EXHIBIT 99
[IKONICS CORPORATION LOGO]
NEWS RELEASE
NEWS CONTACT: Bill Ulland FOR IMMEDIATE RELEASE
Chairman, President & CEO July 26, 2004
(218) 628-2217
IKONICS REPORTS 75% INCREASE IN PROFITS ON RECORD SALES
DULUTH, MN - IKONICS Corporation, a Duluth based imaging technology company,
announced its second consecutive quarter of record sales. Sales for the second
quarter of 2004 were $3,683,000, a 16% increase over the second quarter of 2003.
Earnings were $274,000, or $0.14 per share, a 75% increase over the comparable
quarter of last year. The second quarter of 2003 was negatively impacted by a
$75,000 write down of an investment and positively impacted by a $42,000 tax
refund.
For the first six months of 2004, sales are 18% ahead of the 2003 period and
earnings are up by 134% to $0.22 cents per share. During the quarter, IKONICS
affected a 3 for 2 stock split. Above per share earnings are adjusted for the
new number of shares.
As was true in the first quarter, strong sales growth was experienced in all
product groups and geographical markets. The company's current financial
structure of generally high margin products and relatively high fixed costs
results in the acceleration of earnings as sales grow.
Bill Ulland, IKONICS CEO, said, "IKONICS is planning a number of new product
launches in the second half of this year, which we believe will further broaden
our market base".
IKONICS stock is listed on the Nasdaq SmallCap market under the symbol IKNX.
This press release contains forward-looking statements regarding sales,
earnings, and new products that involve risks and uncertainties. The company's
actual results could differ materially as a result of domestic and global
economic conditions, competitive market conditions, acceptance of new products,
the ability to identify and make suitable acquisitions, as well as the factors
described in the company's Form 10-KSB, Forms 10-QSB and other reports on file
with the SEC.
IKONICS CORPORATION
STATEMENTS OF OPERATIONS
For the Three and Six Month Periods Ended June 30, 2004 and 2003
THREE MONTHS ENDED SIX MONTHS ENDED
6/30/04 6/30/03 6/30/04 6/30/03
------- ------- ------- -------
Sales $ 3,683,415 $ 3,161,731 $ 7,066,213 $ 5,992,378
Costs and expenses, net of interest income 3,312,347 2,911,455 6,475,520 5,696,444
Loss on Investment (74,666) (74,666)
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Income before income taxes $ 371,068 $ 175,610 $ 590,693 $ 221,268
Federal and state income tax expense 96,655 19,131 155,622 35,111
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Net income $ 274,413 $ 156,479 $ 435,071 $ 186,157
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Earnings per common share-diluted $ .14 $ .08 $ .22 $ .10
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Average shares outstanding-diluted 2,016,595 1,881,449 2,004,158 1,879,606
BALANCE SHEETS
AS OF JUNE 30, 2004 AND DECEMBER 31, 2003
6/30/04 12/31/03
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ASSETS
Current assets $6,457,466 $5,597,674
Property, equipment, patents & licenses 1,326,974 1,110,159
Investment 112,834 112,834
Other intangible 73,335 308,017
Deferred taxes 66,000 66,000
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$8,036,609 $7,194,684
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LIABILITIES AND EQUITY
Current liabilities $1,062,631 $ 826,334
Long term debt 0 0
Stockholders' equity 6,973,978 6,368,350
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$8,036,609 $7,194,684
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STATEMENTS OF CASH FLOW
For the Six Months Ended June 30, 2004 and 2003
6/30/04 6/30/03
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Cash flows from operating activities $ 498,851 $ 556,945
Cash flows used in investing activities $ (95,643) $(119,199)
Cash flows provided by financing activities $ 165,736 $ 0
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Net increase in cash and cash equivalents $ 568,944 $ 437,746
Cash and cash equivalents at beginning of period $ 1,507,794 $ 384,107
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Cash and cash equivalents at end of period $ 2,076,738 $ 821,853
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