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Nortech Systems Incorporated (NASDAQ: NSYS) today reported net sales of $28.4 million for the first quarter ended March 31, 2012. This compares to net sales of $29.0 million for the first quarter of 2011.
Income from operations rose 15 percent for the first quarter of 2012, to $328,430. This compares with $286,662 for the same period in 2011. Net income for the first quarter of 2012 was $122,805, or $0.04 per diluted common share. This compares with last year’s $98,181, or $0.04 per diluted common share before non-operating gain from acquiring certain assets of Winland Electronics’ EMS operations. The net after-tax impact of the non-operating gain increased net income in the first quarter of 2011 by $528,007, or $0.19 per diluted common share.
“We’re pleased with our improvements in operating profits during the first quarter,” said Mike Degen, Nortech Systems’ president and CEO. “The progress we’ve made integrating our acquisitions, along with our ability to better control costs and expenses, helped us generate $2.7 million in operating cash flow for the quarter.”
Degen noted that revenue results across the company remain mixed in the sluggish economic environment. “We’re seeing encouraging signs from certain industrial and medical customers, evidenced by our backlog positions in these markets registering modest single-digit increases since year-end,” he added.
In the quarter, Nortech Systems was awarded significant design engineering projects from customers in both the industrial and medical markets. Degen cited these wins as examples of how Nortech’s internal realignment, implemented in January, improves the company’s ability to target new business opportunities across three key markets – industrial, medical and defense.
Last week Nortech amended its financing agreement with Wells Fargo Bank, N.A. and its Business Credit operating division. The fourth amendment to the third amended and restated credit agreement provides for a line of credit of $13.5 million through May 2015, a $1.8 million real estate term note with a maturity date of March 2027, which replaces the $0.9 million note set to expire on May 31, 2012, and a new term loan of up to $2.0 million for capital expenditures to be made through the end of 2013.