Intricon (IIN) 8-K Intricon Reports 2008 Second-quarter Results

Exhibit 99.1

FOR IMMEDIATE RELEASE

INTRICON REPORTS 2008 SECOND-QUARTER RESULTS

Professional Audio and Medical Businesses Drive Year-Over-Year Sales Growth

ST. PAUL, Minn. — July 24, 2008 — IntriCon Corporation (NASDAQ: IIN), a designer, developer, manufacturer and distributor of body-worn medical and electronics devices, today announced financial results for its 2008 second quarter ended June 30, 2008.

For the second quarter, the company reported net sales of $17.5 million, a 3 percent increase from net sales of $16.9 million for the 2007 second quarter. IntriCon’s 2008 second-quarter net income was $410,000, or $0.07 per diluted share, compared with net income of $527,000, or $0.10 per diluted share, for the year-ago period. For the quarter, net income from the company’s core business (hearing health, professional audio and medical) was $447,000, or $0.08 per share, partially offset by a non-core business net loss of $37,000, or $0.01 per share. For the 2007 second quarter, net income from IntriCon’s core business was $425,000, or $0.08 per share; non-core business net income was $102,000, or $0.02 per share.

“Second-quarter sales were driven by strong performance in medical, and in particular, professional audio,” said Mark S. Gorder, president and chief executive officer of IntriCon. “Net income for the quarter declined due in large part to a 33 percent increase in new research and development expense. New medical projects contributed to the rise. One of IntriCon’s strategic goals for 2008 is a continued emphasis on investing in R&D—not only to develop new products and technology, but to further enhance our current product portfolio.

“By leveraging our proprietary technology, we’re designing smaller, more advanced body-worn devices. We believe that our commitment to enhancing the mobility and effectiveness of these devices, combined with IntriCon’s strategic expansion initiatives, will fuel long-term growth.”

For the six-month period, IntriCon reported net sales of $34.1 million and net income of $560,000, or $0.10 per diluted share. This compares to 2007 net sales of $31.5 million and net income of $554,000, or $0.10 per diluted share for the six months ended June 30, 2007. For the six-month period, net income from the company’s core business was $654,000, or $0.12 per share, partially offset by a net loss in its non-core business of $94,000, or $0.02 per share. For the six months ended June 30, 2007, core business net income was $506,000, or $0.09 per share; non-core business net income was $48,000, or $0.01 per share.

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 2

Business Update

For the second quarter,net sales for IntriCon’s core businesses increased 8 percent over the prior year. Net sales for the company’s non-core electronics business decreased 21 percent from the year-earlier period. Company wide, year-to-date gross margins rose slightly to 23.7 percent from 23.5 percent a year ago.

Said Gorder, “Recently, IntriCon has achieved a number of key milestones that we believe bode well for our performance going forward. On the hearing health front, we introduced Ethos^TM, our new high-performance adaptive digital signal processing (DSP) hearing aid amplifier. Ethos’ advanced capabilities are ideally suited for the hearing health market. We believe the introduction of Ethos, equipped with advanced technologies that will greatly improve hearing performance for customers, solidifies our position as a leader of high-performance adaptive DSP hearing aid amplifiers.”

In professional audio, IntriCon continues to work to enhance the mobility and effectiveness of body-worn devices. IntriCon recently demonstrated the effectiveness of its nanoLink^TM wireless application to key customers.

Double-digit second-quarter sales gains in medical were driven by continuing projects with large OEM customers. IntriCon’s development efforts in the medical arena continue to focus on bio-telemetry, through its strategic partnership with Advanced Medical Electronics.

Said Gorder, “During the quarter, we were recognized for our strong performance over the past year. In June, IntriCon was named to FORTUNE Small Business magazine’s 2008list of the 100 fastest-growing small companies in America—ranking number 22. We also were added to the Russell Microcap^® Index—which is widely used by investment managers and institutional investors for index funds and a benchmark for both passive and active investment strategies. We believe that both honors acknowledge our accomplishments as a company and enhance our visibility among both current and prospective investors.”

According to Gorder, the company continues to make progress with its 2008 strategic priorities of leveraging its proprietary technology to:

• gain additional traction and market share in hearing health;

• further advance its professional audio product offering; and

• develop new bio-telemetry medical applications.

“Across our core markets, the shift to smaller body-worn devices is clear. IntriCon has the capabilities to design, manufacture and bring these devices to market. Given today’s unpredictable economic conditions, we might experience quarter-to-quarter fluctuations. However, we believe that our long-term growth prospects are encouraging—and we remain committed to continuing to deliver sales growth and improving gross margins,” concluded Gorder.

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 3

About IntriCon Corporation

Headquartered in Arden Hills, Minn., IntriCon Corporation designs, develops and manufactures miniature and micro-miniature body-worn medical and electronics products. The company is focused on three key markets: medical, hearing health, and professional audio and communications. IntriCon has facilities in the United States, Asia and Europe. The company’s common stock trades under the symbol “IIN” on the NASDAQ Stock Market. For more information about IntriCon, visit www.intricon.com.

Forward-Looking Statements

Statements made in this release and in IntriCon’s other public filings and releases that are not historical facts or that include forward-looking terminology such as “may”, “will”, “believe”, “expect”, “should”, “optimistic” or “continue” or the negative thereof or other variations thereon are “forward-looking statements” within the meaning of the Securities Exchange Act of 1934 as amended. These forward-looking statements include, without limitation, statements concerning prospects in the miniature body-worn device arena, future growth and expansion, future financial condition and performance, prospects and the positioning of IntriCon to compete in chosen markets and the Company’s planned investments in research and development. These forward-looking statements may be affected by known and unknown risks, uncertainties and other factors that are beyond IntriCon’s control, and may cause IntriCon’s actual results, performance or achievements to differ materially from the results, performance and achievements expressed or implied in the forward-looking statements. These risks, uncertainties and factors include, without limitation, risks related to the Tibbetts acquisition, including unanticipated liabilities and expenses, the risk that IntriCon may not be able to achieve its long-term strategy, weakening demand for products of the company due to general economic conditions, possible non-performance of developing technological products, the volume and timing of orders received by the company, changes in the mix of products sold, competitive pricing pressures, the cost and availability of electronic components and commodities for the company’s products, ability to create and market products in a timely manner, competition by competitors with more resources than the company, foreign currency risks arising from the company’s foreign operations, the costs and risks associated with research and development investments and other risks detailed from time to time in the company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2007. The company disclaims any intent or obligation to publicly update or revise any forward-looking statements, regardless of whether new information becomes available, future developments occur or otherwise.

Contacts

At IntriCon:	At Padilla Speer Beardsley:
Scott Longval, CFO	Matt Sullivan/Marian Briggs
651-604-9526	612-455-1700
slongval@intricon.com	msullivan@psbpr.com / mbriggs@psbpr.com

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 4

IntriCon Corporation

Consolidated Condensed Statements of Operations

(Unaudited)

	Three Months Ended
	June 30, 2008			June 30, 2007
Sales, net	$	17,525,127		$	16,937,697
Costs of sales		13,270,711			12,731,182
Gross profit		4,254,416			4,206,515
Operating expenses:
Selling expense		985,035			962,872
General and administrative expense (a)		1,734,956			1,613,217
Research and development expense		867,459			650,777
Total operating expenses		3,587,450			3,226,866
Operating income		666,966			979,649
Interest expense		(186,081	)		(333,129	)
Interest income		1,287			12,047
Equity in earnings of partnerships		(590	)		(60,000	)
Other (expense) income, net		(42,839	)		35,788
Income before income taxes		438,743			634,355
Income tax expense		28,785			107,511
Net income	$	409,958		$	526,844
Earnings per share:
Basic	$	.08		$	.10
Diluted	$	.07		$	.10
Average shares outstanding:
Basic		5,309,904			5,200,137
Diluted		5,574,222			5,455,743

(a) General and administrative expense includes $139,770 and $68,626 of non-cash stock option expense related to FAS 123(R) for the three-month period ended June 30, 2008 and 2007, respectively.

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 5

IntriCon Corporation

Consolidated Condensed Statements of Operations

(Unaudited)

	Six Months Ended
	June 30, 2008			June 30, 2007
Sales, net	$	34,116,507		$	31,516,964
Costs of sales		26,017,400			24,099,192
Gross profit		8,099,107			7,417,772
Operating expenses:
Selling expense		1,981,261			1,805,638
General and administrative expense (a)		3,387,335			3,033,481
Research and development expense		1,655,232			1,383,458
Total operating expenses		7,023,828			6,222,577
Operating income		1,075,279			1,195,195
Interest expense		(381,706	)		(486,406	)
Interest income		8,547			50,783
Equity in earnings of partnerships		21,566			(80,000	)
Other (expense) income, net		(48,297	)		10,051
Income before income taxes		675,389			689,623
Income tax expense		115,615			135,271
Net income	$	559,774		$	554,352
Earnings per share:
Basic	$	.11		$	.11
Diluted	$	.10		$	.10
Average shares outstanding:
Basic		5,315,382			5,198,542
Diluted		5,592,558			5,410,192

(a) General and administrative expense includes $268,121 and $141,699 of non-cash stock option expense related to FAS 123(R) for the six-month period ended June 30, 2008 and 2007, respectively.

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 6

IntriCon Corporation

Consolidated Condensed Balance Sheets

(Unaudited)

Assets
	June 30, 2008		December 31, 2007
	(unaudited)
Current assets
Cash	$	1,576,826	$	1,651,145
Restricted cash		76,838		72,231
Accounts receivable, less allowance for doubtful accounts of $266,000 at 2008 and $259,000 at 2007		9,223,730		8,408,149
Inventories		9,099,536		9,835,060
Refundable income taxes		45,894		28,297
Note receivable from sale of discontinued operations, less allowance of $225,000 at 2008 and 2007		—		75,000
Other current assets		962,070		775,206
Total current assets		20,984,894		20,845,088
Property, plant and equipment
Machinery and equipment		37,187,054		36,959,184
Less: accumulated depreciation		29,155,612		28,500,318
Net property, plant and equipment		8,031,442		8,458,866
Goodwill		8,266,438		8,238,020
Investment in partnerships		1,611,992		1,590,426
Other assets, net		1,529,719		1,543,127
Total assets	$	40,424,485	$	40,675,527

(more)

IntriCon Corporation 2008 Second-Quarter Results

July 24, 2008

Page 8

IntriCon Corporation

Consolidated Condensed Balance Sheets

(Unaudited)

Liabilities and Shareholders’ Equity	June 30, 2008			December 31, 2007
	(unaudited)
Current liabilities
Checks written in excess of cash	$	706,476		$	1,209,642
Current maturities of long-term debt		1,628,865			1,476,665
Accounts payable		3,287,636			3,965,914
Income taxes payable		31,076			74,549
Deferred gain on building sale		110,084			110,084
Short term partnership payable		260,000			260,000
Other accrued liabilities		4,189,164			4,382,755
Total current liabilities		10,213,301			11,479,609
Long term debt, less current maturities		7,058,420			6,963,410
Other post-retirement benefit obligations		729,913			816,532
Long term partnership payable		1,020,000			1,020,000
Note payable, net of current portion (Amecon)		259,360			259,360
Deferred income taxes		92,273			89,273
Accrued pension liability		643,346			624,517
Deferred gain on building sale		770,589			825,631
Other accrued liabilities		49,894			—
Total non-current liabilities		10,623,795			10,598,723
Total liabilities		20,837,096			22,078,332
Commitments and contingencies
Shareholders’ equity
Common shares, $1 par; 10,000,000 shares authorized; 5,830,131 and 5,813,491 shares issued; 5,314,377 and 5,297,737 outstanding		5,830,131			5,813,491
Additional paid-in capital		13,785,113			13,391,449
Retained earnings		1,437,507			877,733
Accumulated other comprehensive loss		(200,284	)		(220,400	)
Less: 515,754 common shares held in treasury, at cost		(1,265,078	)		(1,265,078	)
Total shareholders’ equity		19,587,389			18,597,195
Total liabilities and shareholders’ equity	$	40,424,485		$	40,675,527

# # #