Growing Demand for Specialty Reactive Inks for Toys and Educational Products

King of Prussia, PA, November 13, 2019– Nocopi Technologies, Inc.(OTC Pink: NNUP), a developer of specialty reactive inks used in entertainment, toy and educational products as well as document and product authentication technologies to combat fraud, today announced results for its third quarter and nine months ended September 30, 2019. Nocopi also announced it has applied to up-list its common stock to OTC Markets’ OTCQB exchange later this month.

Nocopi Technologies, Inc.Financial Highlights

Income StatementQ3’19Q2’19Q1’19Q4’18Q3’18
Net Income$206,800$148,900$85,400$111,000$1,100
Weighted Ave. Shares60M59M59M59M59M
Balance SheetQ3’19Q2’19Q1’19Q4’18Q3’18
Total Current Assets$1,874,600$1,562,400$1,369,600$1,156,900$1,060,400
Working Capital$1,454,600$1,132,800$893,500$810,500$628,200
Book Value $2,450,500$2,201,000$2,052,100$1,966,700$1,855,700
Book Value Per Share$0.041$0.037$0.035$0.033$0.031


  • Q3’19 revenues rose 14% vs. Q3’18, driven primarily by higher ink shipments for a major customer in the entertainment and toy products segment. Revenues in this segment totaled approximately $555,900 (or 87% of total revenues) in Q3’19, with the balance of revenues coming from retail receipt and the document fraud market.
  • Q3’19 gross profit rose 11% to $429,500 vs. Q3’18, reflecting higher revenue and a slightly lower gross margin of 67.4% vs. 69.2% in Q3’18, due to growth in ink sales which carry a somewhat lower margin than royalties and license fees.
  • Net income improved to $206,800 in Q3’19 vs. Q3’18 net income of $1,100, which included a tax provision of $199,300 due to limitations placed on income tax net operating loss deductions by the Commonwealth of Pennsylvania. 
  • Cash rose to $798,000 at the end of Q3’19, along with accounts receivable and inventories which increased to $834,500 and $161,000, respectively, reflecting growth in customer demand.
  • Results for the first nine months of 2018 reflected the benefit of revenue of $1,521,700 recorded in Q2 2018 for the present value of guaranteed minimum royalty payments under a four-year license extension with the Company’s largest customer. Pursuant to the license extension, which commenced in July 2019, Nocopi is entitled to receive quarterly cash payments of $100,000. Excluding revenue from the license extension guarantee in 2018, Nocopi would have recorded revenue of approximately $1,339,000 in the first nine months of 2018. Nocopi’s reported revenue of $1,563,000 for the first nine months of 2019 reflects a year-over-year increase of 17% versus adjusted revenue in the comparable 2018 period. 

Nocopi Chairman and CEO Michael Feinstein commented, “We are very excited with the growing pace of our business and the opportunities we see to build on our success with current customers as well as our plans for new business development. Nocopi reactive inks enable exciting capabilities that have applications across a broad range of consumer products as well as in product security. We have built the business over the past few years with a small but focused team with keen attention to managing overhead and other costs. We now look to reinvest a small portion of our profits in efforts to further expand our business and capabilities, while maintaining our cost disciplines to maximize our cash flow. We believe the outlook for Nocopi is very exciting, that the Company represents a unique and very attractive investment opportunity and there are many avenues we look to pursue to drive continued improvements in our financial performance.

“We spent the past few years working to put Nocopi on a path of consistent profitability, growth and cash generation and a solid financial foundation. During this period we maintained our regular SEC reportingbut otherwise kept a very low profile, focusing our resources on the business. Having achieved what we believe is sustainable profitability, solid cash generation and growth, we believe it now makes sense to invest some of our resources in a proactive investor outreach effort. 

“Today’s press release, our first in many years, represents the start of regular quarterly communications which we will supplement as warranted by developments in our business. We have applied to up-list our shares on the OTCQB market, an important step in building visibility and greater liquidity for our stockholders. We have also retained a veteran investor relations team at NYC-based Catalyst IR, to help us in building awareness for our business, solutions, financial performance and attractive valuation. We plan to invest some time and resources in getting out to meet with new investors and to attend conferences going forward. Please contact the Catalyst team if you would like to schedule a meeting or call or if you have any questions or would like to be added to our email news distribution.” 

Q3 Results

Q3’19 revenues rose 14% to $637,500, reflecting an 8% or $14,200 increase revenues from licenses, royalties and fees and a 16% or $61,900 increase in product and other sales, principally specialty inks. The improvement in licenses, royalties and fees principally reflected higher royalties from five licensees which more than offset a $100,000 reduction in guaranteed licensing revenue related to a four year license extension with Nocopi’s largest customer, the present value of which was recorded as revenue of $1,521,700 in Q2’18. Pursuant to minimum guaranteed payments of the extension, which commenced in July 2019, Nocopi is entitled to receive quarterly cash payments of $100,000 over the next four years. The first of these payments was received during Q3’19.

The increase in Q3’19 product and other sales was due primarily to higher ink shipments for the entertainment and toy product market, offset in part by lower ink shipments for the retail receipt and document fraud market.

Gross profit increased to $429,500 in Q3’19, or approximately 67% of revenues, from $388,400 in Q3’18, or approximately 69% of revenues. The Q3’19 decrease in gross margin principally reflects the increase in product and other sales, as a percentage of revenue, compared to licenses, royalties and fees which typically carry a higher gross profit margin than products, which includes specialty inks. Q3’19 gross margin from licenses, royalties and fees was approximately 78% versus 80% in Q3’18. Q3’19 gross margin from product and other sales was approximately 63% versus 64% in Q3’18. 

Sales and marketing expenses in Q3’19 increased to $81,000 versus $74,600 in Q3’18, principally due to higher commission expenses on higher revenues. General and administrative expenses increased to $84,200 in Q3’19 from $73,400 in Q3’18, due primarily to higher employment and public company expenses. 

Q3’19 net income improved to $206,800 compared to $1,100 in Q3’18, reflecting higher gross profit and the absence of a large provision for Pennsylvania income taxes in Q3’19 compared to Q3’18. The Company’s large Q3’18 tax provision was driven by a change in PA tax law that placed limitations on net operating loss deductions and impacted royalty income generated by the large license extension. 

About Nocopi Technologies (

Nocopi develops and markets specialty reactive inks for unique, mess-free applications in the entertainment, toy and educational product markets. Nocopi also develops and markets document and product authentication technologies designed to combat fraudulent document reproduction, product counterfeiting and/or unauthorized product diversion. Nocopi derives revenue from technology licensing agreements as well as from the sale of its proprietary inks and other products to licensees and/or their licensed printers. Nocopi’s products and systems include trade secrets as well as patented technologies.

Safe Harbor for Forward-Looking Statements 

This release may contain projections and other “forward-looking statements” relating to Nocopi’s business, that are often identified by the use of “believes,” “expects” or similar expressions. Forward-looking statements involve a number of estimates, assumptions, risks and uncertainties that may cause actual results to differ materially from those anticipated. Forward-looking statements may address uncertainties regarding customer preferences or demand for products incorporating Nocopi technology that underlie the company’s revenue expectations, the company’s ability to develop new products and new product applications, the financial condition of customers and the timeliness of their payments, the impact of fluctuations in currencies, global trade and shipping markets, etc. Actual results could differ from those projected due to numerous factors and uncertainties, and Nocopi can give no assurance that such statements will prove to be correct nor that Nocopi’s actual results of ‎operations, financial condition and performance will not differ materially from those reflected or implied by its forward-‎looking statements. Investors should refer to the risk factors outlined in Nocopi’s Form 10-K, 10-Q and other SEC reports available at Forward-looking statements are made as of the date of this news release; Nocopi assumes no obligation to update these statements.

Nocopi Technologies, Inc. Statements of Operations Q3- 2019 (PDF)

Twitter – Investors:@NNUP_IR

Investor & Media Contacts
William Jones, David Collins or Chris Eddy
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