SCI Engineered Materials, Inc. Reports 2024 First Quarter Results

Rhea-AI Summary

SCI Engineered Materials, Inc. reported record revenue of $8,403,095 for the first quarter of 2024, a 45% increase from the same period last year. The company's gross profit increased by 7% to $1,415,116, but operating expenses also rose. Net income was $545,324, with earnings per share at $0.12. Cash and equivalents declined slightly, while total debt outstanding decreased by 42%.

Positive

• Record revenue of $8,403,095 for the first quarter of 2024, a 45% increase from the same period last year.

• Gross profit increased by 7% to $1,415,116.

• Net interest income grew to $87,056.

Negative

• Operating expenses rose to $796,848 for the first quarter of 2024.

• Order backlog decreased to $4.4 million on March 31, 2024.

• Total debt outstanding declined by 42% but was at $28,710 on March 31, 2024.

COLUMBUS, OH / ACCESSWIRE / May 3, 2024 / SCI Engineered Materials, Inc. ("SCI") (OTCQB:SCIA), today reported financial results for the three months ended March 31, 2024. SCI is a global supplier and manufacturer of advanced materials for physical vapor deposition thin film applications who works closely with end users and OEMs to develop innovative, customized solutions.

Jeremy Young, President, and Chief Executive Officer stated "We are pleased with the Company's record 2024 first quarter revenue. SCI continues to gain traction in multiple niche markets of the global photonics industry. During the first quarter of 2024 we purchased additional manufacturing equipment to meet growing demand for our products. SCI is solidly positioned to continue improving long-term performance through its innovative product portfolio and increased marketing and sales initiatives."

Revenue

Revenue was a record $8,403,095 for the first three months of 2024 compared to $5,797,147 for the same period last year. Higher volume coupled with increased raw material costs were key factors that contributed to the 45% increase.

Order backlog was $4.4 million on March 31, 2024, compared to $5.1 million on the same date in 2023. Orders from customers serving multiple markets remain strong.

Gross profit

Gross profit for the 2024 first quarter increased 7% to $1,415,116 from $1,324,597 the prior year. Higher 2024 first quarter revenue was adversely impacted by increased raw material costs.

Operating expenses

Operating expenses (general and administrative, research and development (R&D), and marketing and sales) for the 2024 first quarter were $796,848 compared to $677,344 last year. Higher compensation and benefits, which included increased R&D and marketing and sales staff, plus ongoing research materials and supplies were key factors in the year-over-year increase.

Net interest income

Net interest income increased to $87,056 for the first three months of 2024 from $48,977 a year ago. A higher amount of cash in money market funds plus $2 million of investments in marketable securities benefited from increased interest rates.

Income taxes

Income tax expense was $160,000 for the 2024 first quarter versus $158,210 for the same period a year ago. The Company's effective tax rate was 22.7% for the first three months of 2024 and 2023.

Net income

Net income was $545,324 for the first three months of 2024 compared to $538,020 a year ago. Higher operating expenses primarily offset increases in gross profit and net interest income versus the same period in 2023. Earnings per share were $0.12 for the first quarter of 2024 and 2023.

Cash and equivalents

Cash and equivalents were $5,465,327 on March 31, 2024, compared to $5,673,994 at 2023 year-end. There was also approximately $2.0 million of investments in marketable securities on March 31, 2024, and December 31, 2023. The slight decline in cash and equivalents during the first three months of 2024 was primarily attributable to the Company's purchase of $176,534 of production equipment.

Debt outstanding

Total debt outstanding declined approximately 42% during the first three months of 2024 and was $28,710 on March 31, 2024, compared to $49,149 on December 31, 2023. This amount represents a current finance lease obligation that is anticipated to be repaid in full during the second half of this year.

About SCI Engineered Materials, Inc.

SCI Engineered Materials is a global supplier and manufacturer of advanced materials for PVD thin film applications who works closely with end users and OEMs to develop innovative, customized solutions. Additional information is available at www.sciengineeredmaterials.com or follow SCI Engineered Materials, Inc. at:

https://www.linkedin.com/company/sci-engineered-materials.-inc
https://www.facebook.com/sciengineeredmaterials/
https://www.twitter.com/SciMaterials

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Those statements include, but are not limited to, all statements regarding intent, beliefs, expectations, projections, customer guidance, forecasts, plans of the Company and its management. These forward-looking statements involve numerous risks and uncertainties, including without limitation, other risks and uncertainties detailed from time to time in the Company's Securities and Exchange Commission filings, including the Company's Annual Report on Form 10-K for the year ended December 31, 2023. One or more of these factors have affected and could affect the Company's projections in the future. Therefore, there can be no assurances that the forward-looking statements included in this press release will prove to be accurate. Due to the significant uncertainties in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company, or any other persons, that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to the management of the Company. The Company assumes no obligation to update any forward-looking statements.

Contact:
Robert Lentz
(614) 439-6006

SCI ENGINEERED MATERIALS, INC.
BALANCE SHEETS
ASSETS

		March 31,				December 31,
		2024				2023
		(UNAUDITED)
Current Assets
Cash and cash equivalents		$	5,465,327			$	5,673,994
Investments - marketable securities, short term			500,000				1,000,000
Accounts receivable, less allowance for doubtful accounts			1,135,547				910,647
Inventories			3,685,041				4,654,398
Prepaid purchase orders and expenses			169,289				1,338,438
Total current assets			10,955,204				13,577,477
Property and Equipment, at cost			9,742,842				9,603,316
Less accumulated depreciation and amortization			(7,446,121	)			(7,359,310	)
Property and Equipment, net			2,296,721				2,244,006
Investments, net - marketable securities, long term			1,508,478				994,478
Right of use asset, net			567,329				592,170
Other assets			77,056				78,289
Total other assets			2,152,863				1,664,937
TOTAL ASSETS		$	15,404,788			$	17,486,420
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short term debt		$	28,710			$	49,149
Operating lease, short term			104,690				111,193
Accounts payable			351,945				385,489
Customer deposits			2,428,497				4,871,035
Accrued expenses			304,504				527,595
Total current liabilities			3,218,346				5,944,461
Deferred tax liability			146,391				69,846
Operating lease, long term			470,714				492,080
Total liabilities			3,835,451				6,506,387
Total shareholders' equity			11,569,337				10,980,033
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$	15,404,788			$	17,486,420

SCI ENGINEERED MATERIALS, INC.
STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
(UNAUDITED)

		2024				2023
Revenue		$	8,403,095			$	5,797,147
Cost of revenue			6,987,979				4,472,550
Gross profit			1,415,116				1,324,597
General and administrative expense			482,261				432,413
Research and development expense			185,235				135,360
Marketing and sales expense			129,352				109,571
Income from operations			618,268				647,253
Interest income, net			87,056				48,977
Income before provision for income taxes			705,324				696,230
Income tax expense			160,000				158,210
NET INCOME		$	545,324			$	538,020
Earnings per share - basic and diluted
Income per common share
Basic		$	0.12			$	0.12
Diluted		$	0.12			$	0.12
Weighted average shares outstanding
Basic			4,534,801				4,525,103
Diluted			4,567,707				4,555,409

SCI ENGINEERED MATERIALS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
(UNAUDITED)

		2024				2023
CASH (USED IN) PROVIDED BY:
Operating activities		$	(11,694	)		$	719,764
Investing activities			(176,534	)			(147,721	)
Financing activities			(20,439	)			(24,840	)
NET (DECREASE) INCREASE IN CASH			(208,667	)			547,203
CASH - Beginning of period			5,673,994				3,947,966
CASH - End of period		$	5,465,327			$	4,495,169

SOURCE: SCI Engineered Materials, Inc.

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FAQ

What was SCI Engineered Materials, Inc.'s revenue for the first quarter of 2024?

SCI Engineered Materials, Inc. reported record revenue of $8,403,095 for the first quarter of 2024.

What was the net income for SCI Engineered Materials, Inc. in the first quarter of 2024?

SCI Engineered Materials, Inc.'s net income was $545,324 for the first quarter of 2024.

How much did SCI Engineered Materials, Inc.'s total debt outstanding decrease by in the first three months of 2024?

SCI Engineered Materials, Inc.'s total debt outstanding declined approximately 42% during the first three months of 2024.