Tim Koziol, chairman and CEO of GEM, stated, Throughout the year, we have been challenged by the global economic recession which included fuel price fluctuations early in the year, and the collapse of certain financial institutions and industries throughout the remainder of the year.
We believe we are meeting and adapting to the current economic challenges presented and through Management’s coordinated efforts, the company will continue to adjust towards positive performance during these changing times. We continue to monitor all of our key economic indicators both within the company and our industry in an effort to reach our growth targets and increase shareholder value.
Highlights:
Adjusted EBITDA was a positive $636,877 for 2008 compared to a negative EBITDA of $4,436,799 for 2007, an improvement of $5,073,676.
2008 Operating Expenses were reduced by $5,219,922 compared to 2007.
Today, similar to many companies in our industry, we have been affected by the economic downturn which is evident in our year end results, particularly in the fourth quarter of 2008, stated Koziol. Although the revenues for the fourth quarter were 9.4% greater than the prior year, we did not achieve the EBITDA levels required by the covenants in our Revolving Credit and Term Loan Agreement with our senior lender, CVC California, LLC. Not achieving the required levels is considered an ‘Event of Default’ under the terms of the Agreement.
However, as of April 15, 2009, the company is in discussions with our Lender to obtain a waiver of the Event of Default and we continue to operate in the normal course of business and receive uninterrupted advances from our Lender under the Agreement.
