Itronics Inc. (PINKSHEETS: ITRO) (FRANKFURT: ITG) (BERLIN: ITG)
said today that total Company sales for the first half of 2009 are
expected to increase about 20 percent.
"The demand for the GOLD'n GRO fertilizers continues to
increase, but limitations on funds available to purchase
ingredients for manufacturing our fertilizers is restricting first
half GOLD'n GRO sales growth to about 15 percent," said Dr. John
Whitney, Itronics President. He said that while the national
economy is struggling, Itronics Metallurgical, the Company's wholly
owned subsidiary, is benefiting from strong demand for silver and
increased silver prices.
Dr. Whitney, in answering recent investment inquiries, said:
"The majority of fertilizer sales are being made through the
Company's distributor to specialty crop growers in California. In
the second quarter 2008 the parent company of our distributor
acquired a major competitor, integrating the acquired company and
its retail outlets into its existing retail distribution system and
increasing the number of its nationwide retail outlets from more
than 500 to about 800. Itronics' distributor is now one of the
largest U.S. agriculture retail companies.
As a result of the merger, our distributor added 21 retail
branches in Arizona, California and Hawaii for a total of 56 retail
outlets in these states, a 55 percent increase from 2008. The
merger and the resulting increase in distributor sales force and
geographic coverage created an opportunity for strong growth in
GOLD'n GRO orders this spring.
For the past 3 to 4 years several of the California based
distributor retail branches have been working with their large
California based corporate growers to introduce one or more of the
GOLD'n GRO fertilizers. This year several of those corporate
growers placed one or more truck load orders for the first time.
Included in these are two of the largest farming companies in
California. Order placement with our distributor is a vote of
confidence for the cost effective benefits of using the GOLD'n GRO
fertilizers. Ongoing expanding use by these large operations is
expected to significantly increase the demand for our fertilizers
in California in future years.
Most of the fertilizer sales are for specialty crop production
in California which is strongly seasonal with a spring season that
usually starts in the second half of March and ends in the first
half of July. Peak months are April and May. Typically there is
also a fall season which starts in late September and continues
through mid December. In a normal year, about 70 percent of GOLD'n
GRO sales are generated in the first half of the year. The Company
is working to diversify sales to reduce the seasonal
concentration.
A very sharp seasonal spike in fertilizer orders in the spring
creates an equally sharp increase in the need for cash to buy
fertilizer ingredients to make the fertilizers. This year, because
of the collapse in the U.S. financial markets, the Company was
unable to obtain financing needed to fill the seasonal surge in
orders. As a result, almost all of the Company's cash receipts are
being focused on purchasing fertilizer ingredients to fill the
orders. This created a new operating concept, "financing capacity,"
for Itronics Metallurgical, versus normal operating limitations of
"manufacturing capacity." By agreement with our distributor, supply
is being managed to provide available fertilizers to retail outlets
that already have a GOLD'n GRO customer base. New sales development
is currently on hold. By closely coordinating with our distributor
we have been able to keep most of the retail outlets supplied with
critically needed fertilizers. Financing capacity is limiting the
Company's output to about two-thirds of single shift manufacturing
capacity.
Itronics Metallurgical has become an important western U.S.
manufacturer of "Chelated Nutrient Metal" micro-nutrient
fertilizers. It now offers 7 micro-nutrient fertilizers, but sales
are currently dominated by four of these which are listed in
descending order of importance: (1) GOLD'n GRO 9-0-1+7% Zn, (2)
GOLD'n GRO 9-0-2+3% Zn multi-micro mix, (3) GOLD'n GRO 10-0-0+4%
Fe, and (4) GOLD'n GRO 10-0-1+3% Mn. This year, manufacturing has
been limited mainly to production of these four fertilizers. The
orders are being filled and the order back log is being reduced.
Most of the manufacturing is still focused on filling orders for
the GOLD'n GRO 9-0-1+7% Zn which is the most popular GOLD'n GRO
micro-nutrient fertilizer.
Large scale applications of GOLD'n GRO 8-8-8+4% S fertilizer in
drip systems (fertigation) on crops in coastal and central valley
areas in California in 2008 demonstrated that this fertilizer can
be used safely in fertigation applications in locations that have
hard water. This is not normally possible using conventional
phosphate-bearing fertilizers. The GOLD'n GRO 8-8-8+4% S is
manufactured in bulk under license by our distributor at a location
in central California, which improves availability and reduces
shipping cost for bulk deliveries to the central valley and coastal
retail branches.
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. Registration has been applied for in California, but has
not yet been received. With the addition of this chelated
micronutrient, the Company now offers seven chelated micronutrient
fertilizers, and six chelated multinutrient blends, for a total of
13 GOLD'n GRO specialty fertilizers. The GOLD'n GRO Guardian Deer
Repellent is a biopesticide and so the Company is now also offering
one biopesticide for a total of 14 products. National recognition
of the GOLD'n GRO Brand is now also being achieved.
Introduction of the GOLD'n GRO Guardian Deer Repellent
fertilizer is expected to produce summer and fall sales which would
partially mitigate the seasonality issue. Sales development for
this product has been on hold due to financing capacity limits, but
plans are being implemented to start sales as soon as the peak
fertilizer season is over. The GOLD'n GRO Guardian is now
registered in eleven states, including New York, and registration
was recently applied for in Virginia.
The Company has also been implementing a sales program for the
chemical injectors (Chemilizers) that are used for injecting
fertilizer (fertigating) into drip and sprinkler irrigation systems
in green house nursery operations and for up-scale homes. Locations
that install the chemical injectors are set up to use one or two of
the GOLD'n GRO fertilizers. GOLD'n GRO 8-8-8+4% S is typically used
by the green house nursery operations. GOLD'n GRO 15-1-8+4% S and
GOLD'n GRO 20-1-7+3% S are being used for fertigation of lawn and
shrubs by sprinkler systems, and GOLD'n GRO 6-3-9+4% S is being
used for drip irrigation of flower beds, roses, and garden
vegetables.
The Company is working with the largest fertilizer distributor
in Utah and now has more than a dozen green house nursery and lawn
fertigation installations in Utah. In 2008 the Company began
working with a landscape maintenance company in northern Nevada
which now has almost a dozen installations. This project to sell
fertilizer injectors in the nursery and landscape maintenance
markets, while still small, has been under development for several
years and is now starting to make a contribution to sales growth.
These market segments are also expected to mitigate the seasonality
by spreading fertilizer demand over longer growing seasons.
Demand growth for the GOLD'n GRO fertilizers is now being driven
by excellent field results obtained with their use. In 2008 the
Company's agronomy staff finished 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 summary
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. This is the other "Green" aspect of the GOLD'n
GRO fertilizer technology.
One of the emerging national fertilizer needs is to be able to
apply manganese fertilizer in glyphosate (Round Up, a weed spray)
spray mixes on "Round Up Ready" corn and soybeans (these plants
have been genetically altered so that they are not damaged by the
weed spray). Initial tests with GOLD'n GRO 10-0-1+3% Mn in the fall
of 2007 produced very satisfactory results on "Round Up Ready"
corn. In 2008 Itronics Metallurgical worked with one of its
fertilizer ingredient suppliers who put out trials on "Round Up
Ready" soybeans in several states. The GOLD'n GRO 10-0-1+3% Mn was
found to be compatible with the glyphosate spray mixes and crop
response was acceptable. 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. This market is large, but would be strongly seasonal,
so when Itronics Metallurgical is able to support the expansion
with adequate funding and manufacturing capacity, market
development can be initiated.
The GOLD'n GRO nutrient technology is providing economic and
environmental benefits that are driving expanding demand. Use in
fertigation reduces application costs and quantities required.
Improved availability to the plant roots in the soil of phosphorous
and nutrient metals after several years of use is now reducing the
amount of fertilizer needed to provide satisfactory plant
nutrition. This produces both economic and environmental benefits
and increases customer loyalty.
Itronics, through its subsidiary Itronics Metallurgical, is the
inventor and operator of award winning recycling technology that
converts spent photographic liquids into pure silver and GOLD'n GRO
fertilizers. Commercialization of this technology has created a
'Green Consumer Option' for photo and x-ray processors and 'Green
fertilizers' for horticulture and agriculture. The fertilizers
incorporate the ESSENCE OF GREEN because of how they are sourced
and because of their excellent performance in the field."
About Itronics
Headquartered in Reno, Nevada, Itronics Inc. is a "Creative
Clean Technology" company that produces GOLD'n GRO liquid
fertilizers and pure silver bullion. 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 converts spent
photoliquids into pure silver and GOLD'n GRO liquid fertilizers.
The Company is developing environmentally compatible mining
technology, provides project planning and technical services to the
gold mining industry, 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.
VISIT 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.)
Contact: Paul Knopick 888-795-6336
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