DULUTH, Minn., Oct. 28, 2010 (GLOBE NEWSWIRE) -- IKONICS Corporation (Nasdaq:IKNX), a Duluth based imaging technology company, reported record sales for the quarter ending September 30, 2010 of $4,141,000, a 6% increase over the third quarter of 2009. Earnings were $287,000 or $0.15 per share compared to a 2009 third quarter loss of $709,000 due to the write off of the Company's $919,00 investment in Imaging Technology International (iTi). The first nine months of 2010 produced record sales of $12,074,000, a 7% increase over the same period of 2009, and near record earnings of $0.39 per share.
Bill Ulland, IKONICS CEO, stated, "We have rebounded from the poorest quarterly earnings in our company's history—third quarter 2009—and a sluggish world economy to set a new sales record and near record earnings for this current nine month period. Not only have we recovered financially from the failure of iTi, but we have established stronger new sources for the digital printers that iTi was supplying to our Digital Texturing (DTX) program. DTX is now a growing product line, and we have been awarded a European patent on the process and have applied for a U.S. patent."
Ulland added, "The sales growth for both the quarter and nine month periods was primarily driven by increased export sales and our new business initiatives—namely DTX."
Concluding, Ulland said, "Over the past two years we have experienced both increased capital expenditures and operating costs associated with the start up of our new business initiatives. These include increased expenditures for patent applications, as we add to our intellectual property portfolio; an additional chemist hired to advance our DTX program; increased depreciation related to the new facility that houses our new business initiatives as well as shipping for the company. However, sales are growing, profits are at near record levels, and we have a cash and short term investments position at the end the quarter of $2,670,000, with no long term debt. I believe these trends will continue through 2011."
This press release contains forward-looking statements regarding sales, gross profits, net earnings, balance sheet position, 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, capital expenditure requirements, the ability to control operating 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 OPERATIONS (Unaudited) | ||||
| For the Three Months and Nine Months Ended September 30, 2010 and 2009 | ||||
| Three Months Ended | Nine Months Ended | |||
| 9/30/2010 | 09/30/09 | 9/30/2010 | 9/30/2009 | |
| Net sales | $ 4,141,092 | $ 3,920,663 | $ 12,073,724 | $ 11,270,376 |
| Cost of goods sold | 2,474,188 | 2,337,757 | 7,093,266 | 6,825,654 |
| Gross profit | 1,666,904 | 1,582,906 | 4,980,458 | 4,444,722 |
| Operating expenses | 1,249,997 | 1,266,276 | 3,938,063 | 3,906,972 |
| Income from operations | 416,907 | 316,630 | 1,042,395 | 537,750 |
| Gain on sale of investment | -- | -- | -- | 29,762 |
| Loss on investment | -- | (918,951) | -- | (918,951) |
| Interest income | 6,267 | 3,070 | 13,672 | 5,190 |
| Income (loss) before income taxes | 423,174 | (599,251) | 1,056,067 | (346,249) |
| Income tax expense | 135,831 | 110,134 | 277,111 | 163,253 |
| Net income (loss) | $ 287,343 | $ (709,385) | $ 778,956 | $ (509,502) |
| Earnings (loss) per common share-diluted | $ 0.15 | $ (0.36) | $ 0.39 | $ (0.26) |
| Average shares outstanding-diluted | 1,975,882 | 1,967,057 | 1,972,351 | 1,975,911 |
| Condensed Balance Sheets | ||
| As of September 30, 2010 and December 31, 2009 | ||
| 9/30/10 | 12/31/09 | |
| (unaudited) | ||
| Assets | ||
| Current assets | $ 7,452,140 | $ 6,417,488 |
| Property, plant and equipment, net | 5,077,144 | 5,234,244 |
| Intangible assets, net | 311,829 | 345,540 |
| $ 12,841,113 | $ 11,997,272 | |
| Liabilities and Stockholders' Equity | ||
| Current liabilities | $831,383 | $809,186 |
| Deferred income taxes | 162,000 | 162,000 |
| Long term debt | -- | -- |
| Stockholders' equity | 11,847,730 | 11,026,086 |
| $ 12,841,113 | $ 11,997,272 | |
| CONDENSED STATEMENTS OF CASH FLOW (Unaudited) | ||
| For the Nine Months Ended September 30, 2010 and 2009 | ||
| 9/30/10 | 9/30/09 | |
| Net cash provided by operating activities | $ 715,416 | $ 857,258 |
| Net cash used in investing activities | (1,580,950) | (657,289) |
| Net cash provided by (used in) financing activities | 20,110 | (123,844) |
| Net increase (decrease) in cash | (845,424) | 76,125 |
| Cash at beginning of period | 1,304,586 | 901,738 |
| Cash at end of period | $ 459,162 | $ 977,863 |