CyberGuard Announces Second Quarter Fiscal Year 2004 Results.Business Editors/High-Tech Writers FORT LAUDERDALE Fort Lauderdale (lô`dərdāl), residential, commercial, and resort city (1990 pop. 149,377), seat of Broward co., SE Fla., on the Atlantic coast; settled around a fort built (c.1837) in the Seminole War, inc. 1911. , Fla.--(BUSINESS WIRE)--Jan. 27, 2004 $11.236 Million Revenues Rise 36 Percent over Same Quarter Last Year; Company Reports Net Income of $2.344 Million and $.08 Earnings per Diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. Share CyberGuard Corporation (Nasdaq:CGFW), the technology leader in network security, today reported revenues of $11.236 million for the quarter ended December December: see month. 31, 2003. That is an increase of $3.003 million or 36 percent over revenues of $8.233 million for the second quarter of fiscal year 2003 and represents the highest quarterly revenues in company history. For the first six months of fiscal year 2004, revenues were $20.256 million, an increase of $4.923 million or 32 percent over revenues of $15.333 million for the first six months of fiscal year 2003. Net income for the second quarter was $2.344 million or $0.08 per diluted share compared to $1.508 million or $0.06 per diluted share for the same quarter of the previous fiscal year, a 55 percent increase in net income. Excluding a non-cash stock based compensation expense of $274,000 resulting from the SnapGear acquisition, earnings per diluted share would have been $0.09. For the first six months of fiscal year 2004, net income totaled $3.504 million compared to net income of $2.440 million for the first six months of fiscal year 2003. Earnings per diluted share for the first six months of fiscal year 2004 were $0.12 compared to earnings per diluted share of $0.10 for the first six months of fiscal year 2003. "The second quarter was excellent for CyberGuard," stated Pat Clawson Clawson, city (1990 pop. 13,874), Oakland co., SE Mich., a residential suburb between Pontiac and Detroit; settled c.1833, inc. 1920. , chairman and chief executive officer. "We completed the acquisition of SnapGear in late November November: see month. and have made rapid progress in integrating sales and operations. Customers and business partners alike are pleased that they can now turn to CyberGuard for a broad-based broad-based Of or relating to an index or average that provides a good representation of the overall market. The S&P 500 and NYSE Composite are generally regarded as broad-based stock indexes, while the popular Dow Jones Industrial Average is biased security solution and full core-to-edge protection. We have introduced new advanced intrusion prevention See IPS and IDS. features for both the super enterprise and small-to-medium enterprise environments. We posted record revenue and profit; and this is the sixth consecutive quarter of revenue growth over the immediately preceding quarter." Clawson said that CyberGuard's growth signaled that it is becoming a true worldwide information security provider. He added that the company is committed to continuing to meet the information security requirements of customers worldwide by incorporating even more technologies, and that the company would be doing that through both partnerships and acquisition. Some of the significant events since the start of the second quarter include: -- October October: see month. 2 - CyberGuard expands presence in Asia-Pacific The term Asia-Pacific generally applies to littoral East Asia, Southeast Asia and Australasia near the Pacific Ocean, plus the states in the ocean itself (Oceania). market, signs distribution agreement with key Japanese Japanese (jăp'ənēz`), language of uncertain origin that is spoken by more than 125 million people, most of whom live in Japan. There are also many speakers of Japanese in the Ryukyu Islands, Korea, Taiwan, parts of the United States, and partner, Canon canon, in music canon, in music, a type of counterpoint employing the strictest form of imitation. All the voices of a canon have the same melody, beginning at different times. Successive entrances may be at the same or at different pitches. System Solutions. -- October 15 - Large government integrated communications and computer network in Asia selects CyberGuard firewall/VPN appliances and announces that they will deploy them over two-year period. -- November 5 - CyberGuard continues expansion in Asia-Pacific when it signs regional distributor agreement with eGlobal International. -- November 13 - CyberGuard announces that it will acquire SnapGear, extending its product line to the edge of enterprise and adding embedded Linux The Linux operating system configured and enhanced to work in a wide variety of applications, including handheld devices, network appliances, industrial machines and consumer electronics devices. The modularity of the Linux kernel makes it well suited to embedded systems. security technology. -- November 26 - CyberGuard completes acquisition of SnapGear. -- December 4 - CyberGuard's line of firewall/VPN appliances achieves Challenger status in METAspectrum(SM)ranking. -- December 9 - Company begins worldwide shipping of Global Command Center(TM), its next generation central management product, which enables companies to manage hundreds of firewalls and VPNs securely from a central location. -- December 17 - CyberGuard appliances achieve top rankings from third-party Miercom lab. -- January January: see month. 8 - CyberGuard introduces new advanced intrusion Unauthorized access to a computer system or network. See intruder and IDS. prevention features that enable security professionals to create security policies based on deep inspection of HTTP-based applications, streaming media See streaming audio, streaming video and digital media hub. , VoIP, and applications that employ SOAP and XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. . -- January 12 - NetOctave division enhances interoperability The capability of two or more hardware devices or two or more software routines to work harmoniously together. For example, in an Ethernet network, display adapters, hubs, switches and routers from different vendors must conform to the Ethernet standard and interoperate with each other. , adds support for new IPsec (IP SECurity) A security protocol from the IETF that provides authentication and encryption over the Internet. Unlike SSL, which provides services at layer 4 and secures two applications, IPsec works at layer 3 and secures everything in the network. stack which enables engineers to significantly reduce the development time and costs for producing feature-rich VPN (Virtual Private Network) A private network that is configured within a public network (a carrier's network or the Internet) in order to take advantage of the economies of scale and management facilities of large networks. server products. -- January 13 - Toshiba Toshiba Corporation (株式会社東芝 Kabushiki-gaisha Tōshiba America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. Medical Systems chooses cutting-edge VPN concentrator from SnapGear by CyberGuard(TM) to deploy VPN tunnels The following are lists of tunnels:
Vehicle diagnostics enables a mechanic to diagnose the exact mechanical condition of the vehicle and its systems and components. Remote Diagnostics enables to perform such diagnosis without requiring the vehicle to physically be present for checkup. and maintenance within HIPAA-sensitive healthcare networks. -- January 14 - SnapGear by CyberGuard announces major upgrade to its VPN/firewall appliance A stand-alone hardware device or software environment dedicated to a specific task. See hardware appliance and software appliance. SME (1) (Small and Medium-sized Enterprise) See SMB. (2) (Subject Matter Expert) An individual who is well-versed in the policies and procedures of a particular department or division. 575 with addition of intrusion detection system. -- January 20 - SnapGear by CyberGuard launches embedded Inserted into. See embedded system. firewall network card for distributed security control. Included in the company's earnings for the quarter ended December 31, 2003, is a charge of $274,000 related to stock-based compensation expense associated with the acquisition of SnapGear at the end of November. This is due to the accounting treatment required when continued employment is linked with the release of shares from escrow escrow Instrument, such as a deed, money, or property, that constitutes evidence of obligations between two or more parties and is held by a third party. It is delivered by the third party only upon fulfillment of some condition. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the original purchase price. While the economics of the transaction remain the same, the required accounting for this portion of the purchase price will be as compensation rather than as goodwill. The compensation expense was to be initially amortized over the 24 months of the required employment period. However, the company has subsequently elected e·lect v. e·lect·ed, e·lect·ing, e·lects v.tr. 1. To select by vote for an office or for membership. 2. To pick out; select: elect an art course. to remove the employee requirement from the restricted stock agreement and just retain the release of stock from escrow over the next two years. In Q3 of fiscal year 04, the company will take a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of $4,113,000 representing the part of the original $16 million purchase price being expensed. The company felt that it would be more beneficial to remove the employee link and expense the amount as a one-time charge as opposed op·pose v. op·posed, op·pos·ing, op·pos·es v.tr. 1. To be in contention or conflict with: oppose the enemy force. 2. to having a recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. non-cash charge for 24 months requiring an explanation in each quarter. Conference Call Information CyberGuard will hold a conference call to review its fiscal year 2004 second quarter financial results on Tuesday Tuesday: see week. , January 27, at 10:00 a.m. Eastern Time (7:00 a.m. Pacific Time). Participants should dial 1-706-645-9750 and ask for conference ID number 4811672. A recording of the conference call proceedings will be available from two hours after the call's conclusion on January 27 until midnight Eastern Time on Feb 2, 2004. Both U.S. and international callers may listen to the recording by dialing 1-706-645-9291 and requesting conference ID number 4811672. Additional financial information can be found at http://www.cyberguard.com/investors/reports.cfm. About CyberGuard Corporation CyberGuard Corporation (Nasdaq:CGFW), the technology leader in network security, provides advanced intrusion prevention solutions that protect the critical information assets of Global 2000 companies and governments worldwide. CyberGuard offers a broad line of scalable high performance firewall/VPN appliances, sophisticated security processors and accelerator accelerator: see particle accelerator. (1) A key combination such as Alt-G or Ctrl-Shift H that is used to activate a task. (2) An incubator that expects to develop the company considerably faster than normal. See incubator. products for the SSL (Secure Sockets Layer) The leading security protocol on the Internet. Developed by Netscape, SSL is widely used to do two things: to validate the identity of a Web site and to create an encrypted connection for sending credit card and other personal data. and IPsec markets, and industry-leading embedded Linux and Linux Linux Nonproprietary operating system (OS) for digital computers. In 1991 Linus Torvalds of Finland began asking for volunteer programmers over the Internet to collaborate on the development of a UNIX-like OS for personal computers; the “1. security solutions. Headquartered in Ft. Lauderdale Lauderdale is the name of various places:
Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and , the company has branch offices and training centers around the world. More information about CyberGuard Corporation can be found at http://www.cyberguard.com. 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. Statements regarding estimates, expectations and future prospects contained in this press release are forward-looking statements. These statements are based upon assumptions and analyses made by the Company in light of current conditions, future developments, and other factors the Company believes are appropriate in the circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or , or information obtained from third parties, and are subject to a number of assumptions, risks and uncertainties. Readers are cautioned that forward-looking statements are not guarantees and that actual results might differ materially from those suggested in the forward-looking statements. Some of the factors that might cause future actual events to differ from those predicted or assumed include: future advances in technologies and computer security; the Company's history of losses; the Company's ability to execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution on its business plans; recent changes in management; risks associated with the recent acquisition; the Company's dependence on outside parties such as its key customers and alliance partners; competition from major computer hardware, software, and networking companies; uncertainties in availability of expansion capital in the future and other risks associated with capital markets; overall network security spending; global economic conditions; and the outcome of a class action lawsuit class action lawsuit A lawsuit in which one party or a limited number of parties sue on behalf of a larger group to which the parties belong. For example, investors may bring a class action lawsuit against a brokerage firm that has actively promoted a tax against the Company. For a more complete discussion regarding forward-looking statements, the reader is referred to the Company's periodic reports filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934, including the Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended June June: see month. 30, 2003, and other information filed with the Commission. CyberGuard(R) and SnapGear(R) are registered trademarks of CyberGuard Corporation and SnapGear by CyberGuard(TM) is a trademark of CyberGuard Corporation. All other trademarks are property of their respective owners.
CYBERGUARD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Amounts in thousands, except per share data)
Three Months Ended Six Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2003 2002 2003 2002
---- ---- ---- ----
Revenues
Products 8,211 5,795 14,384 10,668
Services 3,025 2,438 5,872 4,665
---------------------------------------
Total revenues 11,236 8,233 20,256 15,333
---------------------------------------
Cost of revenues
Products 2,361 1,398 3,980 2,622
Services 933 721 1,769 1,273
--------------------------------------
Total cost of revenues 3,294 2,119 5,749 3,895
--------------------------------------
Gross profit 7,942 6,114 14,507 11,438
--------------------------------------
Operating expenses
Research and development 1,563 1,207 3,395 2,254
Selling, general and
administrative 4,797 3,543 8,695 6,865
--------------------------------------
Total operating expenses 6,360 4,750 12,090 9,119
--------------------------------------
Operating income 1,583 1,364 2,417 2,319
--------------------------------------
Other income
Interest income, net 35 25 68 54
Gain/(loss) on sale of assets 0 3 - (33)
Other income 127 116 152 100
--------------------------------------
Total other income 162 144 220 121
--------------------------------------
Income before income taxes 1,745 1,508 2,637 2,440
--------------------------------------
Income tax benefit 599 - 867 -
--------------------------------------
Net income 2,344 1,508 3,504 2,440
======================================
Basic earnings per
common share $0.11 $0.08 $0.16 $0.13
======================================
Weighted average number of
common shares outstanding 22,239 19,475 21,776 19,328
======================================
Diluted earnings per
common share $0.08 $0.06 $0.12 $0.10
======================================
Weighted average number
of common shares
outstanding 29,357 24,316 28,901 23,479
======================================
CYBERGUARD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Amounts in thousands)
December 31, June 30,
2003 2003
---- ----
ASSETS
Cash and cash equivalents $14,202 $12,095
Restricted cash 521 379
Accounts receivable, less allowance for
uncollectible accounts
of $227 at Dec 31, 2003, and $707 at
June 30, 2003 7,656 7,608
Inventories, net 2,512 359
Other current assets 948 967
Receivable from insurance company - 6,500
--------------------
Total current assets 25,839 27,908
Property and equipment at cost, less
accumulated depreciation of $4,046
at Dec 31, 2003 and $3,373 at
June 30, 2003 1,471 1,762
Capitalized software, less accumulated
amortization of $2,087 at Dec 31, 2003
and $1,988 at June 30, 2003 566 158
Intangibles, less accumulated amortization of
$739 at Dec 31, 2003 and $304 at June 30, 2003 3,364 799
Other assets 165 283
Goodwill 6,780 -
Deferred tax asset, net 5,116 4,249
--------------------
Total assets $43,301 $35,159
====================
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable 1,801 1,215
Deferred revenue 6,219 5,697
Litigation payable - 10,400
Accrued expenses and other liabilities 4,605 3,176
--------------------
Total liabilities $12,625 $20,488
--------------------
Commitments and Contingencies - -
Shareholders' equity
Preferred stock par value $0.01; authorized
5,000 shares; none issued - -
Common stock par value $0.01; authorized 50,000
shares; issued and outstanding 22,953 at
Dec 31, 2003 and 20,953 at June 30, 2003 230 210
Additional paid-in capital 111,522 94,924
Accumulated deficit (77,038) (80,542)
Unearned restricted stock compensation (4,113) -
Accumulated other comprehensive income 75 79
--------------------
Total shareholders' equity 30,676 14,671
--------------------
Total liabilities and
shareholders' equity $43,301 $35,159
====================
CYBERGUARD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Amounts in thousands)
Six Months Ended
Dec. 31, Dec. 31,
2003 2002
---- ----
Cash flows from operating activities
Net income $3,504 $2,440
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation 673 476
Amortization 535 152
Amortization of unearned restricted stock
compensation 274 -
Loss on disposal of property & equipment - 33
Deferred tax benefit (867) -
Provision for uncollectible accounts receivable 31 328
Compensation expense related to stock options 10 70
Non cash expense for company 401(k) match 217 123
Changes in assets and liabilities
(excluding the effect of acquisition)
Decrease in restricted cash (40) (31)
Increase in accounts receivable (41) (1,663)
Decrease/(Increase) in other current assets 19 (374)
Increase in inventories (49) (320)
Decrease in other, net 118 14
(Decrease)/Increase in accounts payable (635) 110
Increase in accrued expenses and other liabilities 760 196
Increase in deferred revenue 15 726
Decrease in litigation receivable 6,500 -
Decrease in litigation payable (10,400) -
-------------------
Net cash provided by operating activities 624 2,280
-------------------
Cash flows used in investing activities
Acquisition of SnapGear, net of cash acquired 85 -
Capitalized software costs (507) (179)
Purchase of property & equipment (259) (20)
-------------------
Net cash used in investing activities (681) (199)
-------------------
Cash flows provided by financing activities
Repayment of notes payable - (44)
Proceeds from stock options exercised 2,104 766
Proceeds from sale of common stock in
stock purchase plan 64 36
-------------------
Net cash provided by financing activities 2,168 758
-------------------
Translation adjustment (4) (74)
Net increase in cash 2,107 2,765
Cash and cash equivalents at beginning of period 12,095 6,166
-------------------
Cash and cash equivalents at end of period $14,202 $8,931
===================
Supplemental disclosure of cash flow information
Cash paid for interest $ - $ 3
===================
Cash paid for income taxes $ - $ -
===================
Supplemental disclosure of non-cash information
During fiscal year 2002, the Company's CEO, Scott Hammack,
participated in a special option program which required the Company to
record compensation expense of $60.
Approximately 310 options to purchase shares of the Company's
common stock were issued at a below market price, which required the
Company to record approximately $10 in compensation expense during
fiscal year 2003 and 2002. In connection with the acquisition of
SnapGear, 1,651 shares valued at $14,222 were issued and a contingent
purchase consideration of $800 was accrued for during the quarter
ended December 31, 2003.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion