CyberGuard Corporation Reports Third Quarter Results.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)--May 5, 1997--CyberGuard Corporation (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 :CYBG), a leading provider of network security and electronic commerce solutions, today announced financial results for the third fiscal quarter of 1997 ended March 31, 1997. Revenue of firewall related products for the quarter was a record $4.1 million, an increase of 37 percent over second quarter revenue of $3.0 million. Revenue for the quarter increased 64 percent over revenue of $2.5 million for the same period of fiscal 1996. "We are very pleased with this quarter's results. We achieved record revenue, significantly expanded U.S. distribution channels and improved gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. . Our strong growth this quarter validates our business plan," noted Robert L. Carberry, chairman, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of CyberGuard Corporation. For the three months ended March 31, 1997, the Company reported a net loss of $0.89 million, or ($0.12) per share compared to a $1.81 million loss, or ($0.31) per share for the quarter ended March 30, 1996. Results for the three months ended March 31, 1997 include a one-time gain of $0.8 million or $0.11 per share from the sale of Securities held for resale. The results for the March 31, 1997 quarter exclude the operations of CyberGuard's TradeWave electronic commerce company which began operations on April 10, 1997 following completion of the purchase of the related business assets from SunRiver Corporation on April 9, 1997. CyberGuard Firewall unit shipments for the quarter increased 44 percent compared to the previous quarter, and 171 percent compared to the quarter ended March 30, 1996. This represents the seventh consecutive quarter of increased unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. for the Company's firewall and related products. For the quarter ended March 31, 1997, approximately 75 percent of the units shipped were Release 3 for industry-standard Intel Pentium and Pentium-Pro servers from IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) , Compaq, Hewlett Packard and Unisys. For the quarter, the Company also reported improved sequential gross margins as a result of increased shipments of the CyberGuard Firewall Release 3 software. Specifically, gross margin percentage increased to 55 percent for the three months ended March 31, 1997 compared to 51 percent for the previous quarter ended December 31, 1996, and 39 percent for the quarter ended September 30, 1996. "The CyberGuard Firewall Release 3 product has garnered seven awards in independent lab testing over the past several months. These awards, combined with continued customer acceptance, shows the CyberGuard Firewall delivers the best network security, ease-of-use and performance in the marketplace. In addition, the purchase of TradeWave, our new electronic commerce company, allows CyberGuard to become a one-stop supplier of all the elements needed for complete enterprise network - firewalls, 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. , 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. and services," Carberry added. Highlights for the quarter include: --CyberGuard Firewall Release 3 introduced in September 1996 received numerous accolades from leading industry publications including: - Editor's Choice Award, Network Computing Storing and/or running applications in servers in a network. See cloud computing and network computer. Magazine - Well Connected Award Nominee, Network Computing Magazine - Max Award Communications Week Magazine - Tester's Choice Award, Data Communications data communications, application of telecommunications technology to the problem of transmitting data, especially to, from, or between computers. In popular usage, it is said that data communications make it possible for one computer to "talk" with another. Magazine - National Software Testing Software testing is the process used to measure the quality of developed computer software. Usually, quality is constrained to such topics as correctness, completeness, security, but can also include more technical requirements as described under the ISO standard ISO 9126, such Laboratory 5-Star Rating, March 1997 Software Digest Report - Editor's Choice Award Secure Computing Magazine Secure Computing Magazine is a computer magazine emphasising security. (U.K.) - Government Best Buy Award Federal Computer Week Magazine --CyberGuard announced the availability of a CyberGuard Firewall NT product in the third calendar quarter. The CyberGuard Firewall NT product will deploy a unique NT Security Shield which will address security issues in Microsoft's Windows NT (Windows New Technology) A 32-bit operating system from Microsoft for Intel x86 CPUs. NT is the core technology in Windows 2000 and Windows XP (see Windows). Available in separate client and server versions, it includes built-in networking and preemptive multitasking. operating system operating system (OS) Software that controls the operation of a computer, directs the input and output of data, keeps track of files, and controls the processing of computer programs. . --Over 20 resellers joined the CyberGuard Security Alliance Partner Program during the quarter. CyberGuard now has approximately 30 resellers representing 175 U.S. locations that cover approximately 90% of the Company's targeted vertical markets. --CyberGuard received the ITSEC See NCSC. E3 certification in March, making CyberGuard Firewall the product of choice for sensitive government and military applications in the U.K., Germany and Australia. --The appointment of David Proctor David William Proctor (born May 4, 1984 in Bellshill, North Lanarkshire) is a Scottish footballer who plays as a right-back or right midfielder for Scottish Premier League club Inverness Caledonian Thistle. to CyberGuard's Board of Directors. The 30-year software industry veteran will also consult to CyberGuard, assisting with strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. and operations. About CyberGuard CyberGuard Corporation (NASDAQ:CYBG) is a leading Intranet and 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. solutions provider to Fortune 1000 companies and governments worldwide. CyberGuard's award-winning, industrial-strength firewall and security products protect the integrity of data and applications from hackers and digital thieves. CyberGuard's subsidiary, TradeWave, provides certificate authority products and services to safeguard electronic-commerce applications. CyberGuard products have been certified See certification. by the U.S. National Computer Security Center, the National Computer Security Association and the European Information Technology Security Evaluation Criteria. The company has U.S. headquarters in Ft. Lauderdale, Florida and branch offices worldwide. More information on CyberGuard products and services is available through an E-mail request to info@mail.cybg.com and from CyberGuard's web site at http://www.cyberguardcorp.com . Statements in this release concerning CyberGuard's future prospects are "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. " under the Federal securities laws. There can be no assurance that future results will be achieved, and actual results could differ materially from forecasts, estimates, and summary information contained in this press release. Important factors that could cause actual results to differ materially include, but are not limited to, those listed in CyberGuard's quarterly reports on Form 10-Q Form 10-Q See 10-Q. and CyberGuard's 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 year ended June 30, 1996, as filed with Securities and Exchange Commission on September 30, 1996. -0-
CYBERGUARD CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
($000's except per share data)
Three Months Ended Nine Months Ended
3/31/97 3/30/96 3/31/97 3/30/96
Revenues:
Firewall Products $ 3,874 $ 2,432 $9,585 $ 5,007
Firewall Services $ 231 $ 138 $ 634 $ 285
Real Time Product
Revenues - 10,544 - 28,979
Total Revenues 4,105 13,114 10,219 34,271
Cost of Revenues:
Firewall Products 1,727 1,739 4,924 3,458
Firewall Services 143 56 328 124
Real Time Product
Revenues 5,123 14,903
Total Cost of Revenues 1,870 6,918 5,252 18,485
Gross Margin 2,235 6,196 4,967 15,786
PERCENT OF SALES 54.45% 47.25% 48.61% 46.06%
Operating Expenses:
Research & Development 1,028 271 3,095 828
Selling, General
& Administrative 2,847 1,728 7,743 4,615
Transaction expense 820 820
Real Time Related 5,258 18,581
3,875 8,077 10,838 24,844
Operating Loss (1,640) (1,881) (5,871) (9,058)
Other Income & (Expense) 748 71 (4,100) 480
Net Loss ($892) ($1,810) $ (9,971) ($8,578)
Loss per Common Share ($0.12) $(0.31) ($1.40) ($1.45)
Weighted Average Number
of Shares 7,375,293 5,929,000 7,105,576 5,924,287
SELECTED BALANCE SHEET DATA
(Numbers in $000)
Mar. 31, 1997 Mar. 30, 1996
Cash $6,434 $1,307
Securities Held For Resale 1,320 -
Accounts Receivable, net 4,856 15,335
Inventory 1,444 6,381
Other Current Assets 677 660
Total Current Assets 14,731 23,683
Property and Equipment, net 1,570 5,912
Other Assets 1,113 8,957
Total Assets $17,414 $38,552
Current Liabilities $4,692 $9,412
Deferred revenue 859 -
Total Liabilities 5,551 9,412
Total Shareholders' Equity 11,863 29,140
Total Liabilities and
Shareholders' Equity $17,414 $38,552
-0- NOTE TO EDITORS: In the Internet/email address noted in this news release, there is an "at" symbol between info and mail.cyb.com. In the World Wide Web address noted in this news release, there is a double slash between http: and www.cyberguardcorp.com. These symbols may not appear properly in some systems. CyberGuard Firewall is a trademark of CyberGuard Corporation. All other trademarks are property of their respective owners. CONTACT: CyberGuard Corporation Lisa Thornhill - Media/Investor Relations 954/977-5615 |
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