VASCO Reports Results for Third Quarter and First Nine Months of 2008
biz.yahoo.com
Thursday October 23, 3:00 am ET
Revenue for the third quarter 2008 was $39.7 million, an increase of 32% over third quarter 2007; Operating income was $11.4 million, an increase of 39% over third quarter 2007. Both revenue and operating income were the highest in the Company's history. VASCO reaffirms its full-year 2008 guidance; Financial results for the third quarter of 2008 to be discussed on conference call today at 10:00 a.m. E.D.T.
OAKBROOK TERRACE, Ill. and ZURICH, Switzerland, Oct. 23 /PRNewswire-FirstCall/ -- VASCO Data Security International, Inc. (Nasdaq: VDSI) today reported financial results for the third quarter and nine months ended September 30, 2008.
Revenue for the third quarter of 2008 increased 32% to $39.7 million from $30.0 million for the third quarter of 2007, and for the first nine months of 2008, increased 17% to $104.0 million from $88.8 million for the first nine months of 2007.
Net income for the third quarter of 2008 was $9.1 million, or $0.24 per diluted share, an increase of $3.2 million, or 55%, from $5.9 million, or $0.15 per diluted share, for the comparable period in 2007. Net income for the first nine months of 2008 was $21.5 million, or $0.56 per diluted share, an increase of $3.8 million, or 21%, from $17.7 million, or $0.46 per diluted share, for the comparable period in 2007.
Other Financial Highlights:
-- Gross profit was $27.8 million, or 70% of revenue, for the third
quarter of 2008 and $73.3 million, or 70% of revenue, for the first
nine months of 2008. Gross profit was $20.0 million, or 67% of revenue
for the third quarter of 2007 and $58.2 million, or 66% of revenue, for
the first nine months of 2007.
-- Operating expenses for the third quarter and first nine months of 2008
were $16.4 million and $47.0 million, respectively, an increase of
$4.7 million, or 40%, from $11.7 million reported for the third quarter
of 2007 and an increase of $13.3 million, or 40%, from $33.6 million
reported for the first nine months of 2007. Operating expenses for the
third quarter and first nine months of 2008 included $0.8 million and
$2.3 million, respectively, related to stock-based incentives.
-- Operating income for the third quarter and first nine months of 2008
was $11.4 million and $26.3 million, respectively, an increase of
$3.2 million, or 39%, from $8.3 million reported for the third quarter
of 2007 and an increase of $1.7 million, or 7%, from $24.6 million
reported for the first nine months of 2007. Operating income, as a
percentage of revenue, for the third quarter and first nine months of
2008 was 29% and 25%, respectively, compared to 28% for both of the
comparable periods in 2007.
-- Earnings before interest, taxes, depreciation and amortization was
$11.5 million and $28.4 million for the third quarter and first nine
months of 2008, respectively, an increase of 31% from $8.7 million
reported for the third quarter of 2007 and an increase of 7% from
$26.5 million reported for the first nine months of 2007.
-- Total cash balances at September 30, 2008 totaled $50.7 million
compared to $42.1 million and $38.8 million at June 30, 2008 and
December 31, 2007, respectively.
Operational and Other Highlights:
-- VASCO won 365 new customers in Q3 2008 (62 new banks and 303 new
enterprise security customers). For the first nine months of 2008,
VASCO won 1,472 new customers (212 banks and 1,260 enterprise security
customers).
-- VASCO launches new EMEA + LAM Enterprise Security Partner Program to
maximize Enterprise
-- VASCO launches Digipass Go 7 Strong User Authentication
-- VASCO makes Digipass 810 available to Asian markets
-- VASCO launches aXsGUARD survey for July 2008
-- Encore Payment Systems (U.S.) secures remote access with DIGIPASS GO 3
and VACMAN Middleware
-- WhiteGold to distribute VASCO in Australia
-- VASCO launches Japanese version of website
Guidance for full-year 2008:
VASCO reaffirmed its full-year 2008 guidance provided at the end of the second quarter, as follows:
-- Revenue growth is projected to be 15% to 25% for the full-year 2008
over full-year 2007,
-- Gross margin as a percentage of revenue for full-year 2008 is projected
to be in the range of 60% to 68%, and
-- Operating margin as a percentage of revenue for full-year 2008 is
projected to be in the range of 20% to 25%.
"We were pleased to see that the strong order flow that we experienced at the end of the second quarter continued in the third quarter," stated T. Kendall Hunt, Chairman & CEO. "Given the strong order flow, we continue to be cautiously optimistic in spite of the turmoil in the financial markets and we are, therefore, reaffirming the guidance for the full-year 2008 that we gave at the end of the second quarter. Even though the banking industry is going through a period of major change, our products continue to be very well positioned to help banks reduce their costs, extend their brand into the hands of their customers and reduce fraud by providing their customers with secure access to their accounts."
"The results for the third quarter were consistent with our belief that our growth over 2007 would be stronger in the second half of 2008 than in the first half of the year," said Jan Valcke, VASCO's President and COO. "While we expect that there may be some changes in the timing of orders from banks that have experienced major changes in their ownership, we believe that the overall demand for our products will continue to grow as the number of customers using the internet to access their accounts grows. Given the strength of our products, we also expect that the changes in ownership will create new opportunities for us to present our products' benefits to many individuals that have not worked with us previously."
Cliff Bown, Executive Vice President and CFO added, "The continued strong operating performance has resulted in a continued strengthening of our balance sheet. Our net cash balance increased $8.6 million, or 21%, and our working capital increased $6.9 million, or 10%, from June 30, 2008 to September 30, 2008. Days Sales Outstanding (DSO) in net accounts receivable decreased to approximately 69 days at September 30, 2008 from 83 days and 76 days at June 30, 2008 and December 31, 2007, respectively." |
