Rainbow Technologies Announces Q1 1999 Results.IRVINE Irvine, town, Scotland Irvine (ûr`vĭn), town (1991 pop. 32,507), North Ayrshire, SW Scotland, on the Irvine River estuary. Industries include iron and brass foundries. Other products are chemicals, electric goods, and clothing. , Calif.--(BUSINESS WIRE)--April 20, 1999-- Rainbow Technologies Inc. (Nasdaq:RNBO), the leading provider of cryptographic cryp·tog·ra·phy n. 1. The process or skill of communicating in or deciphering secret writings or ciphers. 2. Secret writing. cryp technology for digital rights, Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the , satellite and telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. security, Tuesday Tuesday: see week. announced that first-quarter revenues increased 4% to $26,086,000. Net income for the quarter increased by $1,904,000 to $1,285,000 from a net loss of $619,000 in the quarter ended March 31, 1998. Earnings per share for the quarter ended March 31, 1999, were $0.10, compared with a loss of $0.05 in the corresponding 1998 quarter. "First-quarter 1999 software protection revenues increased 1% to $14,275,000. Our overall business continued to be impacted by the economic problems in Asia and other emerging markets, as well as the strong dollar vs. foreign currency," said Patrick Fevery Fe´ver`y a. 1. Feverish. , chief financial officer. "Our information security business revenues, which include satellite and telecommunications products increased 2% to $11,049,000, primarily due to increased demand for network security products and commercial satellite products. Profitability of the segment was seriously impacted by a reduction in government-funded development programs. "The government is increasingly buying commercially developed products resulting in the company having to use its own funds to finance research and development. In addition, commercial application of this business segment continues to grow, resulting in the company incurring in·cur tr.v. in·curred, in·cur·ring, in·curs 1. To acquire or come into (something usually undesirable); sustain: incurred substantial losses during the stock market crash. 2. related research and development expenses," continued Fevery. "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. product revenues for the quarter increased by $687,000 to $735,000. The significant increase in first-quarter sales of Internet Security Products is a result of wider end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. acceptance of the products." The company continues to invest significantly in its family of Internet solution products. Recently, the company announced the iKey family of cryptographic tokens, providing end-user client 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. to VPNs and enabling operator access to secured network equipment such as routers, switches or firewalls. The statements made in this news release could be forward- looking statements based on expectations that involve a number of risks and uncertainties. The factors that could cause actual results to differ materially include the following: economic conditions and growth in the personal computer hardware and software industry; competitive factors and pricing pressures; changes in product mix; the timely development and acceptance of new products; changes in government procurement Government procurement, also called public tendering, is the procurement of goods and services on behalf of a public authority, such as a government agency. With 10 to 15% of GDP in developed countries, and up to 20% in developing countries, government procurement accounts ; and the risks described from time to time in the company's SEC reports, which include the Annual Report on 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. . -0-
RAINBOW TECHNOLOGIES INC.
Financial Highlights
Three Months Ended
March 31, 1999 March 31, 1998
(unaudited) (unaudited)
Net revenues $26,086,000 $25,030,000
Net income (loss) $ 1,285,000 $ (619,000)
Net income (loss) per share
Basic $ 0.11 $ (0.05)
Diluted $ 0.10 $ (0.05)
Shares used in computing net
income (loss) per share:
Basic 11,804,000 11,650,000
Diluted 12,628,000 11,650,000
FINANCIAL INFORMATION BY BUSINESS SEGMENT
Three Months Ended
March 31, 1999 March 31, 1998
(unaudited) (unaudited)
Revenues
Software Protection $14,275,000 $14,171,000
Information Security 11,049,000 10,801,000
Internet Security 735,000 48,000
QMT 27,000 10,000
Consolidated $26,086,000 $25,030,000
Operating Income
Software Protection $ 2,665,000 $ 3,314,000
Information Security 571,000 2,141,000
Internet Security (1,262,000) (1,564,000)
QMT (422,000) (288,000)
Non-recurring expenses -- (1,500,000)
Consolidated $ 1,552,000 $ 2,103,000
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