EXHIBIT 99.1
(IKONICS LOGO)
4842 Grand Ave., Duluth, MN 55807
Phone: 218-628-2217 Fax: 218-628-3245
www.ikonics.com info@ikonics.com
NEWS RELEASE
NEWS CONTACT: Bill Ulland FOR IMMEDIATE RELEASE
Chairman, President & CEO April 26, 2007
(218) 628-2217
IKONICS POSTS FIRST QUARTER RESULTS
DULUTH, MN - IKONICS Corporation, a Duluth based imaging technology company,
announced today a 4% increase in sales to $3,508,000 for the first quarter of
2007, compared to $3,372,000 for the same period in 2006. Sales in 2007 were a
first quarter record. Earnings declined by 4% to $94,000, or $0.05 per diluted
common share, for the quarter compared to $98,000, or $0.05 per diluted common
share, for the first quarter of 2006.
Bill Ulland, IKONICS CEO, said that first quarter has in recent years been
IKONICS' weakest, and 2007 was no exception. Compared to the same period in
2006, first quarter 2007 income from operations decreased due to expenses
related to the image mate(TM) product line integration, Sarbanes-Oxley
compliance expenses, and seasonal buying patterns in Asia. A $55,000 gain on the
sale of our investment in Apprise Technologies Inc. was not sufficient to offset
these expenses. Although the image mate integration is going well, sales did not
gain traction until later in the quarter while additional costs incurred
throughout the quarter negatively impacted earnings. The Company also realized a
tax benefit during the quarter resulting from the reversal of a valuation
allowance and other tax accrual adjustments.
Ulland added that during the quarter the company made a further capital
investment in its industrial ink jet technology and continued to incur expenses
related to commercializing its ceramic and electronic wafer etching technology.
"We are experiencing limited prototype sales from both projects and anticipate
commercial sales later in 2007," said Ulland.
"In spite of the typical slow start to the year, I am optimistic that 2007 will
be another successful year for IKONICS," said Ulland.
This press release contains forward-looking statements regarding sales,
earnings, new products and acquisitions 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, complete and integrate 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, 2007 and 2006
THREE MONTHS ENDED
03/31/07 03/31/06
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Sales $ 3,507,767 $ 3,371,800
Costs and expenses 3,511,434 3,249,798
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Income (Loss) from Operations (3,667) 122,002
Gain on sale of investment 55,159 --
Interest Income 32,907 23,788
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Income before income taxes $ 84,399 $ 145,790
Federal and state income tax (expense) benefit 9,698 (47,488)
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Net income 94,097 98,302
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Earnings per common share-diluted $ 0.05 $ 0.05
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Average shares outstanding-diluted 2,064,511 2,019,238
CONDENSED BALANCE SHEETS
As of March 31, 2007 and December 31, 2006
ASSETS 3/31/07 12/31/06
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(UNAUDITED)
Current assets $ 8,327,872 $ 8,229,210
Property, plant and equipment, net 1,008,418 991,920
Investment in non-marketable
equity securities 791,451 988,910
Intangible assets 496,155 485,421
Deferred income taxes 48,000 48,000
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$10,671,896 $10,743,461
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LIABILITIES AND EQUITY
Current liabilities $ 669,795 $ 879,362
Long term debt -- --
Stockholders' equity 10,002,101 9,864,099
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$10,671,896 $10,743,461
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CONDENSED STATEMENTS OF CASH FLOW (UNAUDITED)
For the Three Months Ending March 31, 2007 and 2006
3/31/07 3/31/06
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Net cash provided by operating activities 193,372 18,363
Net cash provided by (used in) investing activities 153,120 (217,178)
Net cash provided by financing activities 28,384 121,221
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Net increase (decrease) in cash and cash equivalents 374,876 (77,594)
Cash and cash equivalents at beginning of period 3,428,186 3,412,072
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Cash and cash equivalents at end of period $ 3,803,062 $ 3,334,478
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