Goldfield Announces Third Quarter Results

MELBOURNE, Fla., Nov. 8 /PRNewswire-FirstCall/ -- The Goldfield Corporation (Amex: GV), a leading provider of electrical construction services in the southeastern United States and a developer of condominiums on Florida's east coast, today announced results for the three and nine months ended September 30, 2007.

Revenues for the nine months ended September 30, 2007 were $17.7 million and the Company had an operating loss of $3.0 million, compared to revenues of $38.4 million and operating income of $4.6 million in the nine months ended September 30, 2006.

Revenues for the three months ended September 30, 2007 were $6.6 million and the Company had an operating loss of $1.0 million, compared to revenues of $12.1 million and operating income of $1.2 million in the three months ended September 30, 2006.

The decline in results during the 2007 periods reflects a slowdown in our electrical construction operations and the continuing weakness in the Florida condominium market. For the three and nine months ended September 30, 2007, the electrical construction segment had revenues of $6.5 million and $20.5 million, respectively, compared to $8.9 million and $30.6 million, respectively, in the comparable prior year periods, and operating income of $279,000 and $963,000, respectively, compared to $1.1 million and $4.9 million, respectively, in the comparable prior year periods. These decreases were primarily due to the slowdown noted above as well as unanticipated costs associated with customer-initiated delays arising during the course of certain projects.

The real estate development segment had nominal revenues for the three months ended September 30, 2007, and negative revenues of $2.8 million for the nine months ended September 30, 2007, (resulting from the reversal of $7.2 million of previously recognized revenues) compared to revenues of $3.2 million and $7.8 million, respectively, in the comparable prior year periods, and operating losses of $635,000 and $1.8 million, respectively, compared to operating income of $819,000 and $1.8 million, respectively, in the comparable prior year periods. These decreases were due to the reversal of previously recognized revenues and income as a result of customer defaults on contracts to purchase condominium units, as well as a re-valuation of our unsold condominium units.

Net loss for the nine months ended September 30, 2007 was $1.7 million or $0.07 per share, compared to net earnings of $3.0 million or $0.12 per share in the comparable prior year period. Net loss for the three months ended September 30, 2007 was $271,000 or $0.01 per share, compared to net earnings of $913,000 or $0.04 per share in the comparable prior year quarter.

John H. Sottile, Goldfield's President and Chief Executive Officer commented, "Recent developments indicate that we are seeing a rebound in our electrical construction operations. As we previously announced, Southeast Power was recently selected to partner with a major utility in a multi-year project involving the upgrading of 46.2 miles of transmission line to support load growth in central Florida. Work has commenced on this project in the fourth quarter. In addition, three other construction projects on which work had been suspended are being resumed in the fourth quarter."

Mr. Sottile continued, "With respect to our real estate development operations, our recently commenced marketing efforts and price reductions at Pineapple House have met with early success. With the project completed and a number of the units already occupied, prospective purchasers can now see for themselves the project's high quality. These new efforts have resulted in the sales of five additional condominium units in recent weeks, one of which has already been closed."

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.

This press release includes forward looking statements based on our current expectations. Our actual results may differ materially from what we currently expect. Factors that may affect the results of our electrical construction operations include, among others: the level of construction activities by public utilities; the timing and duration of construction projects for which we are engaged; adverse weather; our ability to estimate accurately with respect to fixed price construction contracts; heightened competition in the electrical construction field, including intensification of price competition, and the availability of skilled construction labor. Factors that may affect the results of our real estate development operations include, among others: interest rates; ability to obtain necessary permits from regulatory agencies; adverse legislation or regulations; ability to acquire land; our ability to maintain or increase historical revenues and profit margins; our ability to collect contracts receivable and close homes in backlog, particularly related to buyers purchasing homes as investments; availability of labor and materials and material increases in labor and material costs; ability to obtain additional construction financing; increases in interest rates and availability of mortgage financing; increases in construction and homeowner insurance and the availability of insurance; the level of consumer confidence; the negative impact of claims for contract rescission or cancellation by unit purchasers due to various factors including the increase in the cost of condominium insurance; adverse weather; natural disasters; changes in generally accepted accounting principles; the continued weakness in the Florida condominium market and general economic conditions, both nationally and in our region. Important factors which could cause our actual results to differ materially from the forward-looking statements in this press release are detailed in the Company's Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operation sections of our Annual Report on Form 10-K and Goldfield's other filings with the Securities and Exchange Commission, which are available on Goldfield's website: http://www.goldfieldcorp.com.

    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       Nine Months Ended
                                 September 30,            September 30,
                                2007        2006        2007         2006

    Revenue
      Electrical
       construction          $6,518,999  $8,903,823  $20,531,121  $30,582,150
      Real estate
       development               41,042   3,244,927   (2,807,828)   7,794,414
        Total revenue         6,560,041  12,148,750   17,723,293   38,376,564

    Costs and expenses
      Electrical
       construction           5,496,723   7,189,242   17,244,833   23,772,776
      Real estate
       development               46,293   2,187,300   (1,729,933)   5,336,218
      Selling, general and
       administrative           841,222     965,393    2,498,556    2,883,523
      Depreciation              757,846     607,185    2,265,963    1,834,595
      Write down of
       inventory                473,227         -        473,227          -
     (Gain) loss on sale
       of assets                 (6,927)      4,439      (17,220)     (24,884)
        Total costs and
         expenses             7,608,384  10,953,559   20,735,426   33,802,228
        Total operating
         income (loss)       (1,048,343)  1,195,191   (3,012,133)   4,574,336

    Other income (expense),
     net
      Interest income            53,779      90,525      166,664      142,210
      Interest expense, net    (235,381)    (61,430)    (414,085)    (161,386)
      Other                     515,282      19,683      577,795      133,304
        Total other income
         (expense), net         333,680      48,778      330,374      114,128

    Income (loss) from
     operations before
     income taxes              (714,663)  1,243,969   (2,681,759)   4,688,464

    Income tax expense
     (benefit)                 (456,444)    479,434     (955,027)   1,806,967

      Income (loss) from
       continuing operations   (258,219)    764,535   (1,726,732)   2,881,497

    Gain (loss) from
     discontinued operations,
     net of tax                 (12,661)    148,637      (12,661)     148,637
    Net income (loss)         $(270,880)   $913,172  $(1,739,393)  $3,030,134

    Earnings (loss) per
     share of common stock -
     basic and diluted
        Continuing
         operations              $(0.01)      $0.03       $(0.07)       $0.11
        Discontinued
         operations                $-         $0.01         $-          $0.01
            Net income
             (loss)              $(0.01)      $0.04       $(0.07)       $0.12

    Weighted average number
     of common shares
     outstanding - basic
     and diluted             25,451,354  25,572,159   25,451,354   25,572,181



                   The Goldfield Corporation and Subsidiaries
                      Condensed Consolidated Balance Sheets
                                   (Unaudited)

                                               September 30,      December 31,
                   ASSETS                          2007              2006
    Current assets
      Cash and cash equivalents                 $4,134,995        $6,801,600
      Accounts receivable and accrued
       billings, net                             4,317,650         4,908,511
      Contracts receivable                             -          10,623,909
      Remediation insurance receivable             253,049           329,888
      Current portion of notes receivable           43,675            41,453
      Construction inventory                        30,209           216,989
      Real estate inventories                   10,232,940           801,411
      Costs and estimated earnings in
       excess of billings on uncompleted
       contracts                                 3,298,477         2,358,738
      Residential properties under
       construction                                    -           3,784,165
      Prepaid expenses and other current
       assets                                    1,924,729         1,022,377
        Total current assets                    24,235,724        30,889,041

    Property, buildings and equipment, at
     cost, net                                  10,425,164         9,465,378
    Notes receivable, less current
     portion                                       363,821           407,409
    Deferred charges and other assets            1,654,684         1,142,348
        Total assets                           $36,679,393       $41,904,176

       LIABILITIES AND STOCKHOLDERS' EQUITY
    Current liabilities
      Accounts payable and accrued
       liabilities                              $2,973,529        $5,359,893
      Billings in excess of costs and
       estimated earnings on uncompleted
       contracts                                       -              24,444
      Notes payable                              7,208,453         8,663,768
      Capital leases, due within one year          321,233           317,160
      Current liabilities of discontinued
       operations                                  112,813           208,221
        Total current liabilities               10,616,028        14,573,486

    Deferred income taxes                          412,165           861,400
    Other accrued liabilities                       25,654            20,821
    Notes payable, less current portion          2,363,776         1,207,745
    Capital leases, less current portion           655,415           894,976
    Total liabilities                           14,073,038        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                          2,651,482         4,390,875
      Common stock in treasury, at cost         (1,308,187)       (1,308,187)
        Total stockholders' equity              22,606,355        24,345,748
        Total liabilities and
         stockholders' equity                  $36,679,393       $41,904,176

SOURCE The Goldfield Corporation