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8-K - 8-K - NORTECH SYSTEMS INCa17-26242_18k.htm

Exhibit 99

 

 

 

Contact:

Paula Graff

 

 

Nortech Systems Incorporated

 

 

(952) 345-2244

 

 

 

or

 

 

Warren Djerf

 

 

Brookside Communications Group

 

 

952-920-3908 / warren@brookcomm.net

 

Nov. 8, 2017

 

Nortech Systems Reports Third Quarter Results

 

MINNEAPOLIS — Nortech Systems Inc. (NASDAQ: NSYS) today reported net sales of $28.3 million for the third quarter ended September 30, compared with net sales of $29.7 million for the third quarter of 2016. For the nine months ended September 30, Nortech’s net sales were $86.8 million, compared with $87.6 million for the same period in 2016.

 

Operating income for the third quarter was $284,000, compared with $190,000 for the third quarter of 2016. For the nine-month period, Nortech reported operating income of $500,000, compared with $301,000 for the same period in 2016.

 

Nortech Systems reported net income in the third quarter of $43,000, or $.02 per diluted common share, compared with $63,000, or $.02 per diluted common share, for the same period last year. For the nine months ended September 30, 2017, Nortech reported net income of $13,000, or $0.00 per diluted common share. This compares with a net loss of $54,000, or $0.02 per diluted common share, for the same period in 2016.

 

“While our defense and industrial customers are beginning to show positive traction, our third quarter results were impacted by a seven percent decline in medical sales,” said Rich Wasielewski, Nortech Systems’ president and CEO. After a long run of medical growth for Nortech, the recent trends in the medical market, along with program delays, have resulted in less engineering project work and product revenue.

 

Industry factors negatively impacting U.S. medical technology companies include uncertainty about the future of the federal medical device tax, increased FDA regulations and lower venture capital funding.

 

Wasielewski expects the medical sector will continue to present challenges through the remainder of 2017 and the first half of next year as several of Nortech’s larger OEM medical customers work down inventory levels; he anticipates medical program funding will improve.

 

-more-

 



 

“Our diverse customer base across three core markets and our globalization strategy remain key strengths,” Wasielewski concluded. “We’re also supporting infrastructure, operations and business development activities to target profitable growth.” Enhancing Nortech’s technical resources, information systems and “One Nortech” cooperation across facilities is aimed at providing better customer service and an improved return to shareholders.

 

Conference Call

 

Nortech Systems will hold a conference call at 10:00 a.m. (CST) on Thursday, November 9, 2017, to discuss the company’s third quarter results. Anyone interested in participating in the conference can access the call by dialing 888-567-1602 from within the United States, or 404-267-0373 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. The telephone replay will be available through November 23, 2017, by dialing 877-481-4010 (from U.S.) or 919-882-2331 (International). To access the replay, the conference PIN# 21831 is required.

 

About Nortech Systems Incorporated

 

Nortech Systems Incorporated (www.nortechsys.com), based in Maple Grove, 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, medical and aerospace/defense. The company has operations in the U.S., Mexico and China. 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

 

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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 Operations

 

 

 

THREE MONTHS ENDED

 

NINE MONTHS ENDED

 

 

 

SEPTEMBER 30

 

SEPTEMBER 30

 

 

 

Unaudited

 

Unaudited

 

Unaudited

 

Unaudited

 

 

 

2017

 

2016

 

2017

 

2016

 

Net Sales

 

$

28,310,230

 

$

29,718,414

 

$

86,762,131

 

$

87,613,591

 

 

 

 

 

 

 

 

 

 

 

Income from Operations

 

284,413

 

189,764

 

499,520

 

300,776

 

Loss on Extinguishment of Debt

 

 

 

(174,834

)

 

Interest Expense

 

(171,699

)

(139,458

)

(452,695

)

(410,727

)

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Income Taxes

 

112,714

 

50,306

 

(128,009

)

(109,951

)

 

 

 

 

 

 

 

 

 

 

Income Tax Expense (Benefit)

 

69,343

 

(13,000

)

(141,061

)

(56,000

)

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

$

43,371

 

$

63,306

 

$

13,052

 

$

(53,951

)

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) per Basic and Diluted Common Shares

 

$

0.02

 

$

0.02

 

$

0.00

 

$

(0.02

)

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Common Shares Outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

2,747,168

 

2,747,832

 

2,747,608

 

2,747,288

 

Diluted

 

2,748,533

 

2,749,944

 

2,748,973

 

2,747,288

 

 

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Condensed Balance Sheets

 

 

 

SEPTEMBER 30
2017

 

DECEMBER 31
2016

 

 

 

Unaudited

 

Audited

 

Cash

 

$

530,764

 

$

268,204

 

Restricted Cash

 

541,795

 

 

Accounts Receivable

 

18,312,667

 

17,320,784

 

Inventories

 

21,068,366

 

20,653,841

 

Other Current Assets

 

1,367,357

 

1,246,908

 

Property and Other Long-term Assets

 

15,703,229

 

16,026,778

 

 

 

 

 

 

 

Total Assets

 

$

57,524,178

 

$

55,516,515

 

 

 

 

 

 

 

Accounts Payable

 

$

14,801,233

 

$

13,825,530

 

Other Current Liabilities

 

6,137,207

 

6,480,109

 

Line of Credit — Long-term

 

8,481,396

 

7,315,262

 

Long-term Debt and Other Long-term Liabilities

 

5,770,739

 

5,580,826

 

Shareholders’ Equity

 

22,333,603

 

22,314,788

 

 

 

 

 

 

 

Total Liabilities and Shareholders’ Equity

 

$

57,524,178

 

$

55,516,515

 

 

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