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Secure Computing Reports Record Revenues and Record Cash From Operations SAN JOSE, CA--(MARKET WIRE)--Oct 29, 2007 -- Secure Computing Corporation (NasdaqGS:SCUR - News), a
leading enterprise gateway security company, today announced
third quarter
GAAP revenue of $60.0 million. This represents a 37% increase
in revenue
compared to $43.7 million in the same quarter last year.
Third quarter
non-GAAP revenue was $65.2 million. This represents a 49%
increase
compared to the same quarter last year. On a GAAP basis,
net loss was
$10.1 million or $0.17 per share. Third quarter
non-GAAP net income was $6.4 million or $0.09 per fully
diluted share. The
company generated a record $12.8 million of cash from operations
and
reduced the long term debt balance by $10.0 million. Billings
for the
quarter were $74.0 million, a 20% increase compared to the
same quarter
last year.
"Our team again delivered solid results in the third quarter," said John McNulty, chairman and chief executive officer of Secure Computing. "Secure Computing is in the enviable position of being able to address the evolving threat environment at the gateway in a fashion that we believe is better and more complete than any other security provider. Today's Web 2.0 technologies have great allure and benefit, but they also provide an inviting target for blended malware, and stopping that type of threat is what we do best. Our products fit the needs of the market and good execution allowed us to realize record revenue and cash from operations. We believe we are well positioned to accelerate our growth in the enterprise security market." Third Quarter Financial Highlights:
-- GAAP revenue for the third quarter was $60.0 million. This represents
a 37% increase compared to $43.7 million in the same quarter last year and
a 4% increase compared to revenue of $57.6 million in the prior quarter.
Non-GAAP revenue for the quarter was $65.2 million. This represents a 49%
increase compared to the same quarter last year and a 2% increase compared
to non-GAAP revenue of $63.7 million in the prior quarter.
-- Billings for the third quarter were $74.0 million. This represents a
20% increase compared to $61.6 million in the same quarter last year and a
5% increase compared to billings of $70.7 million in the prior quarter.
-- GAAP gross profit in the third quarter was 72% of revenue or $43.1
million. Non-GAAP gross profit in the third quarter was 77% of revenue or
$50.0 million. These non-GAAP results compare to 76% of non-GAAP revenue,
or $33.3 million, in the year ago quarter and 76% of non-GAAP revenue, or
$48.1 million, in the prior quarter.
-- Third quarter GAAP operating expenses were $47.9 million, or 80% of
revenue. Non-GAAP operating expenses for the quarter were $41.2 million or
63% of non-GAAP revenue. These non-GAAP results compare to 72% of non-GAAP
revenue in the year ago quarter and 63% in the prior quarter.
-- GAAP operating loss for the third quarter was $4.9 million. Third
quarter non-GAAP operating income was $8.8 million or 13% of non-GAAP
revenue, compared to 8% in the same quarter last year and 12% in the prior
quarter.
-- GAAP net loss for the third quarter was $10.1 million or $0.17 per
share. Third quarter non-GAAP net income was $6.4 million or $0.09 per
fully diluted share, compared to non-GAAP net income of $2.0 million, or
$0.03 per fully diluted share in the year ago quarter, and $5.0 million, or
$0.07 per fully diluted share in the prior quarter.
-- In the third quarter, deferred revenue increased $11.4 million, or 8%,
bringing the total deferred revenue balance to $153.8 million at the end of
September.
-- Days sales outstanding (DSOs) were 90 days. As we have experienced
in previous quarters, the change in DSOs from the prior quarter correlates
to the change in deferred revenue. Excluding the impact of the increase in
deferred revenue, DSOs were 73 days.
-- Total cash and restricted cash was $10.7 million at September 30,
2007. Cash generated from operations in the quarter was a record $12.8
million."In the third quarter, we experienced strong performance across many important metrics, including closing six seven-figure deals and a record 127 deals over $100,000," said Tim Steinkopf, senior vice president of operations and chief financial officer of Secure Computing. "Our strong cash flow from operations over the last three quarters has allowed us to reduce our debt by $32 million since the beginning of the year, which is well ahead of plan." About Secure Computing Secure Computing (NasdaqGS:SCUR - News), a leading provider of enterprise gateway security, delivers a comprehensive set of solutions that help customers protect their critical Web, email and network assets. Over half of the Fortune 50 and Fortune 500 are part of our more than 20,000 global customers in 106 countries, supported by a worldwide network of more than 2,300 partners. The company is headquartered in San Jose, Calif., and has offices worldwide. For more information, see http://www.securecomputing.com. Secure Computing's Outlook Publication Procedures Secure Computing publishes an Outlook section in its quarterly operating results press release. The company continues its current practice of having corporate representatives meet privately during the quarter with investors, the media, investment analysts and others. At these meetings Secure Computing refers any questions regarding the current outlook back to the quarterly results press release Outlook section. The quarterly results press release, which includes the Outlook section, is available to the public on the company's Web site (www.securecomputing.com). Unless Secure Computing is in a Quiet Period (described below), the public can continue to rely on the Outlook section that is part of this quarterly operating results press release as still being the company's current expectations on matters covered, unless Secure Computing publishes a notice stating otherwise. From the close of business on December 14, 2007, until publication of a press release regarding the fourth quarter 2007 operating results, Secure Computing will observe a Quiet Period. During the Quiet Period, the Outlook section and other forward-looking statements contained in this operating results press release as well as in the company's filings with the SEC, should be considered to be historical, speaking as of prior to the Quiet Period only and not subject to update by the company. During the Quiet Period, Secure Computing representatives will not comment concerning the Outlook section or Secure Computing's financial results or expectations. Current Outlook The forward-looking statements in this Outlook section are based on current expectations and are subject to risks, uncertainties and assumptions described under the sub-heading "Forward-Looking Statements." Actual results may differ materially from the expectations expressed below. For the fourth quarter of 2007 billings are expected to be in the range of $76 to $79 million. On a GAAP basis, revenues are expected to be between $64 and $66 million and GAAP net loss, before the impact of any NOL utilization on tax expense, is expected to be $4 to $5 million. On a non-GAAP basis for the fourth quarter of 2007, revenues are expected to be between $67 and $69 million and non-GAAP net income is expected to be between $7 and $8 million, or $0.09 and $0.11 per fully diluted share assuming a fully diluted weighted average count of 76 million. We expect to generate cash from operations of $12 to $13 million. Forward-Looking Statements This release contains forward-looking statements concerning revenues, aggregate margins, operating expenses and profitability for this and future quarters, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements in this release involve risks and uncertainties that could cause actual results to differ materially from current expectations. In order to meet these projections, the company must continue to obtain new enterprise relationships with major clients and overall demand for its products must continue to grow at current or greater levels. The company also must be able to motivate and retain key employees and staff current and future projects in a cost-effective manner and must effectively control its marketing, research, development and administrative costs, including personnel expenses. There can be no assurance that demand for the company's products will continue at current or greater levels, or that the company will continue to grow revenues, or be profitable. There are also risks that the company's pursuit of providing network security technology might not be successful, or that if successful, it will not materially enhance the company's financial performance; that changes in customer requirements and other general economic and political uncertainties and weaknesses in geographic regions of the world could impact the company's relationship with its customers, partners and alliances; and that delays in product development, competitive pressures or technical difficulties could impact timely delivery of next-generation products; and other risks and uncertainties that are described from time to time in Secure Computing's periodic reports and registration statements filed with the Securities and Exchange Commission. The company specifically disclaims any responsibility for updating these forward-looking statements. Use of Non-GAAP Financial Measures Secure Computing provides financial statements that are prepared in accordance with GAAP. In addition, this press release also provides financial measures of results of operations that are not calculated in accordance with GAAP. Our non-GAAP results are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our Management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our historical and prospective financial performance and make operating decisions. Management also believes that these non-GAAP financial measures enhance the investors' ability to evaluate the company's operating results and to compare current operating results to historical operating results. A reconciliation of the GAAP to non-GAAP financial measures for the third quarter, along with the use and economic substance of each non-GAAP financial measure, are provided at the end of this press release.
Condensed Consolidated Statement of Operations
(Unaudited, in thousands, except for per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
--------- --------- --------- ---------
Revenues:
Products $ 31,006 $ 27,884 $ 91,899 $ 81,586
Services 18,992 15,625 54,901 43,286
Other (See Note) 10,020 239 24,638 239
--------- --------- --------- ---------
Total revenues 60,018 43,748 171,438 125,111
Products 9,570 7,658 28,127 22,534
Services 4,020 2,989 12,151 7,993
Other (See Note) 1,446 89 3,934 89
Amortization of purchased
intangibles 1,924 1,049 5,905 3,025
--------- --------- --------- ---------
Total cost of revenues 16,960 11,785 50,117 33,641
--------- --------- --------- ---------
Gross profit 43,058 31,963 121,321 91,470
Operating expenses:
Selling and marketing 29,692 23,703 87,794 57,328
Research and development 11,207 8,828 32,932 23,554
General and administrative 4,310 3,469 11,702 9,386
Amortization of purchased
intangibles 2,712 2,310 8,265 6,990
Litigation settlement --- --- --- 2,500
--------- --------- --------- ---------
47,921 38,310 140,693 99,758
--------- --------- --------- ---------
Operating loss (4,863) (6,347) (19,372) (8,288)
Other (expense)/income (1,576) 501 (5,593) 2,402
--------- --------- --------- ---------
Loss before taxes (6,439) (5,846) (24,965) (5,886)
Income tax (expense)/benefit (3,613) (1,445) (6,610) 5,911
--------- --------- --------- ---------
Net (loss)/income (10,052) (7,291) (31,575) 25
Preferred stock accretion (943) (903) (2,781) (2,653)
Charge from beneficial
conversion of preferred stock --- --- --- (12,603)
--------- --------- --------- ---------
Net loss applicable to common
shareholders $ (10,995) $ (8,194) $ (34,356) $ (15,231)
========= ========= ========= =========
Basic and diluted loss per
share $ (0.17) $ (0.14) $ (0.52) $ (0.28)
Weighted average shares
outstanding - basic and diluted 66,268 57,378 65,772 54,417NOTE: For certain multiple-element arrangements we are unable to establish vendor specific objective evidence (VSOE) of fair value for the undelivered bundled elements and are therefore unable to allocate the value of the arrangement between Products and Services Revenue and have reported these revenues and corresponding cost of revenues as 'Other.'
Condensed Consolidated Balance Sheets
(In thousands)
Sept. 30, Dec. 31,
2007 2006
------------- -------------
Assets
Cash and cash equivalents $ 10,170 $ 8,249
Restricted cash 496 457
Accounts receivable, net 60,029 63,636
Inventory, net 5,369 4,078
Other current assets 15,943 13,948
------------- -------------
Total current assets 92,007 90,368
Property and equipment, net 17,751 14,300
Goodwill 530,744 533,659
Intangibles, net 65,672 78,388
Other assets 9,619 7,413
------------- -------------
Total assets $ 715,793 $ 724,128
============= =============
Liabilities and stockholders' equity
Accounts payable 12,295 12,442
Accrued payroll 10,593 12,035
Accrued expenses 8,415 6,365
Acquisition reserves 1,207 1,418
Deferred revenue 94,461 86,612
------------- -------------
Total current liabilities 126,971 118,872
Acquisition reserves, net of current portion 1,019 1,591
Deferred revenue, net of current portion 59,289 35,671
Deferred tax liability 10,082 7,672
Debt, net of fees 53,371 85,023
Other liabilities 95 ---
------------- -------------
Total liabilities 250,827 248,829
Convertible preferred stock 68,339 65,558
Stockholders' equity
Common stock 669 651
Additional paid-in capital 558,303 538,616
Accumulated deficit (161,605) (127,249)
Accumulated other comprehensive loss (740) (2,277)
------------- -------------
Total stockholders' equity 396,627 409,741
------------- -------------
Total liabilities and stockholders' equity $ 715,793 $ 724,128
============= =============
Condensed Consolidated Statement of Cash Flows
(Unaudited, in thousands)
Nine months ended
September 30,
2007 2006
------------- -------------
Operating activities
Net (loss)/income $ (31,575) $ 25
Adjustments to reconcile net (loss)/income
from continuing operations to net cash
provided by operating activities:
Depreciation 5,327 2,970
Amortization of intangible assets 14,768 10,331
Loss on disposals of property and
equipment and intangible assets 160 995
Amortization of debt fees 348 37
Deferred income taxes 3,701 (6,093)
Share-based compensation 12,361 7,019
Changes in operating assets and liabilities,
excluding effects of acquisitions:
Accounts receivable 4,007 (1,149)
Inventories (1,291) (324)
Other current assets (2,103) 1,032
Accounts payable 272 6,516
Accrued payroll (1,440) 1,771
Accrued expenses 2,281 (3,504)
Acquisition reserves (867) (10,371)
Deferred revenue 31,487 16,753
------------- -------------
Net cash provided by operating
activities 37,436 26,008
Investing activities
Purchase of property and equipment, net (8,896) (8,368)
(Increase)/decrease in intangibles and
other assets (3,400) 734
(Purchases)/maturities of investments, net (8) 31,041
Cash paid for business acquisitions, net
of cash acquired --- (256,747)
------------- -------------
Net cash used for investing activities (12,304) (233,340)
Financing activities
Repayments of term debt (32,000) ---
Proceeds from term debt, net of fees --- 86,868
Proceeds from issuance of common stock 7,344 7,317
Proceeds from revolving debt --- 2,000
Proceeds from issuance of preferred stock
and warrant, net of fees --- 69,945
------------- -------------
Net cash (used for)/provided by
financing activities (24,656) 166,130
Effect of exchange rates 1,445 (927)
------------- -------------
Net increase/(decrease) in cash and cash
equivalents 1,921 (42,129)
Cash and cash equivalents, beginning of
period 8,249 50,039
------------- -------------
Cash and cash equivalents, end of period $ 10,170 $ 7,910
============= =============
Reconciliation of Consolidated GAAP Financial
Measures to Non-GAAP Financial Measures
(Unaudited, in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
-------- -------- -------- --------
NET REVENUES:
GAAP net revenues $ 60,018 $ 43,748 $171,438 $125,111
Fair value adjustment to
acquired deferred revenue (A) 1,952 - 8,693 -
VSOE adjustments to bundled
product revenue (B) 3,266 - 9,313 -
-------- -------- -------- --------
Non-GAAP net revenues $ 65,236 $ 43,748 $189,444 $125,111
======== ======== ======== ========
GROSS PROFIT:
GAAP gross profit $ 43,058 $ 31,963 $121,321 $ 91,470
Fair value adjustment to
acquired deferred revenue (A) 1,952 - 8,693 -
VSOE adjustments to bundled
product revenue (B) 2,761 - 6,700 -
Share-based compensation (C) 277 279 881 701
Amortization of acquired
intangible assets (D) 1,924 1,049 5,905 3,025
-------- -------- -------- --------
Non-GAAP gross profit $ 49,972 $ 33,291 $143,500 $ 95,196
======== ======== ======== ========
OPERATING EXPENSES:
GAAP operating expenses $ 47,921 $ 38,310 $140,693 $ 99,758
Share-based compensation (C) (4,027) (3,057) (11,480) (6,318)
Amortization of acquired
intangible assets (D) (2,712) (2,310) (8,265) (6,990)
One-time expenses and
write-offs (E) - (1,568) - (2,575)
Litigation settlement (F) - - - (2,500)
-------- -------- -------- --------
Non-GAAP operating expenses $ 41,182 $ 31,375 $120,948 $ 81,375
======== ======== ======== ========
OPERATING (LOSS)/INCOME:
GAAP operating loss $ (4,863) $ (6,347) $(19,372) $ (8,288)
Fair value adjustment to
acquired deferred revenue (A) 1,952 - 8,693 -
VSOE adjustments to bundled
product revenue (B) 2,761 - 6,700 -
Share-based compensation (C) 4,304 3,336 12,361 7,019
Amortization of acquired
intangible assets (D) 4,636 3,359 14,170 10,015
One-time expenses and
write-offs (E) - 1,568 - 2,575
Litigation settlement (F) - - - 2,500
-------- -------- -------- --------
Non-GAAP operating income $ 8,790 $ 1,916 $ 22,552 $ 13,821
======== ======== ======== ========
NET (LOSS)/INCOME:
GAAP net (loss)/income $(10,052) $ (7,291) $(31,575) $ 25
Fair value adjustment to
acquired deferred revenue (A) 1,952 - 8,693 -
VSOE adjustments to bundled
product revenue (B) 2,761 - 6,700 -
Share-based compensation (C) 4,304 3,336 12,361 7,019
Amortization of acquired
intangible assets (D) 4,636 3,359 14,170 10,015
One-time expenses and
write-offs (E) - 1,568 - 2,575
Litigation settlement (F) - - - 2,500
Non-cash tax
expense/(benefit) (G) 2,833 1,029 4,519 (6,394)
-------- -------- -------- --------
Non-GAAP net income $ 6,434 $ 2,001 $ 14,868 $ 15,740
======== ======== ======== ========
WEIGHTED AVERAGE SHARES OUTSTANDING:
Weighted average shares
outstanding - basic 66,268 57,378 65,722 54,417
Common stock equivalents (H) 1,456 944 1,266 1,069
Preferred stock as-if
converted to common stock (I) 5,987 5,481 5,987 5,412
-------- -------- -------- --------
Shares used to compute net
income per share - diluted 73,711 63,803 72,975 60,898
======== ======== ======== ========
Non-GAAP net income per share -
diluted (J) $ 0.09 $ 0.03 $ 0.20 $ 0.26
Reconciliation of Projected Financial
Measure to Non-GAAP Financial Measures
(Unaudited, in thousands, except per share amounts)
Three Months Ended
December 31, 2007
--------------------
REVENUES:
GAAP revenue range $ 64,000 - $ 66,000
Fair value adjustment to acquired deferred
revenue (A) 1,500
VSOE adjustments to bundled product revenue (B) 2,000
-----------------------
Non-GAAP revenue range $ 67,000 - $ 69,000
=======================
(LOSS)/INCOME BEFORE TAX IMPACT OF NOL
UTILIZATION
GAAP loss before taxes $ (5,000) - $ (4,000)
Fair value adjustment to acquired deferred
revenue (A) 1,500
VSOE adjustments to bundled product revenue (B) 1,500
Stock-based compensation (C) 4,500
Amortization of acquired intangibles (D) 4,500
-----------------------
Non-GAAP income before tax impact of NOL
utilization $ 7,000 - $ 8,000
=======================
Shares used to compute income per share 76,000 76,000
Non-GAAP income per share $ 0.09 $ 0.11Our management regularly uses these non-GAAP financial measures internally to understand, manage and evaluate our historical and prospective financial performance and make operating decisions. We believe that presentation of the non-GAAP financial measures presented above is useful to an investors' ability to evaluate the company's operating results from management's perspective and to compare current operating results to historical operating results. Disclosure of these non-GAAP financial measures also facilitates comparisons of our operating performance with the performance of other companies in our industry that supplement their GAAP results with non-GAAP financial measures that are calculated in a similar manner. Our management adjusts for each of the items noted above, for the reasons described below. (A) Fair value adjustment to acquired deferred revenue. Non-GAAP revenues and gross profit include revenues and costs associated with acquired deferred revenue and deferred costs that were excluded from GAAP revenue and gross profit as a result of purchase accounting adjustments to fair value. In our non-GAAP measures we have included these revenues and costs because we believe they are most reflective of our ongoing operating results and are useful for comparisons to historical operating performance. We further believe the impact of these purchase accounting adjustments will become immaterial in the near-term. (B) VSOE adjustment to bundled product revenue. GAAP revenue and gross profit is negatively impacted by product billings that were deferred because we were unable to establish VSOE of fair value of the undelivered elements that were sold with the product. Non-GAAP revenues and gross profit presented above have been adjusted to include revenues and gross profits that would have been reported, had we been able to establish VSOE of fair value of the undelivered elements that were sold with those product billings. We believe these adjustments are most reflective of our ongoing operations in the current period and are useful for comparisons to historical operating performance. We further believe the impact of this item on our GAAP revenues and gross profit will become immaterial in the future. (C) Share-based compensation. Consists of expenses for employee stock options, restricted stock units, and employee stock purchase plan determined in accordance with SFAS 123(R). We exclude these share-based compensation expenses when we review our operating performance because they represent compensation expense in the form of equity, rather than cash, and are not indicative of how we view our historical and prospective operational performance. Further, we believe it is useful to investors to understand the impact of the application of SFAS 123(R) to our results of operations. For the three and nine months ended September 30, 2007 and 2006, share-based compensation was allocated as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
---------- ---------- ---------- ----------
Cost of revenues $ 277 $ 279 $ 881 $ 701
Selling and marketing 2,490 1,863 6,907 3,333
Research and development 838 706 2,773 1,625
General and administrative 699 488 1,800 1,360
---------- ---------- ---------- ----------
Total stock based
compensation expense $ 4,304 $ 3,336 $ 12,361 $ 7,019
========== ========== ========== ==========(D) Amortization of purchased intangible assets. The amounts recorded as amortization of purchased intangible assets arise from prior acquisitions and are non-cash in nature. We exclude these expenses when we review our operating performance because we believe that although these assets contribute to our revenue generating activities, they are inconsistent in amount and frequency and are impacted by the timing and magnitude of our acquisitions. Further, they are not indicative of how we view our operating performance in the period incurred and in comparison to historical and prospective periods. For the three and nine months ended September 30, 2007 and 2006, amortization of purchased intangibles was allocated as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
---------- ---------- ---------- ----------
Cost of revenues $ 1,924 $ 1,049 $ 5,905 $ 3,025
Operating expenses 2,712 2,310 8,265 6,990
---------- ---------- ---------- ----------
Total amortization of
intangible assets $ 4,636 $ 3,359 $ 14,170 $ 10,015
========== ========== ========== ==========(E) One-time expenses and write-offs. These amounts arise from severance due to acquisition related restructurings, duplicate and one-time integration costs and facility move costs. We exclude these expenses because we believe they are not reflective of how we view our operating performance in the period incurred, are not recurring in nature and are not meaningful in evaluating our operating performance in comparison to historical operating performance. There were no one-time expenses for the three and nine months ended September 30, 2007. For the three and nine months ended September 30, 2006, one-time expenses and write-offs were allocated as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
---------- ---------- ---------- ----------
Selling and marketing - $ 1,533 - $ 1,742
Research and development - - - 180
General and administrative - 35 - 653
---------- ---------- ---------- ----------
Total one-time expenses and
write-offs $ - $ 1,568 $ - $ 2,575
========== ========== ========== ==========(F) Litigation settlement. This amount represents the settlement of litigation brought by the landlord of our former Concord, CA office. We exclude this expense in our non-GAAP operating results because we believe it is not reflective of how we view our operating performance in the period incurred and is not recurring in nature. (G) Non-cash tax expense/(benefit). These amounts represent the impact from the utilization of purchased net operating loss carry forwards and an increase in the valuation allowance that has been established against our net deferred tax asset. We exclude these expenses/(benefits) because they are non-cash expenses/(benefits) that we believe are not reflective of how we view our operating performance. (H) Common stock equivalents. Represents the common stock equivalents of stock options and restricted stock outstanding at the end of the reported period. (I) Preferred stock as-if converted to common stock. Represents the as-if conversion of outstanding preferred shares to common shares at the end of the reported period. (J) Non-GAAP net income per share. Excludes the impact of preferred stock accretion and a charge for the beneficial conversion of preferred stock. Material Limitations Associated with Use of Non-GAAP Financial Measures The non-GAAP financial measures provided in this press release may have limitations as analytical tools, and these measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Some of the limitations in relying on these non-GAAP measures are:
-- Items such as fair value adjustments to acquired deferred revenue and
VSOE adjustments to our product revenue do not generate additional cash and
therefore should not be considered in analyzing cash flows.
-- Items such as one-time expenses and write-offs and a one-time tax
expense that are excluded from non-GAAP operating results can have a
material impact on cash flows and earnings per share.
-- The adjustments for items such as stock-based compensation,
amortization of acquired intangible assets, and tax impact of NOL
utilization, though not directly affecting our cash position, do affect
earnings per share.
-- Other companies may calculate these non-GAAP measures differently than
we do, limiting the usefulness of those measures for comparative purposes.Compensation for Limitations Associated with Use of Non-GAAP Financial Measures We compensate for the limitations on our use of non-GAAP financial measures by primarily relying on our GAAP results and using non-GAAP financial measures only supplementally. We also provide detailed reconciliations of each non-GAAP financial measure to its most directly comparable GAAP measure within this press release and we encourage investors to carefully review those reconciliations. Contact: Editorial Contact:
Shawn Wolfe
Email Contact
408-979-6165
Investor Contact:
Jane Underwood
Email Contact
408-979-6186
Source: Secure Computing
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