|By Marketwired .||
|August 20, 2014 03:25 PM EDT||
RONKONKOMA, NY -- (Marketwired) -- 08/20/14 -- Sentry Technology Corporation (OTC Pink: SKVY) (PINKSHEETS: SKVY) today reported financial results for the Company's first quarter ended March 31, 2014.
Revenues for the first quarter of 2014 were $1,207,000 compared to revenues of $1,355,000 reported in the first quarter of the prior year. The operating loss was $179,000, or $(0.00) per share, in the first quarter of 2014 as compared to an operating loss of $214,000 or $(0.00) per share, in the first quarter of 2013. EBITDA for the first quarter was a negative ($162,000) in 2014 compared to a negative EBITDA of ($192,000) in the first quarter of 2013.
Sentry Technology Corporation designs, manufactures, sells and installs Closed Circuit Television (CCTV) solutions, Electro-Magnetic (EM) and RFID based Library security and self-service systems. Our CCTV product line features VideoRailway and SmartTrack, proprietary, traveling camera technology. Our OperationalVideo, OVportal software application assists retailers with on-line management of safety and security, merchandising audits and employee procedure compliance. Products are used by libraries to secure inventory and improve operating efficiency, by retailers to deter theft and enhance productivity, and by industrial/institutional customers to protect assets and people. More information can be found 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 uses Adjusted EBITDA as a non-GAAP financial performance measurement. Adjusted EBITDA is calculated by adding back to net income (loss) interest, income taxes, depreciation and amortization expense and net (loss) income attributable to the noncontrolling interest. Adjusted EBITDA is provided to investors to supplement the results of operations reported in accordance with GAAP. Management believes that Adjusted EBITDA provides an additional tool for investors to use in comparing Sentry Technology Corporation's financial results with other companies that also use Adjusted EBITDA in their communications to investors. By excluding non-cash charges such as depreciation and amortization, as well as non-operating charges for interest and income taxes and net (loss) income attributable to the noncontrolling interest, investors can evaluate the Company's operations and can compare its results on a more consistent basis to the results of other companies. In addition, Adjusted EBITDA is one of the primary measures management uses to monitor and evaluate financial and operating results.
Sentry Technology Corporation considers Adjusted EBITDA to be an indicator of the Company's operational strength and performance of its business and a useful measure of the Company's operating trends. However, there are significant limitations to the use of Adjusted EBITDA since it excludes interest income and expense, income taxes, and net (loss) income attributable to the noncontrolling interest, all of which impact the Company's profitability, as well as depreciation and amortization related to the use of long term assets which benefit multiple periods. Sentry Technology Corporation believes that these limitations are compensated by providing Adjusted EBITDA only with GAAP net income (loss) and clearly identifying the difference between the two measures. Consequently, Adjusted EBITDA should not be considered in isolation or as a substitute for net income (loss) presented in accordance with GAAP. Adjusted EBITDA as defined by the Company may not be comparable with similarly named measures provided by other entities. A reconciliation of Adjusted EBITDA to GAAP net income or loss is included in the schedule below.
SENTRY TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands, Except Par Value Amounts) (Unaudited) March 31, December 31, 2014 2013 ------------ ------------ ASSETS Current Assets: Cash $ 51 $ 72 Short-term investments 246 253 Accounts receivable, net of allowance for doubtful accounts of $74 in 2014 and $79 in 2013 374 477 Inventory, net 1,408 1,433 Prepaid expenses and other current assets 160 174 ------------ ------------ Total current assets 2,239 2,409 PROPERTY AND EQUIPMENT, net 261 283 OTHER ASSETS 141 145 ------------ ------------ TOTAL ASSETS $ 2,641 $ 2,837 ============ ============ LIABILITIES AND STOCKHOLDERS' DEFICIT Current Liabilities: Amount due to related parties $ 4,240 $ 4,266 Bank indebtedness and revolving line of credit 1,224 1,236 Accounts payable 1,130 1,084 Accrued liabilities 612 597 Deferred income 236 221 Promissory notes payable 38 38 ------------ ------------ Total current liabilities 7,480 7,442 Deferred tax liabilities 41 42 ------------ ------------ Total long-term liabilities 41 42 Total liabilities 7,521 7,484 STOCKHOLDERS' DEFICIT Sentry Technology Corporation stockholders' deficit: Preferred stock, $0.001 par value; authorized 10,000 (2013 - 10,000) shares; none issued and outstanding Common stock, $0.001 par value; authorized 300,000 (2013 - 300,000) shares; issued and outstanding 196,405 (2013 - 196,405) shares 196 196 Additional paid-in capital 51,759 51,755 Accumulated deficit (58,367) (58,069) Accumulated other comprehensive loss 97 (8) ------------ ------------ Total stockholders' deficit (6,315) (6,126) Noncontrolling interest in subsidiary 1,435 1,479 ------------ ------------ Total deficit (4,880) (4,647) ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 2,641 $ 2,837 ============ ============ SENTRY TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Per Share Amounts) (Unaudited) Three Months Ended -------------------------- March 31, -------------------------- 2014 2013 ------------ ------------ REVENUES: Sales $ 1,075 $ 1,185 Service, installation and maintenance revenues 132 170 ------------ ------------ 1,207 1,355 COST OF SALES AND EXPENSES: Cost of sales 655 749 Customer service expenses 151 183 Selling, general and administrative expenses 565 580 Research and development 73 85 Foreign exchange gain (58) (28) ------------ ------------ 1,386 1,569 ------------ ------------ LOSS FROM OPERATIONS (179) (214) INTEREST EXPENSE, net 96 94 ------------ ------------ LOSS BEFORE INCOME TAXES AND NONCONTROLLING INTEREST (275) (308) INCOME TAX EXPENSE 12 6 ------------ ------------ LOSS BEFORE NONCONTROLLING INTEREST (287) (314) LESS: NET INCOME ATTRIBUTABLE TO THE NONCONTROLLING INTEREST 11 5 ------------ ------------ NET LOSS (298) (319) ============ ============ NET LOSS PER SHARE - Basic and diluted $ (0.00) $ (0.00) ============ ============ WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING Basic and diluted 196,405 196,405 ============ ============ RECONCILIATION OF ADJUSTED EBITDA TO NET LOSS (In thousands) Three Months Ended -------------------------- March 31, -------------------------- 2014 2013 ------------ ------------ Net loss $ (298) $ (319) Reconciling items: Interest expense, net 96 94 Income tax expense 12 6 Depreciation and amortization 17 22 Net income attributable to the noncontrolling interest 11 5 ------------ ------------ Adjusted EBITDA $ (162) $ (192) ============ ============
* Additional financial statements are available on the Company's website at http://www.sentrytechnology.com/.
Peter L. Murdoch
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