News Release

FOR IMMEDIATE RELEASE CONTACT: Peter J. Mundy

Vice President – CFO

(631) 739-2000

SENTRY TECHNOLOGY REPORTS THIRD QUARTER RESULTS

RONKONKOMA, New York, November 11, 2005, -- Sentry Technology Corporation (OTC Bulletin Board: SKVY) today reported financial results for the Company’s third quarter ended September 30, 2005.

Revenues for the third quarter were $3,861,000, compared to revenues of $4,644,000 reported in the third quarter of the prior year. The decrease in revenues is attributable to a reduction in Lowe’s revenues by approximately $1.3 million on a comparable basis. Non-Lowe’s revenues increased 15% in the third quarter of 2005. The net loss in the third quarter of 2005 was $296,000, or $(0.00) per share, compared to a net profit of $40,000, or 0.00 per share, in the third quarter of last year. Included in the current period loss was a foreign exchange loss of $115,000 related to the strengthening of the Canadian dollar. The Company has not engaged in currency hedging activities in the past but is pursuing various alternatives with its lender related to the Canadian currency operating line of credit. In addition, the Company incurred $46,000 in legal expenses related to reestablishing its distribution rights in Brazil.

For the first nine months ended September 30, 2005, revenues were $10,621,000, compared to $11,897,000 reported in the previous year. EAS revenues continued to increase due to the acquisition of ID Systems in April of 2004. The decrease in revenues is attributable to a reduction in Lowe’s revenues by approximately $3 million on a comparable basis. Non-Lowe’s revenues increased by 23% in the first nine months of 2005. Principally as a result of lower revenue levels, Sentry had a net loss of $1,086,000, or $(0.01) per diluted share, in the first nine months of 2005 compared to a net loss of $141,000, or $(0.00) per diluted share, in the first nine months of 2004.

“We have made great strides towards diversifying our customer base and replacing the lost Lowe’s business which has historically represented over 30% of our total revenues,” said Peter L. Murdoch, President and CEO of Sentry Technology Corporation. “Strategic investments have been made in sales and marketing including the hiring of four new sales professionals with substantial industry experience, the partnering with Civitas Group to promote SentryVisionâ to the Homeland Security market and the appointment of a new distributor in Brazil. These efforts have resulted in large sales opportunities with public transportation organizations, libraries and major retailers. In addition, our expanded, high caliber sales team has been successful in leveraging references from satisfied customers to develop opportunities in new and existing markets. Typical of our recent experience, SmartTrack was sold to a national department store chain where many additional installations are expected. We anticipate that the increasing number of ongoing sales cycles will have a positive impact on future revenues.”

Sentry Technology Corporation designs, manufactures, sells and installs a complete line of Radio Frequency (RF) and Electro-Magnetic (EM) EAS systems and Closed Circuit Television (CCTV) solutions. The CCTV product line features the SentryVisionâ SmartTrack system, a proprietary, patented traveling Surveillance System. The Company’s products are used by retailers to deter shoplifting and internal theft and by industrial and institutional customers to protect assets and people. The recent acquisition of ID Systems expands the Company’s product offering to include proximity Access Control and Radio Frequency Identification (RFID) solutions. For further information, please visit our Web site at www.sentrytechnology.com.

This press release may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Securities and Exchange Commission filings.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

September 30, December 31,

2005 2004

(Unaudited) (Audited)

ASSETS

CURRENT ASSETS

Cash and cash equivalents $ 978 $ 1,965

Accounts receivable, less allowance for doubtful

accounts of $137 and $338, respectively 2,954 3,500

Inventories 2,953 3,314

Prepaid expenses and other current assets 451 525

Total current assets 7,336 9,304

PROPERTY, PLANT AND EQUIPMENT, net 641 689

GOODWILL 1,564 1,564

OTHER ASSETS 601 690

$ 10,142 $ 12,247

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES

Revolving line of credit and term loan $ 1,876 $ 2,640

Accounts payable 815 799

Accrued liabilities 974 1,146

Obligations under capital leases - current portion 6 5

Deferred income 103 169

Total current liabilities 3,774 4,759

NOTES PAYABLE --- 189

OBLIGATIONS UNDER CAPITAL LEASES -

non-current portion 3 8

DEFERRED INCOME TAXES 34 39

CONVERTIBLE DEBENTURES 1,894 1,862

MINORITY INTEREST 1,129 1,045

Total liabilities 6,834 7,902

SHAREHOLDERS’ EQUITY 3,308 4,345

$ 10,142 $ 12,247

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Three Months Ended Nine Months Ended

September 30, September 30,

2005 2004 2005 2004

(Unaudited) (Unaudited)

REVENUES

Sales $ 3,343 $ 3,498 $ 8,718 $ 8,532

Service, installation and other 518 1,146 1,903 2,219

3,861 4,644 10,621 11,897

COSTS AND EXPENSES:

Cost of sales 1,793 1,915 4,688 4,538

Customer service expenses 587 1,100 2,038 3,220

Selling, general and administrative expenses 1,479 1,131 4,017 3,248

Research and development 191 266 638 606

4,050 4,412 11,381 11,612

OPERATING INCOME (LOSS) (189) 232 (760) 285

INTEREST AND FINANCING EXPENSES 80 105 249 309

INCOME (LOSS) BEFORE INCOME TAXES

AND MINORITY INTEREST (269) 127 (1,009) (24)

INCOME TAX EXPENSE 9 62 29 77

INCOME (LOSS) BEFORE MINORITY INTEREST (278) 65 (1,038) (101)

MINORITY INTEREST (18) (25) (48) (40)

NET INCOME (LOSS) $ (296) $ 40 $ (1,086) $ (141)

NET INCOME (LOSS) PER SHARE

Basic and diluted $ (0.00) $ 0.00 $ (0.01) $ (0.00)

WEIGHTED AVERAGE SHARES

Basic and diluted 120,629 115,753 120,582 102,457