SOURCE: CTI Industries Corporation

November 11, 2008 07:00 ET

CTI Industries Corporation Reports Results for the Third Quarter 2008

BARRINGTON, IL--(Marketwire - November 11, 2008) - CTI Industries Corporation (NASDAQ: CTIB), a manufacturer and marketer of metallized balloons, latex balloons, novelty items, packaging and storage bags and pouches and printed and laminated films, today released financial results for its third quarter and for the nine months ending September 30, 2008. For the quarter, net sales were $11,953,000, compared to net sales for the third quarter 2007 of $8,673,000, an increase of about 38%. The Company had a net income for the quarter of $269,000 compared to a net loss for the same period of 2007 of $(414,000).

Net income per share for the three months ending September 30, 2008 was $0.10 (basic) and $0.09 (diluted), compared to a net loss per share for the three months ending September 30, 2007 of $(0.18) (basic and diluted).

For the nine month period ending September 30, 2008, net revenues were $35,149,000, compared to net revenues for the same period in 2007 of $26,210,000, an increase of 34%. For the nine month period, the Company had net income of $1,033,000, representing net income per share of $0.38 (basic) and $0.35 (diluted), compared to a net loss of $(43,000) for the same period of 2007 which represented a loss per share of $(0.02) (basic and diluted).

Stephen M. Merrick, Chief Financial Officer of the Company, said, "We continued our rapid rate of growth in the third quarter. Growth in our zippered pouch sales represented the most significant component but we also experienced growth in each of our other product lines -- foil balloons, latex balloons and commercial films. Our profitability was limited by the significant increases in raw materials costs we experienced through the first three quarters of the year. However, with the recent decline in the market price of oil and latex, we are now beginning to see reductions in our raw materials costs."

John Schwan, Chairman of the Company, reported, "In July, the roll-out of the S.C. Johnson & Son, Inc. ZipLoc Vacuum Bag system commenced to retail outlets throughout the United States. This is a product that we are producing for S.C. Johnson & Son, Inc. under a long-term agreement. Much of our increased sales of zippered pouch product during the Third Quarter represents sales of this product."

In the third quarter, sales of pouch products increased by 138% compared to the third quarter 2007, from $1,581,000 to $3,767,000. Sales of foil balloons were up 14% for the quarter, commercial films up 15% and latex balloons up 19%.

For the nine months gross margins were 23%, down from 24% for the same period of 2007.

CTI Industries is one of the leading manufacturers and marketers of metallized and latex balloons, develops, produces and markets bags and pouches for storage and packaging applications and produces laminated and printed films for commercial uses. CTI markets its products throughout the United States and in a number of other countries.

This press release may contain forward-looking statements within the meaning of Section 17A of the Securities Act and Section 21E of the Securities Exchange Act. Actual results could differ materially from those projected in the forward-looking statements, which involve a number of risks and uncertainties, including (i) the risks of generating and maintaining sales in a highly competitive market, (ii) the ability of the Company to enter into or maintain contracts or relationships with customers, distributors, licensors and suppliers, (iii) manufacturing risks, as well as other risks and uncertainties reported by the Company in its SEC filings, and such statements should also be considered in conjunction with cautionary statements contained in the Company's most recent filing with the Securities and Exchange Commission on Form 10-K.

- FINANCIAL HIGHLIGHTS FOLLOW --

Consolidated Statements of Operations


                        Three Months Ended          Nine  Months Ended
                           September 30                September 30
                        2008          2007          2008          2007
                    ------------  ------------  ------------  ------------
                    (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)

Net sales           $ 11,952,979  $  8,672,726  $ 35,148,626  $ 26,210,428
Cost of sales          9,210,708     7,055,243    27,161,791    19,945,862
                    ------------  ------------  ------------  ------------

Gross profit           2,742,271     1,617,483     7,986,835     6,264,566

Operating expenses     2,188,645     1,900,596     6,038,694     5,527,728
                    ------------  ------------  ------------  ------------

Income (loss) from
 operations              553,626      (283,113)    1,948,141       736,838

Other income
 (expense):
  Net Interest
   expense              (242,646)     (348,829)     (799,311)     (976,327)
  Other                   24,912        72,135        67,123       165,482
                    ------------  ------------  ------------  ------------

Income (loss)
 before income
 taxes and minority
 interest                335,892      (559,807)    1,215,953       (74,007)

Income tax expese
 (benefit)                66,487      (145,939)      182,326       (31,053)
                    ------------  ------------  ------------  ------------

Income (loss)
 before minority
 interest                269,405      (413,868)    1,033,627       (42,954)

Minority interest
 (loss) income of
 subsidiary                  (24)          (34)          241          (103)
                    ------------  ------------  ------------  ------------

Net income (loss)   $    269,429  $   (413,834) $  1,033,386  $    (42,851)
                    ============  ============  ============  ============

Basic income (loss)
 per common and
 common equivalent
 shares             $       0.10  $      (0.18) $       0.38  $      (0.02)
                    ============  ============  ============  ============

Diluted income
 (loss) per common
 and common
 equivalent shares  $       0.09  $      (0.18) $       0.35  $      (0.02)
                    ============  ============  ============  ============

Weighted average
 number of shares
 and equivalent
 shares of common
 stock outstanding:
    Basic              2,799,501     2,339,467     2,747,604     2,275,541
                    ============  ============  ============  ============

    Diluted            2,968,895     2,339,467     2,934,736     2,275,541
                    ============  ============  ============  ============




CTI Industries Corporation and Subsidiaries
Condensed Consolidated Balance Sheet


                                     September 30, 2008  December 31, 2007

                                     ------------------  ------------------
              Assets                     (Unaudited)
Current Assets:
  Cash and cash equivalents          $          860,016  $          483,112
  Accounts receivable, net                    6,738,667           5,950,551
  Inventories, net                           10,742,677           9,700,618
  Other current assets                        1,425,475           1,666,420
                                     ------------------  ------------------
Total current assets                         19,766,835          17,800,701

Property, plant and equipment, net           10,568,979          10,096,155
Other assets                                  1,366,797           1,427,279
                                     ------------------  ------------------

Total Assets                         $       31,702,611  $       29,324,135
                                     ==================  ==================

  Liabilities & Stockholders' Equity
Total current liabilities            $       16,900,234  $       16,483,109
Long term debt, less current
 maturities                                   5,376,543           5,167,039
Other liabilities                               953,488           1,070,151
Minority interest                                12,775              12,534
Stockholders' equity                          8,459,571           6,591,302
                                     ------------------  ------------------

Total Liabilities & Stockholders'
 Equity                              $       31,702,611  $       29,324,135
                                     ==================  ==================

Contact Information

  • FOR FURTHER INFORMATION CONTACT:

    Stephen M. Merrick
    Executive Vice President
    (847) 382-1000

    Catherine E. Lawler
    Investor Relations
    (847) 671-1177