Strong Fourth Quarter Lifts IKONICS

IKONICS Corporation Logo

DULUTH, Minn., Feb. 19, 2013 (GLOBE NEWSWIRE) -- IKONICS Corporation (Nasdaq:IKNX), a Duluth-based imaging technology company, reported a strong 2012 fourth quarter. Sales were up 8% and earnings, at $0.14 per share, were 109% higher than the fourth quarter of 2011 The Company ended 2012 with record sales of $17,312,000 – a 3% increase over 2011. Earnings for the year ended up at $0.35 per share – essentially the same as 2011.

Bill Ulland, IKONICS CEO said: "Our patient investment in DTX and Micro-Machining technologies continues to depress earnings, but I believe we now are beginning to see the payoff, particularly with our Micro-Machining customers in the aerospace industry.

"In addition to ongoing business related to the Boeing 747-8, we have received a blanket order associated with the Airbus A350, which we expect to grow as the A350 is placed into production. We also have orders beginning early in 2013 for acoustic liners from a major jet engine manufacturer; I anticipate that this product line will grow during the year," he said. "Consequently, we are expanding our manufacturing capability, adding both equipment and people. I believe that these exciting developments not only portend a profitable business for Ikonics but also are a validation of our unique technology by a very sophisticated industry."

"During the year we also invested significantly in strengthening our patent position for both Micro-Machining and DTX," he continued. "Our domestic screen print market was a star performer in 2012, with sales up 7% over last year while competing in a difficult market."

Ulland noted: "During the fourth quarter of 2012 we paid a $1.00 per share, one-time special cash dividend, amounting to approximately $2,000,000. We currently have cash and short-term investment of $2.4 million versus $3.9 million at the end of the third quarter of 2012, and we continue to generate a strong cash flow. I believe our current cash and its projected growth is more than sufficient to meet our growth plans. We have no long-term debt."

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This press release contains forward-looking statements regarding sales, gross profits, net earnings, balance sheet position, new products and new business initiatives that involve risks and uncertainties. The Company's actual results could differ materially as a result of domestic and global economic conditions, downturns in the aerospace industry, unexpected production delays by customers using the Company's products, competitive market conditions, changes in consumer preferences, inability to commercialize technologies the Company is developing on the anticipated timeline or at all, acceptance of new products the Company offers, introduction of new products or technologies by competitors, unexpected 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.

IKONICS Corporation
For the Three Months and Twelve Months Ended December 31, 2012 and 2011
Three Months Ended Twelve Months Ended
12/31/2012 12/31/11 12/31/12 12/31/11
Net sales $4,524,468 $4,178,419 $17,312,407 $16,780,262
Cost of goods sold 2,641,347 2,469,645 10,367,563 10,070,852
Gross profit 1,883,121 1,708,774 6,944,844 6,709,410
Operating expenses 1,456,944 1,451,114 5,911,963 5,683,406
Income from operations 426,177 257,660 1,032,881 1,026,004
Interest income 2,673 3,882 12,050 17,253
Income before income taxes 428,850 261,542 1,044,931 1,043,257
Income tax expense 143,708 124,850 351,000 345,000
Net income $285,142 $136,692 $693,931 $698,257
Earnings per common share-diluted $0.14 $0.07 $0.35 $0.35
Average shares outstanding-diluted 1,994,802 1,989,106 1,990,847 1,986,041
As of December 31, 2012 and 2011
12/31/2012 12/31/2011
Current assets $7,417,041 $8,404,194
Property, plant and equipment, net 5,461,878 5,436,902
Intangible assets 305,357 326,362
$13,184,276 $14,167,458
Liabilities and Stockholders' Equity
Current liabilities $1,023,531 $838,915
Deferred income taxes 366,000 338,000
Long term debt --
Stockholders' equity 11,794,745 12,990,543
$13,184,276 $14,167,458
For the Twelve Months Ended December 31, 2012 and 2011
12/31/2012 12/31/2011
Net cash provided by operating activities $1,181,950 $793,532
Net cash used in investing activities (171,725) (288,881)
Net cash provided by (used in) financing activities (1,909,447) 71,131
Net increase (decrease) in cash and cash equivalents (899,222 575,782
Cash and cash equivalents at beginning of period 1,867,165 1,291,383
Cash and cash equivalents at end of period $967,943 $1,867,165

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

Source:IKONICS Corporation