nCoat, Inc. wishes to advise that its wholly owned subsidiaries, nTech, Inc. ("nTech") and High Performance Coatings, Inc. ("HPC") have created and supplied custom formulated nano-coatings that have led to 2006 sales of approximately US $1 million directly from its nano-formulated product mix.
The Company anticipates that revenue opportunities for 2007 will continue to grow via the diesel engine manufacturing industry and its ongoing search for new methods to reduce emissions. The EPA has clearly identified diesel emissions as a serious public health risk and a major contributor to the nation's continuing air quality problems. As a result, manufacturers are working apace to introduce new methods to decrease emissions ahead of regulatory timelines.
In response to industry need, nCoat's nano-formulated product has resolved a major corrosion risk impeding the performance of a singularly important and highly effective method to reduce diesel engine emissions known as Exhaust Gas Recirculation ("EGR"), where combusted air and fuel is re-circulated to decrease emissions. The EGR method produces extreme temperatures and acidic conditions that pose a significant corrosion risk to the exposed aluminum engine parts that previously dramatically increased engine failure rates.
"We are proud to announce that after coating tens of thousands of parts with our nano-formulated coatings for our valued customers in the Over The Road ("OTR") diesel truck industry, we have had zero failures," said Terry R. Holmes, President of nCoat, Inc. "We anticipate that we will be able to capitalize on our success in the diesel engine industry by meeting the varied needs of other major industries with superior custom nano-formulated solutions."
Generally, in coating technology, the smaller the materials used, the higher bond strength of the product and the better performance and functionality. Replacing micron-formulated coatings with nano-formulated coatings creates a major impact in increased coating density and porosity reduction. The resulting product provides extremely effective and durable corrosion protection against highly corrosive elements and conditions.
Increasingly stringent nation-wide rules mandated by the EPA call for phased increases to diesel emission standards, with cuts required by 2007 and additional cuts by 2010 involving reductions in particulates and nitrogen oxides by 90%, a dramatic reduction of 95% over previous standards. These regulations will greatly assist in lowering emissions through the adoption of ever more aggressive new technologies. nCoat views this changing manufacturing environment as a perfect example of the significant need for and adaptability of nano-formulated commercial products and as a unique growth opportunity and potential major integrated revenue stream for the Company.