GPS Industries, Inc.
OTC Bulletin Board : GPSN

GPS Industries, Inc.

August 15, 2007 06:30 ET

GPS Industries Reports Revenue Growth of 125%, Gross Profit Up 119% For Q2 2007

Accelerating Sales Continue As Company Expands Global Customer Base And Narrowcast Media Network

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 15, 2007) - GPS Industries, Inc. (GPSI) (OTCBB:GPSN), the world's leading provider of WiFi-enabled GPS golf management systems and targeted on-course media, is pleased to announce financial results for its second fiscal quarter of 2007, ended June 30, 2007.

Revenue during both the three- and six-month periods ended June 30, 2007 were $3.7 million and $5.9 million, an increase of 125% and 141% as compared to the same periods in 2006. The increase was due largely to the growing number of installations of the Company's Inforemer( Golf Management System. For the three- and six-month periods ended June 30, 2007, installations were 17.5 and 28.5 respectively versus 7.0 and 10.5 for the comparable periods in 2006. This growth was driven by increased marketing efforts, a growing leadership reputation throughout the golf industry and an innovative new pricing structure.

"We have instituted a two-tiered pricing structure that allows our golf course customers to choose the financing structure that best serves their unique needs" said Robert Silzer, Sr. President and CEO of GPS Industries. "One of these options creates a reduced upfront selling price for GPSI for which we obtain the right to not only implement our Fire At The Flag™ program but also participate in the recurring revenue streams generated by on-screen advertising."

Approximately one half of sales during the six-month 2007 fiscal period were concluded under the lower price program. These sales reduced the Company's immediate revenues and decreased gross margins relative to guidance issued in March, but are expected to provide substantial longer-term financial returns. The Company also anticipates that revenues will continue to increase for the balance of the current fiscal year as a result of marketing efforts that are generating increased brand awareness and actively stimulating both inquiries and orders.

Gross profit for the three- and six-month periods ended June 30, 2007 was $1.0 million and $1.6 million respectively, up $0.8 million and $0.6 million from the comparable periods in 2006. This is directly attributable to the increased number of installations partially offset by the lower average selling price achieved.

Operating expenses were $2.4 million and $5.6 million in the three and six month periods in 2007, up $0.4 million and $1.4 million from the same periods in 2006. The increase is due primarily to the increased marketing efforts and sales commissions in 2007.

The Net Loss reported for the three and six months ended June 30, 2007 was $14.1 million and $17.0 million. Adjusted for one time items including the $12.5 million deemed preferred stock dividend in 2007 and the decrease in the fair value of derivative liabilities in 2006, the adjusted Net Operating Loss for the three and six month periods ended June 30, 2007 was $1.6 million and $4.5 million respectively, an improvement of $1.0 million over the corresponding periods in 2006.

"Overall this was a strong quarter for GPSI" said Silzer. "We have continued to escalate sales and grow the media network that will deliver significant returns long term."

About GPS Industries (GPSI)

GPS Industries, Inc. (OTCBB:GPSN) is a global media and technology solutions provider. In the golf industry, the Company's Inforemer( GPS Management System features an integrated WiFi communications network, a comprehensive suite of management tools, and award-winning cart-mounted display units that provide an enriched playing experience for golfers and a lucrative advertising opportunity for the Company and its client facilities. In the community development vertical, the Company's WiStream™ division implements WiFi coverage for residential communities, creating a wireless 'hot-spot' which sup-ports an unique array of WiFi amenities: wireless internet connectivity, location tracking devices, wireless security protection, VOIP phones, mobile point-of-sale systems, and an interactive real estate sales tool. The Company owns key patents for many important GPS and Differential GPS (DGPS) applications in fifteen countries worldwide, including the United States, Australia, Great Britain and Japan. For additional information, please visit www.gpsindustries.com.

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