SOURCE: Itronics Inc

August 14, 2008 15:28 ET

Itronics Reports Second Quarter Results

Gross Profit up 243 Percent; Sales up 39 Percent

RENO, NV--(Marketwire - August 14, 2008) - Itronics Inc. (OTCBB: ITRO) (FRANKFURT: ITG) (BERLIN: ITG) today reported a positive gross profit for the first half 2008 of $425,400, up from $124,000 in the first half of 2007, an increase of 243 percent. In the first half 2008, total sales increased by 39 percent to $1,917,000, but non-fertilizer sales increased by 65 percent and made a major contribution to improved gross profit. Operating loss in the first half was reduced by 43 percent.

The Itronics Form 10Q is now available on the U. S. Securities & Exchange Commission web site at www.sec.gov.

On a consolidated basis, gross profit in the second quarter increased to $319,700 from $111,000 in the same period in 2007, an increase of 188 percent. Gross profit in the first half 2008 was $425,400, up from $124,000 in the same period in 2007, an increase of 243 percent.

On a consolidated basis, various changes in revenues and operating expenses resulted in a second quarter 2008 operating loss of $292,000, compared to $622,600 for the second quarter 2007, a decrease in operating loss of $330,600, or 53 percent.

Net income before taxes for the second quarter 2008 was $5,552,800 compared to a net loss before taxes of $1,235,600 for the 2007 second quarter, an improvement of $6,788,400. The improvement is due to a combination of increased sales, reduced operating expenses, and an increased non-cash gain on derivative instruments related to the Company's financing.

For the six month period ended June 30, 2008 consolidated operating loss was $735,300 compared to $1,296,000 for the prior year comparable period, a decreased operating loss of $560,600, or 43 percent.

Net income before taxes for the six months ended June 30, 2008 was $1,194,000 compared to a net loss before taxes of $1,704,000 for the prior year six month period, an improvement of $2,898,000. This improvement is due to a combination of increased sales, reduced operating expenses, and an increased non-cash gain on derivative instruments related to the Company's financing.

Expansion Projects and developments completed or underway during the quarter which are described in more detail in the Company's Form 10Q, pages 30 to 38, include:

--  In the second quarter 2008 the parent company of our distributor
    acquired a major competitor. Early in the second quarter the parent
    company disclosed plans to integrate the acquired company and its
    retail outlets into its existing retail distribution system, increasing
    the number of its nationwide retail outlets from more than 500 to more
    than 800. Our distributor will manage some of the new retail outlets
    opening up opportunities for increased GOLD'n GRO liquid fertilizer
    sales.
    
--  High grain crop prices and high and increasing fertilizer prices
    are producing a need for improved fertilizers. One of the emerging
    needs is to be able to apply manganese fertilizer in glyphosate (Round
    Up) spray mixes on "Round Up Ready" corn and soybeans. Tests are
    underway to evaluate the suitability of GOLD'n GRO 10-0-1+3% Manganese
    for this use. Initial tests in the fall of 2007 produced very
    satisfactory result on "Round Up Ready" corn. This year Itronics is
    working with one of our fertilizer raw material suppliers who has put
    out trials on "Round Up Ready" soybeans in several states. Results are
    not complete, but the supplier has an extensive nationwide liquid
    fertilizer distribution system and is fully capable of introducing the
    GOLD'n GRO fertilizer in relevant markets in the midwest and southern
    United States where both corn and soybeans are major crops.
    
--  In the second quarter the Company's agronomy staff was nearly
    finished with a peer reviewed research summary of how GOLD'n GRO
    fertilizers should be able to increase the availability of phosphorous
    and nutrient metals applied as fertilizers to the soil for growing
    crops. The research, which has been done by others over a period of
    many years, suggests that the unique chemistry of the GOLD'n GRO
    fertilizers is beneficial when applied to the soil by improving the
    availability of phosphate and the nutrient metals including iron, zinc,
    manganese, calcium, and magnesium. A related benefit is that fertilizer
    residuals, to the extent they occur, are used as a nutrient source by
    soil microbes providing virtually complete use of the fertilizers.
    
--  Large scale applications of GOLD'n GRO 8-8-8+4% Sulfur fertilizer in
    drip systems on crops in the coastal areas in California are
    demonstrating that this fertilizer can be used safely in fertigation
    applications in locations that have hard water. This is not normally
    possible using conventional fertilizers.
    
--  The GOLD'n GRO nutrient technology is now providing economic and
    environmental benefits that are expected to drive expanded use at a
    time of high and increasing fertilizer prices, and greatly increased
    environmental concerns. Expanded use in fertigation reduces application
    costs and quantities required. Improved soil availability of
    phosphorous and nutrient metals is expected to reduce the amount of
    fertilizer needed to provide satisfactory plant nutrition, which
    produces both economic and environmental benefits.
    
--  The Company, working with its distributor, has completed
    development of a new chelated micronutrient fertilizer, "GOLD'n GRO 9-0-
    0 Iron Man Z." This fertilizer, which was developed in response to
    customer requests, fills a nutrient gap, and is targeted for use in the
    turf and ornamental market, and for use on vegetables, trees and vines.
    With addition of this chelated micronutrient, the Company now offers
    five chelated micronutrient fertilizers, for a total of 13 GOLD'n GRO
    multi-nutrient specialty fertilizers.
    
--  The Company has completed registration of GOLD'n GRO Guardian Deer
    Repellent in Nevada, Utah, Colorado, Maryland, Massachusetts, New
    Jersey, and Rhode Island. The Company has identified qualified
    distributors in several of these states.
    
--  In the second quarter the Company initiated photo liquid recycling
    service with a large national waste hauling company. This agreement is
    expected to provide an increase in photo liquids that will support
    increased GOLD'n GRO liquid fertilizer sales and that will require an
    increase in silver refining capacity.
    
--  The Company recently announced a breakthrough in the Iron (FeLix) and
    Sulfur (SuLix) leaching technology that it is developing which reduces
    the bulk volume of silver-bearing material being sent to the Company's
    silver refinery and increases the per melt refining capacity up to 10
    times, producing a 90 percent reduction in per melt refining cost. The
    technology also reduces waste by recovering and converting nutrient
    metals into liquid form that can be used in the manufacture of the
    Company's GOLD'n GRO liquid fertilizers.
    
--  The Company believes that the FeLix and SuLix technology will be
    useable for processing several different types of materials, including
    concentrates produced by silver-zinc mines. Each type of material will
    require its own leaching circuit, and in certain cases where large
    volumes could be involved, separate processing plants may be necessary.
    

Itronics has the business infrastructure in place to support on-going sales growth that is being guided by the Company's eight part long term growth plan. The primary focus for sales growth is on expanding fertilizer sales which are now the driver for overall growth in the GOLD'n GRO fertilizer segment. Incremental manufacturing facility expansion to support GOLD'n GRO fertilizer production and to expand silver sales is underway.

"The projects we have underway are converting Itronics into a viable operating clean technology company with enormous growth potential," said Dr. John Whitney, Itronics President. "Probably the largest challenge we are now facing is to obtain less costly long term debt and equity financing to support our growth. We have a five year business plan and a three year funding plan. Going forward, one of management's highest priorities is to implement the Company's three year funding plan which includes restructuring its balance sheet."

Results for the three and six months ended June 30, 2008, together with comparative figures for 2007 are summarized below:

                                         ITRONICS INC.
                          For the Quarter            For the 6 Months
                           Ended June 30               Ended June 30
                        2008          2007          2008          2007
REVENUE
   Fertilizer        $ 1,114,865  $   745,214    $ 1,560,443   $ 1,158,937
   Silver            $    80,953  $    52,050    $   198,018   $   120,897
   Photo Services    $    36,672  $    42,646    $    71,318   $    87,978
   Mining Technical
    Services         $    31,373  $     1,675    $    87,215   $     6,628

Total Revenues       $ 1,263,863  $   841,585    $ 1,916,994   $ 1,374,440

Gross Profit (Loss)  $   319,651  $   111,049    $   425,635   $   123,970

Operating Income
 (Loss)              $  (291,959) $  (622,582)   $  (735,330)  $(1,295,951)

Other Income
 (Expense)           $  (324,550) $  (301,881)   $  (586,888)  $  (239,266)
 (including interest)

Gain (Loss) on
 Derivative
 Instruments         $ 6,169,281  $  (311,142)   $ 2,516,212   $  (168,753)
 (non cash item
 related to financing)

Net Income (Loss)    $ 5,552,772  $(1,235,605)   $ 1,193,994   $(1,703,970)

Net Income (Loss)
 Per Share           $     0.005  $    (0.003)   $     0.001   $    (0.005)

About Itronics

Headquartered in Reno, Nevada, Itronics Inc. is a "Creative Clean Technology" company. Itronics, through its subsidiary, Itronics Metallurgical, Inc. is the only company with a fully permitted "Beneficial Use Photochemical, Silver, and Water Recycling" plant in the United States that can convert used photoliquids into pure silver and GOLD'n GRO liquid fertilizers. The Company also provides environmentally compatible mining technology development, project planning, and technical services to the gold mining industry. Itronics Reports 2008 2nd Quarter Results and operates the popular InsideMetals.com web site, http://www.insidemetals.com. which provides a value-added WORLD VIEW of Gold Producer Stocks, Mineral Producer Stocks, Junior Gold Stocks, and Junior Mineral Stocks. Itronics has received numerous domestic and international awards that recognize its ability to successfully create and implement new environmentally clean recycling and fertilizer technologies.

The Company's environmentally friendly GOLD'n GRO liquid fertilizers, which are extensively used in agriculture, can be used for lawns and houseplants, and are available, along with liquid fertilizer injectors, at the Company's "e-store" catalog at http://goldngro.com. The popular Silver Nevada Miner bars are available at the Company's "e-store" catalog at http://www.itromet.com.

VISIT OUR WEB SITE: http://www.itronics.com

("Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This press release contains or may contain forward-looking statements such as statements regarding the Company's growth and profitability, growth strategy, liquidity and access to public markets, operating expense reduction, and trends in the industry in which the Company operates. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in the Company's filings with the Securities and Exchange Commission. The Company assumes no obligation to update these forward-looking statements to reflect actual results, changes in risks, uncertainties or assumptions underlying or affecting such statements, or for prospective events that may have a retroactive effect.)

Contact Information

  • Contact:
    Paul Knopick
    888-795-6336