IKONICS Corp. (IKNX) had 2020 revenue of $13,432,000, down 23.8 percent from the prior year.
The company realized a net loss for 2020 of $439,000, or 22 cents per diluted share, compared with a 2019 loss of $814,000, or 41 cents per diluted share. Fourth quarter sales were $4,228,000, down 14.8 percent versus the same quarter in 2019.
Fourth quarter earnings improved from a loss of $80,000, or 4 cents per diluted share, in 2019 to income of $1,463,000, or 74 cents per diluted share in 2020. Year-to-date and fourth quarter earnings in 2020 were both favorably impacted by the company receiving forgiveness on its $1,215,000 SBA PPP loan.
“I am pleased to announce that IKONICS delivered markedly improved fourth quarter results compared to the same period last year, a positive conclusion to the most challenging year in the company’s history. The results were driven by our relentless cost cutting, renewed focus on operational excellence and an improving international business climate,” said Glenn Sandgren, IKONICS’ chief executive.
“The IKONICS team’s performance has been exceptional. They navigated a myriad of obstacles and put forth a tremendous effort to deliver the results. It is important to highlight that the fourth quarter of 2020 was IKONICS’ first quarterly profit since the fourth quarter of 2018, and that IKONICS would have been profitable in the fourth quarter of 2020 irrespective of the one-time PPP loan forgiveness,” he continued.
Opportunities for 2021 include:
- IKONICS Imaging business—which saw renewed customer interest in the fourth quarter of 2020 and benefited greatly from its IKONART consumer screen printing system—enjoyed robust sales for the year and is on a trajectory to significantly outperform in 2021.
- Integrated Ink Jet Systems (IIS) that made great technical strides with the Dual Print mold texturing mask making system in 2020 and expects to commercialize the technology in 2021, with revenue ramping into 2022.
- Improving demand for Chromaline screen print products as economies both domestically and internationally begin to reopen.”
- Conversely, Sandgren stated that the AMS division will continue to be negatively impacted in 2021 by the slow aerospace industry recovery. He also noted that the company was notified that its $2.7 million outstanding loan will be payable on April 1, 2021. Due to efforts in 2020, the company was able to build cash through the year, and he believes that any adverse effect of the loan recall is mitigated by its strong working capital position including cash and cash equivalents of $3.7 million along with the company's $2.0 million available line of credit.
“2020 was a catalyst for transformation at IKONICS. The fourth quarter performance was outstanding, and IKONICS is well positioned as the global economy is expected to begin reopening in mid-2021. We are in a continual search for strategic additions to our businesses and other possibilities that leverage our core strengths and improve our trajectory. Barring the unknown additional impact of COVID-19 related restrictions on our served markets, 2021 will be a year of measured business improvement and new opportunities for IKONICS,” he said.