ITRONICS REPORTS SECOND QUARTER RESULTS
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Gross Profit up 243 Percent; Sales Up 39 Percent
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RENO, Nevada, August 14,
2008 -- Itronics Inc. (OTC BB: ITRO; Frankfurt
and Berlin Stock Exchanges: 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 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. Earl 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 relevent 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 .
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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.)