Sono-Tek: 9-month 2008 sales up 14%

Sono-Tek Corporation announced sales on 15 January 2009 of USD 1,582,000 for the three months ended 30 November 2008, compared to USD 1,561,000 for the same period 2008. For the nine months ended 30 N…

Sono-Tek Corporation announced sales on 15 January 2009 of USD 1,582,000 for the three months ended 30 November 2008, compared to USD 1,561,000 for the same period 2008. For the nine months ended 30 November 2008, the company“s sales increased to USD 4,808,000 from USD 4,208,000 for the same period 2008, an increase of 14%. Dr. Christopher L. Coccio, chairman and CEO, attributed the increase to the company“s recent business development program, and he noted that the sales increase was based on products such as the Exactacoat and Flexicoat, which serve the solar and fuel cell markets, the new SonoFlux EZ and Servoflux, Widetrack systems for glass customers, sales of medical device coating systems, and SonoDry ultrasonic spray dryers for the pharmaceutical and nanotechnology industries. Most of these products were developed as part of the business development program initiated a year ago, and they explain the company“s positive sales performance in a negative economic climate, particularly within the electronics industry. The company reported an operating loss of USD 366,000 for the three months ended 30 November 2008 compared to operating income of USD 4,000 for the prior year period. The operating loss is attributed to the increased spending associated with the technical and market development portions of the new business development program. The company reported a net loss of USD 976,000 for the three months ended 30 November 2008 as compared to net income of USD 24,000 for the prior year period. During the quarter ended 30 November 2008, the company recognized USD 612,000 in tax expense related to the write down of its deferred tax asset. The write down of the deferred tax asset is a non-cash expense item. In the future, the deferred tax asset may be recorded based upon the company“s return to profitable operations. According to Dr. Coccio, “This year, we have committed ourselves to building the business for the future, and it has taken increased spending, the use of some of our cash reserves, and reported losses to do so. We have continued this “spend to grow“ approach for the past three quarters as well as in the last quarter of the preceding fiscal year, in spite of the difficulties facing the economy. As a result, we have seen double digit sales growth this year – a clear indication that our business development program is working. We are now busy with orders in the newer areas, and our 4Q promises to be one of our best in terms of sales revenues, based on the backlog on hand”. “For the upcoming fiscal year, we will be reducing costs with the goal of bringing the business back to a profitable mode again. We believe that we will be able to reduce certain expenditures that were needed to fulfill the business development objectives, and that the new products, technology developments, and increased marketing and sales coverage we established will continue to generate higher sales volume for us next year. The combination of increased sales and cost reductions should lead the way to profitability in the coming year”.