Q2 Trading Update
13 January 2004 - 6:25PM
UK Regulatory
RNS Number:1504U
Surfcontrol PLC
13 January 2004
FOR IMMEDIATE RELEASE
SurfControl plc
Trading Update for the 2nd quarter ended 31 December 2003
London, England (13 January, 2004) - SurfControl plc (London:SRF), the world's
Number One Web and E-mail filtering company, today gave a trading update for the
second quarter ended 31 December 2003.
Q2 Trading Highlights:
- Record Q2 revenue expected to be in the range of $21.0m to $21.2m, a
year-on-year increase of approximately 13% and a sequential increase of 7%
- Q2 invoicing at $26.8m, a year-on-year increase of 6% and a sequential
increase of 36%
- Non American Q2 invoicing growth of 43% year-on-year and 38% sequentially
- Cash balances increased to $80m, driven by strong operating cash flow
- Record EBITDA and pre tax earnings expected to be in the range of $3.8m to
$4.1m
- Strong increase in deferred revenues to over $61m, a year-on-year increase of
approximately 48% and a sequential increase of 12%
SurfControl will be announcing its full un-audited financial results for the
second quarter and the six months to 31 December 2003 on Tuesday February 3rd,
2004.
Steve Purdham, Chief Executive Officer, commented:
"Q2 was our best revenue quarter to date and we have made significant progress
on many fronts. We did, however, see lower than expected invoicing in our
American operations toward the end of the calendar year. We believe this to be a
result of a combination of factors including slightly lower new customer
additions, faster than expected channel transition which now represents 71% of
new sales (Q2 03, 57%), and a slightly lower proportion of longer term contracts
relative to the same period last year.
We believe that the fundamental demand for our products is strong. This belief
is supported by our continued customer addition rate with more than 1,700 new
customers added in the quarter, strengthening renewal rates and a significant
contribution from our non-American operations, which grew 43% compared to Q2
last year.
All other operating metrics remain strong. Our balance sheet now shows cash
balances of $80m and no debt. Operating cashflow remains strong, driven by
continued profit generation, business process improvements and DSOs remaining
below target. Deferred revenue has strongly increased and is expected to exceed
$61m. Revenue is expected to be in the range of $21.0 - $21.2m and, due to
continued gains in cost efficiencies, is expected to produce a record quarterly
EBITDA and profit before tax position in the range of $3.8m to $4.1m.
Growth with profit remains our primary goal and we continue to see the content
security market as offering significant opportunity in the short and long term.
With this in mind we believe that continued strategic investment is fundamental
to the achievement of our long-term goals. Even with this on-going strategic
investment, we believe that earnings for the year as a whole will be materially
in line with current expectations."
SurfControl plc
Steve Purdham steve.purdham@surfcontrol.com +44 (0)1260 296 200
Simon Wilson simon.wilson@surfcontrol.com +1 831 440 2530
Tom Moriarty tom.moriarty@surfcontrol.com +44 (0)1260 296 200
ICIS
Caroline Evans-Jones info@icisnet.com +44 (0)207 628 1114
About SurfControl
SurfControl plc, the world's number one Web and e-mail filtering company,
delivers on its promise to help companies 'Stop Unwanted Content' in the
workplace by continuous innovation, invention and expansion of its filtering
products to address new content risks as they emerge. The company is the leader
in the Content Security market, a significant subset of the Secure Content
Management market, a market that analysts expect to reach $6.4 billion in 2007.
SurfControl is the only company in the security market offering a total content
security solution that combines Web, E-mail (including Anti-Spam and Anti-Virus)
and Instant Message Filters with the industry's largest, most accurate and
relevant content database and adaptive reasoning tools to automate content
recognition.
SurfControl's world-class partners include Sun Microsystems, Check Point, Cisco,
IBM, and Nokia. The company has more than 20,000 customers worldwide, including
many of the world's largest corporations. The company employs nearly 450 people
in nine locations across the United States, Europe, and Asia/Pacific.
For further information and news on SurfControl, please visit
http://www.surfcontrol.com/
Caution concerning forward-looking statements
Any statements contained in this announcement that are not historical facts are
forward-looking statements. Although the Company believes that its plans,
intentions and expectations reflected in such forward-looking statements are
reasonable, a number of important factors could cause SurfControl's actual
future results to differ materially from those expressed in any such
forward-looking statements. The forward-looking statements herein speak only as
of today. SurfControl expressly disclaims any obligation or undertaking to
update or revise such information.
Any references to pro-forma financial measures must be read in conjunction with
the accompanying reconciliation to the nearest UK GAAP measure which can be
found on our web site at http://www.surfcontrol.com/company/investors/
financial_information
This information is provided by RNS
The company news service from the London Stock Exchange
END
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