EX-99 2 c54597exv99.htm EX-99 exv99
Exhibit 99
(IKONIKS CORPORATION LOGO)
         
News Contact:
  Bill Ulland   For Immediate Release
 
  Chairman, President & CEO   November 6, 2009
 
  (218) 628-2217    
IKONICS REPORTS THIRD QUARTER RESULTS
DULUTH, MN — IKONICS Corporation (NASDAQ:IKNX), a Duluth based imaging technology company, reported sales for the third quarter of 2009 of $3,921,000, a 2.3% increase over the third quarter of 2008, and a 3.5% increase over the second quarter of 2009. Excluding the previously disclosed $919,000 write off of an investment in Imaging Technology International (iTi), pre-tax earnings for the third quarter of 2009 were $320,000, up 48% over pre-tax earnings for the second quarter of 2009 and up 9.6% compared to the third quarter of 2008. Pre-tax loss for the third quarter of 2009 was $599,000 and the net loss for the quarter was $709,000, or $0.36 per share. This is IKONICS’ second consecutive quarter of sales growth, and management believes the recession may be weakening. At the end of the 2009 third quarter, the company’s cash and short term investment position had increased to $1,578,000.
The recession was a contributing factor to IKONICS’ third quarter write off of its $919,000 investment in iTi, as iTi was unable to refinance its debt and has ceased operations.
Bill Ulland, IKONICS CEO, said, “The write off and the loss of iTi as a supplier for our DTX printers is certainly an unwelcomed event. However, we believe we have viable options to replace iTi as our supplier of printers and hope to be in the market with this technology in the first half of 2010. I am pleased that our sales are improving and particularly gratified by the progress of our IKONICS Acoustics and Photo-Machining initiatives, both of which are showing good sales. We are also in the process of doubling our Photo-Machining manufacturing capacity,” said Ulland.
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 (Unaudited)
For the Three Months and Nine Months Ended September 30, 2009 and 2008
                                 
    Three Months Ended     Nine Months Ended  
    09/30/09     09/30/08     09/30/09     09/30/08  
Net sales
   $ 3,920,663     $ 3,832,783     $ 11,270,376     $ 11,943,690  
Cost of goods sold
     2,337,757       2,178,597       6,825,654       6,798,858  
 
                        
Gross profit
     1,582,906       1,654,186       4,444,722       5,144,832  
Operating expenses
     1,266,276       1,406,983       3,906,972       4,311,623  
 
                        
Income from operations
     316,630       247,203       537,750       833,209  
Gain on sale of investment
     —       24,550       29,762       24,550  
Loss on investment
     (918,951 )     —       (918,951 )     —  
Interest income
     3,070       19,890       5,190       87,262  
 
                        
Income (loss) before income taxes
     (599,251 )     291,643       (346,249 )     945,021  
Income tax expense
     110,134       53,810       163,253       243,113  
 
                        
Net income (loss)
   $ (709,385 )   $ 237,833     $ (509,502 )   $ 701,908  
 
                        
Earnings per common share-diluted
   $ (0.36 )   $ 0.11     $ (0.26 )   $ 0.34  
 
                        
Average shares outstanding-diluted
     1,967,057       2,073,925       1,975,911       2,070,134  
CONDENSED BALANCE SHEETS
As of September 30, 2009 and December 31, 2008
                 
    09/30/09     12/31/08  
    (Unaudited)          
Assets
                
Current assets
   $ 5,920,080     $ 5,562,130  
Property, plant and equipment, net
     5,345,301       5,602,063  
Investment in non-marketable equity securities
     —       918,951  
Intangible assets
     357,619       403,285  
 
            
 
   $ 11,623,000     $ 12,486,429  
 
            
 
                
Liabilities and Stockholders’ Equity
                
Current liabilities
   $ 627,682     $ 909,789  
Deferred income taxes
     178,000       143,000  
Long term debt
     —       —  
Stockholders’ equity
     10,817,318       11,433,640  
 
            
 
   $ 11,623,000     $ 12,486,429  
 
            
CONDENSED STATEMENTS OF CASH FLOW (Unaudited)
For the Nine Months Ended September 30, 2009 and 2008
                 
    9/30/09     9/30/08  
Net cash provided by operating activities
   $ 857,258     $ 1,009,363  
Net cash provided by (used in) investing activities
     (657,289 )     621,926  
Net cash used in financing activities
     (123,844 )     (380,181 )
 
            
Net increase in cash and cash equivalents
     76,125       1,251,108  
Cash and cash equivalents at beginning of period
     901,738       1,230,020  
 
            
Cash and cash equivalents at end of period
   $ 977,863     $ 2,481,128