Gemini Corporation
TSX VENTURE : GKX

Gemini Corporation

May 17, 2006 16:35 ET

Gemini Corporation Reports 2006 First Quarter Results

CALGARY, ALBERTA--(CCNMatthews - May 17, 2006) -

Q1 2006 Revenues Double Q1 2005

Gemini Corporation, (TSX VENTURE:GKX) a leading provider of engineered solutions and field services to an array of industry sectors, today announced its first quarter financial results for the period ended March 31, 2006.

Revenue in the first quarter totalled $24,307,000, a 100% increase over the $12,134,000 generated in the first quarter of 2005. This growth was achieved through the previously announced pipeline module fabrication project, additional maintenance revenue secured in the Fort Saskatchewan area and moderate growth in engineering services.

First quarter gross profit increased 47% to $4.8 million from $3.3 million in the same period of 2005. Net earnings for the first quarter increased to $732,000 (2.1 cents per share) compared to the $530,000 (1.6 cents per share) achieved last year. Earnings growth was dampened by cost escalation on two significant fixed price field service projects completed in the first quarter. In addition, we experienced a modest reduction in engineering utilization rates in the quarter as the Corporation transitioned from a large project recently completed into other projects. Earnings are expected to more closely track revenue growth in the remaining quarters of 2006.

"We are pleased with the revenue generated for the quarter", said Carl Johnson, Gemini's President and CEO. "We are capable of sustaining this level of revenue and our challenge is to ensure acceptable profitability is achieved on each project in the future. By shifting our focus toward rate-based work, we are confident that we will achieve our growth targets in 2006 with improved profitability."

Gemini's outlook for the balance of 2006 is optimistic as operations continue to evolve and mature at this higher level of activity. The market demand for the services Gemini offers in both a stand-alone and bundled fashion is robust. With further refinement of the operating systems and management techniques employed throughout the organization, greater long-term earnings stability will be achieved.

About Gemini Corporation

Gemini Corporation offers a wide range of interrelated services including project management, engineering, fabrication, construction, operations and maintenance of oil & gas and industrial facilities within Canada and internationally. The Corporation is a leading provider of engineered solutions and field services through either stand-alone or integrated, full-service approaches to a broadening client base in an array of industry sectors.

Shares of Gemini trade on the TSX Venture Exchange under the symbol "GKX". For more information about the Corporation and its services, go to www.geminicorp.ab.ca.

Gemini's 2006 first-quarter report will be filed with SEDAR at http://www.sedar.com by May 30, 2006.



CONSOLIDATED FINANCIAL HIGHLIGHTS

Three Months Ended
Operating Highlights ($'000) March 31, March 31,
2006 2005
Revenue $ 24,307 $ 12,134
Gross profit 4,835 3,284
Earnings before interest & taxes 1,218 871
Net earnings 732 530
Earnings per share (basic) $ 0.021 $ 0.016
Earnings per share (diluted) $ 0.020 $ 0.015

Operating cash flow (1)
(excludes working capital changes) $ 1,156 $ 863
Operating cash flow per share $ 0.034 $ 0.027


Balance Sheet Highlights ($'000) March 31, December 31,
2006 2005
Working capital $ 7,417 $ 7,322
Total assets 33,948 30,843
Shareholders' equity 11,733 10,848

(1) Operating cash flow is a non-GAAP financial measure which does not
have a standard meaning and therefore may not be comparable to
similar measures presented by other companies.


Statements in this release which describe Gemini's intentions, expectations or predictions, or which relate to matters that are not historical facts are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of Gemini to be materially different from any future results, performances or achievements expressed in or implied by such forward-looking statements. Gemini may update or revise any forward-looking statements, whether as a result of new information, future events or changing market and business conditions.


The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information