2007 4th Quarter Report

IKONICS ANNOUNCES RECORD 2007 RESULTS

DULUTH, MN – IKONICS Corporation, a Duluth based imaging technology company announced record sales of $15,825,000, in 2007, a 6% increase over 2006. Earnings were $1,170,000 ($0.57 per share), a 4% increase over 2006, also a record.

Bill Ulland, IKONICS CEO, said that sales growth was led by Chromaline Screen Print Products, which was aided by the image mate® acquisition made in December 2006. Earnings were negatively impacted by startup costs for the company’s new Digital Texturing and Photo-Machining projects, as well as Sarbanes-Oxley compliance costs.

Ulland added, “We are beginning to build a customer base for our Photo-Machining service; however, we do not as yet know the market potential, nor do we clearly understand where our technology fits into this large and complex industry. Digital Texturing has advanced more rapidly. We know the market for our technology in the plastic injection mold making industry is large, relative to our size. We are currently producing commercial product from prototype equipment; and, so far, the market response has been very encouraging. We anticipate having high volume production equipment installed in Duluth in the second quarter of 2008 and, assuming no unforeseen problems, we hope to be taking orders for digital equipment by the end of the year. We will be providing our proprietary fluid and patent-applied-for inkjet receptive substrate for these machines and will continue to supply imaged product from Duluth.”

The company has announced that it has acquired an option to purchase from the City of Duluth a 15 acre brownfield site and is considering the construction of a 35,000 square foot manufacturing and warehouse facility at the site.

 

IKONICS Corporation

 

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months and Twelve Months Ended December 31, 2007 and 2006

                                                           

                                                                  Three Months Ended                      Twelve Months Ended       

                                                                12/31/07            12/31/06            12/31/07            12/31/06

Net Sales                                               $3,925,358         $3,743,608         $15,824,725       $14,888,912

 

Costs and expenses                                  3,420,008          3,245,133          14,398,080         13,414,601

 

Income from operations                                 505,350             498,475            1,426,645           1,474,311

 

Gain on sale of investment                                                 –                        –                 55,159                     –

 

Interest income                                              43,724               32,815               153,971              115,454

 

Income before income taxes                          549,074             531,290            1,635,775           1,589,765

 

Federal and state Income tax expense            203,723             138,249               466,000              466,000

 

Net income                                             $   345,351        $   393,041        $   1,169,775      $   1,123,765

 

Earnings per common share-diluted                        $         0.17       $         0.19       $           0.57     $            0.55

 

Average shares outstanding-diluted                         2,075,580          2,038,499          2,063,380             2,027,916

 

 

CONDENSED BALANCE SHEETS

As of December 31, 2007 and December 31, 2006

 

                                                                          12/31/07           12/31/06        

Assets 

Current assets                                        $  9,315,737       $  8,229,210

Property, plant and equipment, net                1,320,591             991,920

Investment in non-marketable

equity securities                                         855,201             988,910

Intangible assets                                           479,888             485,421

Deferred income taxes                                      11,000               48,000

 $11,982,417       $10,743,461

Liabilities and Stockholders’ Equity                                                                                

Current liabilities                                     $     936,703      $     879,362
Long term debt                                                     –                         –

Stockholders’ equity                                 11,045,714           9,864,099

$11,982,417       $10,743,461

 

 

   Read More