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Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Omnitek Engineering Corp. Reports 2018 Results

April 1, 2019

VISTA, Calif., April 01, 2019 (GLOBE NEWSWIRE) -- Omnitek Engineering Corp. (OTCQB: OMTK) today reported results for its fourth quarter and year ended December 31, 2018 – reflecting the completion of certain multi-year natural gas engine development programs overseas and the initial ramp up of related orders.

Revenues for the fourth quarter ended December 31, 2018 were $276,034 compared with $260,004 a year earlier. For the same period, the company reported a sharply reduced net loss of $150,467, or ($0.01) per share, compared with $485,818, or ($0.02) per share, a year ago. The decreased loss is due primarily to a reduction in the non-cash inventory reserve adjustment between 2017 and 2018. The inventory reserve adjustment represents a non-cash charge for slow-moving inventory and is recorded as a separate line item component of total cost of goods sold.

Gross margin for the quarter included the non-cash inventory reserve adjustment noted above, resulting in a positive gross margin of $66,229 for the fourth quarter ended December 31, 2018 compared with negative gross margin of $188,379 a year earlier.

Revenues for the full year increased to $1.3 million compared with $1.1 million a year earlier, primarily due to higher diesel-to-natural gas engine conversion kit sales in foreign markets and the completion of engine development projects. For the full year, the company reported a sharply reduced net loss of $468,406 or ($0.02) per share, compared with a net loss of $1 million, or $0.05 per share, a year earlier – primarily attributable to the increased sales noted above combined with a reduction in the non-cash charge for the inventory reserve adjustment and general and administrative expenses.

Gross margin for the full year includes the non-cash inventory reserve adjustment noted above, resulting in a gross margin of $500,793 compared with gross margin of $169,062 a year earlier. Adjusted gross margin as percentage of sales was 47 percent compared with 44 percent a year earlier, excluding the previously noted non-cash inventory reserve adjustment.

Results for the twelve months ended December 31, 2018 reflect non-cash expenses, including the value of options and warrants granted in the amount of $37,730, depreciation and amortization of $7,590 and inventory reserve adjustment of $97,436. For the twelve months ended December 31, 2017, non-cash expenses and income included the value of options and warrants granted for $131,522, depreciation and amortization of $24,586 and inventory reserve adjustment of $305,458.

“The past year was a transformative year for the company as several multi-year development programs, particularly in Asia and Europe, were completed. We are now finally gaining traction and have begun to generate initial orders for engine conversion projects to support the utilization of CNG and LPG fuels,” said Werner Funk, president and chief executive officer of Omnitek Engineering Corp.

He noted the shift from domestic to international demand for engine conversions continues to be an important strategic growth driver for the company, particularly given stringent air pollution regulations overseas and the price disparity between diesel and natural gas in foreign markets, mostly as a result of higher taxes on diesel fuel.

Funk emphasized the 200-nation “Paris Agreement on Climate Change” remains an important catalyst for alternative solutions to diesel fuel, with natural gas being particularly appealing -- especially since the fine-particles (PM2.5) and black carbon emissions from diesel engines, a potent greenhouse gas (GHG), are abated when using natural gas.

At December 31, 2018, current liabilities totaled $1.3 million and current assets totaled $1.4 million, resulting in positive working capital of approximately $62,000 and a current ratio of 1.05 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.Statement of Operations

For the Three For the Three For the Year For the Year Months Ended Months Ended Ended Ended December 31 December 31 December 31 December 31 -------------- -------------- -------------- -------------- 2018 2017 2018 2017 -------------- -------------- -------------- -------------- REVENUES $ 276,034 $ 260,004 $ 1,285,686 $ 1,074,213 COST OF GOODS SOLD 162,369 142,925 687,457 599,693 INVENTORY RESERVE ADJUSTMENT 47,436 305,458 97,436 305,458 - ---------- - - ---------- - - ---------- - - ---------- - Total Cost of Goods Sold 209,805 448,383 784,893 905,151 - ---------- - - ---------- - - ---------- - - ---------- - GROSS MARGIN 66,229 (188,379 ) 500,793 169,062 OPERATING EXPENSES General and administrative 192,779 262,730 811,459 1,052,344 Research and development expense 25,012 26,273 106,896 118,940 Depreciation and amortization expense 296 5,992 7,590 24,586 - ---------- - - ---------- - - ---------- - - ---------- - Total Operating Expenses 218,087 294,995 925,945 1,195,870 - ---------- - - ---------- - - ---------- - - ---------- - LOSS FROM OPERATIONS (151,858 ) (483,374 ) (425,152 ) (1,026,808 ) - ---------- - - ---------- - - ---------- - - ---------- - OTHER INCOME (EXPENSE) Loss on settlement of debt - - (32,963 ) - Interest expense (6,050 ) (2,444 ) (17,882 ) (8,689 ) Other income 7,441 - 8,391 - - ---------- - - ---------- - - ---------- - - ---------- - Total Other Income (Expense) 1,391 (2,444 ) (42,454 ) (8,689 ) - ---------- - - ---------- - - ---------- - - ---------- - LOSS BEFORE INCOME TAXES (150,467 ) (485,818 ) (467,606 ) (1,035,497 ) INCOME TAX EXPENSE - - 800 800 - ---------- - - ---------- - - ---------- - - ---------- - NET LOSS $ (150,467 ) $ (485,818 ) $ (468,406 ) $ (1,036,297 ) - ---------- - - ---------- - - ---------- - - ---------- - BASIC AND DILUTED LOSS PER SHARE $ (0.01 ) $ (0.02 ) $ (0.02 ) $ (0.05 ) - ---------- - - ---------- - - ---------- - - ---------- - WEIGHTED AVERAGE NUMBER OF COMMON SHARES BASIC 20,420,402 20,281,082 20,349,024 20,281,082 AND DILUTED - ---------- - - ---------- - - ---------- - - ---------- -

OMNITEK ENGINEERING CORP.Balance Sheet

ASSETS December 31, December 31, 2018 2017 ------------- - ------------- - CURRENT ASSETS Cash $ 17,060 $ 23,279 Accounts receivable, net 13,442 7,984 Accounts receivable - related parties 6,666 3,440 Inventory, net 1,359,678 1,554,656 Contract assets 12,772 - Deposits 5,811 17,385 - ----------- - - ----------- - Total Current Assets 1,415,429 1,606,744 - ----------- - - ----------- - PROPERTY & EQUIPMENT, net 2,376 7,253 - ----------- - - ----------- - OTHER ASSETS Other noncurrent assets 30,425 14,280 - ----------- - - ----------- - Total Other Assets 30,425 14,280 - ----------- - - ----------- - TOTAL ASSETS $ 1,448,230 $ 1,628,277 - ----------- - - ----------- - LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES Accounts payable and accrued expenses $ 362,363 $ 358,032 Accrued management compensation 506,103 406,841 Accounts payable – related parties 145,171 114,321 Notes payable – related parties 15,000 15,000 Convertible notes payable – related parties - 15,000 Convertible notes payable 100,000 - Contract liabilities 84,496 30,000 Customer deposits 140,338 212,410 - ----------- - - ----------- - Total Current Liabilities 1,353,471 1,151,604 - ----------- - - ----------- - Total Liabilities 1,353,471 1,151,604 - ----------- - - ----------- - STOCKHOLDERS’ EQUITY Common stock, 125,000,000 shares authorized no par value 20,420,402 and 20,281,082 shares issued and outstanding, respectively 8,427,210 8,411,411 Additional paid-in capital 11,923,056 11,852,363 Accumulated deficit (20,255,507 ) (19,787,101 ) - ----------- - - ----------- - Total Stockholders’ Equity 94,759 476,673 - ----------- - - ----------- - TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 1,448,230 $ 1,628,277 - ----------- - - ----------- -

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