SAN MARCOS, Calif., May 12, 2011 (GLOBE NEWSWIRE) -- Omnitek Engineering Corporation (OTCQB:OMTK) today reported results for its first quarter ended March 31, 2011 – reflecting a sharp increase in revenues supported by high oil prices with continued strong demand for Omnitek's diesel-to-natural gas conversion systems around the world and its high-pressure natural gas filter.
Net revenues for the first quarter increased 47.5 percent to $615,256 from $417,242 a year earlier. For the same period, the company reported a modest net profit of $26,257, or less than $0.01 per diluted share, compared with a net loss of $525,136, or $0.03 per share, a year ago.
Gross margin for the three months ended March 31, 2011 was $332,626 compared with $165,990 a year ago, reflecting increased sales. Gross margin for the three-month period as a percentage of sales was 54 percent compared with 40 percent in the same period a year ago.
"Global demand for converting high-polluting diesel powered engines to operate on natural gas continues to increase, supported by high crude oil prices, dependency on foreign supplies, environmental considerations and geopolitical unrest. As a result, we anticipate strong sales momentum, as the company is well-positioned to capitalize on these trends," said Werner Funk, president and chief executive officer of Omnitek Engineering Corporation.
He added that the U.S. Environmental Protection Agency's (EPA) recent ruling finalizing regulations applicable to certifying and converting diesel and gasoline engines to operate on natural gas will hasten adoption of the technology in the United States.
"The new EPA regulations will now enable Omnitek to certify and convert diesel engines in a cost-effective manner," Funk said. He noted that Omnitek's technology has been utilized outside the United States since 2001, with more than 5,000 engine conversions currently in operation.
Funk added that compressed natural gas provides significant advantages over diesel fuel, including reduced emissions, plentiful supplies and favorable economics. "Industry observers believe that up to eight million heavy-duty vehicles in the U.S. could benefit from conversion to natural gas. Replacing old diesel trucks with new natural gas-powered trucks is certainly an option, but it is much more expensive and manufacturing the required quantity of new engines has a very large carbon-footprint consequence. Our technology is feasible and affordable, with a projected return on investment of less than two years. In addition, diesel engines have a service life of up to 20 years, which provides an additional incentive to convert," Funk said.
About Omnitek Engineering Corporation
Omnitek Engineering Corp. develops and sells new natural gas engines, as well as proprietary diesel-to-natural gas conversion systems -- providing global customers with innovative alternative energy and emissions control solutions that are sustainable, affordable and designed to combat global warming.
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.
| OMNITEK ENGINEERING CORP. | ||
| Statements of Operations | ||
| (unaudited) | ||
| For the Three | For the Three | |
| Months Ended | Months Ended | |
| March 31, | March 31, | |
| 2011 | 2010 | |
| REVENUES | $ 615,256 | $ 417,242 |
| COST OF GOODS SOLD | 282,630 | 251,252 |
| GROSS MARGIN | 332,626 | 165,990 |
| OPERATING EXPENSES | ||
| General and administrative | 265,857 | 621,750 |
| Research and development expense | 27,465 | 38,712 |
| Depreciation and amortization expense | 20,393 | 23,731 |
| Total Operating Expenses | 313,715 | 684,193 |
| INCOME (LOSS) FROM OPERATIONS | 18,911 | -518,203 |
| OTHER INCOME (EXPENSE) | ||
| Interest expense | -- | -7,803 |
| Interest income | -- | 1,670 |
| TOTAL OTHER INCOME (EXPENSE) | -- | -6,133 |
| NET INCOME (LOSS) BEFORE INCOME TAXES | 18,911 | -524,336 |
| INCOME TAX EXPENSE (BENEFIT) | 800 | 800 |
| NET INCOME (LOSS) | $ 18,111 | $ (525,136) |
| BASIC AND DILUTED LOSS PER SHARE | $ 0.00 | $ (0.03) |
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | 15,659,829 | 16,146,564 |
| OMNITEK ENGINEERING CORP. | ||
| Balance Sheets | ||
| ASSETS | ||
| March 31, | December 31, | |
| 2011 | 2010 | |
| (unaudited) | (audited) | |
| CURRENT ASSETS | ||
| Cash | $ 31,945 | $ 34,944 |
| Accounts receivable, net of allowance of $10,000 | 20,344 | 28,117 |
| Accounts receivable -related party | 30,295 | -- |
| Inventory, net | 959,236 | 1,055,047 |
| Deposits | 112,288 | 73,412 |
| Total Current Assets | 1,154,108 | 1,191,520 |
| FIXED ASSETS, net | 10,530 | -- |
| OTHER ASSETS | ||
| Intellectual property, net | 56,217 | 76,518 |
| Total Current Assets | 56,217 | 76,518 |
| TOTAL ASSETS | $ 1,220,855 | $ 1,268,038 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| CURRENT LIABILITIES | ||
| Accounts payable and accrued expenses | $ 66,348 | $ 136,936 |
| Accrued expenses - related parties | 383,965 | 395,888 |
| Accounts payable - related parties | 3,290 | 4,068 |
| Customer deposits | 282,431 | 333,887 |
| Total Current Liabilities | 736,033 | 870,779 |
| Total Liabilities | 736,033 | 870,779 |
| STOCKHOLDERS' EQUITY | ||
| Common stock, 25,000,000 shares authorized, no par value 15,659,829 shares issued and outstanding | 2,374,799 | 2,374,799 |
| Additional paid-in capital | 4,074,059 | 4,004,607 |
| Accumulated deficit | (5,964,036) | (5,982,147) |
| Total Stockholders' Equity | 484,822 | 397,259 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,220,855 | $ 1,268,038 |