Omnitek Engineering Reports Third Quarter and Nine-Month Results

VISTA, Calif., Nov. 10, 2016 (GLOBE NEWSWIRE) -- Omnitek Engineering Corp. (OTCQB:OMTK) today announced results for its third quarter and nine months ended September 30, 2016 – reflecting an order backlog of approximately $226,000 and the commencement of a development contract for a 450hp EURO 6 13-liter natural gas engine for Class 8 trucks after the quarter end.

Net revenues for the third quarter were $355,050 compared with $438,178 from a year earlier – reflecting the timing of shipments and product mix on a year-over-year basis. For the same period, the company reported a net loss of $217,909, or $0.01 per share, compared with a net loss of $271,972, or $0.01 per share, a year earlier.

Net revenues for the nine-month period were $946,948 compared with $1.48 million a year ago -- reflecting the timing of shipments and product mix on a year-over-year basis. For the same period, the company reported a net loss of $707,592, or $0.04 per share, compared with a net loss of $677,414, or $0.03 per share, a year earlier.

Gross margin for the quarter ended September 30, 2016 was 43 percent compared with 44 percent a year earlier. Gross margin for the nine months was 45 percent compared with 48 percent a year earlier, both within the company’s normalized target range of 40 to 50 percent.

“We remain confident that the domestic shift to natural gas will continue as large domestic trucking fleet operators focus on the environment, the availability of our natural gas “drop-in” engines and the company’s extensive lineup of EPA-approved conversion kits. Equally important, our business in Mexico, Europe and Asia is continuing its expansion – supported by a global focus on environmental and economic considerations,” said Werner Funk, president and chief executive officer of Omnitek Engineering Corp.

The company’s previously announced evaluation programs for two large North American fleet customers are proceeding as planned. “We remain optimistic that the programs will be enlarged to address a larger portion of the fleet vehicles, and we look forward to announcing further details and developments in cooperation and with the approval of our customers,” Funk said.

At September 30, 2016, current liabilities totaled $684,127 and current assets totaled $2.1 million, resulting in positive working capital of approximately $1.4 million and a current ratio of 3.00 to 1. The company’s total assets at September 30, 2016 were $2.1 million.

Funk emphasized, despite lower oil prices which he expects will begin to increase, the cost for a diesel truck engine conversion can be recouped within a one-to-two-year period, particularly in foreign markets where taxes are particularly higher than in the domestic market. Conversion costs also benefit when the process is performed during a regularly scheduled engine overhaul.

About Omnitek Engineering Corp.
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 and affordable. Additional information is available at

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)

Condensed Statements of Operations (unaudited)
For the Three For the Three For the Nine For the Nine
Months Ended Months Ended Months Ended Months Ended
September 30 September 30 September 30 September 30
2016 2015 2016 2015
REVENUES $ 355,050 $ 438,178 $ 946,948 $ 1,480,063
COST OF GOODS SOLD 200,894 245,419 521,387 766,067
GROSS MARGIN 154,156 192,759 425,561 713,996
General and administrative 306,535 385,209 960,789 1,133,102
Research and development expense 57,402 71,962 151,706 238,201
Depreciation and amortization expense 6,617 7,526 21,081 23,050
Total Operating Expenses 370,554 464,697 1,133,576 1,394,353
LOSS FROM OPERATIONS (216,398) (271,938) (708,015) (680,357)
Other income 200 - 5,574 3,934
Interest expense (1,711) (40) (4,351) (212)
Interest income - 6 - 21
Total Other Income (Expense) (1,511) (34) 1,223 3,743
LOSS BEFORE INCOME TAXES (217,909) (271,972) (706,792) (676,614)
NET LOSS $ (217,909) $ (271,972) $ (707,592) $ (677,414)
BASIC AND DILUTED LOSS PER SHARE $ (0.01) $ (0.01) $ (0.04) $ (0.03)
OF COMMON SHARES OUTSTANDING BASIC AND DILUTED 20,273,473 19,981,082 20,095,681 19,980,934

Condensed Balance Sheet
September 30, December 31,
2016 2015
Cash$ 6,805 $ 105,846
Accounts receivable, net 31,913 30,835
Accounts receivable - related parties 3,375 17,257
Inventory, net 1,995,384 2,107,463
Prepaid expense 5,324 6,050
Cost in excess of billings 21,242 -
Deposits 31,694 19,745
Total Current Assets 2,095,737 2,287,196
FIXED ASSETS, net 38,351 59,151
Intellectual property, net - 281
Other noncurrent assets - 14,280
Total Other Assets - 14,561
TOTAL ASSETS$ 2,134,088 $ 2,360,908
Accounts payable and accrued expenses$ 340,837 $ 145,207
Accrued management compensation 213,875 189,163
Accounts payable – related parties 10,519 7,591
Customer deposits 118,896 230,349
Total Current Liabilities 684,127 572,310
Total Liabilities 684,127 572,310
Common stock, 125,000,000 shares authorized no par value
19,779,582 and 19,759,582 shares issued and outstanding,
respectively 8,411,411 8,291,411
Additional paid-in capital 11,595,554 11,346,599
Accumulated deficit (18,557,004) (17,849,412 )
Total Stockholders' Equity 1,449,961 1,788,598

CONTACT: Gary S. Maier Maier & Company, Inc. (310) 471-1288

Source:Omnitek Engineering Corp.