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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Corero Network Security Plc | LSE:CNS | London | Ordinary Share | GB00B54X0432 | ORD 1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 12.25 | 12.00 | 12.50 | 12.25 | 12.25 | 12.25 | 83,068 | 08:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Computers & Software-whsl | 20.12M | 554k | 0.0011 | 111.36 | 62.33M |
TIDMCNS
RNS Number : 2205V
Corero Network Security PLC
13 April 2021
13 April 2021
Corero Network Security plc (AIM: CNS)
("Corero," the "Company" or the "Group")
Full year results
Corero Network Security plc (AIM: CNS), a leading provider of real-time high-performance, automatic Distributed Denial of Service ('DDoS') cyber defense solutions, announces its audited results for year ended 31 December 2020.
Financial Highlights:
-- Significant revenue growth underpinned by record order intake and strong H2 2020 performance:
o Revenues increased 74% to $16.9 million (2019: $9.7 million)
o Record H2 2020 revenues, up 93% at $10.6 million (H2 2019: $5.5 million)
o Annualised Recurring Revenues(1) ('ARR') up 36% to $9.8 million as at 1 January 2021 (1 January 2020: $7.2 million)
o Revenue from DDoS Protection as-a-Service ('DDPaaS') contracts increased to $2.9 million (2019: $1.3 million)
-- Gross margins of 77% (2019: 81%) -- EBITDA(2) loss of $1.4 million (2019: loss of $3.2 million) -- Adjusted EBITDA(3) loss of $0.6 million (2019: loss of $2.5 million) -- Loss before taxation of $4.0 million (2019: loss of $6.6 million) -- Loss per share of 0.8 cents (2019: loss per share of 1.6 cents) -- Net cash at 31 December 2020 of $7.6 million (H1 2020: $3.3 million; 2019: $5.4 million)
Operational Highlights:
-- Global acceleration of remote working and internet usage as a result of COVID-19 has reinforced the need for online security and further emphasised the ongoing importance of Corero's high quality solutions
-- Order intake increased by 61% to $20.9 million (2019: $13.0 million) -- Addition of 42 new customers in 2020 (2019: 18 new customers)
o 17 of which were secured through Corero's strategic partnership with Juniper (2019: 6 new Juniper customers)
-- Strong growth in DDPaaS and software subscriptions continues to support recurring revenues and earnings visibility
-- Sustained high levels of customer satisfaction continue to result in follow-on orders , which were $10.3 million in 2020 (2019: $6.1 million)
-- Lionel Chmilewsky, CEO and Neil Pritchard, Group Finance Director joined the Company during 2020, with Ashley Stephenson appointed Chief Technology Officer
-- Significant progress in delivering the Group's growth strategy:
o Continued investment in sales and marketing underpins ongoing direct and channel sales efforts globally
o Addition of more agent, distributor and reseller relationships, and in more geographies
o Leveraging strategic partnerships with Juniper and GTT and adding new complementary partners
o Amplifying the Group's services offering
o Intensifying relationships with global and major accounts
o Continuing to focus on technological innovation
Outlook
-- Record order intake in H2 2020 and recurring revenue base provides improved visibility for the Group's future earnings
-- Importance of DDoS mitigation continues to build globally, together with traction for Corero's solutions
-- Increasing market coverage, most notably in broadening of the Group's partnerships
-- Management continues to monitor the business impact of the global COVID-19 pandemic closely, however, remain optimistic in Corero delivering sustained growth
Lionel Chmilewsky, Chief Executive Officer of Corero, commented:
"2020 was a year of real progress for Corero, during which we achieved a strong financial performance and delivered against our strategic priorities. The 74% increase in sales that we achieved in the year was underpinned by record order intake and increasing traction through our key strategic partnerships. Pleasingly, we also continue to generate increased levels of recurring revenues, providing us with good visibility for the Group's future earnings.
"We remain focused on driving growth through the augmentation of our sales efforts - both direct and through partnerships - to broaden our geographic reach and increase penetration with existing customers and partners, as well as ensuring our solutions remain best in class through ongoing investment in R&D.
"Corero has built a solid pipeline for 2021 and we look to the future with confidence, with the significant strategic progress we achieved during 2020 providing us with a renewed platform for growth."
(1) Defined as the normalised annualised recurring revenue and includes recurring revenues from contract values of annual support, software subscription and from DDoS Protection-as-a-Service contracts.
(2) Defined as Earnings before Interest, Taxation, Depreciation and Amortisation.
(3) Defined as Earnings before Interest, Taxation, Depreciation (including DDPaaS assets' depreciation which is charged to cost of sales) and Amortisation, before share-based payments, and less unrealised foreign exchange differences on an intercompany loan.
The information contained within this announcement was deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014, as amended by regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310, prior to release of this announcement. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Enquiries:
Corero Network Security plc Lionel Chmilewsky, CEO Tel: +44(0) 18 9587 Neil Pritchard, Group Finance Director 6382 C anaccord Genuity Limited Tel: +44(0) 20 7523 (Nominated Adviser and Broker) 8000 S imon Bridges / Andrew Potts Vigo Communications Tel: +44(0) 20 7390 0230 Jeremy Garcia / Antonia Pollock corero@vigocomms.com
About Corero Network Security
Corero Network Security plc is a global leader in real-time, high-performance, automatic DDoS cyber defense solutions. Both Service and Hosting providers, alongside digital enterprises across the globe rely on Corero's award winning cybersecurity technology to eliminate the threat of Distributed Denial of Service (DDoS) to their digital environment through automatic attack detection and mitigation, coupled with network visibility, analytics and reporting. Corero's industry leading SmartWall and SecureWatch technology provides scalable protection capabilities against external DDoS attackers and internal DDoS botnets in the most complex edge and subscriber environments, while enabling a more cost-effective economic model than previously available. Corero's key operational centers located in Marlborough, Massachusetts, USA and Edinburgh, UK, with the Company's headquartered in Amersham, UK. The Company is also listed on the London Stock Exchange's AIM market under the ticker CNS. For more information, visit www.corero.com .
CHIEF EXECUTIVE'S STRATEGIC UPDATE AND OPERATIONAL REVIEW
Introduction
Corero's performance across 2020 clearly demonstrates that the Company's renewed strategic focus on its global sales and marketing efforts is delivering tangible benefits. In the year ended 31 December 2020, the Company generated a 74% increase in revenue to $16.9 million (2019: $9.7 million), which as announced in January 2020, was ahead of market expectations, with H2 2020 revenues at a record high of $10.6 million (H2 2019: $5.5 million).
The Company's trading was underpinned by order intake reaching an all-time high at $20.9 million for 2020 (2019: $13.0 million), representing an increase of 61%, with $13.0 million secured in H2 2020 (H2 2019: $8.0 million), another period of record order intake for the Company. It is important to note that revenues associated with order intake are recognisable over the lifetime of each of the contracts.
Significantly, Corero achieved a marked increase in Annualised Recurring Revenues ( 'ARR') in the year to $9.8 million as at 1 January 2021, driven by growth in DDoS Protection-as-a-Service ('DDPaaS') and software subscription orders, which continues to give management better visibility over the Company's future earnings (ARR at 1 January 2020: $7.2 million).
This strong performance was delivered against the backdrop of the COVID-19 pandemic, which presented both opportunities and challenges for the Group. The health and safety of our global workforce was - and continues to be - of paramount importance and the transition to remote working was implemented seamlessly across the Group with business continuity maintained throughout. Corero continued to achieve extremely high customer satisfaction metrics throughout the pandemic, and this could only have been delivered through the dedication of our highly talented and hard working employees.
The pandemic also reinforced the importance of both effective and scalable c yber defense solutions as increased remote working and significantly higher levels of internet usage and e-commerce created new challenges for the sector and the number of DDoS attacks rose globally.
This market dynamic coupled with our customer centric values and market-leading solutions created a strong growth platform for the Group across 2020.
Strategic Progress
The Group has a clearly defined set of near and mid-term strategic priorities, and during 2020, Corero delivered significant progress across all these ambitious initiatives. These priorities are focused on expanding our market coverage and capitalising on our industry-leading technology stack, and are to:
-- increase our international footprint; -- leverage sales channel and business partnerships; -- broaden our Global, major and Tier One client base; -- augment our services portfolio; -- amplify our demand generation programmes; and -- continue to increase our technological innovation leadership.
Increase our international footprint
The Group's solutions are now deployed across more than 40 countries, with nine new territories added during the year. Central to enhancing the Group's global presence are our strategic business relationships and agents, which accelerate our sales growth. During the year, we added six new agents across Eastern Europe, Latin America, APAC, Europe and the Middle East. These new relationships are important in increasing our profile across a number of high growth and strategically important markets.
Leverage sales channel and business partnerships
The Group also continues to leverage its existing strategic partners, such as Juniper and GTT, embedding our products into these highly valuable sales ecosystems.
During 2020, we signed 17 new customers through our Juniper partnership, compared to six in the previous year. We also significantly increased the level of business generated with Juniper compared to the previous year. This strong traction is testament to the excellent work carried out by our sales teams in engaging in closer new business collaboration and product support with the Juniper team. We intend to continue to increase the level of engagement across all our sales channels and believe this is central to creating additional revenue growth.
Broaden our Global, major and Tier One client base
As set out during 2020, the Group sought to both secure new mandates and expand existing mandates with Tier One and Major customers.
During 2020, we secured a number of new mandates with global operators either directly or via our partner network.
Augment our services portfolio
During the period, the Group further increased the level of revenues generated from Managed and Professional Services as part of total order intake, launching a number of initiatives to significantly increase development and promotion of our services offering and therefore increase our recurring revenue base.
Continue to increase our technological innovation leadership
Alongside our ongoing investment in enhancing the features and offering of our solutions, the Group has created a number of internal initiatives to examine product development and enhancements to drive near-term and mid-term improvements across our existing software portfolio. This is key to ensuring Corero maintains its market leading position to take advantage of new market trends.
As part of this process, Corero has created a number of customer-facing task forces to both improve and expand customer engagement.
DDoS market dynamics
Organisations around the world depend on the Internet now more than ever to conduct business and deliver services. This Internet-fi-rst world grows more complex each year due to the demand for faster connections, 5G, Internet of Things ('IoT') devices, and cloud services. DDoS attacks are growing in sophistication, size, recurrency and frequency. Each year, we see a rising number of total recorded attacks. Often such attacks are cover for other nefarious motives and attacks.
Service Providers and Hosting Providers are increasingly expected to assume the responsibility for upholding their customers' internet availability. Real-time DDoS protection has become more critical now than ever before. Unfortunately, in parallel, DDoS-for-hire services, that make it cheap and easy to launch attacks, have become increasingly common. Expectations for Internet response and resilience comes down to seconds not minutes. When the Internet goes down, organisations that rely on Internet service go down with it.
DDoS attacks are considered one of the most serious yet most common threats to Internet availability. Downtime and internet disruption can damage brand reputation, customer trust and revenue. Market reports have commented that during 2020, the average number of attacks per customer per day increased by c.20%, as did the chance of being attacked again within 24 hours, with the average duration of an attack less than five minutes making them more difficult to detect. In addition, during the COVID-19 pandemic, Corero has seen a 400% year-on-year increase in the use of OpenVPN attacks as businesses transitioned to working remotely.
Opportunities for Corero
2020 was clearly a watershed moment for the digital community with heightened levels of remote working, and online commerce highlighting the importance of cyber security innovation. Whilst it is difficult to predict if consumer demand will be maintained, what is clearly evident, is the need for highly robust and secure IT infrastructure is set to continue, as we saw before the pandemic.
Corero's solutions sit firmly at the centre of this trend with customers across telecommunications, retail, banking, data centres, hosting and infrastructure all putting DDoS mitigation as a key near-term priority.
In addition, the expansion of 5G mobile broadband and Edge computing, coupled with the ongoing global reliance on data, business intelligence and Artificial Intelligence (AI) based services, will undoubtably accelerate the creation of more sophisticated cyber threats. Corero intends to continue its path of product development alongside geographic and market coverage expansion to further ensure its customers are best protected from the threat of DDoS attacks.
Financial Summary
The Group generated revenues of $16.9 million in 2020 (2019: $9.7 million), with total operating expenses before share-based payments of $16.4 million (2019: $13.8 million) while continuing to invest in sales and marketing expansion and R&D efforts.
-- Operating expenses net of capitalised R&D costs and before depreciation and amortisation of intangible assets and before share-based payments were $14.1 million (2019: $10.8 million). Capitalised R&D costs were $1.4 million (2019: $1.4 million)
-- Operating expenses include an unrealised exchange loss of $0.3 million (2019: loss of $0.3 million) arising from an intercompany loan
-- Depreciation and amortisation of intangible assets was $2.3 million (2019: $3.0 million)
The EBITDA loss in 2020 of $1.4m narrowed by 56% over the prior year (2019: $3.2m loss) and Adjusted EBITDA loss reduced by 76% to $0.6m (2019: loss of $2.5m). Losses before taxation in 2020 were $4.0 million (2019: loss $6.6 million) including amortisation of capitalised R&D of $1.9 million (2019: $2.6 million). Losses after interest and taxation were $3.8m (2019: $6.6m). The reported loss per share was therefore 0.8 cents (2019: loss per share 1.6 cents). The 2020 losses decreased, primarily due to the increased revenues ahead of the increase in operating expenses.
The net cash generated in operating activities in the year was $5.1 million (2019: net cash outflow of $0.6 million) reflecting the loss for the year and improvement in working capital investment in the period of $5.7 million (2019: decrease in working capital investment of $2.2 million). This improvement was partly due to an order received from a sizeable customer in the third quarter, the proceeds of which were received towards the end of the fourth quarter, but the associated outflows for which fell into the first quarter of the 2021 year.
In terms of overall position, Corero had net cash of $7.6 million at 31 December 2020 (31 December 2019: $5.4 million; H1 2020 $3.3 million), comprising:
-- Cash at bank of $10.1 million as at 31 December 2020 (2019: $8.3 million)
-- Debt of $2.5 million (2019: $2.9 million) including $0.6 million of a US Paycheck Protection Program ("PPP") Loan. This PPP loan was forgiven by the Group's US bank in January 2021.
In April 2021 we have entered into a new banking facility for up to GBP3.0 million (circa $4.1 million), the net proceeds of which will be used for working capital purposes and our on-going investment programme to support our growth strategy ahead.
Outlook
The Company has begun 2021 with a solid pipeline and encouraging levels of business activity from both new and existing customers, particularly through our strategic partnerships. The requirement for its products and the need for cyber security mitigation remains high and continues to grow, and this has undoubtedly been accelerated by the increased levels of remote working and online commerce. However, the Company remains mindful of the risks and challenges presented by COVID-19 including and the ongoing wider economic impact and customer purchasing decisions.
The successful implementation of our strategic priorities is creating a strong platform for the business. These are centred across geographic expansion, creating sustainable sales growth and maintaining our product excellence. The Company is confident in the market dynamics and drivers and believes it is well placed for future growth.
The strong sales traction over the last 12 months, combined with the Group's attractive customer offering and recurring revenue generation provide us with renewed optimism and vigour as we navigate 2021 and beyond.
Lionel Chmilewsky
Chief Executive Officer
12 April 2021
Consolidated Income Statement
for the year ended 31 December 2020
Year ended 31 December Year ended 31 December 2020 2019 Continuing operations $'000 $'000 Revenue 16,877 9,714 Cost of sales (3,832) (1,842) ----------------------- ----------------------- Gross profit 13,045 7,872 Operating expenses (16,431) (13,808)
----------------------------------------------------------------- ----------------------- ----------------------- Consisting of: Operating expenses before depreciation and amortisation (14,114) (10,767) Depreciation and amortisation of intangible assets (2,317) (3,041) ----------------------------------------------------------------- ----------------------- ----------------------- Loss from operations (3,386) (5,936) Share-based payments (359) (265) ----------------------- ----------------------- Operating loss (3,745) (6,201) Finance income 16 15 Finance costs (301) (375) ----------------------- ----------------------- Loss before taxation (4,030) (6,561) Taxation credit 246 - ----------------------- ----------------------- Loss after taxation (3,784) (6,561) ----------------------- ----------------------- Loss after taxation attributable to equity owners of the parent (3,784) (6,561) ----------------------- ----------------------- Basic and diluted loss per share Cents Cents Basic and diluted loss per share (0.8) (1.6) ------ ------ EBITDA(1) (1,428) (3,160) Adjusted EBITDA - for DDPaaS depreciation(1) (1,173) (3,035) Adjusted EBITDA - for DDPaaS depreciation and share based payments(1) (814) (2,770) Adjusted EBITDA - for DDPaaS depreciation, share based payments and unrealised foreign exchange differences on intercompany loan(1) (551) (2,457)
(1) See note 2 for reconciliation.
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020
Year ended 31 December Year ended 31 December 2020 2019 $'000 $'000 -------------------------------------------------------------------- ----------------------- ----------------------- Loss for the year (3,784) (6,561) Other comprehensive (expense)/income: -------------------------------------------------------------------- ----------------------- ----------------------- Items reclassified subsequently to profit or loss upon derecognition: Foreign exchange differences 216 429 -------------------------------------------------------------------- ----------------------- ----------------------- Other comprehensive income for the period net of taxation attributable to the equity owners of the parent 216 429 -------------------------------------------------------------------- ----------------------- ----------------------- Total comprehensive expense for the year attributable to the equity owners of the parent (3,568) (6,132) -------------------------------------------------------------------- ----------------------- -----------------------
Consolidated Statement of Financial Position
as at 31 December 2020
As at 31 December As at 31 December 2020 2019 $'000 $'000 Assets Non-current assets Goodwill 8,991 8,991 Acquired intangible assets 9 7 Capitalised development expenditure 4,646 5,169 Property, plant and equipment - owned assets 1,099 652 Leased right of use assets 237 357 Trade and other receivables 694 307 15,676 15,483 Current assets Inventories 98 63 Trade and other receivables 3,714 2,572 Cash and cash equivalents 10,140 8,321 ----------------- ----------------- 13,952 10,956 ----------------- ----------------- Total assets 29,628 26,439 ----------------- ----------------- Liabilities Current Liabilities Trade and other payables (6,461) (2,008) Lease liabilities (86) (112) Deferred income (3,444) (2,800) Borrowings (2,073) (1,149) (12,064) (6,069) Net current assets 1,888 4,887 Non-current liabilities Trade and other payables (402) (139) Lease liabilities (171) (257) Deferred income (2,705) (1,096) Borrowings (405) (1,788) ----------------- ----------------- (3,683) (3,280) ----------------- ----------------- Net assets 13,881 17,090 ----------------- ----------------- Capital and reserves attributable to the equity owners of the parent Share capital 6,914 6,914 Share premium 82,122 82,122 Capital redemption reserve 7,051 7,051 Share options reserve 968 609 Foreign exchange translation reserve (1,384) (1,600) Accumulated profit and loss reserve (81,790) (78,006) ----------------- ----------------- Total shareholders' equity 13,881 17,090 ----------------- -----------------
Consolidated Statement of Cash Flows
for the year ended 31 December 2020
Year ended 31 December Year ended 31 December 2020 2019 Operating activities $'000 $'000 Loss before taxation for the year (4,030) (6,561) Adjustments for movements: Amortisation of acquired intangible assets 6 13 Amortisation of capitalised development expenditure 1,933 2,638 Depreciation - owned assets 514 450 Depreciation - leased assets 119 65 Finance income (16) (15) Finance expense 274 364 Finance lease interest costs 27 11 Share based payments expense 359 265 Cash used in operating activities before movement in working capital (814) (2,770) Movement in working capital: Decrease in inventories and sales evaluation assets 45 153 (Increase)/decrease in trade and other receivables (1,187) 937 Increase in trade and other payables 6,852 1,129 ---------------------- ---------------------- Net movement in working capital 5,710 2,219 Cash generated from/(used in) operating activities 4,896 (551) Taxation received 246 - ---------------------- ---------------------- Net cash generated from/(used in) operating activities 5,142 (551) Cash flows from investing activities Purchase of intangible assets (8) (6) Investment in development expenditure (1,410) (1,360) Purchase of property, plant and equipment (1,015) (579) Net cash used in investing activities (2,433) (1,945) Cash flows from financing activities Net proceeds from issue of share capital (post fees) - 3,958 Proceeds from borrowings 637 - Finance income 16 15 Finance expense (206) (296) Repayments of borrowings (1,187) (856) Lease liability payments (136) (74) ---------------------- ---------------------- Net cash (used in)/generated from financing activities (876) 2,747 Increase in cash and cash equivalents 1,833 251 ---------------------- ---------------------- Effects of exchange rates on cash and cash equivalents (14) 44 Cash and cash equivalents at 1 January 8,321 8,026 ---------------------- ---------------------- Cash and cash equivalents at 31 December 10,140 8,321 ---------------------- ----------------------
Consolidated Statement of Changes in Equity
for the year ended 31 December 2020
Total Foreign Accumulated attributable Capital Share exchange profit and to equity Share Share redemption options translation loss owners of capital premium reserve reserve reserve reserve the parent $'000 $'000 $'000 $'000 $'000 $'000 $'000 1 January 2019 5,740 79,338 7,051 344 (2,029) (71,445) 18,999 Loss for the year (6,561) (6,561) Other comprehensive expense - - - - 429 - 429 -------- -------- ----------- -------- ------------ ------------ ------------- Total comprehensive expense for the year - - - - 429 (6,561) (6,132) Contributions by and distributions to owners Share based payments - - - 265 - - 265 Issue of share capital 1,174 2,784 - - - - 3,958 Total contributions by and distributions to owners 1,174 2,784 - 265 - - 4,223 31 December 2019 and 1 January 2020 6,914 82,122 7,051 609 (1,600) (78,006) 17,090 Loss for the year - - - - - (3,784) (3,784) Other comprehensive expense - - - - 216 - 216 -------- -------- ----------- -------- ------------ ------------ ------------- Total comprehensive expense for the year - - - - 216 (3,784) (3,568) -------- -------- ----------- -------- ------------ ------------ ------------- Contributions by and distributions to owners Share based payments - - - 359 - - 359 Total contributions by and distributions to owners - - - 359 - - 359 31 December 2020 6,914 82,122 7,051 968 (1,384) (81,790) 13,881 -------- -------- ----------- -------- ------------ ------------ -------------
1. General information
These consolidated financial statements are presented in US Dollars ("$") which represents the presentation currency of the Group. The average $-GBP sterling ("GBP") exchange rate, used for the conversion of the statement of comprehensive income, for the 12 months ended 31 December 2020 was 1.28 (2019: 1.28). The closing $-GBP exchange rate, used for the conversion of the Group's assets and liabilities, at 31 December 2020 was 1.37 (2019: 1.33).
The principal accounting policies adopted in the preparation of the financial information in this results announcement are consistent with those that the Company has applied in its financial statements for the year ended 31 December 2020.
The financial information set out above does not constitute the Company's Annual Report and Accounts for the year ended 31 December 2020. The Annual Report and Accounts for 2019 have been delivered to the Registrar of Companies and those for 2020 will be delivered shortly. The auditor's report for the Company's 2020 Annual Report and Accounts was unqualified but did draw attention to the material uncertainty relating to going concern.
The Directors are, based on detailed financial projections, of the opinion that the Group and Company has adequate working capital to continue as a going concern for the foreseeable future and, in particular, for a period of at least 12 months from the date of approval of this announcement. The financial projections take into account the operational progress made by the Company over the past year and future opportunities.
However, the ability of the Company and Group to achieve the future profit and cash flow projections cannot be predicted with certainty. Additionally, the impact of the on-going COVID-19 global pandemic on the business of the Company and Group brings continued global uncertainties.
The inability of the Company and the Group to meet these projections and deliver revenue growth may adversely impact the achievability of the bank loan covenants which may result in the bank loan being required to be repaid before the maturity date, assuming that the revenue and cash consumption covenants are not met and cannot be renegotiated. This would adversely impact the Company and the Group's working capital position and could require the Company to raise additional funding, with no guarantee such funding could be secured.
These circumstances therefore indicate a material uncertainty that may cast significant doubt on the Company and the Group's ability to continue as a going concern for the foreseeable future.
The auditor's report did not contain statements under s498(2) or (3) of the Companies Act 2006.
Whilst the financial information included in this results announcement has been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 this announcement does not itself contain sufficient information to comply with international accounting standards.
The Annual Report and Accounts for the year ended 31 December 2020 are available on the Company's website www.corero.com /who-we-are/investor-relations .
The information in this results announcement was approved by the Board on 12 April 2021.
2. Key performance measures
EBITDA and Adjusted EBITDA for share based payments
Earnings before interest, tax, depreciation, and amortisation ("EBITDA") is defined as earnings from operations before interest, tax, depreciation, and amortisation charges. The following is a reconciliation of EBITDA and further adjustments for the periods presented:
Year ended Year 31 December ended 31 December 2020 2019 $'000 $'000 Loss before taxation (4,030) (6,561) Adjustments for: Finance income (16) (15) Finance expense 274 364 Finance lease interest costs 27 11 Depreciation - owned assets 259 325 Depreciation - lease liabilities 119 65 Amortisation of acquired intangible assets 6 13 Amortisation of capitalised development expenditure 1,933 2,638 ------------- ------------------- EBITDA (1,428) (3,160) Depreciation of DDoS Protection-as-a-Service assets charged to cost of sales 255 125 ------------- ------------------- Adjusted EBITDA - for DDPaaS depreciation (1,173) (3,035) ------------- ------------------- Share based payments 359 265 ------------- ------------------- Adjusted EBITDA - for DDPaaS depreciation and share based payments (814) (2,770) Unrealised foreign exchange differences on intercompany loan 263 313 ------------- ------------------- Adjusted EBITDA - for DDPaaS depreciation, share based payments and unrealised foreign exchange differences on intercompany loan (551) (2,457) ------------- -------------------
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