SOURCE: MagneGas Corp.

MagneGas Corp.

August 18, 2010 09:00 ET

Key Milestone: MagneGas Announces First Profitable Quarter

Provides Second Quarter and First Half 2010 Operating Results

TAMPA, FL--(Marketwire - August 18, 2010) - MagneGas Corporation ("MagneGas" or the "Company") (OTCBB: MNGA), a producer of a metal working fuel and natural gas alternative made from liquid waste, today announced operating results for the quarter and six months ended June 30, 2010.

Recent Financial Highlights:

  • Generated record revenue of $1.3 MM in the second quarter, $1.5 MM for the first six months
  • Achieved profitability for the first time: net income of $282,372 and $120,289, respectively
  • In July received the first of two $1.0 MM investment installments from China partner DDI (1)

Recent Business Highlights:

  • Entered potentially lucrative China market with 20% ownership of joint venture
  • Acquired 20% of European and African markets
  • Further strengthened competitive advantage through new technological patent(1)

Business Overview:

"We are proud to announce that we achieved in the second quarter that most fundamental of initial goals: profitability," stated MagneGas Chief Financial Officer, Luisa Ingargiola. "We have done so at such an early stage through spending discipline and a strategically sequenced, two-pronged sales approach. The international community has shown an interest in the MagneGas Technology™, so we have focused abroad on equipment sales that can yield large individual payments and thus accelerate revenue growth. We intend to balance this with recurring revenue gas sales in the U.S. -- beginning first with the $1 billion metal working market. We have built a broad distribution network, and now with the financial resources for a concerted marketing push we believe that our superior product can begin to capture market share."

(1) Occurred in third quarter, 2010

To be added to the MagneGas investor email list, please email justin.davis@cirrusfc.com with MNGA in the subject line.

Become a MagneGas fan and follow the Company on Facebook - visit www.facebook.com/MagneGas.

About MagneGas Corporation (www.magnegas.com)

Founded in 2007, Tampa-based MagneGas Corporation (OTCBB: MNGA) is the producer of MagneGas™, a natural gas alternative and metal working fuel made from liquid waste such as sewage, sludge, manure and certain industrial and oil based liquid wastes. The Company's patented Plasma Arc Flow™ process gasifies liquid waste, creating a clean burning fuel that is essentially interchangeable with natural gas, but with lower green house gas emissions. MagneGas™ can be used for metal cutting, cooking, heating or powering bi fuel automobiles.

FORWARD-LOOKING STATEMENTS

The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The safe harbor for forward-looking statements contained in the Securities Litigation Reform Act of 1995 protects companies from liability for their forward-looking statements if they comply with the requirements of the Act. 

   
   
   
MagneGas Corporation  
STATEMENTS OF OPERATIONS  
For the Three and Six Months June 30, 2010 and 2009  
(unaudited)  
                     
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2010   2009     2010   2009  
                     
Revenue   $ 1,256,192   $ 2,585     $ 1,498,374   $ 4,051  
                             
Cost of Sales     388,433     2,289       540,991     3,548  
                             
Gross Profit     867,759     296       957,383     503  
                             
Operating Expenses:                            
  Advertising     9,708     24,397       19,885     34,772  
  Selling     117,580     24,572       176,318     29,640  
  Professional: technical     73,225     8,893       73,225     11,519  
  Professional: legal and accounting     15,676     40,510       37,663     41,599  
  Rent and overhead     12,233     5,163       23,758     25,223  
  Office and administration     85,531     4,088       155,256     5,059  
  Investor Relations     16,623     1,633       38,409     5,683  
  Stock-based compensation     60,666     123,608       186,076     226,328  
  Research and development     7,587     15,153       22,150     15,153  
  Depreciation and Amortization     14,034     12,117       27,854     24,234  
Total Operating Expenses     412,863     260,134       760,594     419,210  
                             
Operating Income (Loss)     454,896     (259,838 )     196,789     (418,707 )
                             
Other (Income) and Expense                            
Interest expense     224     1,945       1,700     3,448  
Sale of Asset(s)     -     -       -     -  
Total Other (Income) Expenses     224     1,945       1,700     3,448  
                             
Net Loss before tax benefit     454,672     (261,783 )     195,089     (422,155 )
Provision for Income Taxes     172,300     -       74,800     -  
Net Income (Loss)   $ 282,372   $ (261,783 )   $ 120,289   $ (422,155 )
                             
                             
Loss per share, basic and diluted   $ 0.00   $ (0.00 )   $ 0.00   $ (0.00 )
Weighted average number of common shares     109,805,492     101,726,394       108,229,422     100,717,953  
                             
   
   
   
MagneGas Corporation  
Balance Sheets  
   
          December  
    June 30,     31,  
    2010     2009  
    (unaudited)     (audited)  
ASSETS  
  Current Assets            
    Cash   $ 1,046,600     $ 7,338  
Accounts receivable, net of allowance for doubtful accounts of $0     3,892       2,399  
    Costs and estimated earnings     1,477,853          
    Inventory, at cost     6,384       8,381  
    Prepaid & other current assets     5,000       -  
      Total Current Assets     2,539,729       18,118  
                 
    Property and equipment, net of accumulated depreciation of $3,996 and $375, respectively     35,191       22,125  
                 
    Deferred Tax Asset     398,100       472,900  
    Intangible assets, net of accumulated amortization     648,189       672,422  
    Investment in joint venture     490,410       -  
  TOTAL ASSETS   $ 4,111,619     $ 1,185,565  
                 
                 
LIABILITIES AND STOCKHOLDERS' EQUITY  
  Current Liabilities                
    Accounts payable   $ 263,658     $ 94,577  
    Accrued expenses     190,622       77,395  
    Deferred revenue and customer deposits     1,516,660       100,000  
    Due to affiliate     10,000       10,000  
    Note payable to related party     25,838       140,087  
  TOTAL LIABILITIES     2,006,778       422,059  
                 
                 
  Stockholders' Equity                
Preferred stock: $0.001 par; 10,000,000 authorized; 2,000 issued and outstanding     2       2  
Common stock: $0.001 par; 900,000,000 authorized; 115,318,802 and 105,954,395 issued and outstanding, respectively     115,319       105,954  
    Additional paid-in capital     4,111,199       2,909,518  
    Issued and unearned stock compensation     (58,333 )     (68,333 )
    Accumulated deficit     (2,063,346 )     (2,183,635 )
  TOTAL STOCKHOLDERS' EQUITY     2,104,841       763,506  
                 
  TOTAL LIABILITIES AND EQUITY   $ 4,111,619     $ 1,185,565  
                 
                 

Contact Information