STEN Corporation Reports Fourth Quarter and Fiscal 2007 Results
MINNEAPOLIS, Dec. 31, 2007 -- STEN Corporation , a Minneapolis-based diversified business, today reported results for its fourth quarter and year ended September 30, 2007. The Company reported a net loss for the year ended September 30, 2007, of $2,205,714 or $1.11 per diluted share compared to a net loss for the year ended October 1, 2006 of $608,238 or $0.30 per diluted share. For the year ended September 30, 2007, the Company had a loss from continuing operations of $2,224,771 or $1.12 per diluted share and net income from discontinued operations of $19,057 or $0.01 per diluted share. This compares to a loss from continuing operations of $935,213 or $0.46 per diluted share and net income from discontinued operations of $326,975 or $0.16 per diluted share for the year ended October 1, 2006. The Company reported a loss for the fourth quarter ended September 30, 2007 of $1,340,060 or $0.67 diluted share compared to a loss of $97,017 or $0.05 per diluted share for the fourth quarter ended October 1, 2006. The loss in the fourth quarter was principally the result of charges incurred as a result of one of the company's auto-dealer customers ceasing operations at the beginning of the fourth quarter. The dealer ceased operations in a manner resulting in charges to reserve for the write-off of certain inventory items and other related costs together with additional charges relating to the installment contracts that were acquired from this dealer prior to its ceasing operations.
STEN Corporation and subsidiaries, headquartered in Minnesota, is a diversified business, primarily focused on its financing and buy/here pay/here auto sales businesses through STEN Financial Corporation. The Company also has a contract manufacturing business and a distribution businesses.
STEN Corporation common stock is traded on the Nasdaq Capital Market under the symbol STEN. More information about STEN Corporation is available at the Company's website: http://www.stencorporation.com/. Except for historical information contained herein, the disclosures in this news release are forward-looking statements that could be affected by certain risks and uncertainties, and actual results may differ materially, depending on a variety of factors. These risks are described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no duty or obligation to update any of the forward-looking statements after the date of this release.
STEN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (audited) For Three Months Ended For the Year Ended 09/30/2007 10/01/2006 09/30/2007 10/01/2006 REVENUES Revenues related to Contract manufacturing, net $ 492,920 $438,021 $1,444,822 $2,156,070 Finance charges related to STEN Financial, net of loan losses and adjustments of $205,223 and $0 for the thirteen weeks and $395,009 and $0 for the years ended 9/30/2007 and 10/01/2006 1,412,127 30,313 3,111,453 30,313 TOTAL REVENUES 1,905,047 468,334 4,556,275 2,186,383 COST AND EXPENSES Costs of goods sold related to Contract manufacturing 450,237 325,357 1,391,807 1,690,605 Loss on impairment of note receivable from Site Equities 0 1,082,671 0 1,082,671 Expenses related to STEN Financial Cost of autos sold 721,273 0 1,002,808 0 Auto inventory write-down and related costs 1,137,439 0 1,137,439 0 Salaries and benefits 505,357 2,541 1,341,921 2,541 Occupancy and operation expenses 271,697 38,463 865,170 38,463 Depreciation and amortization 98,646 7,596 346,053 7,596 Cost of capital 122,227 0 409,960 0 Selling, general and administrative 248,478 254,270 1,179,324 926,673 TOTAL COST AND EXPENSES 3,555,354 1,710,898 7,674,482 3,748,549 Loss from Continuing Operations (1,650,307) (1,242,564) (3,118,207) (1,562,166) OTHER EXPENSE Interest income 21,101 59,076 91,405 207,414 Interest expense (255,274) 0 (308,173) 0 Net Other Income (Expense) (234,173) 59,076 (216,768) 207,414 Loss from Continuing Operations Before Income Taxes (1,884,480) (1,183,488) (3,334,975) (1,354,752) BENEFIT FROM INCOME TAXES (564,604) (356,343) (1,110,204) (419,539) NET LOSS FROM CONTINUING OPERATIONS (1,319,876) (827,145) (2,224,771) (935,213) Income (loss) from discontinued operations (32,052) 1,137,615 30,589 477,976 Provision for (benefit from) income taxes from discontinued operations (11,868) 407,487 11,532 151,001 Income (loss) from discontinued operations (20,184) 730,128 19,057 326,975 NET LOSS $(1,340,060) $(97,017)$(2,205,714) $(608,238) NET LOSS PER SHARE FROM CONTINUING OPERATIONS: Basic $(0.66) $(0.41) $(1.12) $(0.46) Diluted $(0.66) $(0.41) $(1.12) $(0.46) NET INCOME PER SHARE FROM DISCONTINUED OPERATIONS: Basic $(0.01) $0.36 $0.01 $0.16 Diluted $(0.01) $0.36 $0.01 $0.16 NET LOSS PER SHARE: Basic $(0.67) $(0.05) $(1.11) $(0.30) Diluted $(0.67) $(0.05) $(1.11) $(0.30) WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING Basic 1,991,017 2,041,407 1,989,975 2,032,429 Diluted 1,991,017 2,041,407 1,989,975 2,032,429 STEN CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS 09/30/07 10/01/06 CURRENT ASSETS Cash and cash equivalents $366,118 $2,786,941 Current portion of notes and loans receivable 3,066,619 185,629 Other current assets 3,130,743 1,146,280 Assets of discontinued operations 1,419,643 4,141,098 Total Current Assets 7,983,123 8,259,948 PROPERTY AND EQUIPMENT, NET OTHER ASSETS 1,293,620 896,223 Notes and loan receivable, net of current portion 5,853,949 574,000 Other assets 2,340,089 285,527 Total Other Assets 8,194,038 859,527 TOTAL ASSETS $17,470,781 $10,015,698 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current portion of long-term debt $2,886,265 $- Other current liabilities 2,107,572 145,403 Liabilities of discontinued operations 1,522,292 2,454,229 Total Current Liabilities 6,516,129 2,599,632 LONG-TERM LIABILITIES Dealer reserves 1,076,707 - Long-term debt, net of current portion 4,457,458 - Total Long-Term Liabilities 5,534,165 - Total Liabilities 12,050,294 2,599,632 STOCKHOLDERS' EQUITY 5,420,487 7,416,066 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $17,470,781 $10,015,698