Exhibit 99.1

Nortech Systems Reports Second Quarter Results

MINNEAPOLIS – August 8, 2024 — Nortech Systems Incorporated (Nasdaq: NSYS) (“Nortech” or the “Company”), a leading provider of engineering and manufacturing solutions for complex electromedical and electromechanical products serving the medical, industrial and defense markets, reported second quarter ended June 30, 2024 financial results.

2024 Q2 Highlights:

● Net sales of $33.9 million

● Net income of $157 thousand, or $0.06 per diluted share

● Adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”) of $919 thousand

● 90-day backlog of $30.1 million as of June 30, 2024

Management Commentary

“We are working closely with our customers to optimize post Covid supply chain strategies which includes continued near-shoring activities and the development of customer specific collaborations to further reduce lead times,” said Jay D. Miller, President and CEO of Nortech. “We believe that these actions will further strengthen our customer relationships which are key to our achieving our long-term strategic objectives.”

“We continue to effectively manage operating expenses while focusing on long-term growth,” Miller noted. “During the quarter we have rapidly implemented the announced optimization of our Minnesota facilities by the end of 2024. While having a short-term negative impact on our financials, we anticipate these actions will significantly improve our efficiency and reduce our cost structure by at least $1.6 million in 2025 and beyond and position Nortech for improved top and bottom-line growth.”

Summary Financial Information

The following table provides summary financial information comparing the second quarter 2024 (“Q2 2024”) financial results to the same quarter in 2023 (“Q2 2023”) as well as the six-month ended June 30, 2024 (“YTD 24”) information to the same period in 2023 (“YTD 2023”).

($ in thousands)	Q2 24		Q2 23		% Change			YTD 24		YTD 23		% Change
Net sales	$	33,891	$	35,021		(3.2	)%	$	68,106	$	69,909		(2.6	)%
Gross profit	$	4,617	$	5,474		(15.7	)%	$	10,065	$	10,958		(8.1	)%
Operating expenses	$	4,273	$	4,375		(2.3	)%	$	8,566	$	8,806		(2.7	)%
Net income	$	157	$	634		(75.2	)%	$	922	$	1,315		(29.9	)%
EBITDA	$	828	$	1,622		(49.0	)%	$	2,465	$	3,180		(22.5	)%
Adjusted EBITDA	$	919	$	1,622		(43.3	)%	$	2,556	$	3,180		(19.6	)%

Conference Call

The Company will hold a live conference call and webcast at 7:30 a.m. central time on Thursday, August 8, 2024, to discuss the Company’s 2024 second quarter results. The call will be hosted by Jay D. Miller, Chief Executive Officer and President and Andrew D. C. LaFrence, Chief Financial Officer. To access the live audio conference call, US participants may call 888-506-0062 and international participants may call 973-528-0011. Participant Access Code: 394178. Participants may also access the call via webcast at: https://www.webcaster4.com/Webcast/Page/2814/50979.

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About Nortech Systems Incorporated

Nortech Systems is a leading provider of design and manufacturing solutions for complex electromedical devices, electromechanical systems, assemblies, and components. Nortech primarily serves the medical, aerospace & defense, and industrial markets. Its design services span concept development to commercial design, and include medical device, software, electrical, mechanical, and biomedical engineering. Its manufacturing and supply chain capabilities are vertically integrated around wire/cable/interconnect assemblies, printed circuit board assemblies, as well as system-level assembly, integration, and final test. Headquartered in Maple Grove, Minn., Nortech currently has seven manufacturing locations and design centers across the U.S., Latin America, and Asia. Nortech Systems is traded on the NASDAQ Stock Market under the symbol NSYS. Nortech’s website is www.nortechsys.com.

Forward-Looking Statements

This press release contains forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 including without limitation statements regarding future financial results, nearshoring, customer specific collaboration, improved efficiency, expense management, and effects of consolidation of our facilities including growth of net sales and profits. While this release is based on management’s best judgment and current expectations, actual results may differ materially from those expressed or implied and involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the forward-looking statements include, without limitation: (1) commodity cost increases coupled with challenges in raising prices and/or customer pressure to reduce prices; (2) supply chain disruptions leading to shortages of critical components; (3) volatility in market conditions which may affect demand for the Company’s products; (4) increased competition; (5) changes in the reliability and efficiency of operating facilities or those of third parties; (6) risks related to the availability of labor; (7) the unanticipated loss of any key member of senior management; (8) geopolitical, economic, financial and business conditions; (9) the Company’s ability to steadily improve manufacturing output and product quality throughout the remainder of 2024 or (10) the impact of global health epidemics on our customers, employees, manufacturing facilities, suppliers, the capital markets and our financial condition. Some of the above-mentioned factors are described in further detail in the section entitled “Risk Factors” in our annual and quarterly reports, as applicable. You should assume the information appearing in this document is accurate only as of the date hereof, or as otherwise specified, as our business, financial condition, results of operations and prospects may have changed since such date. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the United States Securities and Exchange Commission, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, to reflect actual results or changes in factors or assumptions affecting such forward-looking statements.

Reconciliation of Generally Accepted Accounting Principles (“GAAP”) Measures to Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure used by management that we believe provides useful information to investors because it reflects ongoing performance excluding certain non-recurring items during comparable periods and facilitates comparisons between peer companies since interest, taxes, depreciation, and amortization can differ greatly between different organizations as a result of differing capital structures and tax strategies. EBITDA is defined as net income (loss) plus interest expense, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. It is not a measurement of our financial performance under GAAP and should not be considered an alternative to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical metric, and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.

	THREE MONTHS ENDED						SIX MONTHS ENDED
	JUNE 30,						JUNE 30,
INCOME STATEMENTS	2024			2023			2024			2023
(in thousands USD, except share and per share amounts)
Net sales	$	33,891		$	35,021		$	68,106		$	69,909
Cost of goods sold		29,274			29,547			58,041			58,951
Gross profit		4,617			5,474			10,065			10,958
Operating expenses:
Selling		909			953			1,714			1,843
General and administrative		2,982			3,105			6,152			6,370
Research and development		291			317			609			593
Restructuring charges		91			-			91			-
Total operating expenses		4,273			4,375			8,566			8,806
Income from operations		344			1,099			1,499			2,152
Other expense
Interest expense		(165	)		(125	)		(332	)		(235	)
Income before income taxes		179			974			1,167			1,917
Income tax expense		22			340			245			602
Net income	$	157		$	634		$	922		$	1,315
Net income per common share:
Basic (in dollars per share)	$	0.06		$	0.23		$	0.34		$	0.49
Weighted average number of common shares outstanding - basic (in shares)		2,760,052			2,718,066			2,751,330			2,705,121
Diluted (in dollars, per share)	$	0.05		$	0.22		$	0.32		$	0.46
Weighted average number of common shares outstanding - diluted (in shares)		2,935,671			2,870,848			2,922,113			2,887,313
Other comprehensive income (loss)
Foreign currency translation		(175	)		(281	)		(358	)		(241	)
Comprehensive income (loss), net of tax	$	(18	)	$	353		$	564		$	1,074

CONDENSED BALANCE SHEET ($ in thousands)	JUNE 30, 2024			DECEMBER 31, 2023
ASSETS
Current assets:
Cash	$	1,542		$	960
Restricted cash		-			715
Accounts receivable, less allowances of $270 and $358, respectively		17,577			19,279
Inventories, net		22,793			21,660
Contract assets		14,957			14,481
Prepaid assets and other assets		2,292			1,698
Total current assets		59,161			58,793
Property and equipment, net		6,001			6,513
Operating lease assets, net		8,274			6,917
Deferred tax assets		2,640			2,641
Other intangible assets, net		183			263
Total assets	$	76,259		$	75,127
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of finance lease obligations	$	214		$	356
Current portion of operating lease obligations		1,169			1,033
Accounts payable		12,728			15,924
Accrued payroll and commissions		2,612			4,138
Customer deposits		5,453			4,068
Other accrued liabilities		1,120			1,063
Total current liabilities		23,296			26,582
Long-term liabilities:
Long-term line of credit		8,314			5,815
Long-term finance lease obligations, net of current portion		146			209
Long-term operating lease obligations, net of current portion		7,949			6,763
Other long-term liabilities		409			414
Total long-term liabilities		16,818			13,201
Total liabilities		40,114			39,783
Shareholders’ equity:
Preferred stock, $1 par value; 1,000,000 shares authorized; 250,000 shares issued and outstanding		250			250
Common stock - $0.01 par value; 9,000,000 shares authorized; 2,747,678 and 2,740,178 shares issued and outstanding, respectively		28			27
Additional paid-in capital		17,165			16,929
Accumulated other comprehensive loss		(890	)		(532	)
Retained earnings		19,592			18,670
Total shareholders’ equity		36,145			35,344
Total liabilities and shareholders’ equity	$	76,259		$	75,127

	SIX MONTHS ENDED
CASH FLOW STATEMENTS	JUNE 30,
($ in thousands)	2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	922		$	1,315
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		966			1,027
Compensation on stock-based awards		206			192
Change in inventory reserves		113			(53	)
Change in accounts receivable allowances		(88	)		(31	)
Other, net		(59	)		(116	)
Changes in current operating assets and liabilities:
Accounts receivable		1,690			(1,580	)
Employee retention credit receivable		-			2,650
Inventories		(1,288	)		1,350
Contract assets		(476	)		(1,620	)
Prepaid expenses and other current assets		(531	)		(1,042	)
Accounts payable		(2,546	)		586
Accrued payroll and commissions		(1,516	)		(1,788	)
Customer deposits		1,385			(195	)
Other accrued liabilities		(236	)		(414	)
Net cash (used in) provided by operating activities		(1,458	)		281
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of property and equipment		9			-
Purchases of property and equipment		(1,020	)		(956	)
Net cash used in investing activities		(1,011	)		(956	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from line of credit		68,323			65,886
Payments to line of credit		(65,809	)		(65,726	)
Principal payments on financing leases		(202	)		(189	)
Stock option exercises		31			173
Net cash provided by financing activities		2,343			144
Effect of exchange rate changes on cash		(7	)		(35	)
Net change in cash and cash equivalents		(133	)		(566	)
Cash and cash equivalents - beginning of period		1,675			2,481
Cash and cash equivalents - end of period	$	1,542		$	1,915
Reconciliation of cash and restricted cash reported within the condensed consolidated balance sheets:
Cash	$	1,542		$	781
Restricted cash		-			1,134
Total cash and restricted cash reported in the condensed consolidated statements of cash flows	$	1,542		$	1,915

	THREE MONTHS ENDED June 30,				SIX MONTHS ENDED June 30,
	2024		2023		2024		2023
RECONCILIATION OF NET INCOME TO EBITDA
($ in thousands)
Net Income	$	157	$	634	$	922	$	1,315
Interest		165		125		332		235
Taxes		22		340		245		602
Depreciation		444		483		886		948
Amortization		40		40		80		80
EBITDA		828		1,622		2,465		3,180
Restructuring Charges		91		-		91		-
ADJUSTED EBITDA	$	919	$	1,622	$	2,556	$	3,180

Adjustment to EBITDA in 2024 includes ($ in thousands):

● In the second quarter of 2024, we announced the closure of our Blue Earth, Minnesota facility by the end of 2024. In connection with this action, we accrued $91 of retention bonus and other expenses in both the three and six-months ended June 30, 2024, which expense amount is not included in Adjusted EBITDA.

There were no adjustments to EBITDA in 2022 and 2023.

Adjustments to EBITDA in 2021 include ($ in thousands):

● In the third quarter of 2021, we recognized $5,209 related to the CARES Act Employee Retention Credit (ERC) as a reduction of costs of goods sold of $4,670, selling expense of $125, and general and administrative expense of $414. Nortech received ERC cash payment in two installments, the first in December 2022 and the second in May 2023.

● CARES Act Paycheck Protection Program (PPP) loan forgiveness gain of $6,170 recorded in the fourth quarter of 2021.

● Restructuring expense in 2021 of $327 related to the consolidation of our printed circuit board production capabilities into our center of excellence in Mankato, Minnesota and closure of our Merrifield, Minnesota plant.

● Gain on sale of assets in 2021 of $141 related to the closure of our Merrifield, Minnesota plant.

● Loss on abandonment of intangible assets in 2021 of $560 related to abandonment of the Devicix tradename.

($ in millions)	Last Twelve Months (LTM) Ended in Quarter
	Q3 2021			Q4 2021			Q1 2022			Q2 2022			Q3 2022			Q4 2022			Q1 2023			Q2 2023			Q3 2023			Q4 2023			Q1 2024			Q2 2024
Net Sales	$	105.5		$	115.2		$	123.8		$	126.1		$	132.0		$	134.1		$	138.3		$	140.8		$	138.9		$	139.3		$	138.7		$	137.5
Gross Profit $ - Adjusted		10.3			11.2			13.7			15.1			18.1			20.5			21.9			22.4			21.4			23.1			23.1			22.2
Gross Margin % - Adjusted		9.7	%		9.7	%		11.0	%		12.0	%		13.7	%		15.3	%		15.8	%		15.9	%		15.4	%		16.6	%		16.6	%		16.1	%
EBITDA - Adjusted	$	(0.7	)	$	(0.2	)	$	1.9		$	2.5		$	4.2		$	5.8		$	6.7		$	6.8		$	6.0		$	8.0		$	8.1		$	7.3

Contact

Andrew D. C. LaFrence
Chief Financial Officer and Senior Vice President of Finance
alafrence@nortechsys.com

952-345-2243