Aladdin Announces Third Quarter and Nine Months 2000 Financial Results.Business & High Tech Editors NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of & TEL AVIV Tel Aviv (tĕl əvēv`), city (1994 pop. 355,200), W central Israel, on the Mediterranean Sea. Oficially named Tel Aviv–Jaffa, it is Israel's commercial, financial, communications, and cultural center and the core of its largest , Israel--(BUSINESS WIRE)--Nov. 1, 2000 Aladdin Knowledge Systems Aladdin Knowledge Systems NASDAQ: ALDN is a company that provides solutions for software digital rights management and Internet security since 1985. Its corporate headquarters are located in Tel Aviv, Israel. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ALDN), a global leader in the field of Internet content and software security, today reported financial results for the third quarter ended September 30, 2000. Revenues for the third quarter were $10.1 million, compared with revenues of $11 million for the third quarter of 1999. Net loss for the third quarter was $(876,000), or $(0.08) per basic share, ($0.07 diluted), based on 11,460,000 basic and 11,713,000 diluted shares outstanding, compared with net income of $4.1 million, or $0.36 per basic and diluted shares for the quarter ended September 30, 1999. For the nine months ended September 30, 2000, sales were $32.6 million, compared with $32.3 million for the same period last year. For the nine months net income was $1.3 million, or $0.11 per basic and diluted shares, based on 11,439,000 basic and 11,804,000 diluted shares outstanding, compared with net income of $5.5 million, or $0.49 per basic share ($0.48 diluted). In announcing the results, Erez Rosen, Aladdin's Chief Financial Officer, said, "As we announced earlier, our loss was primarily attributable to a decline in HASP/Hardlock product sales in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , as well as the unfavorable conversion of the Euro to dollars. However, we are pleased that the loss was less than anticipated." "We are now focused on increasing sales of HASP/Hardlock, eToken, eSafe and Privilege," Mr. Rosen added. "We are starting to see a growth in the sales of HASP/Hardlock in North America. It is our belief that sales opportunities will continue to increase for these products in the coming quarters, overcoming any challenge." Company Highlights: eSafe -- This quarter saw the launch of eSafe Gateway 3.0, the first comprehensive proactive solution that protects corporate networks against known and unknown threats. This successful release accompanied more big-name customers throughout the world. In early October Aladdin announced that a major Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. services portal, esdlife.com, used eSafe to protect the portal's infrastructure. eToken -- Also earlier in October, Aladdin released the beta version A pre-shipping release of hardware or software that has gone through alpha test. A beta version of software is supposed to be very close to the final product, but, in practice, it is more a way of getting users to test the software in the first place under real conditions. of eToken Enterprise, a plug-and-play USB-based hardware device that provides two-factor authentication The use of two independent mechanisms for authentication; for example, requiring a smart card and a password. The combination is less likely to allow abuse than either component alone. See authentication. , email singing and encryption The reversible transformation of data from the original (the plaintext) to a difficult-to-interpret format (the ciphertext) as a mechanism for protecting its confidentiality, integrity and sometimes its authenticity. Encryption uses an encryption algorithm and one or more encryption keys. capabilities. As the first out-of-the-box solution for securing corporate networks, e-commerce and e-banking, eToken Enterprise is starting to experience an strong beta cycle alongside eToken R2. In addition, the eToken Technology Partnership Program grew with the addition of Miel e-Security, an India-based e-security firm, NTRU NTRU Native Title Research Unit (AIATSIS) NTRU Number Theorists R Us NTRU N-Th Degree Truncated Polynomial Ring Cryptosystems, a US-based provider of secure wireless communication, Gecko gecko (gĕk`ō), small or medium-sized lizard of the family Gekkonidae. The more than 300 species are distributed throughout the warm regions of the world, mostly in the Old World. Despite folklore to the contrary, their bite is not poisonous. Internet, a leading UK-based hosting and web-design solutions company, and Digital Signature Trust, the first licensed Certification Authority See CA. in the US. About Aladdin Aladdin (NASDAQ: ALDN) is a global leader in securing digital content, from applications software to Internet use and access. Aladdin's products include: HASP (Houston Automatic Spooling Program) A mainframe spooling program that provides task, job and data management functions. HASP - Houston Automatic Spooling Program and Hardlock, software security systems that protect the revenues of developers and publishers; Privilege, a software licensing platform for the Internet; the eSafe line of anti-vandal, anti-virus and content filtering See Web filtering and parental control software. software for PCs and networks connected to the Internet; and eToken, for Internet security ''This article or section is being rewritten at Internet security is the process of protecting data and privacy of devices connected to internet from information robbery, hacking, malware infection and unwanted software. and authentication (1) Verifying the integrity of a transmitted message. See message integrity, e-mail authentication and MAC. (2) Verifying the identity of a user logging into a network. . Aladdin serves its customers through eight offices located in the world's major software markets, as well as through a network of 50 distributors serving more than 100 countries. Forward Looking Statement Except for the statements of historical fact, the information presented herein constitutes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the loss of market share, changes in consumer buying habits and other factors over which Aladdin Knowledge Systems Ltd. has little or no control.
Aladdin Knowledge Systems Ltd.
Summary of unaudited results (U.S. dollars, in thousands - except
for per-share amount)
Three months period ended Nine months ended
September 30 September 30
2000 1999 2000 1999
Sales 10,135 11,052 32,562 32,333
Cost of sales 2,650 2,368 7,790 6,978
Gross profit 7,485 8,684 24,772 25,355
Research & development 2,458 1,840 7,324 5,148
Selling & marketing 4,970 4,568 14,942 12,759
General & administrative 1,344 1,469 3,578 4,067
Write off of Intangible
assets 661 562 1,875 1,678
9,433 8,439 27,719 23,652
Operating income (loss) (1,948) 245 (2,947) 1,703
Financial income, net 387 465 852 994
Other income 850 5,967 5,419 6,088
Income (loss) before
taxes (711) 6,677 3,324 8,785
Taxes on income 114 2,456 1,852 3,028
(825) 4,221 1,472 5,757
Equity in loss of
affiliate, net of taxes 51 103 209 230
Net income (loss) (876) 4,118 1,263 5,527
Basic earning (loss)
per share (0.08) 0.36 0.11 0.49
Diluted earnings (loss)
per share (0.07) 0.36 0.11 0.48
Weighted average number
of shares outstanding
for Basic EPS 11,460 11,364 11,439 11,303
Weighted average number
of shares outstanding
for Diluted EPS 11,713 11,469 11,804 11,470
Aladdin Knowledge Systems Ltd.
Balance Sheets
(U.S. dollars, in thousands)
September 30, 2000 December 31, 1999
Assets
Current assets:
Cash & cash equivalents 14,999 30,349
Short term bank deposit 500 -
Marketable securities 13,008 8,387
Other accounts receivable 12,236 10,028
Inventories 5,971 5,083
46,714 53,848
Fixed assets, net 4,995 4,990
Other long term assets, net 20,227 22,879
71,936 81,717
Current liabilities:
Other current liabilities 12,602 19,034
Accrued severance pay 1,597 1,623
Shareholders Equity 57,737 61,060
71,936 81,717
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