8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 12, 2008

CTI INDUSTRIES CORPORATION

(Exact name of registrant as specified in its charter)

Illinois	0-23115	36-2848943
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
22160 North Pepper Road, Barrington, IL		60010
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code (847) 382-1000

N/A 

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item No. 2.02 - Results of Operations and Financial Condition

On August 12, 2008, CTI Industries Corporation issued a press release reporting earnings and other financial results for its second quarter and six months ended June 30, 2008. A copy of the Press Release is attached as Exhibit 99.1.

The information disclosed under this Item 2.02 (including Exhibit 99.1) shall not be deemed “filed” for the purposes of Section 18, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

Item No. 9.01 - Financial Statements and Exhibits

(c)Exhibits:
Exhibit No.	Exhibit
99.1*	Press Release dated August 12, 2008, captioned:“CTI Industries Corporation Reports Second Quarter 2008 Financial Results”

*Filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CTI Industries Corporation (Registrant)
Date: August 13, 2008	By:	/s/ Howard W. Schwan
		Howard W. Schwan, President

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EX-99.1

Exhibit 99.1

NEWS RELEASE

FOR FURTHER INFORMATION CONTACT:

Stephen M. Merrick	Catherine E. Lawler
Executive Vice President	Investor Relations
(847) 382-1000	(847) 671-1177

CTI Industries Corporation Reports

Second Quarter 2008 Financial Results

FOR IMMEDIATE RELEASE

Tuesday, August 12, 2008

BARRINGTON, IL, August 12, 2008 -- CTI Industries Corporation (CTIB - NASDAQ Capital Market), a manufacturer and marketer of flexible packaging and storage products, laminated films and novelty balloons, today announced its results of operations for the second quarter of 2008 and for the six month period ended June 30, 2008.

Consolidated net sales for the second quarter of 2008 were $12,461,000 compared to consolidated net sales of $9,259,000 for the second quarter of 2007, an increase of 34.6%. The Company earned net income of $485,000 or $0.17 per share (basic and diluted) for the second quarter of 2008 compared to net income of $423,000 or $0.18 per share (basic) and $0.17 per share (diluted) for the second quarter of 2007.

For the six month period ended June 30, 2008, consolidated net sales were $23,196,000 compared to $17,538,000 for the same period in 2007, an increase of 32.3%. For this six month period in 2008, net income was $764,000 or $0.28 per share (basic) and $0.26 per share (diluted) compared to net income of $371,000, or $0.17 per share (basic) and $0.15 per share (diluted) for the same period of 2006.

Key Factors and Trends

The revenue increase in the second quarter and for the six months ended June 30, 2008 was led by flexible packaging and pouches, which almost tripled from revenues of $1,967,000 in the first six months of 2007 to $5,889,000 in the first six months of 2008. These increases were the result of sales to a new customer and of increased sales to an existing customer.

In the first six months of 2008, novelty product revenues were up 15.6% compared to the same period of 2007, from $11,236,000 in 2007 to $12,987,000 in 2008. Sales of laminated films also showed a modest increase compared to 2007 both for the second quarter and for the six months.

Gross profit increased from $2,744,000 in the second quarter of 2007 to $2,913,000 in the second quarter of 2008, and from $4,647,000 for the first six months of 2007 to $5,245,000 for the first six months of 2008. Gross margins rates were down from 29.6% in the second quarter of 2007 to 23.4% in the second quarter of 2008, and for the six month period were down from 26.5% in 2007 to 22.6% in 2008. This decline in gross margins is the result principally of significant increases in raw materials costs experienced by the company during the first six months of 2008 which have not yet been fully offset by increases in the selling prices of finished goods.

General, selling and administrative expenses were up in the second quarter, compared to the second quarter of 2007, by about $240,000, and were also up by a similar amount for the six months compared to 2007. As a percentage of sales, general, selling and administrative expenses were lower, representing 17.3% of sales in the second quarter of 2008, compared to 20.7% of sales in the second quarter of 2007. For the six month period, general, selling and administrative expenses were down from 20.6% in 2007 to 16.6% in 2008.

Statements made in this release that are not historical facts are “forward-looking” statement (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These “forward-looking” statements may include, but are not limited to, statements containing words such as “may,” “should,” “could,” “would,” “expect,” “plan,” “goal,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” or similar expressions. Factors that could cause results to differ are identified in the public filings of the Company with the Securities and Exchange Commission. More information on factors that could affect CTI’s business and financial results are included in its public filings made with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

– FINANCIAL HIGHLIGHTS FOLLOW –

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CTI Industries Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
		June 30, 2008			December 31, 2007
Assets		(Unaudited)
Current Assets:
Cash and cash equivalents	$	1,260,417		$	483,112
Accounts receivable, net		7,066,866			5,950,551
Inventories, net		10,301,316			9,700,618
Other current assets		1,634,694			1,666,420
Total current assets		20,263,293			17,800,701
Property, plant and equipment, net		10,320,567			10,096,155
Other assets		1,349,604			1,427,279
Total Assets	$	31,933,464		$	29,324,135
Liabilities & Stockholders' Equity
Total current liabilities	$	16,744,898		$	16,483,109
Long term debt, less current maturities		5,627,833			5,167,039
Other liabilities		1,033,732			1,070,151
Minority interest		12,798			12,534
Stockholders' equity		8,514,203			6,591,302
Total Liabilities & Stockholders' Equity	$	31,933,464		$	29,324,135
Consolidated Statements of Operations
	Three Months Ended June 30						Six Months Ended June 30
		2008			2007			2008			2007
		(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited
Net sales	$	12,460,945		$	9,258,828		$	23,195,646		$	17,537,702
Cost of sales		9,548,061			6,514,432			17,951,083			12,890,619
Gross profit		2,912,884			2,744,396			5,244,563			4,647,083
Operating expenses		2,158,074			1,918,204			3,850,048			3,627,132
Income from operations		754,810			826,192			1,394,515			1,019,951
Other income (expense):
Net Interest expense		(286,404	)		(292,914	)		(556,665	)		(627,498	)
Other		11,889			41,175			42,211			93,347
Income before income taxes and minority interest		480,295			574,453			880,061			485,800
Income tax (benefit) expense		(4,818	)		151,293			115,839			114,886
Income before minority interest		485,113			423,160			764,222			370,914
Minority interest in (loss) income of subsidiary		(24	)		(35	)		264			(69	)
Net income	$	485,137		$	423,195		$	763,958		$	370,983
Basic income per common and common equivalent shares	$	0.17		$	0.18		$	0.28		$	0.17
Diluted income per common and common equivalent shares	$	0.17		$	0.17		$	0.26		$	0.15
Weighted average number of shares and equivalent shares
of common stock outstanding:
Basic		2,781,025			2,303,371			2,721,646			2,230,670
Diluted		2,929,548			2,540,729			2,885,783			2,507,219

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