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Commtouch Reports Fourth Quarter And Full Year 2012 Results

Stocks in this article: CTCH

MCLEAN, Virginia, February 20, 2013 /PRNewswire/ --

Fourth Quarter 2012 Revenues of $6.8 Million, Up 22% Sequentially, Up 14% Versus a Year Ago

Full Year 2012 Revenues of $23.9 Million, Up 4% Year-over-Year

Formal Launch of New Cloud-Based Email Security-as-a-Service Offering in Early 2013 Highlights Execution on Strategic Roadmap and Foundation for Future Growth

2013 Full Year GAAP Revenue Growth Forecasted to be 42% to 46% Above 2012 Level

Commtouch® (NASDAQ: CTCH), a leading provider of Internet security technology and cloud-based services, today announced its fourth quarter and full year 2012 financial results for the period ending December 31, 2012.

     (Logo: http://photos.prnewswire.com/prnh/20120501/529254 )

Fourth Quarter & Full Year 2012 Financial Highlights:

  • Revenues in accordance with US Generally Accepted Accounting Principles (US GAAP) totaled $6.8 million for the fourth quarter compared to $5.6 million for the sequential third quarter of 2012 and $6.0 million in the fourth quarter of 2011. Full year 2012 revenues totaled $23.9 million, an increase of 4.0% as compared to $23.0 million in 2011.
  • Non-GAAP revenues totaled $7.0 million for the fourth quarter compared to $5.6 million for the sequential third quarter of 2012 and $6.0 million in the fourth quarter of 2011.  Full year 2012 non-GAAP revenues totaled $24.1 million, an increase of 5.0% as compared to $23.0 million in 2011. The difference between non-GAAP and GAAP revenue is derived from the fact that deferred revenues consolidated from acquired companies are recorded based on fair value rather than book value for GAAP purposes.
  • In the fourth quarter of 2012, Commtouch closed the previously announced acquisitions of FRISK Software International's antivirus business as of October 1, 2012 and eleven GmbH as of November 16, 2012. During the fourth quarter and full year, the company recognized expenses totaling approximately $0.4 million and $0.8 million in the respective periods related to acquisition related costs. Fourth quarter and full year 2012 GAAP net income (loss) and earnings per diluted share data include the impact of the aforementioned acquisition and related costs.
  • GAAP net income (loss) for the fourth quarter was ( $0.5 million) compared to net income of $19,000 for the sequential third quarter of 2012 and $1.3 million in the fourth quarter of 2011. Full year 2012 GAAP net income totaled $1.5 million compared to $4.6 million in 2011. Fourth quarter and full year 2012 data includes the aforementioned acquisition related expenses.
  • GAAP earnings per diluted share for the fourth quarter were ($0.02), compared to $0.00 for the sequential third quarter of 2012 and $0.05 in the fourth quarter of 2011. Full year 2012 GAAP earnings per diluted share were $0.06 compared to $0.19 in 2011. Fourth quarter and full year 2012 data includes the aforementioned acquisition related expenses.
  • Non-GAAP net income for the fourth quarter was $0.3 million compared to $0.7 million for the sequential third quarter of 2012 and $1.7 million in the fourth quarter of 2011. Full year 2012 non-GAAP net income totaled $3.9 million compared to $6.4 million in 2011 and was marginally lower than anticipated primarily due to an increased strategic investment in the company's global sales and marketing function to leverage Commtouch's expanded portfolio of IT security solutions.
  • Non-GAAP earnings per diluted share for the fourth quarter were $0.01, compared to $0.03 for the sequential third quarter of 2012 and $0.07 in the fourth quarter of 2011. Full year 2012 non-GAAP earnings per diluted share were $0.16 compared to $0.26 in 2011.
  • Cash used for operating cash activities during the quarter was $1.6 million, which included payments for professional service fees and other acquisition related costs associated with the two acquisitions that closed during the quarter.
  • Cash as of December 31, 2012 was $5.1 million, compared to $17.3 million as of September 30, 2012. Cash usage during the quarter included the net purchase price payments of $10.2 million, as well as payments for transaction and integration costs associated with the two acquisitions completed during the quarter.
  • Brian Briggs was appointed as Commtouch Chief Financial Officer. Briggs brings more than 22 years of finance and operations experience, offering extensive expertise in profitability building in public companies.

Shlomi Yanai, Commtouch's chief executive officer stated, "The fourth quarter culminated 2012 with renewed revenue growth and tremendous progress on our transformation into a provider of comprehensive SecaaS offerings, which was accelerated by our strategic acquisitions. Commtouch's new Email Security-as-a-Service solution marks a major launch of the Company's latest cloud-based offerings and is complemented by new solutions focused on Email Security On-Premise for Service Providers and Mobile Security Services for Android. All three solutions were recently launched into the market and have generated great initial customer interest. Our material progress on executing this strategy and deploying our new offerings has successfully set the stage for double-digit revenue growth in 2013.

"On the financial front, fourth quarter and full year sales marked Commtouch's return to top-line growth, while acquisition related transaction and integration expenses, combined with an increased investments in global sales and marketing infrastructure, contributed to lower bottom-line profitability. New bookings growth remained strong in the fourth quarter and full year, doubling new bookings compared to the levels seen in the year ago period. Organic new bookings growth, combined with the synergies of our late 2012 strategic acquisitions, put Commtouch on track to realize full year 2013 revenue growth in the range of 42% to 46% over 2012.  We remain committed to investing in our enhanced sales and marketing platform to fully leverage the value of our innovative new SecaaS offerings among customers and partners worldwide, all while continuing to fund our growth through internal cash flow generation and with a focused commitment to improving bottom line profitability.

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