Great American Group(R)* Announces Improved Fourth Quarter and

Great American Group(R)* Announces Improved Fourth Quarter and Full
Year 2011 Financial Results 
WOODLAND HILLS, CA -- (Marketwire) -- 03/30/12 --   Great American
Group, Inc. (OTCBB: GAMR) ("Great American Group" or the "Company"),
a leading provider of asset disposition, valuation and appraisal
services, today announced financial results for its fourth quarter
and full year ended December 31, 2011. 
Fiscal Year Highlights  


 
--  Fiscal 2011 total revenues of $63.5 million, an increase of 50.7% from
    a year ago
--  Fiscal 2011 operating income of $7.4 million, up from an operating
    loss of $11.4 million a year ago
--  Fiscal 2011 net income of $602,000, up from a net loss of $11.0
    million a year ago
--  Fiscal 2011 diluted earnings per share of $0.02, up from diluted loss
    per share of $(0.39) a year ago

  
Fourth Quarter Results 
For the fourth quarter ended December 31, 2011, the Company reported
total revenues of $11.4 million, an increase of 3.3% from revenues of
$11.0 million in the fourth quarter of 2010. Revenues from services
and fees were $10.5 million, compared to $10.6 million in the same
period the prior year. Revenues from sales of goods were $0.9
million, compared to $0.4 million in the fourth quarter of 2010. The
increase in total revenues during the quarter was primarily due an
increase in revenues from the sale of goods in the Auction and
Liquidation segment.  
"During fiscal 2011 we experienced year-over-year improvements in our
financial results with a strong increase in revenues and a return to
profitability. The retail liquidation of T.J. Hughes Limited in
Europe and our participation in the joint venture involving the
liquidation of Borders Group in the United States contributed to the
increase in revenues and operating profit in the auction and
liquidation segment during fiscal 2011," said A
ndrew Gumaer, Chief
Executive Officer of Great American Group. "We continue to monitor
expenses, and our cost reduction initiatives had a positive financial
benefit during the year and help to contribute to a significant
increase in operating income. Going forward, we will continue to
invest in our newer revenue generating initiatives such as GA Keen
and GA Europe and expect these businesses to continue to complement
our core businesses going forward." 
Direct cost of services was $3.8 million, compared to $4.5 million a
year ago. The decrease in direct cost of services was primarily the
result of a decrease in the number of fee and commission engagements
in the fourth quarter of 2011, where the Company contractually bills
fees, commissions and reimbursable expenses, in the auction and
liquidation segment as compared to the same period in 2010. Cost of
goods sold was $1.1 million in the fourth quarter of 2011, compared
to $0.6 million in the fourth quarter of the prior year. The increase
was primarily the result of the sale of goods in 2011 with high asset
values and a lower of cost or market charge of $0.2 million for goods
held for sale or auction in 2011 compared to the prior year. 
Selling, general and administrative expenses were $6.1 million,
compared to $6.8 million in the fourth quarter of 2010. The decrease
was primarily the result of the Company's corporate cost savings
initiatives and a decrease in contractual compensation with
noncontrolling shareholder's that earn a profit and bonus based on a
percentage of the operating profits from their operations.  
Operating income for the fourth quarter of 2011 was $0.3 million,
compared to operating loss of $0.8 million during the same period of
2010. 
Interest expense during the fourth quarter of 2011 was flat at $1.0
million, compared to the prior year.  
Loss from operations before a provision for income taxes was $0.5
million during the fourth quarter of 2011, compared to loss from
operations of $2.1 million in the fourth quarter of 2010. 
During the fourth quarter of 2011, the Company recorded a provision
for income taxes of $0.2 million, compared to a benefit for income
taxes of $0.2 million in the fourth quarter of 2010. Overall, in the
fourth quarter of 2011, the Company generated net loss of $0.7
million, or $0.02 per diluted share, compared with net loss of $1.9
million, or $0.07 per diluted share, in the fourth quarter of 2010. 
Full Year 2011 Results  
For the year-ended 2011, the Company reported total revenues of $63.5
million, an increase of 50.7% from $42.1 million in 2010. Revenues
from services and fees were $60.6 million, up from $37.0 million a
year ago. Sales of goods were $2.9 million, compared to $5.1 million
in the prior year.  
Total operating expenses were $56.1 million, compared to $53.5
million in 2010. Operating income was $7.4 million, compared to an
operating loss of $11.4 million in the prior year. Income before
provision for income taxes was $2.7 million, compared to a loss
before income taxes of $16.1 million during 2010. The Company
recorded a provision for income taxes of $2.1 million during 2011,
compared to a benefit for income taxes of $5.1 million in the same
period of 2010. Net income for 2011 was $0.6 million, or $0.02 per
diluted share, compared with a net loss of $11.0 million, or $(0.39)
per diluted share, in the same period of 2010. 
Financial Position
 At December 31, 2011, the Company had $15.0
million in cash and cash equivalents. Working capital was $26.1
million at December 31, 2011. During 2011, the Company used $2.0
million in cash from operations. 
Conference Call
 The Company will host a conference call at 4:30 p.m.
EDT on Friday, March 30, 2012, to discuss results for the fourth
quarter ended December 31, 2011. To participate in the event by
telephone, please dial (877) 941-1427 10 minutes prior to the start
time (to allow time for registration) and use conference ID #4525808.
International callers should dial (480) 629-9664. A digital replay
will be available beginning March 30, 2012, at 7:30 p.m. EDT, through
April 13, 2012, at 11:59 p.m. EDT. To access the replay, dial (877)
870-5176 (U.S.), and use passcode 4525808. International callers
should dial (858) 384-5517 and ente
r the same passcode. The call will
also be broadcast over the Internet and can be accessed on the
Investor Relations section of the Company's Web site at
www.greatamerican.com. To listen to the webcast, please visit the
site at least 15 minutes prior to the start of the call in order to
register, download and install any necessary audio software. A replay
of the call will also be available for 90 days on the Web site. 
About Great American Group, Inc. 
Great American Group, Inc. is a leading provider of asset disposition
solutions and valuation and appraisal services to a wide range of
retail, wholesale and industrial clients, as well as lenders, capital
providers, private equity investors and professional service firms.
Great American Group has offices in Atlanta, Boston, Chicago, Dallas,
London, Los Angeles, New York and San Francisco. For more
information, please visit www.greatamerican.com. 
*Great American Group and the Eagle Design are trademarks registered
in the US Patent and Trademark Office and are exclusive property of
Great American Group, Inc. 
Forward-Looking Statements 
This press release may contain forward-looking statements by Great
American Group that are not based on historical fact, including,
without limitation, statements containing the words "expects,"
"anticipates," "intends," "plans," "believes," "seeks," "estimates"
and similar expressions and statements. Because these forward-looking
statements involve known and unknown risks and uncertainties, there
are important factors that could cause actual results, events or
developments to differ materially from those expressed or implied by
these forward-looking statements. Such factors include those risks
described from time to time in Great American Group's filings with
the SEC, including, without limitation, the risks described in Great
American Group's proxy statement/prospectus filed with the SEC on
July 18, 2011, and its Annual Report on Form 10-K for the year ended
December 31, 2010. These factors should be considered carefully and
readers are cautioned not to place undue reliance on such
forward-looking statements. All information is current as of the date
this press release is issued, and Great American Group undertakes no
duty to update this information. 
Note Regarding Use of Non-GAAP Financial Measures 
Certain of the information set forth herein, including Adjusted
EBITDA, may be considered non-GAAP financial measures. Great American
Group believes this information is useful to investors because it
provides a basis for measuring Great American Group's performance
against the contingent share earnout provisions in the AAMAC
transaction. In addition, Great American Group's management uses
these non-GAAP financial measures along with the most directly
comparable GAAP financial measures in evaluating Great American
Group's operating performance, capital resources and cash flow.
Non-GAAP financial measures should not be considered in isolation
from, or as a substitute for, financial information presented in
compliance with GAAP, and non-financial measures as reported by Great
American Group may not be comparable to similarly titled amounts
reported by other companies. 


 
                                                                            
                GREAT AMERICAN GROUP, INC. AND SUBSIDIARIES                 
                        CONSOLIDATED BALANCE SHEETS                         
                  (Dollars in thousands, except par value)                  
                                                 December 31,  December 31, 
                                                     2011          2010     
                                                 ------------  ------------ 
                                                                            
                     Assets                                                 
Current assets:                                                             
  Cash and cash equivalents                      $     15,034  $     20,080 
  Accounts receivable, net                              7,482         3,087 
  Advances against customer contracts                   5,276         3,063 
  Goods held for sale or auction                       12,934        13,504 
  Loan receivable                                       8,306            -- 
  Note receivable - related parties                     3,844         5,930 
  Deferred income taxes                                 5,050         5,463 
  Prepaid expenses and other current assets             1,110         1,353 
                                                 ------------  ------------ 
    Total current assets                               59,036        52,480 
Property and equipment, net                               916         1,369 
Goodwill                                                5,688         5,688 
Other intangible assets, net                              140           221 
Deferred income taxes                                   9,914        11,372 
Other assets                                              664         1,144 
                                                 ------------  ------------ 
    Total assets                                 $     76,358  $     72,274 
                                                 ============  ============ 
 Liabilities and Stockholders' Equity (Deficit)                             
Current liabilities:                                                        
  Accounts payable and accrued liabilities       $     13,718  $     10,631 
  Auction and liquidation proceeds payable                 18         1,712 
  Mandatorily redeemable noncontrolling                                     
   interests                                        
    3,408         2,858 
  Revolving credit facility                             1,942            -- 
  Current portion of long-term debt                     1,724         1,724 
  Note payable                                         11,555        12,014 
  Current portion of capital lease obligation              29            27 
                                                 ------------  ------------ 
    Total current liabilities                          32,394        28,966 
Capital lease obligation, net of current portion           13            42 
Long-term debt, net of current portion                 52,207        52,169 
                                                 ------------  ------------ 
    Total liabilities                                  84,614        81,177 
                                                 ------------  ------------ 
Commitments and contingencies                                               
Stockholders' equity (deficit):                                             
  Preferred stock, $0.0001 par value; 10,000,000                            
   shares authorized; none issued                          --            -- 
  Common stock, $0.0001 par value; 135,000,000                              
   shares authorized; 31,001,609 and 30,559,036                             
   issued and outstanding as of December 31,                                
   2011 and 2010, respectively                              4             4 
  Additional paid-in capital                            3,177         2,878 
  Retained earnings (deficit)                         (11,190)      (11,792)
  Accumulated other comprehensive income                 (247)            7 
                                                 ------------  ------------ 
    Total stockholders' equity (deficit)               (8,256)       (8,903)
                                                 ------------  ------------ 
    Total liabilities and stockholders' equity                              
     (deficit)                                   $     76,358  $     72,274 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                GREAT AMERICAN GROUP, INC. AND SUBSIDIARIES                 
                   CONSOLIDATED STATEMENTS OF OPERATIONS                    
                           (Dollars in thousands)                           
                            Three Months Ended                              
                               December 31,         Year Ended December 31, 
                         ------------------------  ------------------------ 
                             2011         2010         2011         2010    
                         -----------  -----------  -----------  ----------- 
Revenues:                                                                   
  Services and fees      $    10,480  $    10,618  $    60,627  $    37,026 
  Sale of goods                  887          387        2,899        5,119 
                         -----------  -----------  -----------  ----------- 
    Total revenues            11,367       11,005       63,526       42,145 
                         -----------  -----------  -----------  ----------- 
Operating expenses:                                                         
  Direct cost of                                                            
   services                    3,845        4,479       19,749       15,417 
  Cost of goods sold           1,104          576        3,391        6,674 
  Selling, general and                                                      
   administrative              6,098        6,796       32,946       31,413 
                         -----------  -----------  -----------  ----------- 
    Total operating                                                         
     expenses                 11,047       11,851       56,086       53,504 
                         -----------  -----------  -----------  ----------- 
    Operating income                                                        
     (loss)                      320         (846)       7,440      (11,359)
Other income (expense):                                                     
  Interest income                 67          188          476          522 
  Other income                    13           --           --           -- 
  Loss from equity                                                          
   investment in Great                                                      
   American Real Estate,                                                    
   LLC                           153         (372)        (369)      (1,640)
  Interest expense            (1,011)      (1,027)      (4,885)      (3,667)
                         -----------  -----------  -----------  ----------- 
    Income (loss) from                                                      
     operations before                                                      
     (provision) benefit                                                    
     for income taxes           (458)      (2,057)       2,662      (16,144)
Benefit (provision) for                                                     
 income taxes                   (196)         151       (2,060)       5,106 
                         -----------  -----------  -----------  ----------- 
    Net income (loss)    $      (654) $    (1,906) $       602  $   (11,038)
                         ===========  ===========  ===========  =========== 
                                                                            
Basic earnings (loss)                                                       
 per share               $     (0.02) $     (0.07) $      0.02  $     (0.39)
                         ===========  ===========  ===========  =========== 
                                                                            
Diluted earnings (loss)                                                     
 per share               $     (0.02) $     (0.07) $      0.02  $     (0.39)
                         ===========  ===========  ===========  =========== 
                                                                            
Weighted average basic                                                      
 shares outstanding       28,681,609   28,239,036   28,539,651   28,075,758 
Weighted average diluted                                                    
 shares outstanding       28,681,609   28,239,036   29,408,466   28,075,758 
                                                                            
                                                                            

 
                                                                            
                 GREAT AMERICAN GROUP, LLC AND SUBSIDIARIES                 
                    CONSOLIDATED STATEMENT OF CASH FLOWS                    
                           (Dollars in thousands)                           
                                                   Year ended December 31,  
                                                 -------------------------- 
                                                     2011          2010     
                                                 ------------  ------------ 
Cash flows from operating activities:                                       
  Net income (loss)                              $        602  $    (11,038)
  Loss from discontinued operations                         -             - 
                                                 ------------  ------------ 
  Income (loss) from continuing operations                602       (11,038)
  Adjustments to reconcile net income (loss) to                             
   net cash provided by (used in) operating                                 
   activities:                                                              
    Depreciation and amortization                         981           792 
    Provision for (recovery of) doubtful                                    
     accounts                                             424            60 
    Impairment of goods held for sale or auction          159         1,389 
    Share-based payments                                  431         4,420 
    Effect of foreign currency on operations              (14)           21 
    Noncash interest expense                            1,083          (193)
    Amortization of discount on note payable              609             - 
    Loss on equity investment in Great American                             
     Real Estate, LLC                                     369         1,640 
    Loss on disposal of assets                              4             3 
    Deferred income taxes                           
    1,871        (5,122)
    Change in fair value of mandatorily                                     
     redeemable noncontrolling interests                  (83)         (205)
    Income allocated to mandatorily redeemable                              
     noncontrolling interests                           3,934         1,806 
    Change in operating assets and liabilities:                             
      Accounts receivable and advances against                              
       customer contracts                              (7,032)       (3,524)
      Income taxes receivable                               -         1,100 
      Goods held for sale or auction                      224           121 
      Loan receivable                                  (8,306)            - 
      Prepaid expenses and other assets                 1,093         3,222 
      Accounts payable and accrued expenses             3,300        (1,841)
      Auction and liquidation proceeds payable         (1,694)        1,266 
                                                 ------------  ------------ 
        Net cash (used in) provided by operating                            
         activities                                    (2,045)       (6,083)
                                                 ------------  ------------ 
Cash flows from investing activities:                                       
  Purchases of property and equipment                    (264)         (592)
  Decrease (increase) in notes receivable -                                 
   related party                                        2,706        (5,930)
  Equity investment in Great American Real                                  
   Estate, LLC                                         (1,202)         (949)
  Proceeds from redemption of officer life                                  
   insurance                                                -           355 
  Decrease (increase) in restricted cash                    -           459 
                                                 ------------  ------------ 
        Net cash provided by (used in) investing                            
         activities                                     1,240        (6,657)
                                                 ------------  ------------ 
Cash flows from financing activities:                                       
  Proceeds from revolving line of credit                1,942             - 
  Proceeds from note payable                            7,000             - 
  Payment of financing costs                                -          (752)
  Repayment of notes payable                           (7,759)            - 
  Repayments of long-term debt                         (1,724)       (1,724)
  Repayments of capital lease obligation                  (27)          (25)
  Payment of employment taxes on vesting of                                 
   restricted stock                                      (132)       (1,132)
  Distributions to noncontrolling interests            (3,301)       (1,522)
        Net cash (used in) provided by financing                            
         activities                                    (4,001)       (5,155)
        Effect of foreign currency on cash               (240)          (14)
                                                 ------------  ------------ 
        Net (decrease) increase in cash and cash                            
         equivalents                                   (5,046)      (17,909)
Cash and cash equivalents, beginning of year           20,080        37,989 
                                                 ------------  ------------ 
Cash and cash equivalents, end of year           $     15,034  $     20,080 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                                                     Three Months Ended     
                                                        December 31,        
                                                 -------------------------- 
                                                     2011          2010     
                                                 ------------  ------------ 
Adjusted EBITDA Reconciliation:                                             
                                                                            
Net income (loss) as reported                    $       (654) $     (4,542)
Adjustments:                                                                
  Provision (benefit) for income taxes                    196        (4,054)
  Interest expense                                      1,011         2,001 
  Interest income                                         (67)          (12)
  Depreciation and amortization                           356           169 
  Share based compensation                                 --         1,965 
                                                 ------------  ------------ 
    Total EBITDA adjustments                            1,496            69 
                                                 ------------  ------------ 
                                                                            
Adjusted EBITDA                                  $        842  $     (4,473)
                                                 ============  ============ 
                                                                            
                                                                            
                                                   Year Ended December 31,  
                                                 -------------------------- 
                                                     2011          2010     
                                                 ------------  ------------ 
Adjusted EBITDA Reconciliation:                                             
                                                                            
Net income (loss) as reported                    $        602  $    (11,038)
Adjustments:                                                                
  Provision (benefit) for income taxes                  2,060        (5,106)
  Interest expense                                      4,885         3,667 
  Interest income                                        (476)         (522)
  Depreciation and amortization                           981           792 
  Share based compensation                                431         4,420 
                                                 ------------  ------------ 
    Total EBITDA adjustments                            7,881         3,251 
                                                 ------------  ------------ 
                                                                            
Adjusted EBITDA                                  $      8,483  $     (7,787)
                                                 ============  ============ 

 
GAMR-F 
Investor Contacts: 
Great American Group 
Phil Ahn
SVP, Strategy & Corporate Development 
818-884-3737  
Addo Communications
Andrew Greenebaum 
310-829-5400
andrewb@addocommunications.com 
or 
Press Contact: 
Great American Group
Laura Drummond
847-444-1400 ext. 312
ldrummond@greatamerican.com 
 
 
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