Knobias Clip Report (11-05-2007)

Submitted By Knobias ClipReport

Airtrax Rolling in New Direction

Like countless other companies with stocks trading under $1, Airtax, Inc., (AITX) has found itself facing hurdles in turning around its fortunes. In addition to fighting a perceived identity misconception from the public in general, the Company has undoubtedly struggled with its financial situation. After mourning the passing of former CEO Peter Amico in August of last year, the Company underwent management changes. Along with the appointment of Andrew Guzzetti to Chairman of the Board, Robert M. Watson was named as the Company’s CEO.

“We’re a company that’s been in existence for a while, but the leadership team we’ve brought in has really only been in operation for about a year,” Mr. Guzzetti said. “A lot of people think we’re in the forklift business, but we’re really in the technology business, trying to find ways that Omni-Directional can be used.”

A U.S.-based developer of Omni-Directional Technology, Airtrax designs and manufactures Omni-Directional Vehicles. The Airtrax patented wheel was designed and developed after receiving a technology transfer from the U.S. Navy in 1997. Its precursor, the Mecanum wheel, was developed in Sweden in 1973, and the patent was sold to the Navy in the 1980’s. According to Wikipedia.com, “It is a conventional wheel with a series of rollers attached to its circumference, these rollers having an axis of rotation at 45° to the plane of the wheel in a plane parallel to the axis of rotation of the wheel. As well as moving forward and backward like conventional wheels, they allow sideways movement by spinning a pair of wheels in opposite directions.”

Mr. Guzzetti commented, “[the vehicle] can turn around in its own footprint, that’s really how you describe it.”

Intrigued by the technology, the Israeli Air Force wanted to check it out for themselves, and signed an initial agreement in September of 2006. This past May, a MP2 Equipment Handler Prototype was shipped to Israel for evaluation in its actual operating environment.

The tests were successful, and Airtrax announced last Tuesday the Israelis had ordered five more units. And in addition to the vehicles themselves, the IAF expressed its intent to order certain support equipment including stand-by battery cassettes, chargers, battery installation and service carts, as well as spare consumable and replacement parts.

The Company said it would receive approximately forty percent of the total revenue from the order in the fourth quarter of 2007, with the remaining balance to be paid in the second quarter of 2008.

Due to the sensitive nature of the vehicle’s intended use, specific details have not been disclosed, however Mr. Guzzetti did say, “The MP2 that the Israelis bought is about a car length long, weighs 2,000 pounds, and has the ability to cut on a dime and get out with whatever they are loading. I would say it can carry over 3,000 pounds.” Total contract value has not been release either, but Guzzetti noted, “The individual machines are in the $100K plus range, we can tell you that.”

And before the Israelis came calling, Airtrax was already developing the technology for civilian use. Along with SIDEWINDER forklifts, the Company plans to launch the KING COBRA line of scissor lifts early next year.

In June, Airtrax signed a 10 year sales and distribution agreement with Metalman Engineering Ltd. of Waterford, Ireland. The agreement granted Metalman the exclusive rights for the sale and distribution of Airtrax's SIDEWINDER and KING COBRA products throughout Ireland. By September, four SIDEWINDER ATX-3000 forklifts had been shipped.

And have the Israelis shown interest in continuing their relationship with Airtrax?

“Absolutely,” noted Guzzetti, “They’ve already indicated that this is just the first order, and want to look at how Omni-Directional technology can benefit their other military divisions.” In fact, the Company recently hosted a contingent from the Israeli Ministry of Defense in October, including top level officials.

“We’re doing a lot of things to get this company up and running; we think it’s exciting technology…. there are a lot of different applications for it and we’re one of the leaders in it, if not the leader.”

Airtrax currently reports TTM revenues of almost $300 thousand, with net losses of $7.1 million. The Company’s stock was recently quoted at $0.23 per share.



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