UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8‑K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 29, 2021
IKONICS CORPORATION
(Exact name of registrant as specified in its charter)
Minnesota |
000-25727 |
41-0730027 |
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
4832 Grand Avenue Duluth, Minnesota |
55807 |
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(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code (218) 628-2217
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Common Stock, par value $.10 per share |
IKNX |
Nasdaq Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On April 29, 2021, IKONICS Corporation (the “Company”) reported its financial results for the quarter ended March 31, 2021. See the Company’s press release dated April 29, 2021, which is furnished as Exhibit 99 hereto and incorporated by reference in this Item 2.02.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibit.
Exhibit Number |
Description |
99 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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IKONICS CORPORATION |
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Date: April 29, 2021 |
/s/ Jon Gerlach |
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Jon Gerlach |
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Chief Financial Officer |
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and Vice President of Finance |
Exhibit 99
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4832 Grand Avenue Duluth, MN 55807 USA Phone: (218) 628-2217 Fax: (218) 628-3245 Email: info@ikonics.com Website: www.ikonics.com |
News Contact: | Glenn Sandgren | For Immediate Release |
Chief Executive Officer | April 29, 2021 | |
(218) 628-2217 |
IKONICS ANNOUNCES IMPROVED FIRST QUARTER 2021 RESULTS
DULUTH, MN - IKONICS Corporation (Nasdaq:IKNX), a Duluth-based imaging technology company (“IKONICS” or the “Company”), announced its first quarter 2021 earnings. Net Sales were $3,073,000 compared to $3,497,000 in 2020, a decline of 12.1%. IKONICS realized a net loss of $322,000, or $0.16 per diluted share, a 45.1% improvement over the $587,000 net loss, or $0.30 per diluted share, for the same quarter of 2020.
Glenn Sandgren, IKONICS CEO, noted, “The overall performance of IKONICS continues to trend upwards, comparing very favorably to the prior year. Our served markets are rapidly reopening, and our major strategic initiatives are progressing well.”
Key Points:
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IKONICS quarterly performance is cyclical, and the first quarter is traditionally the most challenging. It is encouraging that 2021 first quarter results have improved due to cost reduction efforts versus the prior year quarter, despite a 12.1% sales decrease for the period. |
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Imaging sales are strengthening as awards customers reopen and IKONART® sales continue to outperform, driven by a compelling social media presence. |
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Chromaline sales were driven by strong international demand, and early reopening in North America. Division sales were down compared to the prior year, but division income almost doubled. |
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Multiple large mold makers are evaluating our IIS DualPrint™ mold texturing mask making system, with very positive feedback. |
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Pressure has continued to be put on the AMS Division from the aerospace industry slowdown. However, frequency of new business inquiries has returned to pre-Covid levels and the legacy customer order rate during the first quarter was improved over the second half of last year. |
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On April 1, 2021, IKONICS paid off its $2.7 million real estate loan, leaving the Company with only working capital related liabilities. Company liquidity remains strong based on cash on hand in addition to the $2.1 million available line of credit. |
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Supply chains are under pressure from weather events and logistical challenges. Currently, no long-term impact is expected. |
Sandgren said in closing, “Opportunities abound as the world reopens, and IKONICS is well positioned to make the most of them as they arise. We are excited about IKONICS improving prospects for the remainder of the year.”
This press release contains forward-looking statements regarding sales, gross profits, net earnings, balance sheet position, supply chain, new products, new business initiatives, customer behavior and market trends that involve risks and uncertainties. The Company's actual results could differ materially as a result of domestic and global economic conditions, downturns in the aerospace or automotive industries, unexpected production delays by customers using the Company’s products, supply chain disruptions, competitive market conditions, changes in consumer preferences, inability to commercialize technologies the Company is developing on the anticipated timeline or at all, acceptance of new products the Company offers, introduction of new products or technologies by competitors, unexpected capital expenditure requirements, delays in completing planned expansions, the ability to control operating costs without impacting growth as well as the factors described in the Company's Forms 10-K, and 10-Q, and other reports on file with the SEC.
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4832 Grand Avenue Duluth, MN 55807 USA Phone: (218) 628-2217 Fax: (218) 628-3245 Email: info@ikonics.com Website: www.ikonics.com |
IKONICS Corporation
CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
For the Three Months Ended March 31, 2021 and 2020
Three Months Ended |
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3/31/21 |
3/31/20 |
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Net sales |
$ | 3,073,408 | $ | 3,497,192 | ||||
Cost of goods sold |
2,077,076 | 2,343,960 | ||||||
Gross profit |
996,332 | 1,153,232 | ||||||
Operating expenses |
1,318,513 | 1,964,600 | ||||||
Loss from operations |
(322,181 | ) | (811,368 | ) | ||||
Interest expense |
(19,842 | ) | (21,484 | ) | ||||
Other Income |
37 | 6,917 | ||||||
Loss before income taxes |
(341,986 | ) | (825,935 | ) | ||||
Income tax benefit |
(20,347 | ) | (238,929 | ) | ||||
Net loss |
$ | (321,639 | ) | $ | (587,006 | ) | ||
Loss per common share-basic and diluted |
$ | (0.16 | ) | $ | (0.30 | ) | ||
Average diluted shares outstanding |
1,976,771 | 1,976,354 |
CONDENSED BALANCE SHEETS
As of March 31, 2021 and December 31, 2020
3/31/2021 |
12/31/2020 |
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Assets |
(unaudited) |
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Current assets |
$ | 8,164,356 | $ | 7,803,453 | ||||
Property, plant, and equipment, net |
7,227,802 | 7,388,363 | ||||||
Intangible assets, net |
243,819 | 243,583 | ||||||
$ | 15,635,977 | $ | 15,435,399 | |||||
Liabilities and Stockholders' Equity |
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Current liabilities |
$ | 4,074,392 | $ | 3,596,053 | ||||
Long-term debt |
— | — | ||||||
Stockholders' equity |
11,561,585 | 11,839,346 | ||||||
$ | 15,635,977 | $ | 15,435,399 |
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
For the Three Months Ended March 31, 2021 and 2020
3/31/2021 |
3/31/2020 |
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Net cash provided by (used in) operating activities |
$ | 771,355 | $ | (427,276 | ) | |||
Net cash (used in) provided by investing activities |
(6,787 | ) | 1,104,749 | |||||
Net cash used in financing activities |
(30,144 | ) | (35,682 | ) | ||||
Net increase in cash |
734,424 | 641,791 | ||||||
Cash at beginning of period |
3,693,845 | 963,649 | ||||||
Cash at end of period |
$ | 4,428,269 | $ | 1,605,440 |