STEN Corporation Reports Fiscal 2008 Results

MINNEAPOLIS, Jan 12, 2009 /PRNewswire-FirstCall via COMTEX/ -- STEN | Quote | Chart | News | PowerRating -- STEN Corporation (Nasdaq: STEN), a Minneapolis-based diversified business; today reported results for its year ended September 28, 2008. The Company reported a net loss for the year ended September 28, 2008, of $8,021,386 or $3.25 per diluted share compared to a net loss for the year ended September 30, 2007 of $2,205,714 or $1.11 per diluted share. For the year ended September 28, 2008, the Company had a loss from continuing operations of $5,435,061 or $2.71 per diluted share and a loss from discontinued operations of $1,344,325 or $0.54 per diluted share. This compares to a loss from continuing operations of $2,753,542 or $0.93 per diluted share and a loss from discontinued operations of $344,376 or $0.18 per diluted share for the year ended September 30, 2007. A significant portion of the loss relates to non-cash charges including recording an allowance against approximately $2.96 million in net deferred tax assets. Kenneth Brimmer, CEO noted, "As a small finance company dealing with sub-prime borrowers we were hurt particularly hard by the marketplace events of the last year including the historic crisis in the credit markets, the most significant general economic recession in more than 20 years, the historic low levels of investor confidence, and the ever-increasing costs associated with being a public company. The combined effects of all these factors contributed to the significant loss for the year."

The Company also reported that on January 12, 2009, the Company received a Staff Deficiency Letter regarding a deficiency in the composition of the Company's Audit Committee for the period from October 28, 2008 to December 12, 2008. Due to the resignation of Steven F. Sabes from the Board and Audit Committee on October 28, 2008, the Company became non-compliant with the audit committee requirement for continued listing on The Nasdaq Stock Market as set forth in Marketplace Rule 4350(d)(2) because the Company's Audit Committee was comprised of only two instead of three members. On December 12, 2008, the Company's Board of Directors appointed Gervaise Wilhelm, an independent director, to serve on the Audit Committee. As a result of this action, the Company's Audit Committee is now comprised of three members, all of whom are independent directors. Accordingly, as stated in the Staff Deficiency Letter, the Nasdaq staff has determined that the Company has regained compliance with the Marketplace Rule 4350(d)(2).

STEN Corporation and Subsidiaries, headquartered in Minnesota, is a diversified business, primarily focused on its financing business through STEN Financial Corporation.

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: 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 (AUDITED) 09/28/2008 09/30/2007 REVENUES Stencor sales $2,053,430 $1,444,822 STEN Financial, auto loan interest and other 2,416,110 1,164,603 STEN Financial, vehicle sales 11,402,061 1,167,212 TOTAL REVENUES 15,871,601 3,776,637 COST AND EXPENSES Costs of goods sold related to Stencor 2,079,164 1,903,240 Loss on impairment of Stencor assets 650,000 Expenses related to STEN Financial Cost of autos sold 7,755,240 1,002,808 Salaries and benefits 1,307,904 727,352 Occupancy and operation expenses 778,980 240,923 Depreciation and amortization 251,853 200,301 Provision for credit losses 3,435,116 1,160,936 Interest expense, net 3,297,357 626,728 Loss on impaired of STEN Financial asset 571,667 - Selling, general and administrative 1,179,381 667,891 TOTAL COST AND EXPENSES 21,306,662 6,530,179 Loss from Continuing Operations Before Income Taxes (5,435,061) (2,753,542) Provision for (benefit from) income taxes 1,242,000 (892,204) NET LOSS FROM CONTINUING OPERATIONS (6,677,061) (1,861,338) Loss from Discontinued Operations Before Income Taxes (1,344,325) (550,844) Benefit from income taxes 0 (206,468) Loss from discontinued operations (1,344,325) (344,376) NET LOSS $(8,021,386) $(2,205,714) NET LOSS PER SHARE FROM CONTINUING OPERATIONS: Basic $(2.71) $(0.93) Diluted $(2.71) $(0.93) NET LOSS PER SHARE FROM DISCONTINUED OPERATIONS: Basic $(0.54) $(0.18) Diluted $(0.54) $(0.18) NET LOSS PER SHARE: Basic $(3.25) $(1.11) Diluted $(3.25) $(1.11) WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING Basic 2,470,348 1,989,975 Diluted 2,470,348 1,989,975

STEN CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (AUDITED) ASSETS 09/28/08 09/30/07 09/30/07 CURRENT ASSETS Cash and cash equivalents $242,733 $156,399 Current portion of notes and loans receivable 2,817,234 2,213,649 Other current assets 3,134,249 3,103,852 Assets of discontinued operations 80,074 1,928,575 Total Current Assets 6,274,290 7,402,475 PROPERTY AND EQUIPMENT, NET 824,141 1,051,012 OTHER ASSETS Notes and loan receivable, net of Current portion 8,813,057 5,695,849 Other assets 2,313,649 3,163,343 Total Other Assets 11,126,706 8,859,192 TOTAL ASSETS $18,225,137 $17,312,679 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current portion of long-term debt $5,442,524 $2,886,265 Other current liabilities 1,791,706 1,845,010 Liabilities of discontinued operations 1,344,407 1,626,752 Total Current Liabilities 8,578,637 6,358,027 LONG-TERM LIABILITIES Dealer reserves 27,303 1,076,707 Long-term debt, net of current portion 10,983,738 4,457,458 Total Long-Term Liabilities 11,011,041 5,534,165 Total Liabilities 19,589,678 11,892,192 STOCKHOLDERS' EQUITY (1,364,541) 5,420,487 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $18,225,137 $17,312,679

SOURCE STEN Corporation

http://www.stencorporation.com

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