Business Editors
CHICAGO--(BUSINESS WIRE)--April 23, 2001
Sonoma Financial Corporation/SHC Corp. (OTCBB: SONM), one of the largest payday advance operations in the greater Chicago area and The Money Market stores in southern Indiana, announced it filed its Form 10 KSB for the fiscal 2000 year on April 17, 2001 within the allowable filing timetable. In fiscal 2000, Sonoma reported a loss of $3.8 million, compared to a $2.2 million loss recorded in 1999.
Terrence L. Donati, President of Sonoma, stated that, "On the surface, one would say it was a horrendous year. We, however, view the year as a clean-up year with several one-time non-cash expense items as we prepared for the introduction of the new future of growth for Sonoma, i. e., franchising. In 2000, we addressed the over-expansion that took place during the previous two years and have scaled back operations significantly. We now operate 22 stores, 19 in Illinois and three in Indiana. As the franchise program develops in the coming months, those numbers may be reduced further if we determine it is beneficial to include an existing store with a franchised area.
"When examining the year, I want to note two things to our shareholders. First, our gross profit for the year increased 73% over the prior year when there were more stores opened. Our goal in 2001 for the retail business is higher loan volume with the same or fewer outlets. Second, over 40% of the net loss recorded was related to non-cash expenses connected with stock issuances for services, conversion options on new borrowings or write-off of fixed assets at closed stores. Coupled with the incremental costs for professional services to bring Sonoma current with SEC filings, resolve court cases, etc., the loss was much greater than anticipated. For 2001, a significant reduction in expenses should be possible.
"As alluded to above, the franchising program has begun and has been well received. We are eligible to sell franchises in over 30 states. Of these 20 are considered `payday friendly,' which includes Illinois, Wisconsin and Iowa. We are very excited about the opportunities franchising presents and we look forward to issuing future progress reports."
A complete investor package for Sonoma Financial is available at http://www.e-relations.com/vmax.
About Sonoma Financial Corporation:
Sonoma Financial Corporation operates three subsidiaries, two of which focus on consumer lending and one is a collection agency. Payday Check Advance, Inc. and Money Market, Inc. are financial service companies that operate a chain of stores devoted to providing low documentation, short-term consumer loans. Sonoma intends to become the national leader in the "Payday Loan" market by strategic acquisition and penetrating new markets. E-Star Systems, Inc., is an industry specific collection service addressing the needs of the short-term loan industry. Sonoma Financial is currently the only publicly traded company with a sole focus on `payday advances'. Ace (NASDAQ:AACE), First Cash Financial Services (NASDAQ: FCFS) and Pinnacle Business Management (OTCBB: PCBM), have proven the viability of the concept in other markets, but are not specifically focused in this area. American Nortel Communications (OTCBB: ARTM) a shareholder.
