Sento's 2Q Revenues Rise 51%.AMERICAN FORK, Utah American Fork is a city in Utah County, Utah, USA, at the foot of Mount Timpanogos in the Wasatch Range, north of Utah Lake. As of the 2000 census, the city population was 21,941 and was estimated at 22,387 in 2004. It has been rapidly growing since the 1970s. -- Sento Corporation (Nasdaq: SNTO) a leading provider of integrated, multi-channel See multichannel. customer support, announced financial results for its second fiscal quarter ended September September: see month. 30, 2004. For its second fiscal quarter ended September 30, 2004, Sento's revenues increased by 51% to $6.2 million compared to $4.1 million for last year's second fiscal quarter. This strong growth coupled with Sento's first quarter growth led to a 55% revenue increase for this year's six-month year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. revenue of $12.7 million compared to the $8.2 million for last year's comparable period. Gross profit for the second fiscal quarter increased by 54% to $529,000 compared to $343,000 for last year's second fiscal quarter. Gross profit increased by 143% to $1,320,000 during the first six months of fiscal 2005 compared to $544,000 in the same period of fiscal 2004. Additionally gross profit as a percent of sales increased by 3.7 percentage points to 10.4% in the first six months of fiscal 2005 versus 6.6% in the same period of fiscal 2004. The increase was primarily related to leveraging comparable fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). across higher revenues. The six-month net loss attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to common stockholders for fiscal 2005 improved 27% to $(747,000), or $(0.20) per share, versus $(1,017,000), or $(0.46) per share for the comparable period in fiscal 2004. A portion of the improvement was related to an $87,000 decrease in the first six months of fiscal 2005 for non-cash expenses Noun 1. non-cash expense - an expense (such as depreciation) that is not paid for in cash disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) and dividends relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc stock option and warrant transactions as compared to the first six months of fiscal 2004. Net loss for the second fiscal quarter was $(555,000), or $(0.15) per share, compared to a net loss of $(478,000), or $(0.21) per share, for last year's second fiscal quarter. The primary reasons for the increased loss in the quarter ending September 30, 2004 were one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. training expenses, investments in product development and an increase in general and administrative expense for additional employees hired to respond to increased demand for Sento products and services. However, the net loss as a percent of revenue improved by 4.6 percentage points to -6.2% in the fiscal 2005 second quarter compared to -10.2% in the same period of fiscal 2004. "We continue to deliver revenue growth and margin improvement. Historically, our first and second fiscal quarters have generated lower revenues and gross margins than our third and fourth quarters, principally due to certain seasonal business. Our stated goal of reducing the seasonality of our revenues is being realized with the addition of organic and new business generated during our most recent two quarters. We anticipate that our margins will continue to be somewhat impacted during the third quarter as we incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. additional training and labor expenses surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the implementation of additional new business from current clients. However, we also expect to realize revenue and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. improvements during the remaining six months of our fiscal year and beyond," reported Anthony J. Sansone, Chief Financial Officer. In conclusion Mr. Sansone stated, "Our balance sheet remains strong with $6.9 million in cash and $6.8 million in working capital." "We are extremely pleased with our revenue growth so far this year. Our client base continues to evolve Evolve may refer to several terms:
Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for fiscal 2005 is right on target" stated Patrick O'Neal, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . Mr. O'Neal further commented, "Given our strong cash position, we also have been evaluating several strategic opportunities over the last six months and hope to identify the right opportunity in the near future." CONFERENCE CALL Sento senior management will host a conference call today at 2:15 p.m. Mountain Time (4:15 p.m. Eastern Time) to discuss Sento's results, business developments, and growth opportunities. To access the call, dial 904-779-4711, in or outside the U.S., five minutes before start time. The confirmation number will be 27281031. In addition, this call will be Web cast by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at Sento's Web site at: www.sento.com. The Web cast is also being distributed over CCBN's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN's individual investor center at www.fulldisclosure.com or by visiting any of the investor sites in CCBN's Individual Investor Network. Institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. can access the call via CCBN's password-protected event management site, StreetEvents (www.streetevents.com). The Web cast of this call will be available for two months by visiting one of CCBN's Web sites as stated above. SENTO PROFILE Sento Corporation (www.sento.com) has emerged as a leading provider of outsourced Outsourced is a modern day comedy of cross-cultural conflict and romance, directed by John Jeffcoat, released in 2007. Synopsis Todd Anderson (Josh Hamilton) spends his days managing a customer call center for American Novelty Products in Seattle, until his job, customer care and sales support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services , managing customer relationships for a growing number of high-profile companies across multiple industries. Through Sento's Customer Choice Platform(TM), an integrated suite of multi-channel CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. technologies, customers are given a choice of self-service and assisted-service options--via web, e-mail, chat, and phone--for increased customer satisfaction with dramatic cost savings to Sento's clients. Sento provides support in 17 languages. FORWARD LOOKING STATEMENTS Statements in this press release, which are not purely historical, are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements encompass Sento's beliefs, expectations, hopes or intentions regarding future events. Words such as "expects," "intends," "believes," "anticipates," "should" and "likely" also identify forward-looking statements. All forward-looking statements included in this release are made as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" and are based on information available to Sento as of such date. Sento assumes no obligation to update any forward-looking statement. Actual results could differ materially from those anticipated for a number of reasons, including, among others: the Company's stock price has historically been volatile With regard to computer memory, it means "temporary" and not "highly changeable," which is the usual meaning of the word. See volatile memory. 1. (programming) volatile - volatile variable. 2. (storage) volatile - See non-volatile storage. ; variations in market and economic conditions; the effect on the Company's earnings of the repricing Repricing To change the price of an asset. In derivatives, it sometimes refers to the exchange of options of with different strike prices. repricing of options; the Company's dependence on its limited number of key clients; reduction in services requested by the Company's clients resulting in lower revenues for the Company; the Company's ability to complete negotiations and execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution client agreements; risk of emergency interruption INTERRUPTION. The effect of some act or circumstance which stops the course of a prescription or act of limitation's. 2. Interruption of the use of a thing is natural or civil. of the Customer Contact Solutions operations; and other unanticipated factors. Risk factors, cautionary statements and other conditions, which could cause actual results to differ from the Company's current expectations, are contained in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-KSB, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. .
SENTO CORPORATION AND SUBSIDIARY
Condensed Consolidated Balance Sheets
Assets
September 30, March 31,
2004 2004
------------- ------------
(Unaudited)
Current assets:
Cash and short-term investments $6,860,645 $6,567,811
Accounts receivable (net) 2,749,594 4,632,111
Other current assets 464,487 456,182
------------- ------------
Total current assets 10,074,726 11,656,104
Property and equipment (net) 4,377,190 4,220,560
Other assets 185,877 132,896
------------- ------------
Total assets $14,637,793 $16,009,560
============= ============
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt and
capital lease obligations $814,234 $728,357
Accounts payable 1,050,128 1,334,409
Accrued liabilities and other 1,456,353 2,394,204
------------ ------------
Total current liabilities 3,320,715 4,456,970
Long-term debt and capital lease obligations,
net of current portion 943,768 656,324
Stockholders' equity 10,373,310 10,896,266
------------ ------------
Total liabilities and
stockholders' equity $14,637,793 $16,009,560
============ ============
SENTO CORPORATION AND SUBSIDIARY
Condensed Consolidated Statements of Operations
(Unaudited)
Three Three Six Six
Months Months Months Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2004 2003 2004 2003
----------- ----------- ------------ ------------
Revenues $6,168,960 $4,085,034 $12,735,708 $8,239,665
Cost of sales 5,639,975 3,742,276 11,415,927 7,695,432
----------- ----------- ------------ ------------
Gross profit 528,985 342,758 1,319,781 544,233
Product development 114,963 - 233,976 -
Selling, general and
administrative 911,623 663,586 1,738,104 1,264,933
Non-cash charge for
valuation of
warrants 74,909 - 186,501 -
Stock-based
compensation
expense (benefit) (15,659) 35,341 (166,408) 49,558
----------- ----------- ------------ ------------
Operating loss (556,851) (356,169) (672,392) (770,258)
Other income
(expense), net 5,031 (75,583) (29,841) (144,691)
Non-cash charge for
valuation of
warrants and
conversion of
debentures (3,069) (46,154) (7,326) (102,546)
----------- ----------- ------------ ------------
Net loss (554,889) (477,906) (709,559) (1,017,495)
Deemed dividend as a
result of warrant
modifications - - (37,875) -
----------- ----------- ------------ ------------
Net loss
attributable to
common stockholders $(554,889) $(477,906) $(747,434) $(1,017,495)
=========== =========== ============ ============
Basic and diluted
loss per share $(0.15) $(0.21) $(0.20) $(0.46)
=========== =========== ============ ============
Weighted average
number of common
and common
equivalent
shares outstanding 3,732,326 2,270,162 3,680,006 2,201,695
=========== =========== ============ ============
SENTO CORPORATION AND SUBSIDIARY
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Six Months Ended
------------------------
Sept. 30, Sept. 30,
2004 2003
----------- ------------
Cash flows from operating activities:
Net loss $(709,559) $(1,017,495)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 799,944 831,643
Accretion of debenture for warrant and non-
cash charge for conversion of debentures 193,827 102,546
Stock-based compensation (166,408) 49,558
Changes in operating assets and
liabilities:
Accounts receivable 1,882,517 311,610
Other assets (82,095) (61,642)
Accounts payable (284,281) (234,461)
Accrued liabilities (389,222) 120,203
----------- ------------
Net cash provided by
operating activities 1,244,723 101,962
Cash flows from investing activities:
Purchase of property and equipment (778,629) (330,362)
Cash flows from financing activities:
Principal payments on long-term debt
and debentures (510,093) (1,292,721)
Net borrowings under line of credit - 664,934
Proceeds from long-term debt, capital
leases and debentures 720,173 540,000
Payment of accrued offering costs (603,823) -
Proceeds from stock options exercised 180,617 7,298
Proceeds from stock issued through
employee stock purchase plan 39,866 -
----------- ------------
Net cash used in financing
activities (173,260) (80,489)
----------- ------------
Net increase (decrease) in cash 292,834 (308,889)
Cash at beginning of period 6,567,811 2,583,337
----------- ------------
Cash at end of period $6,860,645 $2,274,448
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