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Omnitek Engineering Reports Second Quarter and Six-Month Results

Revenues Up Sharply for Quarter and Six Months

VISTA, Calif., Aug. 06, 2018 (GLOBE NEWSWIRE) -- Omnitek Engineering Corp. (OTCQB: OMTK) today reported results for its second quarter and six months ended June 30, 2018 – reflecting increased sales and a sharply reduced net loss for both periods.

/EIN News/ -- Net revenues for the second quarter climbed 50 percent to $369,555 from $246,314 a year earlier. For the same period, net loss decreased to $76,543, or $0.00 per share, from a net loss of $191,589, or $0.01 per share, a year earlier.

Net loss for the quarter included a non-cash inventory reserve adjustment of $25,000 for slow-moving inventory. Results for the quarter were also impacted by non-cash expenses, including the value of options and warrants granted in the amount of $5,215 and depreciation and amortization of $1,745. For the three-month period a year earlier, non-cash expenses included the value of options and warrants granted of $25,200 and depreciation and amortization of $6,224.

Net revenues for the six-month period increased 36 percent to $729,085 from $537,968 a year ago. For the same period, net loss decreased to $174,633, or $0.01 per share, from a net loss of $400,630, or $0.02 per share, a year earlier.

Net loss for the six-month period included a non-cash inventory reserve adjustment $50,000 for slow-moving inventory. Results for the six months were also impacted by non-cash expenses, including the value of options and warrants granted in the amount of $27,186 and depreciation and amortization of $5,726. For the six-month period a year earlier, non-cash expenses included the value of options and warrants granted of $94,733 and depreciation and amortization of $12,448.

Gross margin as a percentage of revenues was 46 percent for the quarter ended June 30, 2018 compared with 42 percent a year earlier, reflecting product mix. Gross margin as a percentage of revenues for the six months ended June 30, 2018 was 44 percent compared with 45 percent a year earlier.

“Results for the quarter reflect continued momentum for engine conversions and the benefit of increasing demand for company’s proprietary natural gas filters. Higher oil prices, air pollution regulations and the price disparity between diesel and natural gas in foreign markets remain important catalysts for our business; and, we continue to expect a transformative year for the company as sales gain further momentum, particularly in China, Turkey and India,” said Werner Funk, president and chief executive officer of Omnitek Engineering Corp.

Funk noted the level of inquires and quote activity from other potential international customers continues to be encouraging, with expectations for continued momentum in the second half. 

At June 30, 2018, current liabilities totaled $1,162,637 and current assets totaled $1,543,343, resulting in positive working capital of $380,706 and a current ratio of 1.33 to 1.

About Omnitek Engineering Corp.

Omnitek Engineering Corp. develops and sells proprietary diesel-to-natural gas conversion systems and complementary products, including new natural gas engines that utilize the company’s technology -- providing global customers with innovative alternative energy and emissions control solutions that are sustainable and affordable.

Some of the statements contained in this news release discuss future expectations, contain projections of results of operations or financial condition or state other "forward-looking" information. These statements are subject to known and unknown risks, uncertainties, and other factors that could cause the actual results to differ materially from those contemplated by the statements. The forward-looking information is based on various factors and is derived using numerous assumptions. Important factors that may cause actual results to differ from projections include, among many others, the ability of the Company to raise sufficient capital to meet operating requirements, completion of R&D and successful commercialization of products/services, patent completion, prosecution and defense against well-capitalized competitors. These are serious risks and there is no assurance that our forward-looking statements will occur or prove to be accurate. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," and variations of such words and similar expressions are intended to identify such forward-looking statements. Unless required by law, the Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

(Financial Tables Follow)

OMNITEK ENGINEERING CORP.
Condensed Statements of Operations (unaudited)
             
        For the Three   For the Three   For the Six   For the Six
        Months Ended   Months Ended   Months Ended   Months Ended
        June 30   June 30   June 30   June 30
        2018   2017   2018   2017
                     
REVENUES   $ 369,555     $ 246,314     $ 729,085     $ 537,968  
COST OF GOODS SOLD     200,488       145,794       404,980       298,407  
GROSS MARGIN     169,067       100,520       324,105       239,561  
                             
OPERATING EXPENSES                        
                             
  General and administrative     213,776       249,017       434,306       549,139  
  Research and development     25,767       33,805       52,569       73,689  
  Depreciation and amortization     1,745       6,224       5,726       12,448  
                             
    Total Operating Expenses     241,288       289,046       492,601       635,276  
                             
LOSS FROM OPERATIONS     (72,221 )     (188,526 )     (168,496 )     (395,715 )
                             
OTHER INCOME (EXPENSE)                        
                           
  Other income     -       -       950       -  
  Interest expense     (3,522 )     (2,263 )     (6,287 )     (4,115 )
                             
    Total Other Income (Expense)     (3,522 )     (2,263 )     (5,337 )     (4,115 )
                             
LOSS BEFORE INCOME TAXES     (75,743 )     (190,789 )     (173,833 )     (399,830 )
INCOME TAX EXPENSE     800       800       800       800  
                             
NET LOSS   $ (76,543 )   $ (191,589 )   $ (174,633 )   $ (400,630 )
                             
BASIC AND DILUTED LOSS PER SHARE   $ (0.00 )   $ (0.01 )   $ (0.01 )   $ (0.02 )
                             
WEIGHTED AVERAGE NUMBER                        
  OF COMMON SHARES OUTSTANDING BASIC AND DILUTED   20,281,082       20,281,082       20,281,082       20,281,082  
                             
                             


OMNITEK ENGINEERING CORP.
 Condensed Balance Sheet 
ASSETS
 
      June 30,   December 31,
      2018   2017
      (unaudited)    
CURRENT ASSETS            
  Cash $ 41,182     $ 23,279  
  Accounts receivable, net   30,722       7,984  
  Accounts receivable - related parties   5,771       3,440  
  Inventory, net   1,443,217       1,554,656  
  Deposits   22,451       17,385  
               
    Total Current Assets   1,543,343       1,606,744  
FIXED ASSETS, net   4,240       7,253  
               
OTHER ASSETS              
  Other noncurrent assets   14,280       14,280  
               
    Total Other Assets   14,280       14,280  
               
    TOTAL ASSETS $ 1,561,863     $ 1,628,277  
               
LIABILITIES AND STOCKHOLDERS' EQUITY  
CURRENT LIABILITIES            
  Accounts payable and accrued expenses $ 350,255     $ 358,032  
  Accrued management compensation   465,738       406,841  
  Accounts payable - related parties   134,617       114,321  
  Billings in excess of costs and estimated earnings   -       30,000  
  Notes payable – related parties   15,000       15,000  
  Convertible notes payable – related parties   15,000       15,000  
  Convertible notes payable, current portion   30,000       -  
  Customer deposits   152,027       212,410  
               
    Total Current Liabilities   1,162,637       1,151,604  
             
LONG-TERM LIABILITIES            
  Convertible notes payable $ 70,000     $ -  
               
    Total Long-term liabilities   70,000       -  
               
    TOTAL LIABILITIES   1,232,637       1,151,604  
               
  STOCKHOLDERS' EQUITY          
  Common stock, 125,000,000 shares authorized no par value          
    20,281,082 shares issued and outstanding   8,411,411       8,411,411  
  Additional paid-in capital   11,879,549       11,852,363  
  Accumulated deficit   (19,961,734 )     (19,787,101 )
               
    Total Stockholders' Equity   329,226       476,673  
               
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,561,863     $ 1,628,277  
               
CONTACT:
                    
                    Gary S. Maier
                    Maier & Company, Inc.
                    (310) 471-1288

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