Sales and Operating Income Increase
Nortech Systems Incorporated (NASDAQ: NSYS) today reported net sales of $28.3 million for the third quarter ended Sept. 30, 2011, a nine percent increase over net sales of $26.0 million for the third quarter of 2010. Operating income for the third quarter of 2011 was $420,000, compared to $166,000 for the third quarter of 2010.
For the third quarter of 2011, Nortech Systems reported net income of $183,000, or $0.07 per diluted common share. This compares with net income of $127,000, or $0.05 per diluted common share, for the third quarter of 2010.
Nortech Systems reported net sales of $85.1 million for the nine months ended Sept. 30, 2011. This compares with $72.4 million for the same period in 2010, an increase of 18 percent. Operating income for the first nine months of 2011 was $1.0 million, compared with operating income of $977,000 reported for the same period in 2010.
Net income for the nine-month period was $955,000, or $0.35 per diluted common share, compared with $370,000, or $0.13 per diluted common share, reported for the same period in 2010.
“Revenue growth was led by our industrial and medical customers, strongly aided by our two most recent acquisitions,” said Mike Degen, president and CEO of Nortech Systems. “Strengthening and expanding our customer base has helped offset some weakness in demand we’re experiencing with certain industrial customers.”
Degen added that macroeconomic uncertainty in the U.S. and worldwide has been impacting Nortech’s customer base, most significantly in semiconductor capital equipment. However, demand is increasing from defense customers.
“In this difficult business climate, we’re successfully managing our business to suit economic conditions,” commented Degen. “We are also pleased with our progress integrating our latest acquisitions — we began to see profitability improve along with revenue.
“Meeting the challenges of an uncertain economy while continuing our successful integration activities and other lean initiatives will keep Nortech on the path to achieving our long-term goals,” Degen concluded.
Conference Call
Nortech Systems announces a conference call to be held at 10:00 a.m. (CDT) on Thursday, Nov. 3, 2011, to discuss the company’s third quarter results. Anyone interested in participating in the conference can access the call by dialing 877-407-8031 from within the United States, or 201-689-8031 if calling internationally. An audio webcast and replay of this conference call can be accessed at the investor relations portion of Nortech Systems’ website at www.nortechsys.com or at www.investorcalendar.com. A podcast (MP3 download) will also be available. The telephone replay will be available through Nov. 17, 2011, by dialing 877-660-6853 (from U.S.) or 201-612-7415 (International). To access the replay, the account number 286 and conference ID 382042 are both required.
About Nortech Systems, Incorporated
Nortech Systems Incorporated (www.nortechsys.com), based in Wayzata, Minn., is a full-service electronics manufacturing services (EMS) provider of wire and cable assemblies, printed circuit board assemblies, and higher-level complete box build assemblies for a wide range of industries. Markets served include industrial equipment, aerospace/defense and medical. The company has manufacturing capabilities and operating partners in the U.S., Asia and Latin America. Nortech Systems Incorporated is traded on the NASDAQ Stock Market under the symbol NSYS.
Forward-Looking Statements
This press release contains forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. While this release is based on management’s best judgment and current expectations, actual results may differ and involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the forward-looking statements include, without limitation: volatility in market conditions which may affect market supply of and demand for the company’s products; increased competition; changes in the reliability and efficiency of operating facilities or those of third parties; risks related to availability of labor; commodity and energy cost instability; general economic, financial and business conditions that could affect the company’s financial condition and results of operations; as well as risk factors listed from time to time in the company’s filings with the SEC.
| Condensed Statements of Income | |||||||||||||||||
| Three months ended Sept. 30, | Nine months ended Sept. 30, | ||||||||||||||||
| Unaudited | Unaudited | ||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||||||
| Net Sales | $ | 28,318,158 | $ | 25,957,327 | $ | 85,112,931 | $ | 72,393,274 | |||||||||
| Income from Operations | 420,138 | 166,190 | 1,045,934 | 976,942 | |||||||||||||
| Income before | |||||||||||||||||
| Income Taxes | 280,865 | 220,318 | 1,390,147 | 767,714 | |||||||||||||
| Income Tax Expense | 98,000 | 93,000 | 435,000 | 398,000 | |||||||||||||
| Net Income | 182,865 | 127,318 | 955,147 | 369,714 | |||||||||||||
| Net Income Per | |||||||||||||||||
| Basic and Diluted | |||||||||||||||||
| Common Share | $ | 0.07 | $ | 0.05 | $ | 0.35 | $ | 0.13 | |||||||||
| Weighted Average | |||||||||||||||||
| Number of Common | |||||||||||||||||
| Shares – Basic and | |||||||||||||||||
| Diluted | 2,742,992 | 2,742,992 | 2,742,992 | 2,742,186 | |||||||||||||
| Condensed Balance Sheets | ||||||||
| Sept. 30, 2011 | Dec. 31, 2010 | |||||||
| (Unaudited) | ||||||||
| Current Assets | $ | 40,572,100 | $ | 33,467,996 | ||||
| Property and Other Long-term Assets | 9,448,100 | 8,092,928 | ||||||
| Total Assets | $ | 50,020,200 | $ | 41,560,924 | ||||
| Current Liabilities | $ | 28,755,014 | $ | 20,403,551 | ||||
| Long-Term Debt | 997,428 | 1,868,554 | ||||||
| Shareholders’ Equity | 20,267,758 | 19,288,819 | ||||||
| Total Liabilities and Shareholders’ Equity | $ | 50,020,200 | $ | 41,560,924 | ||||
Nortech Systems Incorporated
Richard Wasielewski, 952-345-2244
or
Brookside Communications Group
Warren Djerf, 952-920-3908
warren@brookcomm.net