News Release

FOR IMMEDIATE RELEASE CONTACT: Peter L. Murdoch

President & CEO

(631) 739-2000

SENTRY TECHNOLOGY CORPORATION REPORTS THIRD QUARTER OPERATING PROFIT

RONKONKOMA, New York, November 13, 2007, -- Sentry Technology Corporation (OTC Bulletin Board: SKVY) today reported financial results for the Company’s third quarter ended September 30, 2007.

Revenues for the third quarter increased by 48% to $4,061,000, compared to revenues of $2,743,000 reported in the third quarter of the prior year. Sentry had a small operating profit and a net loss in the third quarter of 2007 of $168,000, or $(0.00) per share, compared to a net loss of $683,000, or (0.01) per share, in the third quarter of last year. The net loss was a result of a third quarter 2007 foreign exchange loss of $255,000 and $592,000 year to date caused by an increase in the value of the Canadian dollar. Excluding the foreign exchange loss, the Company had a net profit of $87,000, or $(0.00) per share.

For the first nine months ended September 30, 2007, revenues were $9,157,000, compared to $8,383,000 reported in the previous year. The increase in revenues is principally attributable to strong third quarter revenue across all product lines and the successful introduction of the Company’s OperationalVideo™ solution using SmartTrack™ to deliver real-time images over the internet to help retailers control safety and security as well as remote viewing of store operations, merchandising, signage, displays, pricing and employee procedure compliance. Sentry had a net loss of $1,790,000, or $(0.01) per diluted share, in the first nine months of 2007 compared to a net loss of $2,011,000, or $(0.02) per diluted share, in the first nine months of 2006.

“We are very pleased with the third quarter revenue increase,” said Peter L. Murdoch, President and CEO of Sentry Technology Corporation. “Except for the foreign exchange adjustment Sentry achieved a net profit. This result is a substantial improvement over previous periods. We anticipate that this is the beginning of a trend that will continue in the fourth quarter and throughout 2008.”

Sentry designs, manufactures, sells and installs a complete line of Closed Circuit Television (CCTV) solutions, Electro-Magnetic (EM) and RFID based Library Management systems including QuickCheck™ patron self-service kiosks. The Company’s products are used by libraries to secure inventory and improve operating efficiency, by retailers to deter shoplifting and internal theft and by industrial and institutional customers to protect assets and people. The CCTV product line features SentryVisionâ, SmartTrack™, a proprietary, patented traveling camera system. OperationalVideo™, a Sentry innovation, uses SmartTrack™ to deliver real-time images over the internet to help retailers control safety and security as well as remote viewing of store operations, merchandising, signage, displays, pricing and employee procedure compliance. For further information, please visit our website 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.

CONSOLIDATED BALANCE SHEETS

(In thousands)

September 30, December 31,

2007 2006

(Unaudited) (Audited)

ASSETS

Current Assets:

Cash and cash equivalents $ 361 $ 360

Short-term investments 200 259

Accounts receivable, less allowance for doubtful

accounts of $199 and $160, respectively 2,662 2,251

Inventory 3,114 3,005

Prepaid expenses and other current assets 805 306

Total current assets 7,142 6,181

PROPERTY AND EQUIPMENT, net 638 609

GOODWILL 1,564 1,564

OTHER ASSETS 302 480

TOTAL ASSETS $ 9,646 $ 8,834

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

Current Liabilities:

Bank indebtedness, demand loan and revolving line of credit $ 3,796 $ 3,030

Accounts payable 1,289 609

Accrued liabilities 1,478 1,078

Obligations under capital leases - current portion 2 3

Deferred income 183 185

Total current liabilities 6,748 4,905

OBLIGATIONS UNDER CAPITAL LEASES -

less current portion 8 8

DEFERRED TAX LIABILITY 106 91

CONVERTIBLE DEBENTURE 1,976 1,945

Total liabilities 8,838 6,949

MINORITY INTEREST 1,199 1,237

STOCKHOLDERS’ (DEFICIT) EQUITY (391) 648

TOTAL LIABILITIES AND STOCKHOLDERS’

(DEFICIT) EQUITY $ 9,646 $ 8,834

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Three Months Ended Nine Months Ended

September 30, September 30,

2007 2006 2007 2006

(Unaudited) (Unaudited)

REVENUES

Sales $ 3,222 $ 2,252 $ 7,542 $ 7,042

Service, installation and other revenues 839 491 1,615 1,341

4,061 2,743 9,157 8,383

COST OF SALES AND EXPENSES:

Cost of sales 1,799 1,217 4,175 3,775

Customer service expenses 692 520 1,632 1,601

Selling, general and administrative expenses 1,403 1,287 3,995 3,964

Research and development 165 210 556 614

4,059 3,234 10,358 9,954

OPERATING INCOME (LOSS) 2 (491) (1,201) (1,571)

INTEREST AND FINANCING EXPENSE, net 221 141 627 309

LOSS BEFORE INCOME TAXES AND

MINORITY INTEREST (219) (632) (1,828) (1,880)

INCOME TAX (RECOVERY) EXPENSE (7) 30 --- 70

LOSS BEFORE MINORITY INTEREST (212) (662) (1,828) (1,950)

MINORITY INTEREST 44 (21) 38 (61)

NET LOSS $ (168) $ (683) $ (1,790) $ (2,011)

LOSS PER SHARE

Basic and diluted $ (0.00) $ (0.01) $ (0.01) $ (0.02)

WEIGHTED AVERAGE NUMBER OF

COMMON SHARES OUTSTANDING

Basic and diluted 120,744 120,744 120,744 120,707