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Sentry Technology Reports Second Quarter Results and Bank Debt Restructuring

RONKONKOMA, N.Y., Sept. 14, 2011 /PRNewswire/ -- Sentry Technology Corporation (OTC Markets: SKVY) today reported financial results for the Company's second quarter ended June 30, 2011.

Revenues for the second quarter of 2011 were $2,177,000 compared to revenues of $2,487,000 reported in the second quarter of the prior year. The loss from operations was $192,000 compared to income of $12,000 in the second quarter of 2010. The net loss was $595,000, or $(0.00) per share, as compared to a net loss of $254,000, or $(0.00) per share, in the second quarter of 2010. The net loss includes a noncash charge related to financing of $244,000 and $163,000 in the second quarter of 2011 and 2010, respectively.

For the first six months ended June 30, 2011, revenues were $4,412,000 compared to revenues of $4,713,000 reported in the first six months of the prior year. Sentry had a net loss of $1,192,000, or $(0.01) per share, compared to a net loss of $714,000, or $(0.01) per share, in the first half of 2010. The net loss includes a noncash charge related to financing of $489,000 and $295,000 in the first six months of 2011 and 2010, respectively.

"During the second quarter, considerable effort was made to restructure the Company's debt and continue to develop new products," said Peter Murdoch, President and CEO of Sentry Technology Corporation. "In August this resulted in the purchase of the $3,164,000 Royal Bank of Canada loan by two Sentry Directors who control the majority of the Company's common stock. Sentry will benefit from reduced debt service costs of approximately $190,000 on an annual basis. The purchase of the Company's largest debt confirms the commitment of Sentry's shareholders to the future of the Company."

Mr. Murdoch goes on to say, "We have a high level of confidence in the opportunity to grow our business via the continued development of our RFID products for libraries as evidenced by a recent contract award from the Lower Merion Public Library to install complete RFID systems in 6 locations beginning in November of this year. The total value of the contract is estimated to be $650,000. In addition a prototype of our new VideoRailway(TM) traveling camera system is installed in the Sentry engineering department. We are enthusiastic about its initial performance. VideoRailway(TM) is key to our success and we believe the product launch will lead to significant growth in our traveling camera sales."

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 SentryVision®, SmartTrack(TM), a proprietary, patented traveling Surveillance System. Our OperationalVideo(TM), OVportal(TM) 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.

CONTACT: Peter L. Murdoch
President & CEO
(631) 739-2000

    SENTRY TECHNOLOGY CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS *
    (In thousands, except per share data)

                           Three Months               Six Months
                               Ended                    Ended
                             June 30,                 June 30,
                             --------                 --------
                           2011          2010         2011          2010
                           (Unaudited)               (Unaudited)

    Revenues             $2,177        $2,487       $4,412        $4,713
    Cost of sales         1,140         1,315        2,240         2,416
    Operating
     expenses             1,229         1,160        2,550         2,479
                          -----         -----        -----         -----
    (Loss) income
     from
     operations            (192)           12         (378)         (182)
    Interest
     expense, net           178           135          350           261
    Non-cash
     amortization
     costs related
     to financing           244           163          489           295
                            ---           ---          ---           ---
    Loss before
     income taxes
     and
     noncontrolling
     interest           (614)      (286)    (1,217)      (738)
    Income tax
     recovery               ---            (4)         ---           ---
                            ---           ---          ---           ---
    Net loss               (614)         (282)      (1,217)         (738)
    Less: net loss
     attributable
     to the
     noncontrolling
     interest            (19)       (28)       (25)       (24)
                            ---           ---          ---           ---
    Net loss              $(595)        $(254)     $(1,192)        $(714)
                          =====         =====      =======         =====
    Loss per share
              Basic and
               diluted   $(0.00)       $(0.00)      $(0.01)       $(0.01)
                         ======        ======       ======        ======
    Weighted
     average number
     of common
     shares
     outstanding
              Basic and
               diluted  143,617       120,744      143,617       120,744
                        =======       =======      =======       =======

* Full financial statements are available on the Company's website at www.sentrytechnology.com.

SOURCE Sentry Technology Corporation