Exhibit 99.1

Nortech Systems Reports Second Quarter Results
MINNEAPOLIS – August 12, 2026 – Nortech Systems Incorporated (Nasdaq: NSYS) (“Nortech” or the “Company”), a leading provider of engineering and manufacturing solutions for complex electromedical and electromechanical products serving the medical imaging, medical device, industrial, and aerospace & defense markets, reported financial results for the second quarter ended June 30, 2026.
2026 Q2 Highlights:
| ● | Net sales of $33.5 million in Q2 2026 vs. $30.7 million in Q2 2025 | |
| ● | Net income of $316 thousand, or $0.11 per basic share in Q2 2026 vs. $313 thousand, or $0.12 per basic share in Q2 2025 | |
| ● | Adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”) of $938 thousand in Q2 2026 vs. $1.1 million in Q2 2025 | |
| ● | 90-day backlog of $33.4 million as of June 30, 2026 vs. $26.6 million as of June 30, 2025 | |
| ● | Total backlog of $93.8
million as of June 30, 2026 |
Management Commentary
“Nortech delivered a solid second quarter, with year-over-year revenue growth, improved gross margins, and continued positive operating income reflecting the benefits of our restructuring actions and disciplined execution,” said President & CEO, Jay D. Miller.
“We are encouraged by the continued strength
of our
Summary Financial Information
The following table provides summary financial information comparing the second quarter 2026 (“Q2 2026”) financial results to the same quarter in 2025 (“Q2 2025”) as well as the six-month period ended June 30, 2026 (“YTD 2026”) with the same period in 2025 (“YTD 2025”).
| ($ in thousands) | Q2 2026 | Q2 2025 | % Change | YTD 2026 | YTD 2025 | % Change | ||||||||||||||||||
| Net sales | $ | 33,540 | $ | 30,675 | 9.3 | % | $ | 63,856 | $ | 57,570 | 10.9 | % | ||||||||||||
| Gross profit | $ | 5,703 | $ | 4,837 | 17.9 | % | $ | 10,405 | $ | 7,915 | 31.5 | % | ||||||||||||
| Operating expenses | $ | 5,080 | $ | 4,095 | 24.1 | % | $ | 9,735 | $ | 8,786 | 10.8 | % | ||||||||||||
| Net income (loss) | $ | 316 | $ | 313 | 1.0 | % | $ | 282 | $ | (1,003 | ) | (128.1 | )% | |||||||||||
| EBITDA | $ | 938 | $ | 1,073 | (12.6 | )% | $ | 1,288 | $ | (193 | ) | (767.4 | )% | |||||||||||
| Adjusted EBITDA | $ | 938 | $ | 1,073 | (12.6 | )% | $ | 1,288 | $ | 73 | 1,664 | % | ||||||||||||
Conference Call
The Company will hold a live conference call and webcast at 3:30 p.m. central time on Wednesday, August 12, to discuss the Company’s 2026 second quarter results. The call will be hosted by Jay D. Miller, Chief Executive Officer and President and Andrew D. C. LaFrence, Chief Financial Officer and Senior Vice President of Finance. To access the live audio conference call, US participants may call 888-506-0062 and international participants may call 973-528-0011. Participant Access Code: 979013. Participants may also access the call via webcast at: https://www.webcaster5.com/Webcast/Page/2814/54239.
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About Nortech Systems Incorporated
Nortech Systems is a leading provider of design and manufacturing solutions for complex electromedical devices, electromechanical systems, assemblies, and components. Nortech primarily serves the medical imaging, medical device, aerospace & defense, and industrial markets. Its design services span concept development to commercial design, and include medical device, software, electrical, mechanical, and biomedical engineering. Its manufacturing and supply chain capabilities are vertically integrated around wire, cable, and interconnect assemblies, printed circuit board assemblies, as well as system-level assembly, integration, and final test. Headquartered in Maple Grove, Minn., Nortech currently has six manufacturing locations and design centers across the U.S., Latin America, and Asia. Nortech Systems is traded on the NASDAQ Stock Market under the symbol NSYS. Nortech’s website is www.nortechsys.com.
Forward-Looking Statements
Reconciliation of Generally Accepted Accounting Principles (“GAAP”) Measures to Non-GAAP Financial Measure
EBITDA is a non-GAAP financial measure used by management that we believe provides useful information to investors because it reflects ongoing performance excluding certain non-recurring items during comparable periods and facilitates comparisons between peer companies since interest, taxes, depreciation, and amortization can differ greatly between different organizations as a result of differing capital structures and tax strategies. EBITDA is defined as net income (loss) plus interest expense, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Adjusted EBITDA reflects the impact of restructuring and non-recurring items. EBITDA and Adjusted EBITDA are not a measurement of our financial performance under GAAP and should not be considered an alternative to net sales or net income (loss), as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA and Adjusted EBITDA have limitations as an analytical metric, and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.
NORTECH SYSTEMS INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
| THREE MONTHS ENDED | SIX MONTHS ENDED | |||||||||||||||
| JUNE 30, | JUNE 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | $ | 33,540 | $ | 30,675 | $ | 63,856 | $ | 57,570 | ||||||||
| Cost of goods sold | 27,837 | 25,838 | 53,451 | 49,655 | ||||||||||||
| Gross profit | 5,703 | 4,837 | 10,405 | 7,915 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Selling | 1,484 | 1,204 | 2,815 | 2,388 | ||||||||||||
| General and administrative | 3,250 | 2,589 | 6,264 | 5,504 | ||||||||||||
| Research and development | 346 | 302 | 656 | 628 | ||||||||||||
| Restructuring charges | - | - | - | 266 | ||||||||||||
| Total operating expenses | 5,080 | 4,095 | 9,735 | 8,786 | ||||||||||||
| Income (loss) from operations | 623 | 742 | 670 | (871 | ) | |||||||||||
| Other expense: | ||||||||||||||||
| Interest expense, net | (197 | ) | (257 | ) | (453 | ) | (471 | ) | ||||||||
| Income (loss) before income taxes | 426 | 485 | 217 | (1,342 | ) | |||||||||||
| Income tax expense (benefit) | 110 | 172 | (65 | ) | (339 | ) | ||||||||||
| Net income (loss) | $ | 316 | $ | 313 | $ | 282 | $ | (1,003 | ) | |||||||
| Net income (loss) per common share: | ||||||||||||||||
| Basic (in dollars per share) | $ | 0.11 | $ | 0.12 | $ | 0.10 | $ | (0.36 | ) | |||||||
| Weighted average number of common shares outstanding - basic (in shares) | 2,805,183 | 2,773,598 | 2,795,659 | 2,767,263 | ||||||||||||
| Diluted (in dollars per share) | $ | 0.11 | $ | 0.12 | $ | 0.09 | $ | (0.36 | ) | |||||||
| Weighted average number of common shares outstanding - diluted (in shares) | 2,999,002 | 2,954,765 | 3,007,439 | 2,767,263 | ||||||||||||
| Other comprehensive income (loss) | ||||||||||||||||
| Foreign currency translation | $ | 21 | $ | 124 | $ | 90 | $ | 130 | ||||||||
| Comprehensive income (loss), net of tax | $ | 337 | $ | 437 | $ | 372 | $ | (873 | ) | |||||||
NORTECH SYSTEMS INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2026 AND DECEMBER 31, 2025
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE DATA)
| JUNE 30, 2026 |
DECEMBER 31, 2025 |
|||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 1,380 | $ | 1,655 | ||||
| Restricted cash | 294 | - | ||||||
| Accounts receivable, less allowance for credit losses of $154 and $161, respectively | 19,850 | 16,998 | ||||||
| Inventories, net | 24,512 | 20,695 | ||||||
| Contract assets | 16,979 | 15,184 | ||||||
| Prepaid assets and other assets | 1,279 | 1,618 | ||||||
| Total current assets | 64,294 | 56,150 | ||||||
| Property and equipment, net | 4,977 | 5,203 | ||||||
| Operating lease assets, net | 6,420 | 7,016 | ||||||
| Deferred tax assets | 3,963 | 3,394 | ||||||
| Other intangible assets, net | 147 | 156 | ||||||
| Deferred line of credit issuance costs, net | 244 | - | ||||||
| Total assets | $ | 80,045 | $ | 71,919 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Lines of credit | $ | 7,868 | $ | 7,000 | ||||
| Current portion of term loan, net |
432 | - | ||||||
| Accounts payable | 14,949 | 12,809 | ||||||
| Accrued payroll and commissions | 2,808 | 1,822 | ||||||
| Customer deposits | 6,848 | 5,386 | ||||||
| Current portion of operating leases | 1,246 | 1,332 | ||||||
| Current portion of finance lease obligations | 243 | 274 | ||||||
| Other accrued liabilities | 1,644 | 1,221 | ||||||
| Total current liabilities | 36,038 | 29,844 | ||||||
| Long-term liabilities: | ||||||||
| Term loan, net |
1,636 | - | ||||||
| Long-term operating lease obligations | 5,929 | 6,476 | ||||||
| Long-term finance lease obligations | 534 | 626 | ||||||
| Other long-term liabilities | 434 | 426 | ||||||
| Total long-term liabilities | 8,533 | 7,528 | ||||||
| Total liabilities | 44,571 | 37,372 | ||||||
| Shareholders’ equity: | ||||||||
| Preferred stock, $1 par value; 1,000,000 shares authorized; 250,000 shares issued and outstanding | 250 | 250 | ||||||
| Common stock - $0.01 par value; 9,000,000 shares authorized; 2,853,766 and 2,786,134 shares issued and outstanding, respectively | 29 | 28 | ||||||
| Additional paid-in capital | 18,409 | 17,855 | ||||||
| Accumulated other comprehensive loss | (619 | ) | (709 | ) | ||||
| Retained earnings | 17,405 | 17,123 | ||||||
| Total shareholders’ equity | 35,474 | 34,547 | ||||||
| Total liabilities and shareholders’ equity | $ | 80,045 | $ | 71,919 | ||||
NORTECH SYSTEMS INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
| SIX MONTHS ENDED JUNE 30, | ||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net income (loss) | $ | 282 | $ | (1,003 | ) | |||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 618 | 678 | ||||||
| Compensation on stock-based awards | 320 | 235 | ||||||
| Change in allowance for credit losses | (7 | ) | 10 | |||||
| Change in inventory reserves | (311 | ) | 351 | |||||
| Deferred taxes | (569 | ) | (700 | ) | ||||
| Changes in current operating items: | ||||||||
| Accounts receivable | (2,705 | ) | (2,842 | ) | ||||
| Inventories | (3,530 | ) | 2,714 | |||||
| Contract assets | (1,795 | ) | (1,192 | ) | ||||
| Prepaid expenses and other assets | 338 | (1,647 | ) | |||||
| Accounts payable | 2,077 | 295 | ||||||
| Accrued payroll and commissions | 978 | (94 | ) | |||||
| Customer deposits | 1,463 | 36 | ||||||
| Other accrued liabilities | 392 | 386 | ||||||
| Net cash used in operating activities | (2,449 | ) | (2,773 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Proceeds from sale of property and equipment | - | 9 | ||||||
| Purchases of property and equipment | (323 | ) | (367 | ) | ||||
| Net cash used in investing activities | (323 | ) | (358 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from lines of credit | 35,061 | 51,405 | ||||||
| Payments to line of credit | (34,198 | ) | (48,485 | ) | ||||
| Proceeds from term loan | 2,200 | - | ||||||
| Payments of debt issuance costs | (290 | ) | - | |||||
| Principal payments on term loan | (110 | ) | - | |||||
| Principal payments on financing leases | (124 | ) | (85 | ) | ||||
| Stock award exercises | 235 | 23 | ||||||
| Net cash provided by financing activities | 2,774 | 2,858 | ||||||
| Effect of exchange rate changes on cash and restricted cash | 17 | 9 | ||||||
| Net change in cash and restricted cash | 19 | (264 | ) | |||||
| Cash and restricted cash - beginning of period | 1,655 | 916 | ||||||
| Cash and restricted cash - end of period | $ | 1,674 | $ | 652 | ||||
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA
|
THREE MONTHS ENDED JUNE 30, |
SIX MONTHS ENDED JUNE 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| ($ in thousands) | ||||||||||||||||
| Net income (loss) | $ | 316 | $ | 313 | $ | 282 | $ | (1,003 | ) | |||||||
| Interest | 197 | 257 | 453 | 471 | ||||||||||||
| Taxes | 110 | 172 | (65 | ) | (339 | ) | ||||||||||
| Depreciation | 311 | 327 | 609 | 669 | ||||||||||||
| Amortization | 4 | 4 | 9 | 9 | ||||||||||||
| EBITDA | 938 | 1,073 | 1,288 | (193 | ) | |||||||||||
| Restructuring charges | - | - | - | 266 | ||||||||||||
| ADJUSTED EBITDA | $ | 938 | $ | 1,073 | $ | 1,288 | $ | 73 | ||||||||
There were no material adjustments to EBITDA in the three or six months ended June 30, 2026 and the three months ended June 30, 2025. Adjustment to EBITDA for the six months ended June 30, 2025 include ($ in thousands):
| ● | During the first quarter of 2025, we incurred $235 of severance charges for a February 2025 reduction in force to align staffing to our forecasted net sales and $31 of expenses related to our closed Blue Earth facility, which expense amount is not included in Adjusted EBITDA. |
| ($ in millions) | Last Twelve Months (“LTM”) Ended in |
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Q3 2023 |
Q4 2023 |
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Q1 2025 |
Q2 2025 |
Q3 2025 |
Q4 2025 |
Q1 2026 |
Q2 2026 |
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| Net Sales | $ | 140.8 | $ | 138.9 | $ | 139.3 | $ | 138.7 | $ | 137.5 | $ | 135.6 | $ | 128.1 | $ | 120.8 | $ | 117.6 | $ | 116.7 | $ | 118.4 | $ | 121.8 | $ | 124.7 | ||||||||||||||||||||||||||
| Gross Profit $ - Adjusted | 22.4 | 21.4 | 23.1 | 23.1 | 22.2 | 20.7 | 16.7 | 14.4 | 14.6 | 15.8 | 18.0 | 19.6 | 20.5 | |||||||||||||||||||||||||||||||||||||||
| Gross Margin % - Adjusted | 15.9 | % | 15.4 | % | 16.6 | % | 16.6 | % | 16.1 | % | 15.3 | % | 13.1 | % | 11.9 | % | 12.4 | % | 13.5 | % | 15.2 | % | 16.1 | % | 16.4 | % | ||||||||||||||||||||||||||
| EBITDA - Adjusted | $ | 6.8 | $ | 6.0 | $ | 8.0 | $ | 8.1 | $ | 7.3 | $ | 5.9 | $ | 2.1 | $ | (0.5 | ) | $ | (0.4 | ) | $ | 0.7 | $ | 2.5 | $ | 3.9 | $ | 3.7 | ||||||||||||||||||||||||
Contact
Andrew D. C. LaFrence
Chief Financial Officer and Senior Vice President of Finance
alafrence@nortechsys.com
952-345-2243