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Superconductive Components, Inc. Reports Fourth Quarter Results

COLUMBUS, Ohio -- April 5, 2005 -- Superconductive Components, Inc. (OTCBB: SCCI), a manufacturer of advanced ceramics, optical materials, and high temperature superconductive and non-superconductive products, today announced results for the three months and twelve months ended December 31, 2004.

Dan Rooney, Chairman, President and Chief Executive Officer, stated, “The Company’s results were substantially below our expectations for 2004. Our move to a new manufacturing facility in the first quarter combined with weak conditions in the photonics market throughout most of 2004 negatively impacted our performance. We have addressed these issues and anticipate improved revenues and gross profit for 2005 compared to 2004.”

Mr. Rooney added, “The market for lithium thin-film batteries is beginning to move forward. Some thin-film battery manufacturers, our customers, have raised capital during the past several months to purchase equipment and substantially increase their production capabilities. This is an important step toward broader product market acceptance leading to higher demand for these batteries. We intend to remain the leading supplier to thin-film battery manufacturers in the U.S. and expect to raise equity capital during the first half of 2005 to expand our manufacturing capabilities.”

Fourth Quarter 2004 Results

Total revenue increased to $551,087 for the quarter ended December 31, 2004 from $374,114 for the same period in 2003. Product sales increased 43.0% to $493,016 for the fourth quarter 2004 compared to $344,790 the prior year. This was due to higher sales to the Company’s photonics customers.

Gross margin was $69,561 for fourth quarter 2004 compared to ($166,022) for the same period last year. The increase in fourth quarter 2004 net sales compared to the prior year was the most significant factor that impacted gross margin. For the fourth quarter 2003, gross margin was negatively impacted by $133,015 of non-cash inventory adjustments.

General and administrative expenses were $216,399 for the fourth quarter 2004 compared to $205,572 for the same period in 2003. This was due to the increase in rent for the fourth quarter 2004 compared to the prior year.

The loss applicable to common shares was $213,163, or $0.08 per diluted share, for the fourth quarter 2004 compared to a net loss applicable to common shares of $438,246, or $0.24 per diluted share, for the fourth quarter 2003.

Year 2004 Results

Revenue declined 4.2% for 2004 to $2,172,864 from $2,268,488 for 2003. The largest category of revenues, product sales, declined 5.2% to $1,915,732 for 2004 from $2,021,653 the prior year.

This was primarily due to the Company’s move to a new manufacturing facility in the first half of 2004 and management’s intentional withdrawal from certain lower margin business. Total contract research revenues rose to $257,132 for 2004 compared to $246,835 for 2003. Most of these revenues were attributable to higher government development contracts, which benefited from a Phase II SBIR grant from the U.S. Department of Energy awarded in 2003.

Gross margin was $226,372 or 10.4% of total revenue for 2004 compared to $302,656 or 13.3% of total revenue the prior year. This decline was principally due to lower product revenues for 2004 resulting in a reduction in overhead absorption compared to 2003. For the year 2003, the Company recognized a non-cash adjustment to inventory which lowered inventory $133,015.

General and administrative expenses rose 13.5% to $884,000 for 2004 from $778,758 in 2003. Factors that contributed to this year-over-year increase include the Company’s relocation to a new manufacturing facility in the first half of 2004, which represented $80,863 of the increase, higher rent for the new manufacturing facility, which rose from $66,594 to $133,424, and a non-cash expense for non-employee stock warrants granted in 2004.

The net loss applicable to common stock for 2004 was $1,125,007, or $0.51 per diluted share, compared to a net loss applicable to common stock of $746,061, or $0.41 per diluted share, the prior year.

About Superconductive Components, Inc.

Superconductive Components, Inc. operates through SCI Engineered Materials and manufactures advanced ceramics such as superconductors, ferroelectric and optical materials for use in wire, cable, batteries, wireless and fiber optics 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 anticipate improved revenues and gross profit for 2005 compared to 2004 (paragraph 2), the market for lithium thin-film batteries is beginning to move forward, broader product market acceptance leading to higher demand for these batteries, the Company’s intention to remain the leading supplier to thin-film battery manufacturers in the U.S., and an expectation to raise equity capital during the first half of 2005 to expand its manufacturing capabilities (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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