Argon St (STST) 8-K Sensytech, Inc. Announces Q3 Results

Exhibit 99.1

8419 Terminal Road, P.O. Box 1430, Newington, VA 22122-1430
703.550.7000 Fax 703.550.0883
www.sensytech.com

NEWS RELEASE

For Immediate Release

Sensytech, Inc. Announces Q3 Results

NEWINGTON, VA, August 14, 2003 / Business Wire / — Sensytech, Inc. (NASDAQ: STST), today announced revenues and earnings for its third quarter ended June 30, 2003.

Revenues for the three months ended June 30, 2003 increased $4,069,000 or 45.1% to $13,100,000 compared to $9,031,000 for the prior year quarter. Revenue for the nine months ended June 30, 2003 increased $17,167,000 or 83.7% to $37,676,000, compared to $20,509,000 for the prior year period.

Net income for the three months ended June 30, 2003 was $1,058,000, or $0.16 per diluted share, an increase of 57.9% compared to $670,000 or $0.16 per diluted share for the prior year quarter. For the nine months ended June 30, 2003 net income increased to $2,949,000, or $0.48 per diluted share, an increase of 84.7% compared to the prior year period of $1,597,000, or $.38 per diluted share.

“Our revenue and profit performance continues to improve in line with our expectations. As our planning process focuses on fiscal year 2004, the opportunities for substantially added business is materializing. Demand for our engineered solutions continues to be high in all business segments with a defined focus on domestic work for Homeland Security and Defense,” noted S. Kent Rockwell, CEO of Sensytech.

Mr. Rockwell further stated, “Our new sixty thousand square foot manufacturing facility located in Fairchance, Pennsylvania, will be opened on August 15, 2003. Manufacture of the Surface Ship Torpedo Defense System and LAMPS MK III Communications system will be fully transitioned to this new facility by the second quarter of 2004. We are currently hiring for the necessary skills to staff the facility and pleased that there appears to be no shortage of qualified applicants. The challenge of closing our New Jersey facility while simultaneously opening our Fairchance operations will be complex and demanding for the next two quarters. We remain continuously optimistic about the opportunities beyond that timeframe.”

Financial Highlights

• Revenue for the third quarter increased 45.1% over the prior year quarter to $13,100,000

• Our book to bill ratio in the trailing twelve months was 1.23, up slightly from the previous quarter

• Revenue for the nine month period increased 83.7% over the prior year period to $37,676,000

• Net Income for the third quarter of $1,058,000, or $0.16 per diluted share, compared to $0.16 per diluted share for the prior year quarter

• Net Income for the nine months period of $2,949,000, or $0.48 per diluted share, up $0.10 per diluted share, from the prior year period

About SenSyTech Inc.

Sensytech, Inc. designs, develops and manufactures electronic support measures (ESM), electronic intelligence (ELINT), and threat warning systems, active electronic warfare (EW) systems, airborne imaging systems, communications reconnaissance systems, shipboard support systems, and other special purpose communications equipment serving worldwide markets. Sensytech, through its predecessor companies, has been providing cutting edge technology applications and cost-effective systems solutions for three decades.

Statements in this press release which are not historical facts are forward-looking statements under the provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve risks and uncertainties. The Company wishes to caution readers that certain factors can cause the Company’s actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, the Company. The Company undertakes no obligation and does not intend to update, revise or otherwise publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances.

SENSYTECH, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

		June 30, 2003			September 30, 2002
ASSETS
CURRENT ASSETS
	Cash and cash equivalents	$	18,769,000		$	700,000
	Accounts receivable, net		9,595,000			8,880,000
	Unbilled contract costs, net		7,274,000			8,820,000
	Inventories		2,166,000			3,168,000
	Deferred income taxes		411,000			411,000
	Other current assets		409,000			272,000
TOTAL CURRENT ASSETS			38,624,000			22,251,000
PROPERTY AND EQUIPMENT			2,696,000			2,608,000
OTHER ASSETS
	Deferred income taxes		216,000			260,000
	Intangibles, net		175,000			400,000
	Other assets		103,000			333,000
TOTAL ASSETS		$	41,814,000		$	25,852,000
LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES
	Line of credit	$	—		$	2,900,000
	Accounts payable		1,789,000			2,916,000
	Accrued salaries, benefits, and related expenses		2,200,000			2,093,000
	Other accrued expenses		1,441,000			438,000
	Billings in excess of costs		1,578,000			2,342,000
	Income taxes payable		205,000			497,000
TOTAL CURRENT LIABILITIES			7,213,000			11,186,000
STOCKHOLDERS’ EQUITY
	Common Stock		66,000			42,000
	Additional paid-in capital		24,943,000			7,972,000
	Treasury stock at cost		(534,000	)		(525,000	)
	Retained earnings		10,126,000			7,177,000
TOTAL STOCKHOLDERS’ EQUITY			34,601,000			14,666,000
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	41,814,000		$	25,852,000
BACKLOG		$	35,898,000		$	24,400,000

SENSYTECH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)

		For the Three Months Ended						For the Nine Months Ended
		June 30,						June 30,
		2003			2002			2003			2002
REVENUES
	Contract revenues	$	13,100,000		$	9,031,000		$	37,676,000		$	20,509,000
COSTS AND EXPENSES
	Cost of revenues		9,704,000			7,165,000			28,443,000			15,363,000
	General and administrative expenses		1,645,000			724,000			4,267,000			2,529,000
	Total cost and expenses		11,349,000			7,889,000			32,710,000			17,892,000
INCOME FROM OPERATIONS			1,751,000			1,142,000			4,966,000			2,617,000
OTHER INCOME (EXPENSES)
	Interest income		36,000			2,000			79,000			33,000
	Interest expense		(1,000	)		(7,000	)		(49,000	)		(9,000	)
	Other income		5,000			10,000			12,000			77,000
	Other expenses		—			—			(10,000	)		(11,000	)
INCOME BEFORE INCOME TAXES			1,791,000			1,147,000			4,998,000			2,707,000
INCOME TAX PROVISION			(733,000	)		(477,000	)		(2,049,000	)		(1,110,000	)
NET INCOME		$	1,058,000		$	670,000		$	2,949,000		$	1,597,000
PER SHARE AMOUNT
	Basic earnings per share	$	0.16		$	0.17		$	0.49		$	0.40
	Diluted earnings per share	$	0.16		$	0.16		$	0.48		$	0.38
WEIGHTED AVERAGE SHARES OUTSTANDING
	Basic average shares outstanding		6,457,086			4,022,598			5,975,103			3,996,201
	Diluted average shares outstanding		6,617,393			4,284,302			6,116,574			4,232,441

FOR MORE INFORMATION, CONTACT:
Donald F. Fultz, Chief Financial Officer
don.fultz@sensytech.com
URL: www.sensytech.com