SOURCE: US Energy Initiatives Corporation

August 15, 2007 08:36 ET

US Energy Initiatives Reports 47% Increase in Revenues and 31% Decrease in Operating Expenses for the Six-Month Period Ended June 2007

The Company Also Introduced Two New Market-Ready Manufactured Products

TAMPA, FL--(Marketwire - August 15, 2007) - US Energy Initiatives Corporation (OTCBB: USEI) today announced the Company posted a 47% increase in revenues and a 31% decrease in operating expenses for the six-month period ending June 30, 2007. The Company also unveiled two new market-ready manufactured products and announced it has reached a settlement agreement with AMBAC International Corporation relating to a law suit filed during November 2003.

For the six months ended June 30, 2007, the Company reported revenues of $646,246, a 47% increase compared to the same period ended June 30, 2006. For the same comparative period, the Company reported a 31% decrease in operating expenses to $1,875,299 and a 16% decrease in net loss to $(3,821,875). "We are encouraged by our continued growth in revenues," said USEI CEO Phil Rappa. "We believe our continued growth from a development enterprise focused on one product to a manufacturing enterprise offering a family of electronic-related products will accelerate our growth in revenues and reductions in expenses."

                                        Six months ended  Six Months Ended
                                          June 30, 2007     June 30, 2006
                                        ----------------  ----------------
Revenues                                $        646,246  $        425,685
                                        ----------------  ----------------
Operating Expenses                      $      1,875,299  $      2,721,117
                                        ----------------  ----------------
Net (loss)                              $     (3,821,875) $     (4,542,337)
                                        ----------------  ----------------
(Loss) per common share                 $         (0.007) $          (0.02)
                                        ----------------  ----------------

The Company is comprised of two operating segments: Dual-fuel system sales and electronic manufacturing. On a segmented basis, the Company continued to experience significant losses related to the continued development of US Energy's dual-fuel system. With the approval by GMTh of the dual-fuel system, the Company anticipates further significant reductions in developmental costs.

"For the first six months of 2007, our manufacturing business segment produced over 96% of our revenues and accounted for less than 20% of our operating expenses," said USEI CEO Phil Rappa. "We plan to continue reducing our developmental overhead relating to our dual-fuel technology while expanding our family of market ready manufactured products. We expect this strategy to will work to maximize our revenue potential while bringing our costs down. We recently provided an update on our dual-fuel program with General Motors Thailand and other development programs. We also recently announced the introduction of a ship-board distress signal designed for the maritime industry. Today we announce two additional products which we designed and finalized during the second quarter."

The Company has finalized a specialized sensor that fits within infant car automotive car seats. Should the infant be left in the car, an alarm will sound.

The Company has finalized a power conditioning and protective device for use in the upper end recreational vehicle industry. This device allows for the safe and efficient delivery of electricity for the intricate systems found in recreational vehicles available in today's marketplace.

Finally, the Company announced it has reached an agreement with AMBAC International to settle a suit brought against the Company in 2003. The suit was brought by AMBAC relating to materials delivered to the Company during 2002. Under the terms of the settlement, the Company will make payments of $10,000 each month from September through December 2007; $15,000 per month from January through June 2008 and $20,000 per month until the full amount of approximately $280,000 is repaid. This settlement finalizes the last major issue left from prior management.

About US Energy Initiatives Corporation (OTCBB: USEI)

US Energy, formed in 1996 is an ISO-9001 certified manufacturer specializing in the design and deployment of technologies and products for which the Company acts as a sole-source provider. The Company's family of proprietary technologies are made available to the automotive, marine, recreational vehicle, studio recording and municipal market segments.

Investors are cautioned that certain statements contained in this document are "Forward-Looking Statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "believes," "anticipates," "intends," "plans," "expects" and similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible future US Energy Initiatives actions, which may be provided by management, are also forward-looking statements as defined by the act. These statements are not guarantees of future performance.

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