SOTK 8-K filed today.
New Business Development Program Announced
Dr. Christopher L. Coccio, Chairman and CEO, announced that "a recent meeting of the Board of Directors has approved a multi-year business development program where the Company will invest approximately $2M in creating new business growth. The program will be led by Dr. Joseph Riemer, who was recently appointed as President of Sono-Tek, and has as its goal a substantial increase in revenues over the next several years to move Sono-Tek into the $10-$20m revenue arena. Funding for the program will be primarily derived from operating revenues, possibly augmented with some of our cash reserves, and is not expected to require external funding. The program is similar to the new initiatives that have been underway in the first and second quarters of the current fiscal year."
The program will focus on areas where we have demonstrated new capabilities and on areas where there appears to be more opportunity that we could serve with additional technical and sales personnel.
Such areas include medical device coatings, coatings for solar and fuel cells serving the clean energy market, biodegradable food packaging and applications of natural antimicrobials to food products, and the glass and textile industries. In our estimate, our future sales for the food industry alone could become Sono-Tek's largest business segment over time.
Sono-Tek is pursuing this program as a means to grow both the top and bottom lines. Sono-Tek believes that trading current income for future growth is the right choice for the Company at this time, and it will closely monitor the plans' execution and progress.
We are excited about where this program can take us. We have put in place organizational changes designed to focus on the growth opportunities before us, and we are bringing in additional talent to strengthen our structure. Specifically, we are creating several Strategic Business Units, each headed by a director who will be responsible for the growth in their segment. Each of the areas we will be pursuing has specific targets and resources, and in most cases, demonstrated success of our equipment in the application. We intend to apply our marketing, sales and technical resources to ramp up these promising applications and through them, generate larger streams of revenue and income.
We believe this is the right choice for Sono-Tek at this time, considering the success we have had in expanding into the medical device field and the international market in previous years. It is our hope and expectation that we will be a stronger, more diverse, and profitable Company after one to two years of this program.
Sincerely,
Christopher L. Coccio, PhD
Chairman and CEO
