materially
from those implied or expressed by the forward-looking statements.
The Company assumes no duty whatsoever to update these
forward-looking statements or to conform them to future events or
developments.
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