Goldfield Announces Second Quarter Results

MELBOURNE, Fla., Aug. 14 /PRNewswire-FirstCall/ -- The Goldfield Corporation (Amex: GV), a leading provider of electrical construction services in the southeastern United States and a developer of condominiums, today announced results for the three and six months ended June 30, 2007.

Revenues for the six months ended June 30, 2007 were $11.2 million and the Company had an operating loss of $2.0 million, compared to revenues of $26.2 million and operating income of $3.4 million in the six months ended June 30, 2006.

Revenues for the three months ended June 30, 2007 were $1.4 million and the Company had an operating loss of $1.5 million, compared to revenues of $12.2 million and operating income of $1.5 million in the three months ended June 30, 2006.

Revenues in both the three months and six months ended June 30, 2007 reflect decreases in both the electrical construction segment and the real estate development segment. The decrease in the electrical construction segment revenues was primarily due to a slowdown in demand for the Company's electrical construction services. The decrease in the real estate development segment revenues was due to the reversal of revenues previously recognized as a result of customers defaulting or providing notification of their intent to default on their contractual obligations to close the purchase of condominium units in the Pineapple House project, which was completed in June 2007.

For the three and six months ended June 30, 2007, the electrical construction segment had operating income of $875,000 and $684,000, respectively, compared to $2.1 million and $3.9 million, respectively, in the comparable prior year periods. The real estate development segment had operating losses of $1.7 million and $1.1 million, respectively, for the three and six months ended June 30, 2007, compared to operating income of $93,000 and $987,000, respectively, in the three and six months ended June 30, 2006. In both cases these decreases were primarily due to the same factors that affected revenues as described above and, with respect to the electrical construction segment, unanticipated costs associated with customer initiated delays arising during the course of certain of the Company's current projects. In the real estate development segment there was a corresponding reversal of previously recognized cost of goods sold and selling expenses associated with the customer contract defaults.

Net loss for the six months ended June 30, 2007 was $1.5 million or $0.06 per share, compared to net earnings of $2.1 million or $0.08 per share in the comparable prior year period. Net loss for the three months ended June 30, 2007 was $1.1 million or $0.04 per share, compared to net earnings of $972,000 or $0.04 per share in the comparable prior year quarter.

Continuing deterioration in the Florida real estate market has adversely affected closings on existing contracts and marketing of remaining available units. If these market conditions continue, they will likely have an unfavorable impact on future sales, the commencement and development of new projects and the results of the real estate development operations.

John H. Sottile, Goldfield's President and Chief Executive Officer commented, "Although we are feeling the effects of the slowdown in the Florida real estate market, I am optimistic in the long run on the potential of Pineapple House for a number of reasons. The development is attractive, of high quality construction and combines enhanced amenities with an excellent location. Additionally, Pineapple House was completed on budget and in a timely manner. Furthermore, our carrying costs associated with the unsold units, including the construction debt related to the project, are well within our financial capability. With the building completed, we will be focusing our attention on marketing these exceptional residences."

Mr. Sottile continued, "Turning to Southeast Power, our electrical construction segment, the first six month's results were adversely affected by unanticipated costs associated with customer initiated delays arising during the course of our projects. These delays have had a disruptive and costly effect on operations. The delayed jobs are expected to re-commence in the fourth quarter of this year."

About Goldfield

Goldfield is a leading provider of electrical construction and maintenance services in the energy infrastructure industry in the southeastern United States. The company specializes in installing and maintaining electrical transmission lines for a wide range of electric utilities. Goldfield is also involved in the development of high-end condominium projects on Florida's east coast. For additional information, please visit http://www.goldfieldcorp.com.

Statements in this release are based on current expectations. These statements are forward-looking, and actual results may differ materially. For example, electrical construction projects are generally subject to cancellation and, in the real estate segment, there can be no assurance that settlements of condominiums subject to contracts for sale will occur or that construction will progress as expected. For further details, see the Company's filings with the Securities and Exchange Commission.

    For further information, please contact:
    The Goldfield Corporation
    Phone:  (321) 724-1700
    Email:  investorrelations@goldfieldcorp.com



                    THE GOLDFIELD CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

                              Three Months Ended         Six Months Ended
                                   June 30,                  June 30,
                               2007        2006          2007        2006

    Revenue
      Electrical
       construction         $6,658,079  $11,186,323  $14,012,121  $21,678,328
      Real estate
       development          (5,303,303)   1,046,540   (2,848,870)   4,549,487
        Total revenue        1,354,776   12,232,863   11,163,251   26,227,815

    Costs and expenses
      Electrical
       construction          4,946,406    8,460,325   11,748,110   16,583,534
      Real estate
       development          (3,470,151)     827,489   (1,776,226)   3,148,918
      Depreciation             765,770      628,120    1,508,118    1,227,411
      Selling, general and
       administrative          606,362      819,774    1,657,333    1,918,129
      Gain on sale of
       assets                   (1,436)     (11,013)     (10,294)     (29,323)
        Total costs and
         expenses            2,846,951   10,724,695   13,127,041   22,848,669
        Total operating
         income (loss)      (1,492,175)   1,508,168   (1,963,790)   3,379,146

    Other income
     (expense), net
      Interest income           51,554       26,972      112,886       51,684
      Interest expense, net    (99,060)     (62,965)    (178,705)     (99,957)
      Other                     53,364      110,128       62,513      113,622
        Total other income
         (expenses), net         5,858       74,135       (3,306)      65,349

    Income (loss) from
     operations
     before income taxes    (1,486,317)   1,582,303   (1,967,096)   3,444,495

    Income taxes (benefit)    (364,815)     609,831     (498,583)   1,327,533
    Net income (loss)      $(1,121,502)    $972,472  $(1,468,513)  $2,116,962

    Earnings (loss) per
     share of common stock
     - basic and diluted        $(0.04)       $0.04       $(0.06)       $0.08

    Weighted average
     number of common
     shares outstanding
     - basic and diluted    25,451,354   25,572,192   25,451,354   25,572,192



                   THE GOLDFIELD CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

                                                 June 30,        December 31,
    ASSETS                                         2007              2006
    Current assets
      Cash and cash equivalents                 $4,548,191        $6,801,600
      Accounts receivable and accrued
       billings, net                             4,147,221         4,908,511
      Contracts receivable                       3,279,600        10,623,909
      Remediation insurance receivable             273,349           329,888
      Current portion of notes receivable           50,143            41,453
      Construction inventory                           -             216,989
      Real estate inventories                   10,506,278           801,411
      Costs and estimated earnings in
       excess of billings on uncompleted
       contracts                                 2,473,264         2,358,738
      Residential properties under
       construction                                    -           3,784,165
      Prepaid expenses and other current
       assets                                    1,715,024         1,022,377
        Total current assets                    26,993,070        30,889,041

    Property, buildings and equipment, at
     cost, net                                  10,866,696         9,465,378
    Notes receivable, less current
     portion                                       375,099           407,409
    Deferred charges and other assets            1,699,272         1,142,348
    Total assets                               $39,934,137       $41,904,176

    LIABILITIES AND STOCKHOLDERS' EQUITY
    Current liabilities
      Accounts payable and accrued
       liabilities                              $2,899,164        $5,359,893
      Billings in excess of costs and
       estimated earnings on
       uncompleted contracts                           -              24,444
      Notes payable                              9,916,477         8,663,768
      Capital leases, due within one year          326,754           317,160
      Current liabilities of discontinued
       operations                                  133,759           208,221
        Total current liabilities               13,276,154        14,573,486

    Deferred income taxes                          465,400           861,400
    Other accrued liabilities                       24,416            20,821
    Notes payable, less current portion          2,560,976         1,207,745
    Capital leases, less current portion           729,956           894,976
    Total liabilities                           17,056,902        17,558,428
    Commitments and contingencies
    Stockholders' equity
      Common stock                               2,781,377         2,781,377
      Capital surplus                           18,481,683        18,481,683
      Retained earnings                          2,922,362         4,390,875
      Common stock in treasury, at cost         (1,308,187)       (1,308,187)
        Total stockholders' equity              22,877,235        24,345,748
    Total liabilities and stockholders'
     equity                                    $39,934,137       $41,904,176

SOURCE The Goldfield Corporation