Market Overview

Nortech Systems Reports First Quarter Results

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Nortech Systems Incorporated (NASDAQ:NSYS), a leading provider of
design and manufacturing solutions for complex electromechanical
products, reported net sales of $28.2 million for the first quarter
ended March 31, 2019, compared with $26.4 million for the first quarter
of 2018.

Operating loss for the first quarter of 2019 was $104,000, which
compares with an operating loss of $120,000 for the first quarter of
2018. Net loss for the first quarter of 2019 was $363,000, or $0.14 per
diluted common share. This compares with a net loss for first quarter of
2018 of $391,000, or $0.14 per diluted common share.

The mission of Nortech Systems is to be the most trusted, innovative,
and nimble design and manufacturing services and solutions provider,
while taking great care of its employees, customers, and supplier
partners.

About Nortech Systems Incorporated
Nortech
Systems is a leading provider of design and manufacturing solutions for
complex electromechanical systems, assemblies, and components. Nortech
Systems primarily serves the medical, aerospace & defense, and
industrial markets. Its design services span concept development to
commercial design, and include software, electrical, mechanical, and
biomedical engineering. Its manufacturing and supply chain capabilities
are vertically integrated around wire/cable/interconnect assemblies,
printed circuit board assemblies, as well as system-level assembly,
integration, and final test. Headquartered in Maple Grove, Minn.,
Nortech currently has seven manufacturing locations and design centers
across the U.S., Latin America, and Asia. Nortech Systems is traded on
the NASDAQ Stock Market under the symbol NSYS. Nortech's website is www.nortechsys.com.

Forward-Looking Statements
This
press release contains forward-looking statements made pursuant to the
safe harbor provision of the Private Securities Litigation Reform Act of
1995. While this release is based on management's best judgment and
current expectations, actual results may differ and involve a number of
risks and uncertainties. Important factors that could cause actual
results to differ materially from the forward-looking statements
include, without limitation: volatility in market conditions which may
affect market supply of and demand for the company's products; increased
competition; changes in the reliability and efficiency of operating
facilities or those of third parties; risks related to availability of
labor; commodity and energy cost instability; general economic,
financial and business conditions that could affect the company's
financial condition and results of operations; as well as risk factors
listed from time to time in the company's filings with the SEC.

 

Condensed Consolidated Statements of Operations
(in
thousands, except for share data)

 
THREE MONTHS ENDED
MARCH 31,
Unaudited   Unaudited
2019 2018
 
Net Sales $ 28,165 $ 26,447
 
Cost of Goods Sold 25,204   23,419  
 
Gross Profit 2,961   3,028  
10.5 % 11.4 %
 
Operating Expenses
Selling Expenses 761 1,039
General and Administrative Expenses 2,304   2,109  
Total Operating Expenses 3,065   3,148  
 
Loss From Operations (104 ) (120 )
 
Other Expense
Interest Expense (245 ) (172 )
 
Loss Before Income Taxes (349 ) (292 )
 
Income Tax Expense 14   99  
 
Net Loss $ (363 ) $ (391 )
 
Loss Per Common Share - Diluted $ (0.14 ) $ (0.14 )
 
Weighted Average Number of Common Shares Outstanding - Diluted 2,659,859   2,720,609  
 
   

Condensed Consolidated Balance Sheets
(in thousands)

 
MARCH 31, 2019 DECEMBER 31, 2018
Unaudited Audited
Cash
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