|
Press Release
FOR IMMEDIATE RELEASE
Sento Reports Third Quarter Results
Reports Pro-forma Quarterly Net Income
AMERICAN FORK, Utah - January 20, 2004 - Sento Corporation (Nasdaq: SNTO - news), a leading provider of integrated, multi-channel customer support, today announced financial results for its third fiscal quarter and nine months ended December 31, 2003.
Revenues for the quarter ended December 31, 2003, increased by 30% to $5.2 million compared to $4 million for the same quarter of the previous year. Net loss for the quarter was $(141,000), or $(0.06) per share, compared to a net loss of $(373,000), or $(0.18) per share, for the quarter ended December 31, 2002-a 62% improvement.
For the nine-month period, revenues increased 15% to $13.4 million, compared to $11.7 million for the nine-month period last year. The net loss was $(1.2 million), or $(0.51) per share, compared to a net loss of $(2.2 million), or $(1.04) per share, for the nine-month period last year-a 45% improvement.
"We reported to you last quarter that we have firmly established a technology-based platform whose core-costs can be leveraged from increased revenues so that profits going forward can be realized. In October 2003, in two separate press releases, Sento announced additional annualized revenues from new clients totaling $10 million. During the December 2003 quarter we began seeing the positive results from these new revenues," stated Pat O'Neal, President and Chief Executive Officer.
Mr. O'Neal continued, "We have stated in previous reports that an increase in call volumes, if achieved, would result in higher coverage of overhead and fixed costs, which would likely result in improved gross margin percentages. We are pleased to report that this increase in revenues coupled with earlier cost savings from consolidation of telephone and data services with the installation of a new PBX switch, our expansion to new facilities which have lower occupancy costs, and the utilization of excess capacity have had a positive effect on our gross margin percent."
Stanley Cutler, Senior Vice President of Finance, added, "As a result of accounting rules involving expensing repriced employee stock options, Sento recorded and expensed for the quarter non-cash charges of $275,000 relating to this repricing. This charge is directly related to the vesting on options repriced in April 2003 and the increase in our stock price since that time. While Sento experiences a non-cash charge to income for this repricing, we are enjoying increased employee morale from this repricing."
Mr. Cutler went on to explain, "On a pro forma basis, the net income for the quarter ended December 31, 2003 was $182,000, or $0.07 per diluted share, compared to a pro forma net loss of $(350,000), or $(0.17) per share, for the quarter ended December 31, 2002. For the nine-month period, the pro forma net loss was $(683,000), or $(0.30) per share, compared to a pro forma net loss of $(2,104,000), or $(1.00) per share, for the nine-month period of the previous year. Pro forma net income excludes non-cash charges of $275,000 for stock-based compensation, and non-cash charges of $48,000 associated with valuation of warrants and conversion of debentures for the quarter ended December 31, 2003. Pro forma net loss excludes non-cash charges of $325,000 for stock based compensation, and non-cash charges of $151,000 associated with valuation of warrants and conversion of debentures for the nine- months ended December 31, 2003."
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 904-779-4740, in or outside the U.S., five minutes before start time. The confirmation number will be 1374442. A replay will be available for seven days following the call by dialing 402-220-2491 and entering the reservation number 1374442. The replay will be available through January 27, 2004.
In addition, this call will be web cast by CCBN 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 can access the call via CCBN's password-protected event management site, StreetEvents (www.streetevents.com).
Pro Forma Financial Measures
In this earnings release and during our earnings conference call to be held on January 20, 2004 as described above, Sento uses or plans to discuss certain pro forma financial measures, which may be considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States, ("GAAP"). A reconciliation between pro forma and GAAP measures can be found in the accompanying tables. The Company believes that, while these pro forma measures are not a substitute for GAAP results, they provide the best basis for evaluating the Company's operating results exclusive of non-cash items. These pro forma measures have been reconciled to the nearest GAAP measure as is now required under new SEC rules regarding the use of non-GAAP financial measures. The Company computes pro forma operating results by adjusting GAAP operating results for stock-based compensation and valuation of warrants and conversion of debentures.
SENTO PROFILE
Sento Corporation (www.sento.com) is one of the industry's most innovative providers of outsourced customer support services. Sento employs right channeling to create custom solutions that integrate live support with the company's best-in-class software solutions. Sento's Customer Choice PlatformSM allows customers to make choices in communication channels from a range of web-enabled self-service options with live support available at every critical point. Sento focuses on the inter-relationship among voice, chat, email, self-service and web forums. Sento targets its customer acquisition, customer service and technical support solutions to a diversified portfolio of clients in multiple vertical segments. Sento's solutions can provide value-added customer support at significant cost reductions when compared to other, traditional outsourced models. With operations in the U.S., The Netherlands, and France, plus partnerships in India and other low-cost regions, Sento provides customer support in 19 languages.
FORWARD LOOKING STATEMENTS
Statements in this press release, which are not purely historical, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements encompass Sento's beliefs, expectations, goals, hopes or intentions regarding future events. Words such as "expects," "intends," "estimates," "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 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; difficulties encountered in post-acquisition integration and operation of the acquired assets including retaining existing clients of the acquired company; variations in market and economic conditions; the effect on the Company's earnings of the repricing of options; the Company's dependence on its limited number of key clients; failure to renew existing client contracts for continuation of services; 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 client agreements; risk of emergency interruption 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.
Contact:
Patrick O'Neal
President, Chief Executive Officer and Director
Sento Corporation
801-772-1417
pat_oneal@sento.com
Anthony J. Sansone
Chief Finance Officer and Corporate Secretary
Sento Corporation
801-772-1410
tony_sansone@sento.com
Brokers and financial industry members
Laurie S. Roop
President, Shareholder Relations
435-652-3884
laurie@shareholder-relations.net
|
|
|
|
