MINNEAPOLIS, Nov. 22, 2010 (GLOBE NEWSWIRE) -- Northern Technologies International Corporation (Nasdaq:NTIC) today reported its financial results for the year ended August 31, 2010.
- NTIC's consolidated net sales increased 67.8% to $14,386,764 during fiscal 2010 compared to $8,575,308 during fiscal 2009.
- NTIC's consolidated net sales for fiscal 2010 included $1,925,819 of sales made by NTIC's joint venture in Brazil, of those sales, $774,928 in sales were made to the oil and gas industry sector in Brazil. NTIC has consolidated the financial results of Zerust Brazil in NTIC's consolidated financial statements for fiscal 2010 and will continue to do so going forward.
- Net income was $2,607,927, or $0.61 per diluted common share, for fiscal 2010.
During fiscal 2010, $572,663, or 4.0%, of NTIC's consolidated net sales were derived from sales of Natur-Tec ® products compared to 6.3% during fiscal 2009. Net sales of Natur-Tec ® products increased 6.3% during fiscal 2010 compared to fiscal 2009. This increase was due to the addition of new Natur-Tec ® distributors on the West Coast of the United States partially offset by several large stocking orders of Natur-Tec ® products that occurred early in fiscal 2009 that were not repeat orders. NTIC is continuing to fortify and expand its West Coast distribution network in California, while expanding its industrial distribution reach to geographical "green" hotspots such as Oregon, Washington, Minnesota and New England. Additionally, NTIC is targeting key national and regional retailers utilizing independent sales agents.Cost of goods sold as a percentage of net sales decreased to 65.2% during fiscal 2010 compared to 65.5% during fiscal 2009 primarily as a result slightly improved margins resulting from fixed costs spread over increased net sales partially offset by a $360,577 write-down of Natur-Tec ® inventory to its market value during fourth quarter of fiscal 2010. NTIC participates in 27 active joint venture arrangements in North America, South America, Europe, Asia and the Middle East. NTIC only consolidates the proportional equity results of its joint ventures. NTIC's equity in income of joint ventures increased 967.2% to $3,919,084 during fiscal 2010 compared to $367,238 during fiscal 2009. NTIC recognized a 38.8% increase in fees for services provided to joint ventures during fiscal 2010 compared to fiscal 2009. Both of these increases were primarily a result of a 37.3% increase in total net sales of NTIC's joint ventures during fiscal 2010 compared to fiscal 2009. Total sales of NTIC's joint ventures increased 37.3% during fiscal 2010 to $84,973,646 compared to $61,895,133 in fiscal 2009. This increase in total net sales of NTIC's unconsolidated joint ventures was primarily a result of the economic recovery, to some extent, of the international manufacturing sector that the NTIC joint venture network serves.
Net income was $2,607,927, or $0.61 per diluted common share, for fiscal 2010 compared to a net loss of $(3,344,976), or $(0.89) per diluted common share, for fiscal 2009. NTIC's working capital was $5,918,923 at August 31, 2010, including $1,776,162 in cash and cash equivalents.G. Patrick Lynch, President and Chief Executive Officer of NTIC said, "Globally, several of our joint ventures recorded record sales in the third and fourth quarters of fiscal 2010 for our ZERUST® corrosion inhibiting packaging products. With the introduction of several new ZERUST® products over the past few months, we anticipate that this trend will continue and broaden during fiscal 2011." "At the height of the recession," Lynch continued, "many enterprises suspended or slowed their 'Green Sustainability' initiatives. Now that the economic recovery is picking up pace, however, we are seeing a steady increase in orders for our Natur-Tec® products from our growing industrial distribution base." Outlook For the fiscal year ending August 31, 2011, NTIC expects its net sales to range between $18.0 million and $19.5 million, inclusive of sales made by NTIC's joint venture in Brazil, and to earn net income of between $3.6 million to $3.8 million, or between $0.84 and $0.88 per diluted share. Webcast NTIC will host a webcast tomorrow morning, November 23, 2010, beginning at 8:00 a.m. Central Standard Time, to review its results of operations for fiscal 2010 and future outlook, followed by a question and answer session. The live audio webcast will be available to interested parties at http://ir.ntic.com/events.cfm, where it will be archived and accessible for approximately one year. Financial Results
|NORTHERN TECHNOLOGIES INTERNATIONAL CORPORATION|
|CONSOLIDATED STATEMENTS OF OPERATIONS|
|YEARS ENDED AUGUST 31, 2010 AND 2009|
|Net sales, excluding joint ventures||$12,190,171||$7,428,499|
|Net sales, to joint ventures||2,196,593||1,146,809|
|Cost of goods sold||9,384,866||5,620,668|
|JOINT VENTURE OPERATIONS:|
|Equity in income of joint ventures||3,919,084||367,238|
|Fees for services provided to joint ventures||4,690,450||3,378,193|
|General and administrative expenses||3,923,103||2,804,257|
|Expenses incurred in support of joint ventures||875,869||1,427,616|
|Research and development expenses||3,333,683||3,024,205|
|Loss on impairment||—||554,000|
|OPERATING INCOME (LOSS)||2,419,570||(3,549,328)|
|INCOME (LOSS) BEFORE INCOME TAX EXPENSE||2,377,927||(3,646,976)|
|INCOME TAX BENEFIT||(230,000)||(302,000)|
|NET INCOME (LOSS)||2,607,927||(3,344,976)|
|NET INCOME ATTRIBUTABLE TO NON CONTROLLING INTEREST||24,171||--|
|NET INCOME (LOSS) ATTRIBUTABLE TO NTIC||$2,583,756||$(3,344,976)|
|NET INCOME (LOSS) PER COMMON SHARE:|
|WEIGHTED AVERAGE COMMON SHARES|
|QUARTERLY INFORMATION (UNAUDITED)|
|Fiscal Quarter Ended|
|November 30||February 28||May 31||August 31*|
|Fiscal year 2010:|
|Income before income taxes||420,705||252,641||841,968||862,613|
|Net income per share:|
|Weighted average common shares assumed outstanding:|
|* During the fourth quarter of fiscal 2010, the Company decided to consolidate the financial results of Zerust Brazil for the fiscal year ended August 31, 2010. As a result, all revenues and expenses of Zerust Brazil for the fiscal year ended August 31, 2010 are included in the fourth quarter.|
The Northern Technologies International Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5481Forward-Looking Statements Statements contained in this press release that are not historical information are forward-looking statements as defined within the Private Securities Litigation Reform Act of 1995. Such statements include NTIC's expectations regarding the future performance of its new businesses and other statements that can be identified by words such as "expect," "intend," "continue," "anticipate," "estimate," "potential," "will," "would," or words of similar meaning and any other statements that are not historical facts. Such forward-looking statements are based upon the current beliefs and expectations of NTIC's management and are inherently subject to risks and uncertainties that could cause actual results to differ materially from those projected or implied. Such potential risks and uncertainties include, but are not limited to, in no particular order: NTIC's dependence on the success of its joint ventures and fees and dividend distributions that NTIC receives from them; NTIC's relationships with its joint ventures and its ability to maintain those relationships; risks associated with NTIC's international operations; exposure to fluctuations in foreign currency exchange rates; the health of the U.S. and worldwide economies, including in particular the U.S. automotive industry; the level of growth in NTIC's markets; NTIC's investments in research and development efforts; acceptance of existing and new products; increased competition; the success of NTIC's new businesses; the costs and effects of complying with changes in tax, fiscal, government and other regulatory policies, including rules relating to environmental, health and safety matters, NTIC's reliance on its intellectual property rights and the absence of infringement of the intellectual property rights of others, the ability of NTIC's lender to declare outstanding indebtedness immediately due and payable and current and potential litigation. More detailed information on these and additional factors which could affect NTIC's operating and financial results is described in the company's filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q. NTIC urges all interested parties to read these reports to gain a better understanding of the many business and other risks that the company faces. Additionally, NTIC undertakes no obligation to publicly release the results of any revisions to these forward-looking statements, which may be made to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.
CONTACT: Northern Technologies International Corporation Investor and Media Contacts: Matthew Wolsfeld, CFO (763) 225-6600