Omnitek Engineering Corp
For the period ended Dec 31, 2024. Filed Apr 15, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Apr 15, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-04-16.
0001096906-24-000839
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-04-15.
0001096906-25-000515
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 46 previous paragraphs and 48 current paragraphs.
28 unchanged; 14 reworded; 4 added; 4 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
Page24
Current report
Accordingly, the Company has established an allowance for the cost of such obsolete inventory.
Current report
In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which amends the disclosure to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses on an annual and interim basis for to enable investors to develop more decision-useful financial analyses. All public entities will be required to report segment information in accordance with the new guidance starting in annual periods beginning after December 15, 2023. The Company is currently assessing potential impacts of ASU 2023-06 and does not expect the adoption of this guidance will have a material impact on its financial statements and disclosures.
Current report
In December 2023, the FASB issued ASU 2023-09, " Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which amends the disclosure to address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information and includes certain other amendments to improve the effectiveness of income tax disclosures. For entities other than public business entities, the requirements will be effective for annual periods beginning after December 15, 2025. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is currently assessing potential impacts of ASU 2023-09 and does not expect the adoption of this guidance will have a material impact on its financial statements and disclosures and the Company is in a loss position and not incurring any tax expenses.
Removed paragraphs (4)
Previous report
Page25
Previous report
Page26
Previous report
In general, revenue is recognized when control of the promised goods is transferred to our customers, in an amount that reflects the consideration to which we expect to be entitled in exchange for the goods or services. In order to achieve that core principle, a five-step approach is applied: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue allocated to each performance obligation when
Previous report
Revenue from goods and services transferred to customers at a point in time accounted for 100% and 100% of revenue for the periods ended December 31, 2023 and December 31, 2022, respectively.
Reworded paragraphs (14)
Previous wording
Revenues were $1,055,314 for 2023 compared with $1,070,787 in 2022, a decrease of $15,474, or 1.4%. The Company’s revenues remained steady between 2023 and 2022.
Current wording
Revenues were $1,019,726 for 2024 compared with $1,055,314 in 2023, a decrease of $35,588, or 3.4%. The Company’s revenues remained steady between 2024 and 2023.
Previous wording
Total cost of goods sold increased to $644,660 in 2023 from $649,427 in 2022, for an decrease of $4,767. Gross margin was $410,654 in 2023 compared with $421,360 in 2022. Gross margin as a percentage of sales for 2023 was 39 percent compared with 39 percent in 2022. The decrease in the gross margin percentage is attributable to product mix.
Current wording
Total cost of goods sold decreased to $561,853 in 2024 from $644,660 in 2023, for a decrease of $82,807. Gross margin was $457,873 in 2024 compared with $410,654 in 2023. Gross margin as a percentage of sales for 2024 was 45 percent compared with 39 percent in 2023.
Previous wording
Our operating expenses for 2023 were $606,794 compared with $595,780 in 2022, an increase of $11,014, or 2%. General and administrative expense for 2023 was $537,473 compared with $526,836 in 2022. The increase was due primarily to professional fees of $85,512 in 2023 compared with $65,108 in 2022. Major components of general and administrative expenses in 2023 were insurance expense of $53,056, rent expense of $43,298 and salary and wages of $225,609. This compares with insurance expense of $54,812, rent expense of $43,836, and salary and wages of $228,566 in 2022. Research and development outlays were $67,576 in 2023 compared with $66,444 in 2022.
Current wording
Our operating expenses for 2024 were $606,373 compared with $606,794 in 2023, a decrease of $421, or 0.06%. General and administrative expense for 2024 was $532,721 compared with $537,473 in 2023. Major components of general and administrative expenses in 2024 were insurance expense of $63,971, rent expense of $43,038 and salary and wages of $219,981. This compares with insurance expense of $53,056, rent expense of $43,298, and salary and wages of $225,609 in 2023. Research and development outlays were $70,323 in 2024 compared with $67,576 in 2023. The increase in general and administrative expense was primarily due to increase in litigation expense.
Previous wording
Our net loss in 2023 was $215,406, or ($0.01) per share, compared with $196,709, or ($0.01) per share, in 2022. Additionally, operating loss for the year ended December 31, 2023 was $196,140 compared with $174,420 for the year ended December 31, 2022.
Current wording
Our net loss in 2024 was $167,137, or ($0.01) per share, compared with $215,406, or ($0.01) per share, in 2023. Additionally, operating loss for the year ended December 31, 2024 was $148,500 compared with $196,140 for the year ended December 31, 2023.
Previous wording
Results for the year ended December 31, 2023 reflect non-cash expenses, including the value of options and warrants granted in the amount of $15,776 and depreciation and amortization of $1,745. For the year ended December 31, 2022, non-cash expenses included the value of options and warrants granted of $18,341, depreciation and amortization of $2,500.
Current wording
Results for the year ended December 31, 2024 reflect non-cash expenses, including the value of options and warrants granted in the amount of $5,363 and depreciation and amortization of $3,329. For the year ended December 31, 2023, non-cash expenses included the value of options and warrants granted of $15,776, depreciation and amortization of $1,745.
Previous wording
At December 31, 2023, our current liabilities totaled $1,579,512 and our current assets totaled $482,521, resulting in negative working capital of $1,096,991.
Current wording
At December 31, 2024, our current liabilities totaled $2,178,041 and our current assets totaled $881,764, resulting in negative working capital of $1,296,277.
Previous wording
We have historically incurred significant losses, which have resulted in a total accumulated deficit of $21,860,347 at December 31, 2023.
Current wording
We have historically incurred significant losses, which have resulted in a total accumulated deficit of $22,027,484 at December 31, 2024.
Previous wording
We realized positive cash flow from operations of $17,211 for the year ended December 31, 2023, compared with positive cash flow of $9,239 for the year ended December 31, 2022.
Current wording
We realized positive cash flow from operations of $30,077 for the year ended December 31, 2024, compared with positive cash flow of $17,211 for the year ended December 31, 2023.
Previous wording
Included in the net loss of $215,406 for the year ended December 31, 2023, are non-cash expenses, which are not a drain on our capital resources. In 2023, these non-cash expenses include the value of options and warrants granted in the amount of $15,776 and depreciation and amortization of $1,745.
Current wording
Included in the net loss of $167,137 for the year ended December 31, 2024, are non-cash expenses, which are not a drain on our capital resources. In 2024, these non-cash expenses include the value of options and warrants granted in the amount of $5,363 and depreciation and amortization of $3,329.
Previous wording
The Company’s financial statements are prepared using the accrual method of accounting. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Areas where significant estimates are required include the following:
Current wording
The Company’s financial statements are prepared using the accrual method of accounting. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses
Previous wording
Inventories are stated at the lower of market, average cost or standard cost basis. The Company reviews inventories on hand at least annually and records provisions for estimated excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of net realizable value. The regular and systematic inventory valuation reviews include a current assessment of future product demand, historical experience and product expiration.
Current wording
Inventories are stated at the lower of net realizable value, or average cost basis. The Company reviews inventories on hand at least annually and records provisions for estimated excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of net realizable value. The regular and systematic inventory valuation reviews include a current assessment of future product demand, historical experience and product expiration.
Previous wording
Historically, the Company has incurred net losses and negative cash flows from operations. Management believes that based on its operating plan, the projected sales for 2024, combined with funds available from its working capital will be sufficient to fund operations for the next twelve months from the date these financial statements were issued. However, there can be no assurance that operations and operating cash flows will continue at the current levels or improve in the near future. From time to time the Company has raised additional capital through the sale of equity and financing activities to support its operations, and should the need arise will attempt to do so in the future, however, it is uncertain whether the Company will be successful in its efforts to raise additional capital in the future, if necessary.
Current wording
Historically, the Company has incurred net losses and negative cash flows from operations. Management believes that based on its operating plan, the projected sales, combined with funds available from its working capital will be sufficient to fund operations for the next twelve months from the date these financial statements were issued. However, there can be no assurance that operations and operating cash flows will continue at the current levels or improve in the near future. From time to time the Company has raised additional capital through the sale of equity
Previous wording
Page27 we satisfy the performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account for revenue recognition.
Current wording
In general, revenue is recognized when a performance obligation is met. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account for revenue recognition.
Previous wording
Products - The Company recognizes revenue from the sale of products as performance obligations are satisfied. This type of revenue is primarily generated from the sale of finished products to customers. Those sales predominantly contain a single delivery element and revenue is recognized at a single point in time when ownership, risks and rewards transfer. Upon fulfilment of the performance obligation, the customer is provided an invoice demonstrating transfer of control to the customer. Control passes FOB shipping point.
Current wording
Products - The Company recognizes revenue from the sale of products as performance obligations are satisfied. Those sales predominantly contain a single delivery element and revenue is recognized at a single point in time when ownership and risks transfer (i.e. the performance obligation has been satisfied). In general, ownership and risk passes FOB shipping point, or as negotiated.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Page25 during the reporting period. Actual results could differ from those estimates. Areas where significant estimates are required include the following:
Current report — wording carried from elsewhere
Page26 and financing activities to support its operations, and should the need arise will attempt to do so in the future, however, it is uncertain whether the Company will be successful in its efforts to raise additional capital in the future, if necessary.