GlobalSCAPE Reports Second Quarter 2018 Financial Results
09 Août 2018 - 10:15PM
Business Wire
GlobalSCAPE, Inc. (NYSE American: GSB), a worldwide leader in
the secure movement and integration of data, has reported financial
results for the second quarter ended June 30, 2018.
Second Quarter 2018 Operational Highlights
- Concluded its previously announced
Audit Committee investigation and completion of financial statement
review
- Regained compliance with the NYSE
American Continued Listing Standards
- Appointed Robert Alpert, co-Founder and
Principal of 210 Capital LLC, and Clark Webb, co-Founder and
Principal of 210 Capital, LLC to the Board of Directors, building
on the collective guidance and insights of the Board
- Maintained quarterly cash dividend of
$0.015 per share of common stock
Second Quarter 2018 Financial Overview
- Total revenue for the second quarter of
2018 was $8.5 million, which was consistent with the amount
reported for the second quarter of 2017.
- Revenue from the Company’s core EFT
platform increased 1% to $8.1 million. License revenue from the
platform increased 3% to $2.6 million, primarily due to an increase
in the number of large transactions, including transactions that
were originally expected to close in the previous quarter, and a
change in the Company’s lead generation strategy toward the end of
2017 which led to an increase in sales opportunities. Maintenance
and support (M&S) revenue from the platform increased 2% to
$5.1 million, primarily due to ongoing license sales and sustained
high M&S renewal rates.
- Gross profit for the second quarter of
2018 was $6.9 million (81.5% of total revenue), which was
consistent with the $6.9 million (81.9% of total revenue) reported
for the second quarter of 2017.
- Net income totaled $593,000 or $0.03
per diluted share, an increase of 30% from $457,000 or $0.02 per
diluted share in the second quarter of 2017.
- Adjusted EBITDA(1) increased 5% to $1.1
million from the amount reported for the second quarter of
2017.
- As of June 30, 2018, the Company had
cash, cash equivalents and short and long-term investments of
approximately $27.8 million.
1) Adjusted EBITDA is not a measure of financial performance
under GAAP. It should not be considered as a substitute for net
income presented on our consolidated statement of operations and
comprehensive income. Adjusted EBITDA has limitations as an
analytical tool and when assessing our operating performance.
Adjusted EBITDA should not be considered in isolation or without a
simultaneous reading and consideration of our consolidated
financial statements prepared in accordance with GAAP. See note
regarding "Use of Non-GAAP Measures," below for further discussion
of this non-GAAP measure and the reconciliation of this non-GAAP
measure below.
Management Commentary from Matt Goulet, President and CEO of
GlobalSCAPE
“Our results for the second quarter of 2018 came in largely as
we expected. Our total revenue of $8.5 million remained consistent
with the amount reported last year, as we worked through the final
stages of the internal investigation and the sales distractions
that came with it. Nevertheless, we were still able to grow license
and M&S revenue by 3% and 2% year-over-year, respectively,
giving us a platform for more robust growth as we complete the
realignment of our sales force to better address the increasing
needs and requirements of our customers. Perhaps most importantly,
we continued to drive improvements to our bottom line with net
income for the quarter up 30% year-over-year. We also maintained
our strong cash position, which ended the quarter at $27.8 million,
enabling us to continue investing in our business to drive growth
and market share expansion while also returning capital to our
shareholders.
“Over the past few weeks, we have made significant enhancements
to our business, which we believe will allow us to build on our
operational momentum and better execute on our strategy of becoming
a cloud-based software and services provider of MFT technology. As
part of our continued efforts to realign and reduce costs, we
recently reduced our staff by approximately 40 employees. We
believe that, as a result, our operating expenses will decrease
going forward without significantly impacting our revenue or growth
opportunities, as we enhance our focus on our flagship EFT
offering.
“Additionally, we also strengthened our leadership team with the
promotion of our interim CFO, Karen Young, to CFO, as well as
expanded our Board of Directors with the appointment of Robert
Alpert and Clark Webb. We believe these additions enhance our bench
strength and give us the right guidance and tools to reaccelerate
the business. Overall, it’s been a productive and meaningful last
couple of months for GlobalSCAPE. We honed in on our core EFT
offering, right-sized the business, and added significant
experience and insights to the Board. Collectively, these actions
have set the stage for what we expect to be a stronger second half
of 2018 and beyond.”
About GlobalSCAPE
GlobalSCAPE, Inc. (NYSE American: GSB) is a pioneer in securing
and automating the movement and integration of data seamlessly in,
around and outside your business, between people and places, in and
out of the cloud. GlobalSCAPE provides technology that automates
your work and secures your data, while giving visibility to those
who need it. GlobalSCAPE makes business flow brilliantly. For more
information, visit http://www.globalscape.com or follow the blog
and Twitter updates.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. The words
“would,” “exceed,” “should,” “anticipates,” “believe,” “expect,”
and variations of such words and similar expressions identify
forward-looking statements, but their absence does not mean that a
statement is not a forward-looking statement. These forward-looking
statements are based upon the Company’s current expectations and
are subject to a number of risks, uncertainties and assumptions.
The Company undertakes no obligation to update any forward-looking
statements, whether as a result of new information, future events
or otherwise. Among the important factors that could cause actual
results to differ significantly from those expressed or implied by
such forward-looking statements are risks that are detailed in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2017 filed with the SEC on June 14, 2018; the discovery of
additional information relevant to the internal investigation; the
conclusions of the Company’s Audit Committee (and the timing of the
conclusions) concerning matters relating to the internal
investigation; the possibility that additional errors relevant to
the recently completed restatement may be identified; pending
litigation and other proceedings and the possibility of further
legal proceedings adverse to GlobalSCAPE resulting from the
restatement or related matters; and the costs associated with the
restatement and the investigation.
Use of Non-GAAP Measures
The Company uses Adjusted EBITDA (Earnings Before Interest,
Taxes, Total Other Income/Expense, Depreciation, Amortization,
other than amortization of capitalized software development costs,
and Share-Based Compensation Expense) to provide a view of income
and expenses that is supplemental and secondary to the primary
assessment of net income as presented in the consolidated statement
of operations and comprehensive income.
Adjusted EBITDA is not a measure of financial
performance under GAAP. It should not be considered as a substitute
for net income presented on our condensed consolidated statement of
operations and comprehensive income. Adjusted EBITDA has
limitations as an analytical tool and when assessing our operating
performance. Adjusted EBITDA should not be considered in isolation
or without a simultaneous reading and consideration of our
financial statements prepared in accordance with GAAP. A
reconciliation of net income (loss) to Adjusted EBITDA is provided
at the end of this release.
GlobalSCAPE, Inc. Unaudited Reconciliation of Net
Income (Loss) to Adjusted EBITDA
Three Months Ended Six Months Ended June
30, June 30, 2018 2017
2018 2017 Net Income (loss) $ 593 $ 457
$ (342 ) $ 1,288 Add (subtract) items to determine Adjusted EBITDA:
Income tax expense 336 265 105 676 Interest (income) expense, net
(80 ) (77 ) (156 ) (146 ) Depreciation and amortization: Total
depreciation and amortization 525 516 1,120 1,056 Amortization of
capitalized software development costs (464 ) (446 ) (999 ) (920 )
Share-based compensation expense 191 335
862 671 Adjusted EBITDA $ 1,101
$ 1,050 $ 590 $ 2,625
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version on businesswire.com: https://www.businesswire.com/news/home/20180809005655/en/
GlobalSCAPE Press ContactLisa Kilpatrick,
210-308-8267PR@globalscape.comorGlobalSCAPE Investor Relations
ContactMatt Glover or Najim Mostamand, CFA,
949-574-3860IR@globalscape.com
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