SCI Engineered Materials, Inc. Reports 2022 First Quarter Results
SCI Engineered Materials, Inc. (OTCQB:SCIA) reported record revenue of $5,326,432 for Q1 2022, up from $3,022,310 in Q1 2021. Despite a strong start, challenges like supply chain issues, semiconductor shortages, and rising inflation impacted results. Gross profit increased by 24% to $994,101, although gross margin fell due to higher raw material costs. Notably, income applicable to common stock was $384,401 or $0.08 per diluted share, down from the prior year's $646,547.
Net cash was $4,646,475, while total debt decreased to $219,435.
- Record revenue of $5,326,432 for Q1 2022, a significant increase from $3,022,310 in Q1 2021.
- Gross profit rose by 24% to $994,101 due to higher volume and improved manufacturing efficiency.
- Net cash increased to $4,646,475, indicating improved liquidity.
- Total debt decreased to $219,435, reflecting effective debt management.
- Gross margin decreased compared to last year due to higher raw material costs.
- Income applicable to common stock dropped to $384,401 from $646,547, a decline attributed to prior gains and tax credits.
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COLUMBUS, OH / ACCESSWIRE / May 4, 2022 / SCI Engineered Materials, Inc. ("SCI") (OTCQB:SCIA), today reported financial results for the three months ended March 31, 2022. 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, commented, "Our first quarter results, led by record quarterly revenue, represent a strong start to 2022. By comparison, the 2021 first quarter results benefited from a temporary federal tax credit to assist companies during the COVID pandemic, plus a gain on extinguishment of debt."
Mr. Young added, "Challenges impacting the domestic and global economies increased during the first three months of this year. In addition to persistent supply chain issues and semiconductor shortages, inflationary pressures and international political uncertainties rose sharply since 2021 year-end. These factors contributed to customers placing a greater volume of orders for shipment intra-quarter rather than over historically longer periods of time. We continue to adapt to our customers' short-term needs and anticipate shipments to remain strong throughout the second quarter."
Total Revenue
Total revenue increased to a record
Customer orders remain strong with continued emphasis on intra-quarter shipments. Backlog was
ERC Tax Credit
During each of the first three quarters of 2021, the Company recorded an Employee Retention Credit (ERC). The Company recognized
Gross profit
Gross profit increased
Operating expenses
Operating expenses (general and administrative, research and development (R&D), and marketing and sales) were
EBITDA*
Earnings before interest, income taxes, depreciation, and amortization (EBITDA) was
Income Applicable to Common Stock
The 2022 first quarter income applicable to common stock was
Net Cash and Total Debt Outstanding
Net cash was
Total debt outstanding was
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 user 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
*A reconciliation of the differences between the GAAP and non-GAAP financial measure of EBITDA as used in this release with the most directly comparable GAAP financial measures is included in the financial schedules that are a part of this release. This non-GAAP financial measure is intended to supplement and should be read together with our financial results. It should not be considered an alternative or substitute for, and should not be considered superior to, our reported financial results. Accordingly, users of this financial information should not place undue reliance on this non-GAAP financial measure.
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, 2021. 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, | |||||||
| 2022 | 2021 | |||||||
| (UNAUDITED) | ||||||||
Current Assets | ||||||||
Cash | $ | 4,646,475 | $ | 4,140,942 | ||||
Accounts receivable, less allowance for doubtful accounts | 763,669 | 531,577 | ||||||
Inventories | 1,263,720 | 1,073,218 | ||||||
Prepaid expenses | 202,155 | 678,357 | ||||||
Total current assets | 6,876,019 | 6,424,094 | ||||||
Property and Equipment, at cost | 9,035,000 | 8,966,488 | ||||||
Less accumulated depreciation | (6,898,040 | ) | (6,809,850 | ) | ||||
Property and Equipment, net | 2,136,960 | 2,156,638 | ||||||
Right of use asset, net | 252,571 | 274,298 | ||||||
Deferred tax asset | 607,820 | 663,820 | ||||||
Other assets | 88,449 | 89,552 | ||||||
Total other assets | 948,840 | 1,027,670 | ||||||
TOTAL ASSETS | $ | 9,961,819 | $ | 9,608,402 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Current Liabilities | ||||||||
Finance lease obligations | $ | 97,759 | $ | 96,702 | ||||
Operating lease obligations | 99,404 | 97,292 | ||||||
Accounts payable | 345,299 | 250,383 | ||||||
Customer deposits | 1,743,121 | 1,724,556 | ||||||
Accrued expenses | 227,721 | 348,026 | ||||||
Total current liabilities | 2,513,304 | 2,516,959 | ||||||
Finance lease obligations, net of current portion | 121,676 | 146,516 | ||||||
Operating lease obligations, net of current portion | 179,835 | 205,623 | ||||||
Total liabilities | 2,814,815 | 2,869,098 | ||||||
Total Shareholders' Equity | 7,147,004 | 6,739,304 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 9,961,819 | $ | 9,608,402 | ||||
SCI ENGINEERED MATERIALS, INC.
STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(UNAUDITED)
| 2022 | 2021 | |||||||
Revenue | $ | 5,326,432 | $ | 3,022,310 | ||||
Cost of revenue | 4,332,331 | 2,219,274 | ||||||
Gross profit | 994,101 | 803,036 | ||||||
General and administrative expense | 373,188 | 287,881 | ||||||
Research and development expense | 87,031 | 38,219 | ||||||
Marketing and sales expense | 82,188 | 51,393 | ||||||
Income from operations | 451,694 | 425,543 | ||||||
Gain on extinguishment of debt | - | (325,300 | ) | |||||
Interest expense | 6,493 | 7,638 | ||||||
Income before provision for income taxes | 445,201 | 743,205 | ||||||
Income tax expense | 60,800 | 90,620 | ||||||
Net income | 384,401 | 652,585 | ||||||
Dividends on preferred stock | - | 6,038 | ||||||
INCOME APPLICABLE TO COMMON STOCK | $ | 384,401 | $ | 646,547 | ||||
Earnings per share - basic and diluted | ||||||||
Income per common share | ||||||||
Basic | $ | 0.09 | $ | 0.14 | ||||
Diluted | $ | 0.08 | $ | 0.14 | ||||
Weighted average shares outstanding | ||||||||
Basic | 4,510,276 | 4,479,823 | ||||||
Diluted | 4,538,165 | 4,506,531 | ||||||
SCI ENGINEERED MATERIALS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(UNAUDITED)
| 2022 | 2021 | |||||||
CASH PROVIDED BY (USED IN): | ||||||||
Operating activities | $ | 603,992 | $ | 452,394 | ||||
Investing activities | (74,676 | ) | (319,558 | ) | ||||
Financing activities | (23,783 | ) | (43,454 | ) | ||||
NET INCREASE IN CASH | 505,533 | 89,382 | ||||||
CASH - Beginning of period | 4,140,942 | 2,917,551 | ||||||
CASH - End of period | $ | 4,646,475 | $ | 3,006,933 | ||||
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(UNAUDITED)
| 2022 | 2021 | |||||||
Net income | $ | 384,401 | $ | 652,585 | ||||
Interest expense | 6,493 | 7,638 | ||||||
Income tax expense | 60,800 | 90,620 | ||||||
Depreciation and amortization expense | 102,350 | 115,106 | ||||||
EBITDA | 554,044 | 865,949 | ||||||
Stock based compensation expense | 23,299 | 21,888 | ||||||
Adjusted EBITDA | $ | 577,343 | $ | 887,837 | ||||
SOURCE: SCI Engineered Materials, Inc.
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