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8-K - FORM 8-K - IKONICS CORPd436155d8k.htm

Exhibit 99

 

LOGO   

4832 Grand Avenue

Duluth, MN 55807 USA

Phone: (218) 628-2217

Fax: (218 628-3245

Email: info@ikonics.com

Website: www.ikonics.com

 

News Contact:   Bill Ulland      For Immediate Release
  Chairman, President & CEO      November 8, 2012
  (218) 628-2217     

IKONICS REPORTS 6% EARNINGS INCREASE AND EXPANSION OF

AEROSPACE BUSINESS

DULUTH, MN—IKONICS Corporation (NASDAQ:IKNX), a Duluth based imaging technology company, reported 2012 third quarter earnings of $228,000 or $0.11 per share, a 6% increase over the third quarter of 2011. Sales were $4,231,000, down 3% from the comparable quarter of 2011, which was a record third quarter. IKONICS CEO, Bill Ulland stated, “Weak export sales and a temporary purchasing delay at our largest aerospace customer contributed to the sales decease. Increased high margin sales from DTX and IKONICS Imaging partially offset this weakness and contributed to the increased profit. Our balance sheet continues to be strong with $3.9 million in cash and short-term investments, approximately $2.00 per share.”

Mr. Ulland, IKONICS CEO, added, “We are making important strides with our aerospace business. We have begun regular production of parts for a major jet engine manufacturer and anticipate a ramp up in that business in 2013. We are negotiating a long-term contract with a second-tier supplier to the commercial aviation industry, and our primary customer serving the defense industry has informed us that we should anticipate an increase in orders beginning in 2013.

Ulland also stated, “We are conducting feasibility studies of our technology with a number of potential customers to determine if it’s a good fit for their needs. In addition, we are working on joint development projects with two of the largest aerospace companies. Although these activities do not in themselves currently generate significant sales or profits, I believe they could lead to very important business.”

“Because of the increasing demand, we are again expanding our manufacturing capacity—both equipment and people—to serve the aerospace industry. During this expansion and ramp-up phase expenses may temporarily exceed revenues for this segment,” Ulland cautioned.

This press release contains forward-looking statements regarding sales, gross profits, net earnings, and new products and businesses that involve risks and uncertainties. The Company’s actual results could differ materially as a result of domestic and global economic conditions, competitive market conditions, acceptance of new products, availability of equipment sold by the Company or for use with its products, raw materials costs, the ability to identify and make suitable acquisitions, the ability to control costs without impacting growth as well as the factors described in the Company’s Form s 10-K, and 10-Q, and other reports on file with the SEC.

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IKONICS Corporation

CONDENSED STATEMENTS OF INCOME (unaudited)

For the Three Months and Nine Months Ended September 30, 2012 and 2011

 

     Three Months Ended      Nine Months Ended  
     9/30/12      9/30/11      9/30/12      9/30/11  

Net sales

   $ 4,321,235       $ 4,361,312       $ 12,787,939       $ 12,601,843   

Cost of goods sold

     2,478,358         2,681,509         7,726,216         7,601,207   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross profit

     1,752,877         1,679,803         5,061,723         5,000,636   

Operating expenses

     1,414,472         1,383,557         4,455,019         4,232,292   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income from operations

     338,405         296,246         606,704         768,344   

Interest income

     2,572         4,028         9,377         13,371   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before income taxes

     340,977         300,274         616,081         781,715   

Income tax expense

     112,865         85,597         207,292         220,150   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 228,112       $ 214,677       $ 408,789       $ 561,565   
  

 

 

    

 

 

    

 

 

    

 

 

 

Earnings per common share-diluted

   $ 0.11       $ 0.11       $ 0.21       $ 0.28   
  

 

 

    

 

 

    

 

 

    

 

 

 

Average shares outstanding-diluted

     1,993,429         1,987,945         1,990,485         1,985,263   

Condensed Balance Sheets

As of September 30, 2012 and December 31, 2011

 

     9/30/12      12/31/11  
     (unaudited)         

Assets

     

Current assets

   $ 9,054,045       $ 8,404,194   

Property, plant and equipment, net

     5,447,308         5,436,902   

Intangible assets, net

     292,812         326,362   
  

 

 

    

 

 

 
   $ 14,794,165       $ 14,167,458   
  

 

 

    

 

 

 

Liabilities and Stockholders’ Equity

     

Current liabilities

   $ 1,011,608       $ 838,915   

Deferred income taxes

     338,000         338,000   

Long term debt

     —           —     

Stockholders’ equity

     13,444,557         12,990,543   
  

 

 

    

 

 

 
   $ 14,794,165       $ 14,167,458   
  

 

 

    

 

 

 

CONDENSED STATEMENTS OF CASH FLOW (unaudited)

For the Nine Months Ended September 30, 2012 and 2011

 

     9/30/12     9/30/11  

Net cash provided by operating activities

   $ 566,939      $ 465,752   

Net cash used in investing activities

     (214,892     (334,980

Net cash provided by financing activities

     30,123        67,631   
  

 

 

   

 

 

 

Net increase in cash

     382,170        198,403   

Cash at beginning of period

     1,867,165        1,291,383   
  

 

 

   

 

 

 

Cash at end of period

   $ 2,249,335      $ 1,489,786