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Superconductive Components, Inc. Reports Improved Fourth Quarter Results

For Additional Information
Contact: Robert Lentz
(614) 876-2000

COLUMBUS, Ohio (March 27, 2006) Superconductive Components, Inc. (OTCBB: SCCI), which manufactures ceramics and metals for advanced applications including optical systems, thin film batteries, and superconductors, today announced results for the three months and twelve months ended December 31, 2005.  Fourth quarter 2005 highlights included:

  • Total revenues more than doubled to $1,147,377 from $551,087 for the fourth quarter 2004.
  • Gross margin on product revenues increased to 24.1% from 13.7% the prior year.
  • The loss applicable to common shares declined to $38,810, or $0.01 per share, versus a loss applicable to common shares of $213,163, or $0.08 per share, for the fourth quarter 2004.

Dan Rooney, Chairman, President and Chief Executive Officer, commented, “Our fourth quarter 2005 performance, led by record product revenues and improved gross profit margin, underscored the Company’s strong finish for 2005.  During the year, we added key customers in the advanced photonic/optical market as a direct result of achieving ISO 9001:2000 registration in the second quarter and expanded sales activities in key markets.  Additionally, manufacturers in the emerging thin-film battery market continue to move from prototype stage toward commercialization of their products.  Further progress is anticipated during 2006, which is expected to especially benefit 2007 revenues.” 

Mr. Rooney continued, “We entered 2006 with a solid backlog and sales momentum.  The capital we raised during the second half of 2005 positions us to achieve improved financial results this year.”

Fourth Quarter Results

Product revenues increased 124% to a record $1,103,621 for the fourth quarter 2005 from $493,016 the prior year, principally due to higher sales to existing customers coupled with customers added during 2005.  Contract research revenues were $43,756 for the fourth quarter 2005 versus $58,071 for the same period last year.

The Company’s gross profit increased to $263,940, or 23.0% of total revenues, for the fourth quarter 2005 from $69,561, or 12.6% for the same period last year.  The fourth quarter 2005 results benefited from higher production levels and improved operating efficiencies compared to the fourth quarter 2004.
 
General and administrative expense increased slightly to $226,423 for the fourth quarter 2005 from $216,399 a year ago, primarily due to incentive compensation.  Selling expense increased to $70,051 for the fourth quarter 2005 from $51,123 for the same period last year due to the increase in commissions and incentive compensation compared to last year. 

2005 Results

Total revenues increased 59% to $3,457,182 for the twelve months ended December 31, 2005 from $2,172,864 for 2004.  The Company’s growing customer base and increased sales to existing customers represented the most significant factors in the year-over-year increase.  Product revenue increased 65% to $3,167,743 for 2005 from $1,915,732 the prior year.  Contract research revenue increased to $289,439 for the year 2005 compared to $257,132 a year ago as a result of two Small Business Innovation Research awards to determine the feasibility of the initial production of cost-effective, long length round wires for very high field magnet applications.

Gross profit improved to $741,310, or 21.4% of total revenues, for 2005 from $226,372, or 10.4% of total revenues for 2004.  This increase was due to higher volume and revenue mix for 2005 compared to the prior year, which contributed to operating efficiencies.  Gross margin on product revenue improved to 23.5% for 2005 from 12.5% for 2004 as a result of the increase in sales volume of higher margin products.

General and administrative expenses declined approximately 13% to $770,600 for 2005 from $884,000 last year.  This decrease was primarily due to $80,863 of one-time expenses related to the Company’s move to a new facility in 2004.  Selling expense remained relatively flat at $237,569 for 2005 versus $236,235 for 2004.

The loss applicable to common shares declined to $358,405, or $0.14 per share, for 2005 from a loss of $1,125,007, or $0.51 per share, for 2004.

About Superconductive Components, Inc.

SCI Engineered Materials, an operating unit of Superconductive Components, Inc., manufactures ceramics and metals for advanced applications such as thin film batteries, superconductors, and advanced optical systems. The Company also provides materials for thin film applications used in photovoltaics, electronic switches, hardness and decorative coatings. The Company is a global materials supplier with clients in more than 40 countries. Additional information is available at http://www.sciengineeredmaterials.com.

This 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, forecasts, and plans of the Company and its management, and specifically include statements regarding further progress by thin-film battery manufacturers that is anticipated during 2006, which is expected to especially benefit 2007 revenues (paragraph 2), and the Company entered 2006 with a solid backlog and sales momentum, and the capital raised during the second half of 2005 positions the Company to achieved improved performance in 2006 (paragraph 3).  These forward-looking statements involve numerous risks and uncertainties, including, without limitation: the development of the thin film battery market, the impact of competitive products and services, the ability to adapt to technological changes, the availability of capital, and 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-KSB for the year ended December 31, 2004.  One or more of these factors have affected, and could in the future affect, the Company's projections. Therefore, there can be no assurances that the forward-looking statements included in this press release will prove to be accurate. In light of 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.

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