EXHIBIT 99
[IKONICS CORPORATION LETTERHEAD]
NEWS RELEASE
NEWS CONTACT: Bill Ulland FOR IMMEDIATE RELEASE
Chairman, President & CEO April 27, 2006
(218) 628-2217
IKONICS ANNOUNCES INCREASE IN FIRST QUARTER PROFITS
DULUTH, MN - IKONICS Corporation, a Duluth based imaging technology company,
reported earnings for the first quarter of 2006 of $98,000, or $0.05 per share,
compared to $0.01 per share for the first quarter of 2005. Sales were
$3,372,000, a 1% increase over 2005.
The strong increase in earnings reflects reduced expenses and higher margins
resulting from a more favorable product mix. Sales to India continue to be slow,
although the company anticipates a rebound in the second quarter.
Bill Ulland, Ikonics CEO, said, "Historically, the first quarter tends to be our
weakest, affected by cold weather shipping delays and the Asian New Year holiday
season. We look to our new business initiatives to lessen the affect of this
seasonality."
"Our new initiatives are gaining traction," Ulland said. "We are producing
IKONMetal and assigning distributors; our IKONBraille prototype was received
very positively at the recent International Sign Expo in Orlando, and we are
starting to build an inventory of this product."
IKONMetal is a unique metal composite that can be etched by rotary engraving or
abrasive etching into a high-quality, low-cost metallic sign, award or trophy.
IKONBraille is a patent-applied-for product designed to be made into
high-quality, low-cost custom Braille signage using abrasive etching.
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
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
For the Three Months Ended March 31, 2006 and 2005
THREE MONTHS ENDED
03/31/06 03/31/05
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Sales $3,371,800 $3,328,527
Costs and expenses net of interest income 3,226,010 3,313,761
Income before income taxes $ 145,790 $ 14,766
Federal and state income tax expense (benefit) 47,488 (8,889)
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Net income 98,302 23,655
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Earnings per common share-diluted $ 0.05 $ 0.01
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Average shares outstanding-diluted 2,019,238 1,984,051
CONDENSED BALANCE SHEETS
As of March 31, 2006 and December 31, 2005
ASSETS 3/31/06 12/31/05
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(UNAUDITED)
Current assets $7,440,824 $7,728,358
Property, plant and equipment, net 930,772 951,565
Investment in non-marketable
equity securities 700,788 450,790
Intangible assets 283,393 279,086
Deferred income taxes 61,000 61,000
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$9,416,777 $9,470,799
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LIABILITIES AND EQUITY
Current liabilities $ 713,828 $ 992,294
Long term debt 0 0
Stockholders' equity 8,702,949 8,478,505
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$9,416,777 $ 9,470,799
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CONDENSED STATEMENTS OF CASH FLOW (UNAUDITED)
For the Three Months Ending March 31, 2006 and 2005
3/31/06 3/31/05
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Cash flows provided by (used in) operating activities 18,363 ($143,021)
Cash flows provided by (used in) investing activities (217,178) 260
Cash flows provided by financing activities 121,221 75,363
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Net decrease in cash and cash equivalents (77,594) (67,398)
Cash and cash equivalents at beginning of period 3,412,072 2,737,460
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Cash and cash equivalents at end of period $3,334,478 $2,670,062
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