DULUTH, Minn., Aug. 13, 2009 (GLOBE NEWSWIRE) -- IKONICS Corporation (Nasdaq:IKNX), a Duluth-based imaging technology company, reported a 13% decline in 2009 second quarter sales to $3,787,000 compared to the same period in 2008. Earnings per share decreased by 59% to $0.07 per share, down from the $0.17 per share earned in the second quarter of 2008. Despite the sales and earnings decreases, the Company generated over $730,000 in cash from operating activities for the first six months of 2009.
Bill Ulland, IKONICS CEO, said, "The recession continues to impact our sales. Although we have recently experienced an increase in revenue from our new business initiatives, it has been insufficient to compensate for declines in some of our traditional markets, particularly European sales and our higher margin awards and recognition segment."
"I anticipate that our sales decline will begin to level off and start to trend upward in the second half of 2009, but gross profit will trail that trend until our new businesses accelerate their growth. In the meantime, we are controlling costs without neglecting our growth plans," added Ulland.
The IKONICS Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5654
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, 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.
IKONICS Corporation
CONDENSED STATEMENTS OF OPERATIONS
For the Three Months and Six Months Ended June 30, 2009 and 2008
Three Months Ended Six Months Ended
----------------------- -----------------------
06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Net sales $3,786,501 $4,330,059 $7,349,713 $8,110,907
Cost of goods sold 2,329,999 2,468,468 4,487,897 4,620,261
---------- ---------- ---------- ----------
Gross profit 1,456,502 1,861,591 2,861,816 3,490,646
Operating expenses 1,251,832 1,322,705 2,640,696 2,904,640
---------- ---------- ---------- ----------
Income from
operations 204,670 538,886 221,120 586,006
Gain on sale
of investment 9,631 -- 29,762 --
Interest income 2,050 23,697 2,120 67,372
---------- ---------- ---------- ----------
Income before
income taxes 216,351 562,583 253,002 653,378
Income tax expense 69,603 204,146 53,119 189,303
---------- ---------- ---------- ----------
Net income $ 146,748 $ 358,437 $ 199,883 $ 464,075
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Earnings per
common share-
diluted $ 0.07 $ 0.17 $ 0.10 $ 0.22
========== ========== ========== ==========
Average shares
outstanding-
diluted 1,973,514 2,080,617 1,981,677 2,068,292
Condensed Balance Sheets
As of June 30, 2009 and December 31, 2008
06/30/09 12/31/08
----------- -----------
Assets
Current assets $ 5,788,143 $ 5,562,130
Property, plant and equipment, net 5,429,097 5,602,063
Investment in non-marketable
equity securities 918,951 918,951
Intangible assets 367,092 403,285
----------- -----------
$12,503,283 $12,486,429
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Liabilities and Stockholders' Equity
Current liabilities $ 805,208 $ 909,789
Deferred income taxes 178,000 143,000
Long term debt -- --
Stockholders' equity 11,520,075 11,433,640
----------- -----------
$12,503,283 $12,486,429
CONDENSED STATEMENTS OF CASH FLOW
For the Six Months Ended June 30, 2009 and 2008
6/30/09 6/30/08
---------- ----------
Net cash provided by operating activities $ 733,433 $ 716,151
Net cash provided by (used in) investing
activities (629,304) 2,695,420
Net cash provided by (used in) financing
activities (123,844) 146,031
---------- ----------
Net increase (decrease) in cash and cash
equivalents (19,715) 3,557,602
Cash and cash equivalents at beginning
of period 901,738 1,230,020
---------- ----------
Cash and cash equivalents at end of period $ 882,023 $4,787,622
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