SCI Engineered Materials, Inc. Reports 2026 Second Quarter and Six-Month Results

COLUMBUS, OH / ACCESS Newswire / July 30, 2026 / SCI Engineered Materials, Inc. ("SCI" or "Company") (OTCQB:SCIA), today reported financial results for the three months and six months ended July 30, 2026.Jeremy Young, President and Chief Executive Officer, commented, "SCI's second quarter results reflect solid achievements throughout the Company. Revenue increased significantly compared to a year ago due to higher raw material input costs, favorable product mix and increased volume. We are gaining traction in key markets consistent with our growth strategy through expanded marketing initiatives, increased demand for SCI's products and services, and the addition of new customers."Mr. Young added, "We recently ordered manufacturing equipment and added staff to enhance future growth. In addition to increased product sales, interest in SCI's breadth of services to fulfill specific customer needs is growing, including debinding capabilities for commercial additive manufacturing applications and specialty diffusion bonding. Customer emphasis on domestic manufacturing is increasing as they seek to prioritize their sourcing requirements with price sensitivity."RevenueRevenue increased 163% to a record $9,485,119 for the three months ended June 30, 2026, versus $3,609,304 for the same period last year. The year-over-year increase was due to higher raw material input costs, product mix and higher volume.For the first six months of 2026, revenue increased 148% to $17,645,481 from $7,109,536 a year ago, led by product mix, higher raw material input costs and volume.Order backlog was $7.9 million at June 30, 2026, versus $7.1 million at March 31, 2026, and $3.4 million at June 30, 2025.Gross profitGross profit increased 97% to $2,276,455 for the second quarter of 2026 versus $1,158,157 a year ago, due to the increase in revenue. The Company's gross profit margin declined to 24.0% from 32.1% last year principally due to higher raw material input costs and product mix.Gross profit for the first six months of 2026 increased 93% to $4,311,575 from $2,230,971 last year due to the increase in revenue. The gross profit margin declined to 24.4% from 31.4% for the same period a year ago reflecting higher raw material input costs and product mix compared to the same period in 2025.Operating expensesOperating expenses increased 9% to $876,989 for the three months ended June 30, 2026, versus $802,350 a year ago. The year-over-year increase was primarily due to higher compensation and benefits for Marketing and Sales, including additional staff, and higher Research and Development materials and supplies, partially offset by lower General and Administrative expense.Operating expenses for the first six months of 2026 were $2,423,185, including fraud expense of $562,026, compared to $1,572,625 for the same period last year. Key factors in the year-over-year comparison include the 2026 first quarter fraud expense, higher Marketing and Sales compensation and benefits expense, including increased staff, additional materials and supplies for Research and Development, and slightly higher General and Administrative compensation and benefits versus the first six months of 2025.Fraud expenseOn February 10, 2026, the Company reported it was subjected to an imposter scam of $898,325 executed in conjunction with bank fraud. As of June 30, 2026, the Company recovered $336,299 of that amount resulting in fraud expense of $562,026 recorded in the first quarter. On July 12, 2026, the Company was informed that a $250,000 claim related to its Smart Cyber insurance policy was approved. When the insurance proceeds are realized they will reduce the fraud expense to $312,026.Net interest incomeNet interest income was $110,359 for the second quarter of 2026 versus $115,680 the prior year primarily due to lower interest rates compared to the same period a year ago. For the first half of 2026, net interest income was $219,445 compared to $213,810 last year primarily due to an increase in cash and cash equivalents since 2025 year-end.Income taxesThe Company's income tax expense increased 217% to $339,549 for the three months ended June 30, 2026, from $107,028 last year due to higher taxable income. Income tax expense for the first half of 2026 was $475,297 versus $197,980 a year ago, an increase of 140%. The Company's effective tax rate for the second quarter and first half of 2026 was 22.5% compared to 22.7% for the same periods in 2025. The deferred tax liability was $763,983 at June 30, 2026, versus $389,572 at December 31, 2025.Net incomeNet income increased 221% to $1,170,276 for the second quarter of 2026 compared to $364,459 a year ago due to higher gross profit. Net income per share was $0.26 for the three months ended June 30, 2026, versus $0.08 for the same period a year ago.For the first half of 2026, net income increased 142% to $1,632,538 from $674,176 for the first half of 2025. Net income per share was $0.37 for the six months ended June 30, 2026, versus $0.15 a year ago. Weighted average shares outstanding were approximately 3% below the comparable three- and six-month periods in 2025 due to the Company's share repurchase program initiated on December 1, 2025.Cash and cash equivalents and Investments in marketable securitiesCash and cash equivalents were $9,889,753 at June 30, 2026, compared to $7,939,000 at December 31, 2025, an increase of approximately 25%. Investments in marketable securities totaled $3,368,250 at June 30, 2026, compared to $3,367,125 at December 31, 2025.About SCI Engineered Materials, Inc.SCI Engineered Materials is a global supplier and manufacturer of advanced materials for PVD thin film applications and works closely with end users and OEMs to develop innovative, customized solutions. Additional information is available at www.sciengineeredmaterials.com or follow SCI Engineered Materials, Inc. at:https://www.linkedin.com/company/sci-engineered-materials.-inchttps://www.facebook.com/sciengineeredmaterials/https://x.com/SciMaterialsThis press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Those statements include, but are not limited to, all statements regarding intent, beliefs, expectations, projections, customer guidance, forecasts, plans of the Company and its management. These forward-looking statements involve numerous risks and uncertainties, including without limitation, other risks and uncertainties detailed from time to time in the Company's Securities and Exchange Commission filings, including the Company's Annual Report on Form 10-K for the year ended December 31, 2025. One or more of these factors has affected and could affect the Company's projections in the future. Therefore, there can be no assurances that the forward-looking statements included in this press release will prove to be accurate. Due to the significant uncertainties in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company, or any other persons, that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to the management of the Company. The Company assumes no obligation to update any forward-looking statements.Contact: Robert Lentz(614) 439-6006SCI ENGINEERED MATERIALS, INC.CONDENSED BALANCE SHEETSASSETSJune 30,December 31,20262025(UNAUDITED)Current AssetsCash and cash equivalents$9,889,753$7,939,000Investments - marketable securities, short term799,250298,125Accounts receivable, less allowance for doubtful accounts1,041,650720,364Inventories3,624,4201,091,471Prepaid purchase orders and expenses379,820196,491Total current assets15,734,89310,245,451 Property and Equipment, at cost11,491,33910,854,986Less accumulated depreciation and amortization(8,018,015)(8,020,249)Property and equipment, net3,473,3242,834,737 Investments, net - marketable securities, long term2,569,0003,069,000Right of use asset, net959,2241,061,709Other assets58,99361,461Total other assets3,587,2174,192,170TOTAL ASSETS$22,795,434$17,272,358 LIABILITIES AND SHAREHOLDERS' EQUITYCurrent LiabilitiesOperating lease, short term$232,011$212,561Accounts payable477,280245,523Customer deposits4,546,123829,158Accrued expenses418,765568,503Total current liabilities5,674,1791,855,745 Deferred tax liability763,983389,572Operating lease, long term727,212849,148Total liabilities7,165,3743,094,465 Total shareholders' equity15,630,06014,177,893TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$22,795,434$17,272,358SCI ENGINEERED MATERIALS, INCSTATEMENTS OF INCOME(UNAUDITED) THREE MONTHS ENDED JUNE 30,SIX MONTHS ENDED JUNE 30,2026202520262025Revenue$9,485,119$3,609,304$17,645,481$7,109,536Cost of revenue7,208,6642,451,14713,333,9064,878,565Gross profit2,276,4551,158,1574,311,5752,230,971General and administrative expense512,090549,5401,154,1331,097,361Fraud expense--562,026-Research and development expense147,433107,374290,043209,641Marketing and sales expense217,466145,436416,983265,623Income from operations1,399,466355,8071,888,390658,346Interest income, net110,359115,680219,445213,810Income before provision for income taxes1,509,825471,4872,107,835872,156Income tax expense339,549107,028475,297197,980NET INCOME$1,170,276$364,459$1,632,538$674,176Earnings per share - basic and dilutedIncome per common shareBasic$0.26$0.08$0.37$0.15Diluted$0.26$0.08$0.37$0.15Weighted average shares outstandingBasic4,450,0034,574,6864,460,0594,571,425Diluted4,450,0034,578,9264,460,0594,575,729SCI ENGINEERED MATERIALS, INCCONDENSED STATEMENTS OF CASH FLOWS(UNAUDITED)SIX MONTHS ENDED JUNE 30,20262025CASH PROVIDED BY (USED IN):Operating activities$3,088,988$1,923,241Investing activities(870,735)(705,976)Financing activities(267,500)-NET INCREASE IN CASH1,950,7531,217,265 CASH - Beginning of period7,939,0006,753,403 CASH - End of period$9,889,753$7,970,668SOURCE: SCI Engineered Materials, Inc.View the original press release on ACCESS Newswire

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