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Cyren Announces First Quarter 2019 Financial Results
[May 15, 2019]

Cyren Announces First Quarter 2019 Financial Results


MCLEAN, Va., May 15, 2019 /PRNewswire/ -- Cyren (NASDAQ: CYRN) today announced its first quarter 2019 financial results for the period ending March 31, 2019. 

During the first quarter, Cyren reported quarterly revenues of $9.7 million – an increase of 26% over the first quarter of 2018. Annual recurring revenue from Cyren's enterprise business finished the quarter at $6.8 million compared to $4.8 million at the end of Q1 2018, representing a 41% annual increase.

"We are pleased with the company's financial results during the first quarter," said Lior Samuelson, Chairman of the Board at Cyren. "We experienced continued demand for Cyren's email security solutions, which translated to solid year-over-year top line growth. More importantly, I feel like we have built a solid foundation for future growth, and look forward to working with Cyren's next CEO to take the company to new heights."

Following Cyren's previously announced CEO transition plan, on April 24, the company announced that Brett Jackson was appointed by Cyren's Board to serve as the company's next CEO, who started in the position on May 6. Mr. Jackson will be introduced by Mr. Samuelson on the company's first quarter financial results conference call on May 15.

First Quarter 2019 Financial Highlights:

  • Revenues for the first quarter of 2019 were $9.7 million, compared to $7.7 million during the first quarter of 2018, and $9.5 million last quarter.

  • GAAP net loss for the first quarter of 2019 was $4.6 million, compared to a net loss of $5.2 million in the first quarter of 2018.

  • GAAP loss per basic and diluted share for the first quarter of 2019 was $0.08, compared to a loss of $0.10 per basic and diluted share for the first quarter of 2018.

  • Non-GAAP net loss for the first quarter of 2019 was $4.4 million, compared to a Non-GAAP net loss of $4.8 million for the first quarter of 2018.

  • Non-GAAP loss per basic and diluted share was $0.08 for the first quarter of 2019, compared to a Non-GAAP loss of $0.09 per share in first quarter of 2018.

  • Operating cash flow during the first quarter of 2019 was negative $1.3 million, compared to operating cash flow of negative $4.2 million during the first quarter of 2018.

  • Net cash flow for the first quarter of 2019 was negative $5.1 million, compared to negative $5.7 million during the first quarter of 2018.

  • Cash balance as of March 31, 2019 was $12.4 million, compared to $17.6 million as of December 31, 2018.

For information regarding the non-GAAP financial measures discussed in this release, please see "Use of Non-GAAP Financial Measures" and "Reconciliation of Selected GAAP Measures to Non-GAAP Measures."

Recent Business Highlights:

  • In April, Cyren announced the appointment of Brett Jackson as the company's new Chief Executive Officer. Mr. Jackson is an experienced, growth-oriented CEO and has led and scaled multiple companies in the security and analytics markets. He was unanimously approved by Cyren's board of directors.
  • Cyren was recently honored in the Cybersecurity Excellence Awards, with its cloud-based Cyren Email Security winning a first-place gold award in the email security category against six other finalists. This is the third year in a row that Cyren products have been recognized in the Cybersecurity Excellence Awards.
  • In January, Cyren announced a partnership with Microsoft to integrate its web security technology directly into Windows Defender Advanced Threat Protection (ATP). The offering is initially being launched in a private preview with a select set of enterprise customers during the second quarter of 2019, with the goal of reaching general availability for all Windows Defender ATP customers later in the year.

Financial Results Conference Call:

The company will host a conference call at 10 a.m. Eastern Time (5 p.m. Israel Time) on Wednesday, May 15, 2019 to discuss first quarter results.





U.S. Dial-in Number:

1-877-407-0312

Israel Dial-in Number:

1-80-940-6247

International Dial-in Number:   

1-201-389-0899


The call will be simultaneously webcast live on the investor relations section of Cyren's website at https://ir.cyren.com, or by using the following link: https://webcasts.eqs.com/cyren20190515.

For those unable to participate in the live conference call, a replay will be available until May 29, 2019. To access the replay, the U.S. dial in number is 1-877-660-6853 and the non-U.S. dial in number is 1-201-612-7415. Callers will be prompted for replay conference ID number 13690390. An archived version of the webcast will also be available on the investor relations section of the company's website at https://ir.cyren.com/events.

About Cyren:

More than 1.3 billion users around the world rely on Cyren's 100% cloud security solutions to protect them against cyber attacks and data loss every day. Powered by the world's largest security cloud, Cyren (NASDAQ: CYRN) delivers fast time-to-protection with award-winning email security, cloud sandboxing and DNS filtering services for business, and threat intelligence solutions for service providers and security vendors like Microsoft, Google and Check Point. Learn more at www.cyren.com.

Blog: http://blog.cyren.com
Facebook: www.facebook.com/CyrenWeb
LinkedIn: www.linkedin.com/company/cyren
Twitter: www.twitter.com/CyrenInc

Use of Non-GAAP Financial Measures:

Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: stock-based compensation expenses, amortization of acquired intangible assets, and deferred taxes related to acquisitions, adjustments to earn-out obligations, and capitalization of technology. The purpose of such adjustments is to give an indication of the company's performance exclusive of non-cash charges and other items that are considered by management to be outside of the company's core operating results. The company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.

Company management regularly uses supplemental non-GAAP financial measures internally to understand, manage and evaluate the business and make operating decisions.

These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. The company believes this adjustment is useful to investors as a measure of the ongoing performance of the business. The company believes these non-GAAP financial measures provide consistent and comparable measures to help investors understand the company's current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it important to make these non-GAAP adjustments available to investors.

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. For example, statements in the future tense, and statements including words such as "expect," "plan," "estimate," "anticipate," or "believe" are forward-looking statements. These statements are based on information available at the time of the press release and the company assumes no obligation to update any of them. The statements in this press release are not guarantees of future performance and actual results could differ materially from current expectations as a result of numerous factors, including our CEO transition, business conditions and growth or deterioration in the internet security market, technological developments, products offered by competitors, availability of qualified staff, and technological difficulties and resource constraints encountered in developing new products, as well as those risks described in the company's publicly filed reports, which are available through www.sec.gov.

Company Contact
Mike Myshrall, CFO
Cyren
+1.703.760.3320
mike.myshrall@cyren.com

Media Contact 
Matthew Zintel
Zintel Public Relations
+1.281.444.1590
matthew.zintel@zintelpr.com 

 

CYREN LTD.





 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS





(in thousands of U.S. dollars, except per share amounts)






















Three months ended 

March 31


2019


2018


Unaudited


Unaudited





 Revenues 

$               9,655


$            7,636





   Cost of revenues 

4,000


3,382





Gross profit 

5,655


4,254









Operating expenses:








   Research and development, net

4,177


3,355





   Sales and marketing 

3,856


4,145





   General and administrative 

2,432


2,038





Total operating expenses 

10,465


9,538





Operating loss

(4,810)


(5,284)





  Other income (expense), net

248


(2)





   Financial expense, net 

(53)


4





Loss before taxes

(4,615)


(5,282)





   Tax benefit

39


46





Net loss

$              (4,576)


$          (5,236)









Loss per share - basic

$                (0.08)


$             (0.10)





Loss per share - diluted 

$                (0.08)


$             (0.10)





Weighted average number of shares outstanding: 




Basic 

54,177


53,381





Diluted  

54,177


53,381

 

CYREN LTD.





RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES





(in thousands of U.S.dollars, except per share amounts)






Three months ended 


March 31


2019


2018


Unaudited


Unaudited





GAAP gross profit

$                         5,655


$                       4,254

GAAP gross margin

59%


56%

Plus:




Stock-based compensation

29


31

Amortization of intangible assets

839


852

Non-GAAP gross profit

6,523


5,137

Non-GAAP gross margin

68%


67%





GAAP operating loss

(4,810)


(5,284)

Plus:




Stock-based compensation

269


323

Amortization of intangible assets

963


1,009

Capitalization of technology

(742)


(877)

Non-GAAP operating loss

(4,320)


(4,829)





GAAP net loss

(4,576)


(5,236)

Plus:




Stock-based compensation expense

269


323

Intangible amortization expense

963


1,009

Adjustment to earn-out liabilities

-


27

Amortization of deferred tax assets

(57)


(64)

Gain from an earn-out liability settlement

(256)


-

Capitalization of technology

(770)


(877)

Non-GAAP net loss

$                      (4,427)


$                     (4,818)





Numerator for non-GAAP EPS calculation

$                      (4,427)


$                     (4,818)

Non-GAAP net loss per share 

$                          (0.08)


$                       (0.09)





GAAP weighted-average shares used to




compute net loss per share

54,177


53,381

 

CYREN LTD.





CONDENSED CONSOLIDATED BALANCE SHEETS





(in thousands of U.S. dollars)










March 31


December 31


2019


2018


Unaudited


Audited

                 Assets




    Current Assets:




Cash and cash equivalents 

$    12,444


$         17,571

Trade receivables, net

3,024


3,658

Deferred commissions

909


887

Prepaid expenses and other receivables

1,472


778

 Total current assets 

17,849


22,894





Long-term deferred commissions

1,783


1,880

Lease deposits 

812


821

Operating lease right-of-use assets

9,675


-

Severance pay fund 

541


503

Property and equipment, net 

4,692


4,608

Intangible assets, net

8,554


8,802

Goodwill

20,262


20,519

 Total long-term assets 

46,319


37,133

Total assets

$    64,168


$         60,027





                 Liabilities and Shareholders' Equity




    Current Liabilities:




Trade payables

$    1,270


$           1,668

Employees and payroll accruals 

3,375


3,959

Accrued expenses and other liabilities 

1,343


910

Operating lease liabilities

1,277


-

Earn-out consideration

-


2,926

Deferred revenues

5,498


5,773

 Total current liabilities 

12,763


15,236





Deferred revenues

3,242


503

Convertible notes

10,000


10,000

Long-term operating lease liabilities

8,724


-

Deferred tax liability

1,045


1,130

Accrued severance pay 

677


598

Other liabilities

347


700

Total long-term liabilities

24,035


12,931





Shareholders' equity 

27,370


31,860

Total liabilities and shareholders' equity

$    64,168


$         60,027

 

CYREN LTD.





 CONDENSED CONSOLIDATED CASH FLOW DATA





(in thousands of U.S. dollars)






Three months ended 


March 31


2019


2018

Cash flows from operating activities:

Unaudited


Unaudited





Net loss

$                (4,576)


$                (5,236)





Adjustments to reconcile net loss to net cash provided by (used in) operating activities:




Loss on disposal of property and equipment

1


-

Depreciation 

461


455

Stock-based compensation

269


323

Amortization of intangible assets

966


1,009

Amortization of deferred commissions

(332)


242

Amortization of operating lease right-of-use assets

351


-

Interest on convertible notes

140


-

Other expenses (income) related to the earn-out consideration

(256)


27

Deferred taxes, net

(69)


(47)





Changes in assets and liabilities:




Trade receivables

678


587

Prepaid expenses and other receivables

(738)


(659)

Deferred commissions

407


(359)

Change in long-term lease deposits

20


(3)

Trade payables

(405)


(39)

Employees and payroll accruals, accrued expenses and other liabilities

(274)


(252)

Deferred revenues

2,463


(509)

Accrued severance pay, net

41


8

Operating lease liabilities

(365)


-

Other long-term liabilities

(111)


61

Net cash provided by (used in) operating activities

(1,329)


(4,392)





Cash flows from investing activities:








Capitalization of technology, net of grants received

(627)


(662)

Purchase of property and equipment

(544)


(822)

Net cash used in investing activities

(1,171)


(1,484)





Cash flows from financing activities:








Payment of earnout liability

(2,680)


-

Proceeds from options exercised

189


19

Net cash provided by (used in) financing activities

(2,491)


19

Effect of exchange rate changes on cash

(126)


36

Increase (decrease) in cash, cash equivalents and restricted cash

(5,117)


(5,821)

Cash, cash equivalents and restricted cash at the beginning of the period

18,156


24,228

Cash, cash equivalents and restricted cash at the end of the period

$              13,039


$                18,407





Reconciliation of cash, cash equivalents and restricted cash as shown in the consolidated statements of cash flow:




Cash and cash equivalents

$              12,444


$                17,940

Restricted cash included in long-term restricted lease deposits

595


467





Total cash, cash equivalents and restricted cash

$               13,039


$                18,407

 

 

CYREN Logo. (PRNewsFoto/CYREN)

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/cyren-announces-first-quarter-2019-financial-results-300850451.html

SOURCE Cyren


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