2012 Revenue Growth of 20% to
Fourth Quarter GAAP EPS of
Full Year 2012 GAAP EPS of
Fourth Quarter 2012 Financial Highlights
Revenues: Revenues for the fourth quarter of 2012 increased by 19% to
Bookings: Four-Quarter Bookings (a non-GAAP financial measure) were
Gross Profit: GAAPgross profit for the fourth quarter of 2012 increased by 19% to
Operating Income: GAAP operating income for the fourth quarter of 2012 increased to
Net Income: GAAP net income for the fourth quarter of 2012 was
Adjusted EBITDA: Adjusted EBITDA (a non-GAAP financial measure) for the fourth quarter of 2012 increased by 103% to
Full Year 2012 Financial Highlights
Revenues: Revenues for 2012 increased by 20% to
Gross Profit: Gross profit for 2012 increased by 16% to
Operating Income: GAAP operating income for 2012 increased by 3% to
Net Income: GAAP net income for 2012 was
Adjusted EBITDA: Adjusted EBITDA (a non-GAAP financial measure) for 2012 increased by 32% to
Initial Public Offering:
Fourth Quarter 2012 Business Highlights
Customers:
-
New customers include: Citigroup, Colgate-Palmolive, Comcast,
Georgetown University , Grupo Mexico,Hilton Worldwide , Level 3,Nestle Deutschland AG , Penske Automotive,Pepperdine University , RICOH, Standard Life, Sun Life Financial, Telkom SA and U.S. Bancorp. -
Hosted more than 600 customers and partners at the 10th Annual
Qualys Security Conference in four cities around the world, where attendees shared best practices and learned from existing customers and renowned industry experts how to protect their IT Infrastructure from cyber-attacks and manage compliance more effectively.
New Products and Functionalities:
- Released major extensions to the QualysGuard Cloud Platform including automated workflows for Vulnerability Management and enhanced scan management capabilities to increase efficiency for customers.
- Introduced innovative predictive analytics engine to QualysGuard Vulnerability Management to help customers analyze risk exposures to zero-day and Microsoft Patch Tuesday vulnerabilities.
- Expanded QualysGuard Policy Compliance with support for new technologies, including Microsoft Windows 8 and Windows 2012 Server.
- Expanded QualysGuard Web Application Scanning (WAS) with advanced scanning configurations and reporting enhancements to address the growing needs of customers. New capabilities also include Malware Detection, which is a unique and competitive advantage for WAS, as well as forthcoming integrations with attack tools to allow customers and consultants to further test and validate scanning results.
-
Upgraded the first generation of the QualysGuard Private
Cloud Platforms to the new virtualized and extensible platform at Apple, Fujitsu, Microsoft,NTT and Oracle. This new virtualized platform provides customers, partners and government agencies with the performance and scalability to secure their IT infrastructures while keeping data on premise and will enableQualys to seamlessly introduce new services to these customers and partners.
Industry Recognition:
-
Received top customer ratings in an independent information security study conducted by TheInfoPro, a service of 451 Research with top ratings in every category, outperforming all competitors. Additionally, 100% of
Qualys' customers indicated they were not considering switching to a competing solution. -
Named a finalist in five 2013
SC Magazine Awards categories, including best customer service and excellence in security and compliances solutions for enterprises and SMBs.
-
Announced an agreement with
The Emirates Integrated Telecommunications Company ("du") to deliver vulnerability and compliance management services to businesses in theUnited Arab Emirates using the new extensible QualysGuard PrivateCloud Platform to be hosted at du inDubai . - Expanded the partnership with Verizon to include their managed security services and consulting practice leveraging the full suite of QualysGuard solutions.
Financial Performance Outlook
First Quarter 2013 Guidance: Management expects revenues to be in the range of
Full Year 2013 Guidance: Management expects revenues to be in the range of
Investor Conference Call
About
Legal Notice Regarding Forward-Looking Statements
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. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to: our belief that we will continue to diversify our business in 2013, and that our innovation efforts will center on further expanding our platform and reaching into new markets, including the government sector with our Virtualized QualysGuard Cloud Platform; our belief that our best-in-class platform and the benefits of increasing operating scale, will enable us to further drive growth and shareholder value over the coming year; our guidance for revenues, GAAP EPS (net loss) and non-GAAP EPS (net loss)
for the first quarter and full year 2013; and our expectations for the number of weighted average diluted shares outstanding for the first quarter and full year 2013. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include our ability to continue to develop platform capabilities and solutions; customer acceptance and purchase of our existing solutions and new solutions; our ability to retain existing customers and generate new customers; the market for cloud solutions for IT security and compliance not continuing to develop; competition from other products and services; and general market, political, economic and business conditions. The forward-looking statements contained in this press release are
also subject to other risks and uncertainties, including those more fully described in our filings with the
Non-GAAP Financial Measures
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP,
The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating its business internally and as such has determined that it is important to provide this information to investors.
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
(Unaudited) | ||||
(in thousands, except per share data) | ||||
Three Months Ended | Year Ended | |||
|
|
|||
2012 | 2011 | 2012 | 2011 | |
Revenues |
|
|
|
|
Cost of revenues (1) | 4,981 | 4,123 | 18,404 | 13,247 |
Gross profit | 19,676 | 16,529 | 73,016 | 62,965 |
Operating expenses: | ||||
Research and development (1) | 4,870 | 4,953 | 20,195 | 19,633 |
Sales and marketing (1) | 9,911 | 9,229 | 37,738 | 31,526 |
General and administrative (1) | 3,268 | 2,390 | 12,079 | 8,900 |
Total operating expenses | 18,049 | 16,572 | 70,012 | 60,059 |
Income (loss) from operations | 1,627 | (43) | 3,004 | 2,906 |
Other income (expense), net: | ||||
Interest expense | (39) | (40) | (192) | (204) |
Interest income | 12 | 4 | 14 | 14 |
Other income (expense), net | (144) | (447) | (188) | (346) |
Total other income (expense), net | (171) | (483) | (366) | (536) |
Income (loss) before provision for income taxes | 1,456 | (526) | 2,638 | 2,370 |
Provision for income taxes | 281 | 125 | 358 | 416 |
Net income (loss) |
|
|
|
|
Net income (loss) per share attributable to common stockholders: | ||||
Basic |
|
|
|
|
Diluted |
|
|
|
|
Weighted average shares used in computing net income (loss) per share attributable to common stockholders: | ||||
Basic | 30,807 | 5,194 | 11,891 | 5,053 |
Diluted | 35,064 | 5,194 | 28,352 | 24,194 |
(1) Includes stock-based compensation as follows: | ||||
Cost of revenues |
|
|
|
|
Research and development | 188 | 159 | 672 | 499 |
Sales and marketing | 218 | 181 | 1,074 | 578 |
General and administrative | 383 | 248 | 1,430 | 927 |
Total stock-based compensation |
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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
(Unaudited) | ||||
(in thousands) | ||||
Three Months Ended | Year Ended | |||
|
|
|||
2012 | 2011 | 2012 | 2011 | |
Net income (loss) |
|
|
|
|
Foreign currency translation gain (loss), net of zero tax | (42) | (106) | (59) | (166) |
Change in unrealized gain (loss) on short-term investments, net of zero tax | 8 | — | 8 | — |
Other comprehensive income (loss), net | (34) | (106) | (51) | (166) |
Comprehensive income (loss) |
|
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|
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CONDENSED CONSOLIDATED BALANCE SHEETS | ||
(Unaudited) | ||
(in thousands) | ||
|
||
2012 | 2011 | |
Assets | ||
Current assets: | ||
Cash and cash equivalents |
|
|
Short-term investments | 83,547 | — |
Accounts receivable, net | 24,545 | 20,750 |
Prepaid expenses and other current assets | 4,377 | 3,774 |
Total current assets | 147,354 | 49,072 |
Restricted cash | 114 | 112 |
Property and equipment, net | 18,148 | 13,861 |
Intangible assets, net | 2,811 | 3,175 |
Goodwill | 317 | 317 |
Other noncurrent assets | 1,574 | 2,252 |
Total assets |
|
|
Liabilities, Convertible Preferred Stock and Stockholders' Equity (Deficit) | ||
Current Liabilities: | ||
Accounts payable |
|
|
Accrued liabilities | 7,803 | 8,468 |
Deferred revenues, current | 56,497 | 46,717 |
Capital lease obligations, current | 1,183 | 1,987 |
Total current liabilities | 67,514 | 59,426 |
Deferred revenues, noncurrent | 8,616 | 4,713 |
Income taxes payable, noncurrent | 594 | 661 |
Other noncurrent liabilities | 1,231 | 2,134 |
Capital lease obligations, noncurrent | 808 | 2,406 |
Total liabilities | 78,763 | 69,340 |
Convertible preferred stock | — | 63,873 |
Stockholders' equity (deficit): | ||
Common stock | 31 | 5 |
Additional paid-in capital | 166,651 | 12,927 |
Accumulated other comprehensive loss | (1,035) | (984) |
Accumulated deficit | (74,092) | (76,372) |
Total stockholders' equity (deficit) | 91,555 | (64,424) |
Total liabilities, convertible preferred stock and stockholders' equity (deficit) |
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
(Unaudited) | ||
(in thousands) | ||
Year Ended |
||
2012 | 2011 | |
Cash flows from operating activities: | ||
Net income |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 7,341 | 5,373 |
Bad debt expense | 218 | 193 |
Loss on disposal of property and equipment | 10 | 1 |
Stock-based compensation | 3,452 | 2,147 |
Non-cash interest expense | 24 | 36 |
Amortization of premiums on short-term investments | 7 | — |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,014) | (6,651) |
Prepaid expenses and other assets | 91 | (3,835) |
Accounts payable | (242) | 1,248 |
Accrued liabilities | (1,163) | 2,817 |
Deferred revenues | 13,683 | 11,885 |
Income taxes payable | 181 | 333 |
Other noncurrent liabilities | 84 | 1,689 |
Net cash provided by operating activities | 21,952 | 17,190 |
Cash flows from investing activities: | ||
Purchases of short-term investments | (83,547) | — |
Purchases of property and equipment | (11,188) | (7,499) |
Purchases of intangible assets | (49) | — |
Net cash used in investing activities | (94,784) | (7,499) |
Cash flows from financing activities: | ||
Proceeds from initial public offering, net of offering costs | 84,534 | — |
Proceeds from exercise of stock options | 1,685 | 948 |
Proceeds from early exercise of stock options | 384 | 390 |
Proceeds from issuance of Series C Preferred Stock | — | 128 |
Principal payments under capital lease obligations | (2,401) | (1,476) |
Non-contingent payment related to acquisition | (1,000) | — |
Net cash provided by (used in) financing activities | 83,202 | (10) |
Effect of exchange rate changes on cash and cash equivalents | (33) | (143) |
Net increase in cash and cash equivalents | 10,337 | 9,538 |
Cash and cash equivalents at beginning of period | 24,548 | 15,010 |
Cash and cash equivalents at end of period |
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RECONCILIATION OF NON-GAAP DISCLOSURES | ||
FOUR-QUARTER BOOKINGS | ||
(Unaudited) | ||
(in thousands) | ||
Four Quarters Ended | ||
|
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2012 | 2011 | |
Revenues |
|
|
Deferred revenues, current | ||
Beginning of the Four-Quarter Period | 46,717 | 37,811 |
Ending | 56,497 | 46,717 |
Net change | 9,780 | 8,906 |
Four-Quarter Bookings |
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RECONCILIATION OF NON-GAAP DISCLOSURES | ||||
EBITDA AND ADJUSTED EBITDA | ||||
(Unaudited) | ||||
(in thousands) | ||||
Three Months Ended | Year Ended | |||
|
|
|||
2012 | 2011 | 2012 | 2011 | |
Net income (loss) |
|
|
|
|
Depreciation and amortization of property and equipment | 1,829 | 1,473 | 6,895 | 4,939 |
Amortization of intangible assets | 115 | 119 | 446 | 434 |
Interest expense | 39 | 40 | 192 | 204 |
Provision for income taxes | 281 | 125 | 358 | 416 |
EBITDA | 3,439 | 1,106 | 10,171 | 7,947 |
Stock-based compensation | 870 | 635 | 3,452 | 2,147 |
Other (income) expense, net | 132 | 443 | 174 | 332 |
Adjusted EBITDA |
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RECONCILIATION OF NON-GAAP DISCLOSURES | ||||
(Unaudited) | ||||
(in thousands, except per share data) | ||||
Three Months Ended | Year Ended | |||
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|
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2012 | 2011 | 2012 | 2011 | |
GAAP gross profit |
|
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|
Plus: | ||||
Stock-based compensation expense | 81 | 47 | 276 | 143 |
Non-GAAP gross profit |
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|
GAAP income (loss) from operations |
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|
Plus: | ||||
Stock-based compensation expense | 870 | 635 | 3,452 | 2,147 |
Non-GAAP income from operations |
|
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|
|
GAAP net income (loss) |
|
|
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|
Plus: | ||||
Stock-based compensation expense | 870 | 635 | 3,452 | 2,147 |
Non-GAAP net income (loss) |
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|
Non-GAAP net income (loss) attributable to common stockholders |
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|
Non-GAAP net income (loss) per share attributable to common stockholders: | ||||
Basic |
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|
|
|
Diluted |
|
|
|
|
Weighted average shares used in computing non-GAAP net income (loss) per share attributable to common stockholders: | ||||
Basic | 30,807 | 5,194 | 11,891 | 5,053 |
Diluted | 35,064 | 5,194 | 28,352 | 24,194 |
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||||
NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS | ||||
(Unaudited) | ||||
(in thousands, except per share data) | ||||
Three Months Ended | Year Ended | |||
|
|
|||
2012 | 2011 | 2012 | 2011 | |
Numerator: | ||||
Net income (loss) |
|
|
|
|
Net income attributable to participating securities | (16) | — | (1,204) | (1,518) |
Net income (loss) attributable to common stockholders - basic | 1,159 | (651) | 1,076 | 436 |
Undistributed earnings reallocated to participating securities | 15 | — | 1,201 | 1,516 |
Net income (loss) attributable to common stockholders - diluted |
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|
Denominator: | ||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders - basic | 30,807 | 5,194 | 11,891 | 5,053 |
Effect of potentially dilutive securities: | ||||
Convertible preferred stock | 383 | — | 13,270 | 17,590 |
Common stock options | 3,874 | — | 3,187 | 1,537 |
Warrants | — | — | — | 2 |
Contingently issuable shares related to an acquisition | — | — | 4 | 12 |
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders - diluted | 35,064 | 5,194 | 28,352 | 24,194 |
Net income (loss) per share attributable to common stockholders: | ||||
Basic |
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Diluted |
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CONTACT: Investors:Source:Don McCauley Chief Financial OfficerQualys, Inc. +1 (650) 801-6181 dmccauley@qualys.com Media:John Christiansen /Stacy Roughan Sard Verbinnen & Co +1 (415) 618-8750/+1 (310) 201-2040 jchristiansen@sardverb.com/sroughan@sardverb.com
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