SCI Engineered Materials, Inc. Reports 2024 Fourth Quarter and Year-to-Date Results

Rhea-AI Summary

SCI Engineered Materials (SCIA) reported its financial results for Q4 and full-year 2024. Annual revenue decreased to $22.87 million from $27.98 million in 2023, primarily due to lower raw material costs and slight volume decrease. Net income for 2024 was $1.86 million ($0.41 per diluted share), compared to $2.19 million ($0.48 per diluted share) in 2023.

The company's gross profit slightly decreased to $5.07 million in 2024 from $5.25 million in 2023. Operating expenses increased 10% to $3.02 million. Cash position strengthened with cash and cash equivalents reaching $6.75 million, up 19% from previous year. The company maintained zero debt as of December 31, 2024, and reported an order backlog of $2.5 million.

Management highlighted ongoing implementation of growth strategies including digital marketing campaigns, trade show participation, and plans to launch new products in 2025.

Positive

• Strong cash position with $6.75 million in cash and cash equivalents, up 19% YoY
• Zero debt as of December 31, 2024
• Net interest income increased 37% to $393,441
• Maintained profitability with $1.86 million net income for 2024

Negative

• Revenue declined 18.3% to $22.87 million in 2024
• Net income decreased 15.2% to $1.86 million
• Operating expenses increased 10% to $3.02 million
• Order backlog decreased to $2.5 million from $3.0 million in Q3 2024

COLUMBUS, OH / ACCESS Newswire / February 14, 2025 / SCI Engineered Materials, Inc. ("SCI") (OTCQB:SCIA), today reported financial results for the three months and twelve months ended December 31, 2024.

Jeremy Young, President and Chief Executive Officer, said "We continued to implement our growth strategy throughout 2024, despite signs of slower economic activity during the second half of the year. Specific initiatives currently being implemented include targeted digital online marketing campaigns, active participation in industry trade shows and maintaining close customer contact through in-person visits. These activities are increasing SCI's brand recognition and have resulted in additional cross-selling opportunities with existing customers and the addition of new customers, especially for toll manufacturing services. We plan to launch new products in 2025 which further leverage SCI's manufacturing capabilities and offer customers innovative solutions for their markets."

Revenue

The Company's revenue for the twelve months ended December 31, 2024, was $22,870,192 compared to $27,984,083 the prior year. Fourth quarter 2024 revenue was $5,051,150 versus $7,029,123 for the same period in 2023. Lower cost of a key raw material was the primary factor concerning the revenue decrease in 2024 versus 2023. Product mix and a slight decrease in volume also contributed to lower revenue for the full-year and fourth quarter of 2024. Order backlog was $2.5 million on December 31, 2024, compared to $3.0 million at September 30, 2024.

Gross profit

Gross profit was $5,068,301 for the year 2024 compared to $5,251,633 in 2023. The Company's gross profit for the fourth quarter of 2024 was $1,184,953 versus $1,286,763 the prior year. Lower raw material costs were the key factor contributing to the decrease in gross profit. Gross profit margin for both periods in 2024 benefited from lower raw material costs and product mix compared to a year ago.

Operating expenses

Operating expenses (general and administrative, research & development (R&D), and marketing and sales) for the twelve months ended December 31, 2024, increased approximately 10% to $3,023,535 from $2,757,385 a year ago. Higher compensation and benefit expenses, which included increased staff, and additional R&D materials and supplies, were partially offset by lower consulting and travel expenses. The Company's operating expenses for the fourth quarter of 2024 decreased 5% to $702,764 from $741,768 in 2023. Lower R&D and marketing and sales expenses offset slightly higher general and administrative expense.

Net interest income

Net interest income was $393,441 for the year 2024 versus $286,361 in 2023, an increase of 37%. The Company's net interest income increased to $102,533 for the fourth quarter of 2024 from $92,218 a year ago. Both periods in 2024 benefited from higher cash and cash equivalents and increased investments in marketable securities compared to the same periods of the prior year.

Income taxes

Income tax expense decreased slightly to $576,818 for the year 2024 from $586,710 in 2023. The Company's effective tax rate was 23.6% for the twelve months ended December 31, 2024, compared to 21.1% in 2023.

Net income

Net income was $1,861,389, or $0.41 per diluted share, for the twelve months ended December 31, 2024, compared to $2,193,899, or $0.48 per diluted share, in 2023. For the year 2024, increased net interest income partially offset lower gross profit and higher operating expenses. The Company's 2024 fourth quarter net income was $428,981, or $0.09 per diluted share, compared to $565,736, or $0.12 per diluted share, the prior year. Net income for the fourth quarter of 2024 benefited from lower operating expenses and higher net interest income, which partially offset lower gross profit.

Cash and cash equivalents

Cash and cash equivalents were $6,753,403 at December 31, 2024, versus $5,673,994 on the same date a year ago, an increase of 19%. There were $2,758,478 and $1,994,478 of investments in marketable securities at December 31, 2024 and 2023, respectively. The Company's 2024 year-end cash and cash equivalents benefited from increased net cash provided by operating activities, partially offset by the purchase of $750,000 of marketable securities and approximately $500,000 for the acquisition of production equipment during the year.

Debt outstanding

The Company had no debt outstanding at December 31, 2024, compared to $49,149 a year ago. A final lease payment was made during the third quarter of 2024.

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://x.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, 2024. 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
		DECEMBER 31,				DECEMBER 31,
		2024				2023
Current Assets
Cash and cash equivalents		$	6,753,403			$	5,673,994
Investments - marketable securities, short term			509,478				1,000,000
Accounts receivable, less allowance for doubtful accounts			775,288				910,647
Inventories			1,432,914				4,654,398
Prepaid purchase orders and expenses			238,834				1,338,438
Total current assets			9,709,917				13,577,477
Property and Equipment, at cost			9,904,028				9,603,316
Less accumulated depreciation			(7,632,946	)			(7,359,310	)
Property and equipment, net			2,271,082				2,244,006
Investments, net - marketable securities, long term			2,249,000				994,478
Right of use asset, net			1,236,572				592,170
Other assets			66,394				78,289
Total other assets			3,551,966				1,664,937
TOTAL ASSETS		$	15,532,965			$	17,486,420
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short term debt		$	-			$	49,149
Operating lease, short term			174,863				111,193
Accounts payable			419,209				385,489
Customer deposits			337,873				4,871,035
Accrued expenses			532,260				527,595
Total current liabilities			1,464,205				5,944,461
Deferred tax liability			121,649				69,846
Operating lease, long term			1,061,709				492,080
Total liabilities			2,647,563				6,506,387
Total Shareholders' Equity			12,885,402				10,980,033
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$	15,532,965			$	17,486,420

SCI ENGINEERED MATERIALS, INC.
STATEMENTS OF INCOME

		THREE MONTHS ENDED DECEMBER 31,								YEAR ENDED DECEMBER 31,
		2024				2023				2024				2023
Revenue		$	5,051,150			$	7,029,123			$	22,870,192			$	27,984,083
Cost of revenue			3,866,197				5,742,360				17,801,891				22,732,450
Gross profit			1,184,953				1,286,763				5,068,301				5,251,633
General and administrative expense			513,489				486,111				1,939,895				1,771,263
Research and development expense			74,697				129,530				564,576				501,937
Marketing and sales expense			114,578				126,127				519,064				484,185
Income from operations			482,189				544,995				2,044,766				2,494,248
Interest income, net			102,533				92,218				393,441				286,361
Income before provision for income taxes			584,722				637,213				2,438,207				2,780,609
Income tax expense			155,741				71,477				576,818				586,710
NET INCOME		$	428,981			$	565,736			$	1,861,389			$	2,193,899
Earnings per share - basic and diluted
Income per common share
Basic		$	0.09			$	0.12			$	0.41			$	0.48
Diluted		$	0.09			$	0.12			$	0.41			$	0.48
Weighted average shares outstanding
Basic			4,568,127				4,530,207				4,551,763				4,528,948
Diluted			4,572,555				4,561,481				4,556,285				4,559,786

SCI ENGINEERED MATERIALS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE TWELVE MONTHS ENDED DECEMBER 31,

		2024				2023
CASH PROVIDED BY (USED IN):
Operating activities		$	2,369,815			$	2,281,279
Investing activities			(1,241,257	)			(457,884	)
Financing activities			(49,149	)			(97,367	)
NET INCREASE IN CASH			1,079,409				1,726,028
CASH - Beginning of period			5,673,994				3,947,966
CASH - End of period		$	6,753,403			$	5,673,994

SOURCE: SCI Engineered Materials, Inc.

View the original press release on ACCESS Newswire

FAQ

What was SCIA's revenue and net income for full-year 2024?

SCIA reported revenue of $22.87 million and net income of $1.86 million ($0.41 per diluted share) for full-year 2024.

How much cash does SCIA have as of December 31, 2024?

SCIA had $6.75 million in cash and cash equivalents as of December 31, 2024, representing a 19% increase from the previous year.

What caused SCIA's revenue decline in 2024?

The revenue decline was primarily due to lower costs of key raw materials, changes in product mix, and a slight decrease in volume.

What is SCIA's debt position as of Q4 2024?

SCIA had no debt outstanding as of December 31, 2024, after making their final lease payment in Q3 2024.

What growth strategies is SCIA implementing for 2025?

SCIA is implementing targeted digital marketing campaigns, participating in industry trade shows, maintaining close customer contact, and plans to launch new products in 2025.