VRB Power reports Q2 2007 financial results



    VANCOUVER, Aug. 29 /CNW/ - VRB Power Systems Inc. (TSX-V: VRB) today
reported its financial results for the six month period ended June 30, 2007.
    The following is a summary of the key points for the period, updated to
August 28, 2007 (Note - all dollars Canadian)

    
    -   Sales revenue and other income was $201,913 for the six months
        compared to $182,922 for the comparative period in 2006;

    -   Operating expenses were $6,497,681 for the period compared to
        $5,248,689 for the comparative period in 2006;

    -   Net loss of $6,295,768 for the period ($0.05 per share) compared to
        $5,065,767 ($0.05 per share) for the comparative period in 2006;

    -   In August 2007, the Company completed the sale of 37,950,000 common
        shares at a price of $0.38 per share representing gross proceeds of
        $14,421,000 by way of a bought deal financing. Commissions were paid
        consisting of 6.5% cash ($937,365) plus 5% broker's compensation
        options, each option being exercisable to acquire one common share at
        $0.38 per share for a period of 18 months from closing.

    -   In May 2007 the Company announced the supply of a 5kW x 4hr
        VRB-ESS(TM) to a large Canadian Telecommunications provider for
        assessment in a remote "off grid" telecommunications site on a trial
        to purchase basis;

    -   In July 2007 the company announced that the University of South
        Florida, in partnership with Progress Energy Florida, purchased two
        5kW x 4hr VRB Energy Storage Systems, which it will integrate with a
        solar project on the St. Petersburg campus of the University of South
        Florida. This project is aimed at evaluating the storage of
        intermittent solar photovoltaic energy and utilizing that energy at a
        time of maximum benefit to the customer and utility power systems.

    -   The Company completed the construction of the 15kW x 8hr (120kWh)
        VRB-ESS ordered by Risx National Laboratory in Denmark ("Riso") which
        was announced in June 2006. Riso conducts research on new
        technologies that can create opportunities for Danish Society in
        general and Danish industry specifically. The system has been shipped
        to Denmark and is currently in the process of being commissioned.

    -   Systems previously deployed continue to perform to expectations with
        good feedback from customers.
    

    The consolidated financial statements of the Company for the period ended
June 30, 2007 and Management's Discussion and Analysis ("MD&A") thereon were
prepared in accordance with Canadian generally accepted accounting principles
and are presented in Canadian dollars. The Consolidated Balance Sheets,
Consolidated Statements of Operations and Deficit and Consolidated Statements
of Cash Flows are set out below. The full financial statements and MD&A have
been filed on SEDAR (www.sedar.com).

    About VRB Power

    Headquartered in Vancouver, Canada, VRB Power Systems Inc. is an energy
storage technology developer which is marketing, selling and manufacturing
products utilizing the patented VRB Energy Storage System ("VRB-ESS(TM)"). The
VRB-ESS can economically store and supply large amounts of electricity on
demand and is focused on stationary applications. It is a long life, cost
effective, low maintenance, efficient technology that allows for the
scalability of power and storage capacity independently. The VRB-ESS is
particularly beneficial to renewable energy providers, utilities and end users
through its ability to "inventory" electricity, allowing for the optimal match
of supply and demand.
    The VRB-ESS is well suited for a variety of applications. Enabling the
provision of "firm" capacity from intermittent renewable generation such as
wind and solar; more cost effective and efficient generation of electricity in
remote areas; capital deferral for utilities; and load levelling (peak
shaving) applications. The VRB-ESS is also capable of providing backup power
solutions including applications for utility sub-stations and
telecommunication sites. As a "green" technology, the VRB-ESS is characterized
by having a low ecological impact and is unlike most other conventional energy
storage systems that rely on toxic substances such as lead or cadmium.

    Caution Regarding Forward Looking Statements: VRB Power's press releases
may contain forward-looking statements. These statements are based on
management's current expectations and beliefs which are subject to a number of
known and unknown risks and uncertainties (including, but not limited to, the
risk factors described in VRB Power's Annual Information Form filed with the
British Columbia Securities Commission and available at www.sedar.com) that
could cause actual results to differ materially from those expressed or
implied in our forward-looking statements. The Company does not assume any
obligation to update any forward-looking statements contained in this press
release.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.

    Vince Sorace
    President

    
    VRB Power Systems Inc.
    Consolidated statements of operations and deficit
    six months ended June 30, 2007 and 2006
    Unaudited

                                 Three months ended         Six months ended
                                      June 30                   June 30
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
                                    $            $                         $

    Revenue
      Sales                    57,263       37,285       57,263       72,285
    -------------------------------------------------------------------------

    Expenses
      General and
       administrative       2,200,572    1,473,804    3,952,625    2,980,111
      Research and
       development            675,559      702,230    1,261,162    1,109,792
      Amortization of
       intangible assets      507,243      506,683    1,014,488    1,013,368
      Amortization of
       plant and equipment    154,599       80,456      269,406      145,418
    -------------------------------------------------------------------------
                            3,537,973    2,763,173    6,497,681    5,248,689
    -------------------------------------------------------------------------

    Operating loss         (3,480,710)  (2,725,888)  (6,440,418)  (5,176,404)
    -------------------------------------------------------------------------

    Other items
      Interest and
       other income            59,494       54,531      144,650      110,637
    -------------------------------------------------------------------------
                               59,494       54,531      144,650      110,637
    -------------------------------------------------------------------------

    Net loss               (3,421,216)  (2,671,357)  (6,295,768)  (5,065,767)
    Deficit, beginning
     of period            (61,386,396) (50,153,862) (58,511,844) (47,759,452)
    -------------------------------------------------------------------------
    Deficit, end
     of period            (64,807,612) (52,825,219) (64,807,612) (52,825,219)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Loss per share
     - basic and diluted        (0.03)       (0.03)       (0.05)       (0.05)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted average
     number of shares
     outstanding - basic
     and diluted          124,835,532  107,143,223  124,835,532  107,143,223
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    VRB Power Systems Inc.
    Consolidated balance sheets
    as at June 30, 2007 and December 31, 2006
    Unaudited

                                                        June 30, December 31,
                                                           2007         2006
    -------------------------------------------------------------------------
                                                              $            $
    Assets
    Current assets
      Cash and cash equivalents                       4,008,977    6,884,870
      Short-term investments                                  -    2,501,562
      Accounts receivable                                57,263      138,864
      Deposits and other receivables                    243,407      249,041
      Inventory                                       1,151,298      677,451
    -------------------------------------------------------------------------
                                                      5,460,945   10,451,788

    Raw material inventory                              785,844      788,532
    Plant and equipment                               2,112,048    1,693,916
    Intangible assets                                 5,669,958    6,684,446
    Restricted cash                                     193,147      325,231
    -------------------------------------------------------------------------
                                                     14,221,942   19,943,913
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities
    Current liabilities
      Accounts payable and accrued liabilities          956,419      900,479
    -------------------------------------------------------------------------


    Shareholders' equity
    Share capital (Note 6(a))                        74,400,898   74,400,898
    Contributed surplus (Note 6 (d))                  3,672,237    3,154,380
    Deficit                                         (64,807,612) (58,511,844)
    -------------------------------------------------------------------------
                                                     13,265,523   19,043,434
    -------------------------------------------------------------------------
                                                     14,221,942   19,943,913
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Approved on behalf of the Board

    Signed - Vincent Sorace              Signed - Timothy Hennessy
    ------------------------             --------------------------
    Vincent Sorace, Director             Timothy Hennessy, Director



    VRB Power Systems Inc.
    Consolidated statements of cash flows
    six months ended June 30, 2007 and 2006
    Unaudited

                                 Three months ended         Six months ended
                                      June 30                   June 30
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
                                    $            $            $            $

    Operating activities
      Net loss             (3,421,216)  (2,671,357)  (6,295,768)  (5,065,767)
      Items not affecting
       cash
        Amortization          661,842      587,139    1,283,894    1,158,786
        Stock-based
         compensation         301,049      114,370      517,857      477,514
      Change in non-cash
       working capital
        Decrease in
         accounts receivable   24,313            -       81,601            -
        (Increase)/decrease
         in deposits and
         other receivables    (46,973)     (90,055)       5,634     (117,478)
        Increase in
         inventory           (301,804)    (215,632)    (471,159)    (436,918)
        Increase in
         accounts payable     139,973      617,887       55,940      695,560
    -------------------------------------------------------------------------
                           (2,642,816)  (1,657,648)  (4,822,001)  (3,288,303)
    -------------------------------------------------------------------------

    Investing activities
      Decrease in
       short-term
       investments          2,553,488            -    2,501,562            -
      Purchase of plant
       and equipment         (546,332)    (587,331)    (687,538)    (953,615)
      Decrease in
       restricted cash         61,236       58,320      132,084       98,691
    -------------------------------------------------------------------------
                            2,068,392     (529,011)   1,946,108     (854,924)
    -------------------------------------------------------------------------

    Net cash outflow         (574,424)  (2,186,659)  (2,875,893)  (4,143,227)
    Cash and cash
     equivalents,
     beginning of period    4,583,401    5,985,661    6,884,870    7,942,229
    -------------------------------------------------------------------------
    Cash and cash
     equivalents,
     end of period          4,008,977    3,799,002    4,008,977    3,799,002
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Cash and cash
     equivalents consist of:
      Cash                    406,702       53,002      406,702       53,002
      Short-term money
       market investments   3,602,275    3,746,000    3,602,275    3,746,000
    -------------------------------------------------------------------------
                            4,008,977    3,799,002    4,008,977    3,799,002
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    





For further information:

For further information: VRB Power Systems Inc. at (604) 697-8820;
Investor Relations at (604) 697-8835 or visit the company's web site at:
www.vrbpower.com

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