RONKONKOMA, N.Y., March 28 /PRNewswire-FirstCall/ -- Sentry Technology Corporation (BULLETIN BOARD: SKVY) today reported financial results for the Company's fourth quarter and year ended December 31, 2006.
Revenues for the fourth quarter of 2006 were $3,752,000, compared to revenues of $2,949,000 reported in the fourth quarter of the prior year. The net loss was $293,000, or $(0.00) per share, in the fourth quarter of 2006 as compared to a net loss of $604,000, or $(0.01) per share, in the fourth quarter of 2005.
For the year ended December 31, 2006, revenues were $12,135,000 compared to $13,570,000 reported in the previous year. The decrease is primarily related to a reduction in revenue from two key accounts totaling approximately $1,800,000. The net loss was $2,304,000, or $(0.02) per share in 2006, compared to $1,690,000, or $(0.01) per share in 2005.
"While sales increased 27% in the fourth quarter of 2006 compared with the fourth quarter of 2005, the increase was below expectation," said Peter L. Murdoch, President and CEO of Sentry Technology Corporation. "Significant additional cost cuts are fully implemented as of the first quarter of 2007. We anticipate that cost reductions, the successful market testing of SmartTrack(TM) as an OperationalVideo(TM) solution for retailers and continued growth in our library business will improve financial results in 2007."
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(R), 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 http://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
CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31,
2006 2005
ASSETS
CURRENT ASSETS
Cash and cash equivalents $360 $445
Short-term investments 259 397
Accounts receivable, less allowance for doubtful
accounts of $160 and $141, respectively 2,251 2,762
Inventories 3,005 2,709
Prepaid expenses and other current assets 306 318
Total current assets 6,181 6,631
PROPERTY AND EQUIPMENT, net 609 637
GOODWILL 1,564 1,564
OTHER ASSETS 480 563
$8,834 $9,395
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank indebtedness, demand loan
and revolving line of credit $3,030 $2,039
Accounts payable 609 489
Accrued liabilities 1,078 925
Obligations under capital leases - current portion 3 6
Deferred income 185 135
Total current liabilities 4,905 3,594
OBLIGATIONS UNDER CAPITAL LEASES -
non-current portion 8 1
DEFERRED TAX LIABILITY 91 58
CONVERTIBLE DEBENTURES 1,945 1,904
Total liabilities 6,949 5,557
MINORITY INTEREST 1,237 1,140
STOCKHOLDERS' EQUITY
Common stock 121 121
Additional paid-in capital 49,037 48,783
Accumulated deficit (48,712) (46,408)
Accumulated other comprehensive income 202 202
Total stockholders' equity 648 2,698
$8,834 $9,395
SENTRY TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2006 2005 2006 2005
REVENUES
Sales $3,170 $2,413 $10,212 $11,131
Service installation & other revenues 582 536 1,923 2,439
3,752 2,949 12,135 13,570
COSTS AND EXPENSES:
Cost of sales 1,599 1,272 5,374 5,960
Customer service expenses 608 616 2,209 2,654
Selling, general and
administrative expenses 1,332 1,331 5,296 5,348
Research and development 224 218 838 856
3,763 3,437 13,717 14,818
OPERATING LOSS (11) (488) (1,582) (1,248)
INTEREST AND FINANCING EXPENSES 164 84 473 333
LOSS BEFORE INCOME TAXES AND
MINORITY INTEREST (175) (572) (2,055) (1,581)
INCOME TAX EXPENSE 75 20 145 49
LOSS BEFORE MINORITY INTEREST (250) (592) (2,200) (1,630)
MINORITY INTEREST (43) (12) (104) (60)
NET LOSS $(293) $(604) $(2,304) $(1,690)
LOSS PER SHARE
Basic and diluted $(0.00) $(0.01) $(0.02) $(0.01)
WEIGHTED AVERAGE SHARES
Basic and diluted 120,744 120,629 120,716 120,594
