SENTRY TECHNOLOGY CORP. 
By RONKONKOMA, N.Y., Nov. 13 /PRNewswire-FirstCall/ -- Sentry Technology Corporation (Pink Sheets: SKVY) today reported financial results for the Company's third quarter ended September 30, 2009.
Revenues for the third quarter of 2009 were $2,606,000, compared to revenues of $3,573,000 reported in the third quarter of the prior year. Sentry had a net loss of $410,000 in the third quarter of 2009, or $(0.00) per share, compared to a net loss of $204,000, or $(0.00) per share, in the third quarter of last year. The net loss in both periods includes a non-cash amortization expense related to financing of $129,000 and $172,000, respectively. The results in the third quarter also include a foreign exchange loss of $89,000 in 2009 and a gain of $141,000 in 2008. Net of foreign exchange and non-cash financing expenses the 2009 third quarter loss increased by $19,000 compared to the third quarter 2008.
For the first nine months ended September 30, 2009, revenues were $6,989,000, compared to $9,644,000 reported in the previous year. Sentry had a net loss of $1,539,000, or $(0.01) per share, in the first nine months of 2009 compared to a net loss of $1,083,000, or $(0.01) per share, in the first nine months of 2008. The net loss in both periods includes a non-cash amortization expense related to financing of $379,000 and $460,000, respectively. The results in the third quarter also include a foreign exchange loss of $135,000 in 2009 and a gain of $217,000 in 2008.
"It has become nearly a cliche to say that 2009 has been a difficult year," said Peter L. Murdoch, President and CEO of Sentry Technology Corporation. "Despite lower sales due to reduced customer budgets, several new RFID products for libraries have been introduced and recently a contract was signed with an engineering firm to design an improved version of our SmartTrack traveling camera system. Significant cuts have been made to fixed costs and we are operating at near EBITDA breakeven. Having weathered the storm, we see improvements in the current business environment and a growing market opportunity for our new RFID library products and video management software."
Sentry Technology Corporation designs, manufactures, sells and installs a complete line of Closed Circuit Television (CCTV) solutions, Electro-Magnetic (EM) and RFID based Library Management systems as well as Radio Frequency (RF) and Electro-Magnetic (EM) EAS systems. The CCTV product line features SentryVision®, SmartTrack, a proprietary, patented traveling Surveillance System. The Company's products are used by libraries to secure inventory and improve operating efficiency, by retailers to deter shoplifting and internal theft and by industrial and institutional customers to protect assets and people. For further information, please visit our website at www.sentrytechnology.com.
This press release may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Securities and Exchange Commission filings.
SENTRY TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Par Value Amounts)
September 30, December 31,
2009 2008
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and cash equivalents $145 $643
Short-term investments 186 264
Accounts receivable, net of allowance
for doubtful accounts of $175 in
2009 and $179 in 2008 1,037 971
Inventory, net 2,239 2,739
Prepaid expenses and other current
assets 923 682
Total current assets 4,530 5,299
PROPERTY AND EQUIPMENT, net 479 439
OTHER ASSETS 221 232
TOTAL ASSETS $5,230 $5,970
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Bank indebtedness, demand loan and
revolving line of credit $3,764 $3,418
Accounts payable 782 830
Accrued liabilities 1,088 1,211
Obligations under capital leases -
current portion 2 2
Deferred income 233 175
Convertible debenture 2,110 2,000
Total current liabilities 7,979 7,636
Long-term debt - less current portion:
Obligations under capital leases 2 4
Deferred tax liabilities 103 90
Total long-term liabilities 105 94
Total liabilities 8,084 7,730
MINORITY INTEREST 1,294 1,311
STOCKHOLDERS' DEFICIT
Preferred stock, $0.001 par value;
authorized 10,000 (2008 - 10,000)
shares; none issued and outstanding
Common stock, $0.001 par value; authorized
190,000 (2008 - 190,000) shares; issued
and outstanding 120,744 (2008 - 120,744)
shares 121 121
Additional paid-in capital 50,737 50,196
Accumulated deficit (55,067) (53,528)
Accumulated other comprehensive income 61 140
Total stockholders' deficit (4,148) (3,071)
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIT $5,230 $5,970
SENTRY TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
(Unaudited) (Unaudited)
REVENUES
Sales $2,362 $3,101 $6,181 $8,215
Service, installation
and maintenance revenues 244 472 808 1,429
2,606 3,573 6,989 9,644
COST OF SALES AND EXPENSES:
Cost of sales 1,361 1,818 3,483 4,721
Customer service expenses 344 522 1,131 1,627
Selling, general and
administrative expenses 871 1,108 2,702 3,258
Research and development 107 142 348 435
Foreign exchange loss (gain) 89 (141) 135 (217)
2,772 3,449 7,799 9,824
(LOSS) INCOME FROM OPERATIONS (166) 124 (810) (180)
INTEREST, net 128 139 367 415
NON-CASH AMORTIZATION COSTS
RELATED TO FINANCING 129 172 379 460
LOSS BEFORE INCOME TAXES
AND MINORITY INTEREST (423) (187) (1,556) (1,055)
INCOME TAX RECOVERY --- 9 --- 15
LOSS BEFORE MINORITY INTEREST (423) (196) (1,556) (1,070)
MINORITY INTEREST (INCOME)
EXPENSE (13) 8 (17) 13
NET LOSS $(410) $(204) $(1,539) $(1,083)
LOSS PER SHARE
Basic and diluted $(0.00) $(0.00) $(0.01) $(0.01)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
Basic and diluted 120,744 120,744 120,744 120,744
SOURCE Sentry Technology Corporation
