Good news: Entrust Technologies Inc. Reports Record Third Quarter Results
Revenues up 86% to $42.2 Million; Operating Income(a) of $.02 per Diluted Share; Seventh Consecutive Quarter of Operating Profitability
PLANO, Texas--(BUSINESS WIRE)--Oct. 17, 2000-- Entrust® Technologies Inc. (Nasdaq:ENTU - news), the global leader in solutions that bring trust to e-business, today reported financial results for the quarter ended September 30, 2000.
Revenues increased 86% to $42.2 million for the third quarter of 2000 from $22.6 million for the same period in 1999. Net earnings from operations applicable to common shares(a) for the third quarter of 2000 were $1.2 million, or $.02 per diluted share. Including Acquisition Related Costs(a), Entrust Technologies recorded a net (loss) applicable to common shares in the third quarter of 2000 of ($28.8) million or ($.46) per share.
``We are very pleased with our overall performance in the third quarter,'' said John Ryan, president and CEO of Entrust Technologies. ``Our results, which are driven by our global reach and technology leadership, reflect the strength of our business across a broad spectrum of geographies, vertical markets, and application solutions. We are particularly pleased with the third-quarter performance of our core business, which provides customers with trusted e-business infrastructures based on public-key infrastructure (PKI) and authorization solutions. Our new business initiatives, including Entrust.net and wireless, also continued to exceed expectations with record growth and significant new partnerships.''
(a) Net earnings from operations applicable to common shares is defined as reported net earnings applicable to common shares before ``Acquisition Related Costs'' (acquired in-process R&D and the amortization of purchased product rights, goodwill and other intangibles), utilizing a 30% effective tax rate.
Quarterly Highlights
During the third quarter of 2000, Entrust Technologies strengthened its position as the leading player in the global marketplace for trusted e-business infrastructure solutions with gains in several key areas of its business:
--Completed the integration of all major business functions after
the June 26th merger with enCommerce, while achieving record revenues.
--Continued to drive strong International revenue growth with 32%
of third quarter revenues generated outside of North America.
--Experienced continued significant growth for Entrust.net's Web
& wireless server certificates. Entrust.net sold 14,500 Web & wireless
server certificates in the third quarter, up over 1000% from the same
period in 1999 and 45% over the second quarter of 2000.
Entrust also continued to demonstrate leadership and momentum in providing end-to-end trusted e-business infrastructure solutions. Key events in the third quarter for Entrust Technologies included:
--Demonstrated success selling Entrust/getAccess, the authorization
solution acquired as part of Entrust's June 26, 2000 merger with
enCommerce.
--Announced significant customer wins in the financial vertical,
including ING Barings, Sanwa Bank, and The Global Trust Authority.
--Concluded a broad strategic relationship with Motorola for the
development and marketing of wireless security solutions including the
embedding of Entrust.net WAP root CA certificates in Motorola handsets
and wireless Internet gateways.
--Signed partnerships with two additional leading B2B vendors - i2 and
webMethods.
--Signed agreement with PeopleSoft for embedding Entrust/Toolkit for
Java.
--Announced Entrust.net affiliates with Viacode in the U.K., Nettrak
in Korea and Modulo in Brazil.
--Won Network Computing Editor's Choice Award.
ENTRUST TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of dollars, except per share data)
Three Months Ended Nine Months Ended
September 30 September 30
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2000 1999 2000 1999
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(unaudited)(unaudited)(unaudited)(unaudited)
Revenues:
License $ 25,451 $ 16,515 $ 65,120 $ 42,056
Services and
Maintenance 16,736 6,108 35,445 17,147
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Total revenues 42,187 22,623 100,565 59,203
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Cost of revenues:
Licenses (b) 787 603 2,677 1,412
Services and
Maintenance 9,982 3,385 20,614 9,476
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Total cost of revenues 10,769 3,988 23,291 10,888
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Gross profit
Licenses 24,664 15,912 62,443 40,644
Services and
Maintenance 6,754 2,723 14,831 7,671
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Total gross profit 31,418 18,635 77,274 48,315
Sales and marketing 21,337 10,478 49,099 28,857
Research and development 8,454 4,225 19,272 12,111
General and administrative 3,745 1,993 8,659 5,369
Acquisition related costs:
Acquired in-process
research & development - - 29,614 -
Amortization of purchased
product rights 1,377 - 1,377 -
Amortization of goodwill
and other intangibles 28,836 178 31,112 534
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(32,331) 1,761 (61,859) 1,444
Interest income 3,767 966 9,380 2,733
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Income (loss) before
income taxes (28,564) 2,727 (52,479) 4,177
Provision for income
Taxes 212 682 1,921 927
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Net income (loss) $ (28,776) $ 2,045 $ (54,400) $ 3,250
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Weighted average
common shares used
Basic 62,507 44,106 55,112 43,504
Diluted 62,507 54,690 55,112 54,598
Net income (loss)
per share
Basic ($0.46) $0.05 ($0.99) $0.07
Diluted ($0.46) $0.04 ($0.99) $0.06
Supplemental Data:
Net earnings from
operations (a) $ 1,154 $ 2,034 $ 6,737 $ 3,298
Net earnings from
operations per
diluted share $ 0.02 $ 0.04 $ 0.11 $ 0.06
Weighted average common
shares used 67,093 54,690 61,044 54,598
(a) Net earnings from operations excludes Acquisition Related Costs,
utilizing a 30% tax rate.
(b) Excludes amortization of purchased product rights. |
