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IKONICS Reports 6% Earnings Increase and Expansion of Aerospace Business

Thursday, November 8, 2012 11:59 AM


DULUTH, Minn., Nov. 8, 2012 (GLOBE NEWSWIRE) -- 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.

The IKONICS Corporation logo is available athttp://www.globenewswire.com/newsroom/prs/?pkgid=5654

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
CONTACT: Bill Ulland
         Chairman, President & CEO
         (218) 628-2217

IKONICS Corporation Logo

(Source: PrimeZone )
(Source: Quotemedia)

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