MINNEAPOLIS, MN – Nortech reported third quarter net sales of $29.5 million, an increase of 11.7% year-over-year. The revenue improvement was primarily due to higher production volume resulting from actions to scale the direct labor workforce and strengthen the supply chain for parts.

Net income was $3.6 million, up 80% compared to the third quarter of 2020.

As of Sept. 30, the company had $444,000 in cash, compared to $352,000 as of Dec. 31.

Nortech filed for the Employee Retention Credit with the IRS and recognized $5.2 million reduction to payroll tax expense in the third quarter. The company hasn’t received funds yet.

Operating results for the period included a $3.8 million gain on the sale and leaseback transaction for the Bemidji and Mankato, Minnesota, manufacturing facilities. Proceeds from the sale-leaseback in August 2020 were used to pay down bank debt.

“Nortech’s bookings continue to be strong, resulting in another record backlog. Meanwhile, our operations team has been improving the supply chain to deliver high quality parts to our customers while optimizing our investment in working capital,” said Jay D. Miller, CEO and president. “We expect improved results in the fourth quarter, and our $79 million backlog represents an encouraging vote of confidence from our customers that bodes well for growth throughout 2022. Finally, I’m very enthusiastic about the innovative new technologies Nortech has been developing that will help our customers compete better and stay on the cutting edge of new digital data opportunities in 2023 and beyond.”