SOURCE: GPS Industries, Inc.

May 23, 2006 11:49 ET

/ CORRECTION -- GPS Industries Reports Results of First Quarter

New Microcontroller Builds Sales Spike for Q2, and Anomalous Shortfall in Q1

VANCOUVER, BC -- (MARKET WIRE) -- May 23, 2006 -- In the news release, "GPS Industries Reports Results of First Quarter," issued earlier today by GPS Industries, Inc. (GPSI) (OTCBB: GPSN), we are advised by the company that the second sentence of the second paragraph should read "On the heels of a 166% revenue jump in '05 we increased funding to our R&D team." rather than "On the heels of a 266% revenue jump in '05 we increased funding to our R&D team." as originally issued. Complete corrected text follows

GPS Industries Reports Results of First Quarter

VANCOUVER, BC -- 05/23/06 -- GPS Industries, Inc. (GPSI) (OTCBB: GPSN), the leading innovator of Wi-Fi enabled GPS communications for golf facilities and residential communities, today released their Q1 Financial Statements. While the document reports a decrease in revenue for the first quarter of 2006 as compared to the same period of 2005, the company is maintaining its earlier guidance for 2006 sales, projecting an annual increase in sales over 2005.

"The anomaly we're reporting in our Q essentially represents a timing difference between sales contracts signed but not yet installed," explains GPSI President & CEO Bob Silzer. "On the heels of a 166% revenue jump in '05 we increased funding to our R&D team. That investment has quickly paid off with some remarkable enhancements to our microcontroller board. These enhancements further our technological advantage in the industry yet, at the same time, necessitated a pause in new installations."

The company is confident that it will remain on track to deliver on earlier sales projections. "We knew we would have to introduce this pause at some point," continues Silzer, "and since better technology is what we promise our customers we chose to make the enhanced system available sooner rather than later."

The Q1 financials reflect substantial non-cash activity. "Obviously we are continuing to innovate and improve our technology and there are costs associated with that," says Silzer. "But much of the negative elements are actually non-cash. In our last 10-KSB we took a $6.4-million dollar hit from a derivative liability and that has resulted in a $1.3-million write-back to other income in our Q1 filing."

The company remains pleased with its sales trend, as Silzer concludes: "Based on the run rate of new sales contracts signed and at various stages in the pipeline, we expect to see revenue growth through the end of '06, with continued reductions to our cost-of-goods sold over time.''

GPS Industries, Inc. (OTCBB: GPSN) is the leading innovator of Wi-Fi enabled GPS systems for golf facilities and residential communities. The company's patented INFOREMER™ GPS Golf Management System provides precise GPS distance information, a Wi-Fi communications network with asset tracking capabilities, augmented by a powerful suite of operations management tools and revenue-generating modules. Central to the system's functionality are the choice of full color cart-mounted and/or portable handheld display units, which have been recognized for their remarkably vivid graphics and visual impact. For additional information on GPSI and the INFOREMER™ GPS Golf Management System, please visit

Forward-Looking Statements

Some statements contained in this release may be forward looking within the meaning of the Private Securities Litigation Reform Act of 1995. Editors and investors are cautioned that such forward-looking statements involve risks and uncertainties that may cause the company's actual results to differ materially from such forward-looking statements. These risks and uncertainties include, but are not limited to, the company's ability to generate revenues and other factors as described in the Company's literature and filings with the Securities and Exchange Commission.

Contact Information