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Nortech Systems Reports First Quarter Results

Companies mentioned in this article: Nortech Systems Incorporated

MINNEAPOLIS -- (BUSINESS WIRE) -- Nortech Systems Incorporated (NASDAQ: NSYS) today reported net sales of $26.1 million for the first quarter ended March 31, 2014, compared with $25.9 million in the first quarter of 2013.

Income from operations for the first quarter of 2014 was $236,000, compared with $224,000 for the same period in 2013. Net income for the first quarter of 2014 was $86,000, or $0.03 per diluted common share. For the first quarter of 2013, net income of $141,000, or $0.05 per diluted common share, was favorably impacted by the tax benefit related to the retroactive reinstatement of research and development tax credits. Without last year’s tax credit, Nortech would have reported first quarter net income of $71,000, or $0.03 per diluted common share.

“We’re pleased to see our pretax profits rise 13 percent on a slight sales increase,” said Rich Wasielewski, Nortech Systems’ president and CEO. “While the mixed economic recovery is impacting each of our customers differently, we continue focusing on improving our operating performance by managing the areas under our control and actively working on building a qualified sales pipeline.” He added that the company is encouraged by its overall 90-day backlog increasing six percent during the quarter.

Industry analysts expect the North American EMS market will continue to recover slowly in 2014 and forecast modest growth with some volatility from quarter to quarter.

“We’re committed to our corporate values and long-term goals, aimed at strengthening our organization, increasing shareholder value and helping our customers thrive,” concluded Wasielewski.

Conference Call
Nortech Systems announces a conference call to be held at 10:00 a.m. (CDT) on Thursday, May 8, 2014, to discuss the company’s first quarter results. Anyone interested in participating in the conference can access the call by dialing 877-407-8031 from within the United States, or 201-689-8031 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. A podcast (MP3 download) will also be available. The telephone replay will be available through May 22, 2014, by dialing 877-660-6853 (from U.S.) or 201-612-7415 (International). To access the replay, the conference ID 13580718 is required.

About Nortech Systems Incorporated
Nortech Systems Incorporated (www.nortechsys.com), based in Wayzata, 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 equipment, aerospace/defense and medical. The company has manufacturing capabilities and operating partners in the U.S., Asia and Latin America. 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 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 Income

   
Three months ended Mar. 31,
Unaudited
2014     2013
Net Sales $ 26,149,142     $ 25,925,401
Income from Operations 236,221 223,622
 
Other Expense   (100,064 )   (103,533 )
 

Income before Income Taxes

136,157

120,089
 

Income Tax (Benefit) Expense

  50,000     (21,000 )
 

Net Income

$ 86,157   $ 141,089  
 

Net Income Per Basic and Diluted Common Share

$ 0.03 $ 0.05
 

Weighted Average Number of Common Shares –

Basic 2,742,992 2,742,992
Diluted 2,747,858 2,742,992
 
       

Condensed Balance Sheets

March 31, 2014 Dec. 31, 2013
(Unaudited)      
Accounts Receivable $ 15,409,447 $ 16,030,848
Inventories 18,794,263 17,427,470
Other Current Assets 1,906,290 1,457,524
Property and Other Long-term Assets   11,136,174   11,159,579
Total Assets $ 47,246,174 $ 46,075,421
 
Line of Credit $ 7,625,468 $ 7,234,983
Accounts Payable 8,632,089 8,185,012
Other Current Liabilities 4,106,846 3,946,543
Long-term Liabilities 4,852,684 4,773,435
Shareholders’ Equity   22,029,087   21,935,448

Total Liabilities and Shareholders’ Equity

$

47,246,174

$

46,075,421

 


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Contact:

Nortech Systems Incorporated
Paula Graff, 952-345-2244
or
Brookside Communications Group
Warren Djerf, 952-920-3908
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