IKONICS Announces First Quarter Results and Status of New Business Initiatives

IKONICS Announces First Quarter Results and Status of New Business Initiatives

DULUTH, Minn., April 24, 2013 (GLOBE NEWSWIRE) -- IKONICS Corporation
(Nasdaq:IKNX), a Duluth based imaging technology company, announced record
first quarter sales in 2013 of $4,022,000, slightly higher than last year's
record first quarter sales of $4,010,000. The company posted a loss of $88,000
or $0.04 per share in the first quarter of 2013 compared with a loss of
$62,000, $0.03 per share, for the corresponding quarter in 2012.

Bill Ulland, IKONICS CEO, said that although sales set a record for the
quarter, earnings were down, reflecting investments in the Company's new
technologies and the cyclical nature of first quarter sales to our traditional
customers.

"We believe we are on a path for significant growth, particularly with our
composite machining technology," Ulland said. "In the first quarter of 2011 we
had one account for composite machining. Last year in the first quarter the
number of accounts stood at three. Today, we have thirteen."

Ulland added: "For the most part, these accounts represent the use of our
technology for sound deadening in commercial aircraft. We have expanded our
business model to include the machining of composite parts, in addition to
selling masks for use in machining by the customer. Consequently, we are
substantially increasing our machining capabilities and have strengthened our
intellectual property position through patent applications and the protection
of trade secrets.

"In addition to our focus on sound deadening, we recently announced an
exciting project with Lockheed Martin for the machining of ceramic matrix
composites (CMC). We are seeing additional interest in this application of our
technology from other companies. In the aerospace industry, CMC is projected
to replace metal, thereby reducing weight and improving performance in a new
generation of jet engines as indicated in this educational video produced by
General Electric:

http://youtu.be/666VH25FeG0

"While composite machining is a major opportunity for IKONICS, aerospace
programs are slow to develop and ramp-up to full production can take years. In
the second half of 2013 we anticipate sales to increase significantly leading
to major production in 2014 and beyond. As the aerospace industry replaces its
aging commercial fleet with aircraft using a far greater percentage of
composites, we believe we are well positioned to grow within this industry.

"Our Digital Texturing business is also beginning to reach its potential. The
technology is currently in use in Europe and North America on mold texturing
projects for major German and Japanese automakers, and our unique prototyping
capability is helping to drive these sales.

"Our traditional businesses are also healthy. Chromaline Screen Print Products
is being boosted by our Alpha line of products aimed at the electronics/touch
panel industry and a new film product is being very well received in Asia."

This press release contains forward-looking statements regarding sales, gross
profits, net earnings, balance sheet position, industry trends and new
products, technologies and businesses initiatives that involve risks and
uncertainties. The Company's actual results could differ materially as a
result of downturns in the aerospace industry, unexpected production delays by
the Company's customers, lack of acceptance of new products and technologies,
introduction of new products or technologies by competitors, the effects of
federal budget sequestration, domestic and global economic conditions,
inherent risk and uncertainty in the protection of intellectual property
rights, the ability to control operating costs without impacting growth as
well as the factors described in the Company's Form s 10-K, and 10-Q, and
other reports on file with the SEC.


IKONICS Corporation
                                                       
CONDENSED STATEMENTS OF OPERATIONS (unaudited)
For the Three Months Ended March 31, 2013 and 2012
                                            Three Months Ended
                                            3/31/13    3/31/12
                                                       
Net Sales                                    $4,022,272  $4,009,624
                                                       
Cost of Goods Sold                           2,558,013   2,504,064
                                                       
Gross Profit                                 1,464,259   1,505,560
                                                       
Operating expenses                           1,638,061   1,601,911
                                                       
Loss from operations                         (173,802)   (96,351)
                                                       
Interest income                              2,215       3,726
                                                       
Loss before income taxes                     (171,587)   (92,625)
                                                       
Loss tax benefit                             83,837      30,219
                                                       
Net loss                                    $(87,750) $(62,406)
                                                       
Earnings per common share-basic and diluted  $(0.04)   $(0.03)
                                                       
Average shares outstanding-basic and diluted 2,000,555   1,984,695


Condensed Balance Sheets
As of March 31, 2013 and December 31, 2012
                                                 
                                    3/31/13    12/31/12
                                     (unaudited) 
Assets                                            
Current assets                       $7,477,807    $7,417,041
Property, plant and equipment, net   5,534,208     5,461,878
Intangible assets, net               327,660       305,357
                                    $13,339,675   $13,184,276
Liabilities and Stockholders' Equity              
Current liabilities                 $1,150,189    $1,023,531
Deferred income taxes                431,000       366,000
Long term debt                       --           --
Stockholders' equity                 11,758,486    11,794,745
                                    $13,339,675   $13,184,276


CONDENSED STATEMENTS OF CASH FLOW (unaudited)
For the Three Months Ended March 31, 2013 and 2012
                                                               
                                                   3/31/13     3/31/12
Net cash provided by (used in) operating activities $(247,578) $158,995
                                                               
Net cash used in investing activities               (244,616)    (39,544)
                                                               
Net cash provided by financing activities           40,997       3,750
                                                               
Net increase (decrease) in cash                     (451,197)    123,201
                                                               
Cash at beginning of period                         967,943      1,867,165
                                                               
Cash at end of period                               $516,746     $1,990,366

CONTACT: Bill Ulland
         Chairman, President & CEO
         (218) 628-2217

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