Exhibit 99.1
NEWS RELEASE
FOR FURTHER INFORMATION CONTACT:
Stephen M. Merrick | Catherine E. Lawler | |
Executive Vice President | Investor Relations | |
(847) 382-1000 | (847) 671-1177 |
CTI Industries Corporation Reports
Record Sales and Substantial Profit Increase for 2009
FOR IMMEDIATE RELEASE
March 31, 2009
BARRINGTON, IL, March 31, 2009 -- CTI Industries Corporation (NASDAQ Capital Market), a manufacturer and marketer of novelty balloons, printed and laminated films and flexible packaging and storage products, today announced its full-year results of operations for 2008, as well as for the three months ended December 31, 2008.
Year End Results
For the year ended December 31, 2008, consolidated net sales totaled $44,981,000 compared to consolidated net sales of $36,510,000 for the year ended December 31, 2007, an increase of 23.2%. For the year, CTI achieved net income of $1,154,000 or $0.42 per share (basic) and $0.40 per share (diluted). During the year ended December 31, 2007, CTI had a net income of $82,000, representing $0.03 per share (basic and diluted).
Fourth Quarter Results
Consolidated net sales for the fourth quarter of 2008 were $9,832,000 compared to consolidated net sales of $10,299,000 for the fourth quarter of 2007. CTI had net income of $121,000 or $0.04 per share (basic and diluted) for the fourth quarter of 2008 compared to net income of $125,000 or $0.05 per share (basic and diluted) for the fourth quarter of 2007.
Key Factors
During 2008, CTI experienced an increase in revenues of more than 23.2% over 2007 revenues. The largest component of that increase was the increase in sales of pouches for consumer applications. For the year, sales of pouches totaled $10,893,000 compared to $4,938,000 in 2007. Most of this increase resulted from sales of a vacuumable pouch product marketed by S.C. Johnson & Son, Inc. under their brand ZipLoc.
Sales of CTI’s other product lines also increased during 2008:
· | Metalized balloons increased by 10.2% from $15,998,000 in 2007 to $17,629,000 in 2008; |
· | Latex balloon sales increased by 10.9% from $6,853,000 in 2007 to $7,597,000 in 2008; |
· | Sales of commercial films increased by 4.7% from $7,846,000 in 2007 to $8,212,000 in 2008. |
Gross margin levels declined in 2008 to 22.95% from 23.79% in 2007. This decline came principally as a result of increased costs of raw materials, including plastic sheeting, resin and latex. Toward the end of 2008 and into 2009, the cost of these raw materials has reduced significantly from the highest levels they reached during mid-2008.
CTI Industries Corporation, based in suburban Chicago, designs, develops, produces and markets a line of novelty balloon products, laminated and printed films for packaging applications and flexible packaging and storage products.
Statements made in this release that are not historical facts are “forward-looking” statement (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These “forward-looking” statements may include, but are not limited to, statements containing words such as “may,” “should,” “could,” “would,” “expect,” “plan,” “goal,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” or similar expressions. Factors that could cause results to differ are identified in the public filings of the Company with the Securities and Exchange Commission. More information on factors that could affect CTI’s business and financial results are included in its public filings made with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
– FINANCIAL HIGHLIGHTS FOLLOW –
Consolidated Balance Sheets | ||||||||
December 31, 2008 | December 31, 2007 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash | $ | 180,578 | $ | 483,112 | ||||
Accounts receivable, (less allowance for doubtful | 5,821,593 | 5,950,551 | ||||||
accounts of $39,000 and $312,000 respectively) | ||||||||
Inventories, net | 10,504,769 | 9,700,618 | ||||||
Net deferred income tax asset | 674,872 | 1,014,451 | ||||||
Prepaid expenses and other current assets | 506,225 | 651,969 | ||||||
Total current assets | 17,688,037 | 17,800,701 | ||||||
Total property, plant and equipment, net | 10,575,982 | 10,096,155 | ||||||
Total other assets | 1,724,172 | 1,427,279 | ||||||
TOTAL ASSETS | $ | 29,988,191 | $ | 29,324,135 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Total current liabilities | 16,222,180 | 16,483,109 | ||||||
Total long-term liabilities, less current maturities | 6,018,655 | 6,237,190 | ||||||
Minority interest | 12,756 | 12,534 | ||||||
Total stockholders' equity | 7,734,600 | 6,591,302 | ||||||
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 29,988,191 | $ | 29,324,135 |
CTI Industries Corporation and Subsidiaries | ||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||
Year ended December 31, | Three months ended December 31, | |||||||||||||||
2008 | 2007 | 2008 | 2007 | |||||||||||||
Net sales | $ | 44,980,674 | $ | 36,509,710 | $ | 9,832,048 | $ | 10,299,283 | ||||||||
Cost of sales | 34,658,271 | 27,825,493 | 7,496,480 | 7,879,631 | ||||||||||||
Gross profit | 10,322,403 | 8,684,217 | 2,335,568 | 2,419,652 | ||||||||||||
Operating expenses: | ||||||||||||||||
General and administrative | 5,375,526 | 5,211,470 | 1,311,912 | 1,288,897 | ||||||||||||
Selling | 886,391 | 753,571 | 176,195 | 161,277 | ||||||||||||
Advertising and marketing | 1,677,900 | 1,474,289 | 413,016 | 461,428 | ||||||||||||
Total operating expenses | 7,939,817 | 7,439,330 | 1,901,123 | 1,911,602 | ||||||||||||
Income from operations | 2,382,586 | 1,244,887 | 434,445 | 508,050 | ||||||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (1,031,457 | ) | (1,285,964 | ) | (232,146 | ) | (309,637 | ) | ||||||||
Other | 50,003 | 173,510 | (17,118 | ) | 8,028 | |||||||||||
Total other expense | (981,454 | ) | (1,112,454 | ) | (249,264 | ) | (301,609 | ) | ||||||||
Income before income taxes and minority interest | 1,401,132 | 132,433 | 185,181 | 206,441 | ||||||||||||
Income tax expense | 246,779 | 50,673 | 64,454 | 81,726 | ||||||||||||
Income before minority interest | 1,154,353 | 81,760 | 120,727 | 124,715 | ||||||||||||
Minority interest in loss (income) of subsidiary | 222 | (138 | ) | (18 | ) | (35 | ) | |||||||||
Net income | $ | 1,154,131 | $ | 81,898 | $ | 120,745 | $ | 124,750 | ||||||||
Income applicable to common shares | $ | 1,154,131 | $ | 81,898 | $ | 120,745 | $ | 124,750 | ||||||||
Basic income per common share | $ | 0.42 | $ | 0.03 | $ | 0.04 | $ | 0.05 | ||||||||
Diluted income per common share | $ | 0.40 | $ | 0.03 | $ | 0.04 | $ | 0.05 | ||||||||
Weighted average number of shares and equivalent shares of common stock outstanding: | ||||||||||||||||
Basic | 2,763,017 | 2,346,126 | 2,808,720 | 2,555,580 | ||||||||||||
Diluted | 2,898,681 | 2,589,960 | 2,843,196 | 2,648,434 |