AmeraMex International, Inc.

Marty Tullio - Managing Partner, McCloud Communications LLC Lee Hamre - President and CEO Tracie Hannick - CFO

Thank you, Brian. Good morning everyone.

Before we begin today’s call, I’d like to share with you that some of the statements made in this conference call that relate to future financial results, markets, growth plans or performance are forward-looking, and involve certain risks and uncertainties associated with the demand for products and services, and development of markets for the company’s products and services. Actual results, events, and performance may differ materially.

Conference call participants are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. AmeraMex undertakes no obligation to release publicly the results or any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Now I'd like to turn the call over to AmeraMex CEO, Lee Hamre. Good morning Lee.

Good morning Marty. Thank you for joining us everybody, we appreciate your participation in our second quarter financial conference call.

With me today are the Board of Directors, Mike Maloney our COO, along with our CFO, Tracie Hannick, and Marty Tullio who you've already heard from. I want to turn this over first to Tracie, our CFO, and let her get you updated there.

Good morning everyone. Before I begin, I'd like to say that we have made progress on our submission to our Securities attorney for the removal of the yield sign on our symbol, and the status of our new accounting system.

We have provided our Securities attorney with financials for 2013, 2014 and the first six months of 2015. Additionally, all questionnaires have been completed along with Director Bios and submitted to the attorney.

They will review and request any additional clarification, then prepare the documents to the OTC marketplace fore review and removal of the yield sign. Our new accounting system is up and running, effective June 1, 2015.

This system is extremely efficient, easier to use, and allows us to more effectively track our revenue and expenses by department, while providing a full complement of much needed management report. Moving on to the subject at hand, for the second quarter and six month period financials; I would like to add that all numbers discussed today are approximate amount.

As announced earlier this month, revenue for the second quarter ending June 30, 2015 was $1.3 million, a 23% increase when contrasted with revenue of $1 million reported for the comparable 2014 quarter. Gross profit for the quarter increased 34%, due in part to product mix.

Net income for the quarter was $201,606, a significant increase when compared to net income of $76,435 for the comparable second quarter of 2014. Our product mix makes a significant difference to the bottom line.

I have announced earlier this morning, revenue for the six month period ending June 30, was $2.2 million compared with revenue of $3.9 million reported for the comparable 2014 period. Gross profit for the period was $1.3 million, slightly down from the comparable period.

Net income for the six month period was down slightly, when compared to the 2014 six month period. Revenue for the six month 2014 period was significantly higher after the company enjoyed historically high revenue for the first quarter of 2014.

I will turn the call back to Lee now to provide a project update.

Okay, back to me. First, our update on our African opportunities; our partner, from the Republic of Congo, Jean-Noel Makaya will be visiting the offices here of AmeraMex on August 25.

He is working several projects for AmeraMex and get us in front of the government. He is very close with the President of the Republic of Congo.

His family is quite wealthy and is highly connected in Africa, to anybody that's important. So he is a very good contact, he is strong and he is working on getting us into some new projects we haven't discussed yet at all, and he will be here in California visiting next week.

I just got back from a trip on Monday, to Nigeria. I spent a week there with our partner in Nigeria.

He actually lives inside the Presidential compound there, behind the guarded gates, and he is an advisor to the President, the new President of Nigeria, who has only been in office for about three months. As an advisor, he is with the President on a daily basis when he is in town.

We expect that the trip will generate several potential projects, but what it did generate is -- or put together an order for his construction company, for two machines, and we have an inside track, if we can come up with a crane for Chevron. They want to rent a crane from us, that is a really large crane, and I couldn't normally do that at all, the risk would be too high.

But in this case, with Chevron signing the lease, here in the United States, we can. So I am working on that, it isn't done yet, but I think I can get that one done.

The items that Dr. Jester in Nigeria is working on buying, one is a big large container handler, possibly the first of about five machines probably.

He is starting, what we call a dry port. It's about a ten hour drive with a truck from the port of Lagos in Nigeria, up to the capital city of Abuja, and dry port would be a very large container storage yard, where we unload trucks that come in from Lagos and store the containers until they are ready to deliver them to the end users.

In start up, there'd be about -- a flow of about 50 containers a day, coming and go out. It needs the container handler to unload the trucks.

As the flow increases, there will be more machines. So that is a strong specialty of ours, the container handlers, and it looks like one will be going to Abuja.

The exporting economy in Nigeria is expected to present a lot of other opportunities also. Now we will move on to Niger, which borders Nigeria, but it is a different country.

Niger, we are working with Ecobank. We have organized a company in Niger called AmeraMex of Niger, it's solely owned by AmeraMex.

Ecobank is a bank we are dealing with, and Ecobank is recognizing, where the chain of command is now working directly with private buyers on all the trucks for the truck project we have been working on for, probably two years now. We were told to expect Ecobank to produce and send the contract for the first 250 trucks, by the end of September.

Now that doesn't mean, we are going to have it by the end of September, this is their target. So I can make sure everybody is updated, and we should be working on building and shipping new trucks to Niger, before the end of the year, I am sure, but they are saying by the end of September.

We maintain weekly communications, and are assured that while the process is slow, it is continuing to move forward. Once we receive the contract, it will be provided to the American funding group for a final approval.

We do not foresee any issues at this time with the American funding group. They are anxious to get started.

Once the American funding organization approves the Ecobank contract, that it is a possibility and that they will ask for some changes in the contract; and we won't know that until we see it. Once that's done, the deal is done, and trucks begin shipping within 45 to 60 days.

All of the trucks are still expected to ship over a five year period. The total package deal by the time it's completed, it is about $72 million annually.

So please, let me remind you that until the American funding organization does their final approval of the contract, the deal is not done. But we are not competing with anybody on this, and we are being told, we will have the contract shortly.

So that's the best update I can give you on Niger. In the country of Mali, we just shipped four machines, back hose and excavators to Mali.

But we actually ship our men to Conakry, Guinea, and they go by truck to Mali, which has no coast, so they have no ports. Those four machines are paid for and at the port.

They load on the ship this Saturday, as the ship sails on Sunday, about a six week period on the water, before they get to Conakry. But our payment is by form of letter of credit, which we can cash and have into the system within 48 hours after the ship leaves the dock in Galveston.

That same customer has already expressed, based on the -- what he thinks of these four machines when they arrive, he is ready to order four more. He wants to keep going, he is talking about a total of about 60 machines.

His company is building 5,000 houses in Mali; 10,000 houses in Ivory Coast, and 5,000 houses in Niger. I have connected him with the Presidential staff in Nigeria now, and he is negotiating another 5,000 houses in Nigeria, and he will buy all the equipment from us, he is very happy with our service.

He will be extremely happy when he sees the machines. They all look excellent and run perfect.

Let's discuss some of the other projects in Africa; we currently have an African proposal pipeline, of approximately $415 million, that's potential business that I am working on. Again, this is a pipeline, a potential business, it's not closed business.

The Niger military contract we did talk about, I believe, two conference calls ago. We met with the President of Ecobank, who is overseeing the military equipment project, judging from how fast the truck project has come together, I am going to say, we are looking at a few months before we get any closer.

They are going to begin working on the funding for this project with the World Bank, after the Niger truck deal is complete. This opportunity, like I said, is probably 12 months away.

We are establishing a partnership with a tactical vehicle manufacturer right now. It appears as though, we are going to be the authorized dealer for this manufacturer in Canada, to sell military vehicles to Niger, Nigeria, Cameroon, The Congo, Ivory Coast, basically all the West African countries.

If we get that contract put together, that will be a large amount of steady business, because they are having a lot of confrontation over there between terrorists and they need defense vehicles, and that's what they manufacture at this company that I am talking about. When we get closer and the contract is signed, I can give you webpages and manufacturers' name and you can all look at the equipment that would be included in the new military equipment.

We expect the proposal for a solar power plant project in Senegal, with our partner from Hawaii, who would do the construction; and we are waiting for a reply from the Senegal government. There is much competition there from Chinese companies, but our relationship is strong with the numbers in the government we deal with, and we have an agent also in Senegal, that works with me on the local level, when I am not there.

And the equipment manufacturer would be on-site to do the construction. The Senegal government indicates that they have funding for the project already, which is, I believe it can be at least 12 to 18 months away, before we would start that project.

And our profit would come from the solar equipment manufacturing and installation company in Hawaii, directly from them, when they start the project. This project recently spun back to life, we have been quoting it about a year ago and haven't heard much, and then all of a sudden, I think they got the money approved through World Bank, and they are anxious to do something.

But of course, like I said, that's probably 12 to 18 months is anxious for West Africa. During the last -- our core business basically, covered some of that.

During the last conference call, I discussed my meeting with the private construction company, and that was the machines going to Mali, through Conakry, Guinea, and they are in the process of being shipped. That's part of what I would call core business.

The cranes for Nigeria and some more core business, and everything we do here in The States. So the profits that we were talking about earlier, when Tracie was on, are basically all from core business.

There is these big projects -- have not put in money into this. One project that we are doing quite well with, as rentals of large container handling equipment.

We have one customer here, which happened to be the U.S. Government, that is the U.S.

Army Weapons Depot near Reno, and they have currently got 10 machines on rent from AmeraMex and we have a contract in place for three more. These machines will lift and stack loaded containers [indiscernible] high, up to 80,000 pounds each, and the rent is pretty substantial.

At the end of the rental, we own the machines outright, and the used machines will be of market value of about $300,000 a piece, when we get back out for five years. So the rental income completely pays off the machines, and we will see a 25% to 30% profit on top of that, and at the completion of the contract, we own the machines, with no additional investment.

Currently, our pipeline for core business for the company is about $8 million, and that excludes the contract coming from Ecobank when we get that. We appreciate you, our shareholders, and we want you to know that we are working hard to accomplish our goal of increasing shareholder value.

With that said, we'd like to begin the question-and-answer session for today's call. Operator, would you like to begin the Q&A please?

Good afternoon Lee. Congratulations on a nice quarter.

The 70 some odd million that you are looking from Niger, is that solely for AmeraMex?

Yeah, its business that we would be doing. So we have got to buy the trucks, so that's not $70 million profit.

Right, okay. But revenue you would see though, it's not something you're splitting with anybody else, that's your portion?

We have some commissions we have got to pay to our local representative, and other than that -- no that's revenue, that would be gone through our books.

Okay. And do you have any idea on what the profit margin is?

Could you say or --

Well that's not -- no. I don't know exactly.

I have a rough idea, and that will be reported in our quarterly release, since now we are doing on [indiscernible] [0:20:55]. It will be quite obvious.

Right. Okay, all right.

All right, again congratulations on a nice quarter. Things seem to be moving forward, which is nice.

Yeah, it is. I am excited.

It feels like the recession is winding down Mike.

That's a good thing. I will let somebody else ask another question.

Thanks.

All right. Thank you.

Okay. I guess I answered everybody's questions in my narratives, that's good.

That means I did a good job with that. Our goal remains the same, increase the stock value by making decisions that are best for the company now and in the future.

We would like to thank all of you for participating in the call today, and for your questions, and continued support. We look forward to speaking with you in the third quarter financials release.