LOS ANGELES, July 23, 2007 (PRIME NEWSWIRE) -- Today, CFO of Tank Sports, Inc. (OTCBB:TNSP.OB), Jing Jing Long, comments on the company's financials for the quarter ended May 31, 2007 and announces completion of the preliminary consolidation of Redcat Motors.
For the quarter ended May 31, 2007, the company's financials improved significantly on several fields, compared to the same period last year. The total income increased 32.8%, with 490% increase in total assets. Shareholders' equity turned from net assets back to positive territory from -$599,000 to $1.36 million. The cash flow changed significantly from $84,000 quarterly last year to $2.38 million this year, due to new capital investment infusion. It indicates that the company is continuing to improve its financial situation. Compared to the same period last year, the balance sheet improved positively as well.
At the same time, the company realized, within the estimated range, bigger operating loss than the same period last year. Among total loss of $355,070, $213,660 resulted from the acquisition of Redcat Motors, which includes $197,000 accounts payable incurred prior to acquisition by the company of Redcat Motors and $55,590 expenses of traveling, training, warehouse moving and employee severance fees during the transition period post-acquisition. The actual operating loss would be $102,480 if the company had not incurred the expense items. After the redundancies cut off, the company will expect to save a total of $158,280 payroll expenditures and $30,000 in warehouse leasing by the end of second quarter that will end on August 31, 2007.
Jing Jing Long says, "The acquisition is a very important step for us to take the company to the next level. After the acquisition, the company had to focus on the consolidation of parts and service facilities located in different states into one, ERP system integration, cutting off personnel redundancy to keep Redcat's sales team, and expenditure reconstruction. The process distracted the company's effort to synergize the revenue of the two merged companies, but it was within the lower end of the company's projection. If we continue to improve the corporate finance efforts in conjunction with the near term business plan, we will have sufficient financial support to help the company reach the year end revenue target. But we would rather be conservative on the revenue of the 2nd quarter which ends on August 31, 2007."
"Looking forward to the year end of FY2008," Jing Jing Long added, "we are positive that we will meet the annual revenue target for a few reasons. First, the synergy of Tank and Redcat Motors started to show in operations. Second, the first P/O in the amount of $300,000 of 250cc motorcycle racing bikes, which the company will make for a national chain distributor for the long term, will be delivered in September. And most importantly, we have a strategic budgeting and revenue target plan in place for years to come."
About Tank Sports, Inc.
Tank Sports is a leading company that develops, engineers, and markets high performance on-road motorcycles and scooters, as well as off-road all-terrain vehicles (ATVs), dirt bikes and Go Karts through OEMs in China. It utilizes the so-called "China Concept'' to participate in the $31.5 billion annually (data: Motor Industry Council) motorcycle/ATV market.
The Tank Sports, Inc. logo is available at http://www.primezone.com/newsroom/prs/?pkgid=3000
Safe Harbor Statement
The foregoing news release includes numerous forward-looking statements concerning the company's business and future prospects and other similar statements that do not concern matters of historical fact. The federal securities laws provide a limited "safe harbor" for certain forward-looking statements. Forward-looking statements in this news release relating to business developments are based on the company's current expectations. The company's current expectations are subject to all of the uncertainties and risks customarily associated with a small business ventures including, but not limited to, market conditions, successful product development and acceptance, competition and overall economic conditions, as well as the risk of adverse regulatory actions. The company's actual results may differ materially from current expectations. Readers are cautioned not to put undue reliance on forward-looking statements. The company disclaims any intent or obligation to update publicly these forward-looking statements, whether as a result of new information, future events or for any other reason.