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 www.omnitekcorp.com.

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 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  
                             
OPERATING EXPENSES                        
                             
  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 (EXPENSE)                        
                         
                         
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 )
INCOME TAX EXPENSE       -         -         800         800  
                             
NET LOSS   $   (217,909 )   $   (271,972 )   $   (707,592 )   $   (677,414 )
                             
BASIC AND DILUTED LOSS PER SHARE   $   (0.01 )   $   (0.01 )   $   (0.04 )   $   (0.03 )
                             
WEIGHTED AVERAGE NUMBER                        
OF COMMON SHARES OUTSTANDING BASIC AND DILUTED     20,273,473         19,981,082         20,095,681         19,980,934  
                             
                             

OMNITEK ENGINEERING CORP.
Condensed Balance Sheet
ASSETS
               
      September 30,   December 31,
      2016   2015
      (unaudited)    
CURRENT ASSETS          
  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  
               
OTHER ASSETS          
 Intellectual property, net     -         281  
             
               
  Other noncurrent assets     -         14,280  
               
    Total Other Assets       -           14,561  
               
    TOTAL ASSETS $     2,134,088        $     2,360,908  
               
LIABILITIES AND STOCKHOLDERS' EQUITY
               
CURRENT LIABILITIES          
  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  
               
STOCKHOLDERS' EQUITY          
  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  
               
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     2,134,088     $     2,360,908,  

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

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