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Press Release
FOR IMMEDIATE RELEASE
Sento Corporation Reports Financial Results for its First Fiscal Quarter ended June 30, 2003
AMERICAN FORK, Utah - July 24, 2003 - Sento Corporation (Nasdaq: SNTO - news) announced today financial results for its first fiscal quarter ended June 30, 2003.
For the quarter, the Company reported revenues of $4.2 million, which is virtually unchanged compared to $4.2 million for the same quarter in the previous year. Net loss for the quarter ended June 30, 2003 was $(540,000), or $(0.25) per share, compared to a net loss of $(776,000), or $(0.37) per share, for the quarter ended June 29, 2002.
The loss for the quarter represented a 40 percent improvement on a pro-forma basis compared to the same period a year ago and a 30 percent improvement on a GAAP basis. The Company has taken significant steps to reduce costs and as a result reported a gross profit of $201,000 for the current fiscal quarter versus an $(88,000) loss at the gross profit line for last year's first fiscal quarter.
Sento continues to enjoy positive cash flow from operations, generating $395,000 of cash flow for the quarter ended June 30, 2003. As a result of positive cash flow from operations and an additional $296,000 of borrowing under Sento's line of credit, the Company was able to close the quarter with $2.7 million of cash on its balance sheet compared to $2.6 million as of March 31, 2003.
"Sento's continued positive cash flow is a reflection of our ongoing dedication to improving our financial condition and our continued focus on client retention and sales," stated Patrick O'Neal, Sento's president and chief executive officer. "Our sales pipeline is growing and we are scrupulously managing cost structure. Inquiries and interest in our Customer Choice Platform™ and Call Deflection Model™ are growing. Our employees are committed to Sento's vision of maintaining our leadership in our Call Deflection Strategy. We continue to maintain our emphasis on customer self-service, interactive chat and fee-based contact solutions."
Conference Call
Sento senior management will host a conference call today at 2:15 Mountain Time, 4:15 Eastern Time, to discuss the first fiscal quarter results. Senior management will also discuss business developments and future earnings and growth opportunities. To access the call dial: (877) 356-5706 five minutes before start time. The confirmation number will be 1793927. A replay of the conference call will be available for seven days following the call at (706) 645-9291 by entering reservation number 1793927. The replay will be available until July 30, 2003.
Pro Forma Financial Measures
In this earnings release and during our earnings conference call to be held on July 24, 2003 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 cash requirements for ongoing operating activities. 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 net income by adjusting GAAP net income 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
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