Exhibit 99.1
Globalscape® Announces Financial Results for Fourth Quarter 2014 and Fiscal 2014
Quarter and Annual Revenue the Highest in Company History; Quarterly Dividend Program Announced
SAN ANTONIO — February 5, 2015 — GlobalSCAPE, Inc. (NYSE MKT: GSB), a leading developer of secure information exchange solutions, announced today its financial results for the three months and fiscal year ended December 31, 2014, and the initiation of a quarterly dividend program.
Revenue for the fourth quarter of 2014 was $7.9 million, which is the highest quarterly revenue in Globalscape’s history. This result is an increase of 27 percent when compared with revenue of $6.2 million for the fourth quarter of 2013.
Revenue for the year ended December 31, 2014, was $26.8 million, which is the highest annual revenue in Globalscape’s history. This result is an increase of 10 percent when compared with revenue of $24.3 million for the year ended December 31, 2013.
Deferred revenue, which can be an indicator of future revenue trends, was $14.8 million at December 31, 2014, compared with $10.8 million at December 31, 2013, or an increase of 37 percent.
For the fourth quarter of 2014, the Company had net income of $1.2 million compared with net income of $655,000 for the fourth quarter of 2013. Earnings per share was $0.06 for the fourth quarter of 2014 compared with $0.03 for the fourth quarter of 2013.
For the year ended December 31, 2014, the Company had net income of $3.0 million compared with net income of $3.8 million for the year ended December 31, 2013. Earnings per share was $0.15 for the year ended December 31, 2014, compared with $0.21 for the year ended December 31, 2013.
Net income for the year ended December 31, 2013, included infrequent items resulting from the TappIn intangible impairment and earnout liability elimination which occurred in the third quarter of fiscal 2013. Net income excluding infrequent items for the year ended December 31, 2013, was $2.5 million. Basic and diluted earnings per share excluding infrequent items for the year ended December 31, 2013, was $0.13.
Adjusted EBITDA Excluding Infrequent Items was $5.4 million for the year ended December 31, 2014, compared with $5.2 million for the year ended December 31, 2013.
Net income excluding infrequent items and adjusted EBITDA excluding infrequent items are not measures of financial performance under GAAP and have limitations as analytical tools and when assessing the Company’s operating performance. These measures should not be considered in isolation from or as a substitute for net income or other income statement data prepared in accordance with GAAP.
Net cash provided by operating activities was $8.5 million for the year ended December 31, 2014, compared to $4.5 million for the year ended December 31, 2013. Cash, cash equivalents and long-term investments were $14.5 million at December 31, 2014. During the third quarter of 2014, the Company repaid all its notes payable and no longer has any notes payable or long term debt.
“We are pleased with the progress we made in the 2014 that established a solid foundation for long-term growth,” said James Bindseil, Globalscape’s President and Chief Executive Officer. “I am confident that the plans in place will lead us to even higher returns in the future.”
Globalscape Fourth Quarter and Fiscal 2014 Financial Statements
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Financial Statements (PDF)
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Conference Call February 5, 2015 at 4:30 p.m. ET
Globalscape management will hold a conference call Thursday, February 5, 2015, at 4:30 p.m. Eastern Time/3:30 p.m. Central Time to discuss financial results and other corporate matters for the fourth quarter and fiscal 2014. Those wanting to join should call 888-430-8691 or 719-325-2452 and use Conference ID # 8818285. A live webcast of the conference call will also be available in the investor relations page of the company's website at www.Globalscape.com. A webcast replay of the conference call will be available on the Company’s website for approximately 30 days after this call.
About Globalscape
San Antonio, Texas-based GlobalSCAPE, Inc. (NYSE MKT: GSB) ensures the reliability of mission-critical operations by securing sensitive data and intellectual property. Globalscape’s suite of solutions features the EFT platform, the industry-leading enterprise file transfer solution that delivers military-grade security and a customizable platform for achieving best-in-class control and visibility of data in motion or at rest, across multiple locations. Founded in 1996, Globalscape is a leading enterprise solution provider of secure information exchange software and services to thousands of customers, including global enterprises, governments, and small businesses. For more information, visit www.Globalscape.com or follow the blog and Twitter updates.
Safe Harbor Statement
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. The words "would," "exceed," "should," "anticipates," "believe," "steady," "dramatic," and variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. These forward-looking statements are based upon the Company’s current expectations and are subject to a number of risks, uncertainties and assumptions. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ significantly from those expressed or implied by such forward-looking statements are risks that are detailed in the Company’s Annual Report on Form 10-K for the 2013 calendar year, filed with the Securities and Exchange Commission on March 27, 2014.
INVESTOR RELATIONS CONTACT
Contact: Jim Fanucchi
Phone Number: (408) 404-5400
Email: ir@globalscape.com
PRESS CONTACT
Contact: Christen Gentile
Phone Number: (210) 308-8267
Email: PR@globalscape.com
GlobalSCAPE, Inc.
|
Consolidated Balance Sheets
|
(in thousands)
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2014
|
|
|
2013
|
|
Assets
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$ |
11,358 |
|
|
$ |
9,455 |
|
Accounts receivable (net of allowance for doubtful accounts
of $511 and $154 in 2014 and 2013, respectively)
|
|
|
5,938 |
|
|
|
3,765 |
|
Federal income tax receivable
|
|
|
- |
|
|
|
113 |
|
Current deferred tax asset
|
|
|
285 |
|
|
|
184 |
|
Prepaid expenses
|
|
|
488 |
|
|
|
349 |
|
Total current assets
|
|
|
18,069 |
|
|
|
13,866 |
|
|
|
|
|
|
|
|
|
|
Fixed assets, net
|
|
|
616 |
|
|
|
744 |
|
Long term investments
|
|
|
3,185 |
|
|
|
3,122 |
|
Intangible assets, net
|
|
|
3,298 |
|
|
|
1,028 |
|
Goodwill
|
|
|
12,712 |
|
|
|
12,712 |
|
Deferred tax asset
|
|
|
407 |
|
|
|
1,476 |
|
Other assets
|
|
|
100 |
|
|
|
144 |
|
Total assets
|
|
$ |
38,387 |
|
|
$ |
33,092 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$ |
1,111 |
|
|
$ |
655 |
|
Accrued expenses
|
|
|
1,590 |
|
|
|
898 |
|
Deferred revenue
|
|
|
11,411 |
|
|
|
9,092 |
|
Income taxes payable
|
|
|
2 |
|
|
|
- |
|
Long term debt, current portion
|
|
|
- |
|
|
|
1,397 |
|
Total current liabilities
|
|
|
14,114 |
|
|
|
12,042 |
|
|
|
|
|
|
|
|
|
|
Deferred revenue, non-current portion
|
|
|
3,393 |
|
|
|
1,708 |
|
Long term debt, non-current portion
|
|
|
- |
|
|
|
2,989 |
|
Other long term liabilities
|
|
|
52 |
|
|
|
60 |
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
|
|
|
Preferred stock, par value $0.001 per share, 10,000,000
authorized, no shares issued or outstanding
|
|
|
- |
|
|
|
- |
|
Common stock, par value $0.001 per share, 40,000,000
authorized, 20,989,267 and 19,592,117 shares issued
at December 31, 2014 and December 31, 2013, respectively
|
|
|
25 |
|
|
|
20 |
|
Additional paid-in capital
|
|
|
18,367 |
|
|
|
15,834 |
|
Treasury stock, 403,581 shares, at cost, at
December 31, 2014 and December 31, 2013
|
|
|
(1,452 |
) |
|
|
(1,452 |
) |
Retained earnings
|
|
|
3,888 |
|
|
|
1,891 |
|
Total stockholders’ equity
|
|
|
20,828 |
|
|
|
16,293 |
|
Total liabilities and stockholders’ equity
|
|
$ |
38,387 |
|
|
$ |
33,092 |
|
GlobalSCAPE, Inc.
|
Consolidated Statements of Operations and Comprehensive Income
|
(in thousands, except per share amounts)
|
|
|
Year Ended December 31,
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
Operating Revenues:
|
|
|
|
|
|
|
Software licenses
|
|
$ |
10,292 |
|
|
$ |
9,210 |
|
Maintenance and support
|
|
|
15,033 |
|
|
|
13,650 |
|
Professional services
|
|
|
1,445 |
|
|
|
1,479 |
|
Total revenues
|
|
|
26,770 |
|
|
|
24,339 |
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
|
1,018 |
|
|
|
1,011 |
|
Selling, general and administrative
|
|
|
15,224 |
|
|
|
14,881 |
|
Research and development
|
|
|
5,030 |
|
|
|
3,766 |
|
TappIn intangible asset impairment and
earnout liability elimination
|
|
|
- |
|
|
|
(128 |
) |
Depreciation and amortization
|
|
|
883 |
|
|
|
908 |
|
Total operating expenses
|
|
|
22,155 |
|
|
|
20,438 |
|
Income (loss) from operations
|
|
|
4,615 |
|
|
|
3,901 |
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(105 |
) |
|
|
(227 |
) |
Interest income
|
|
|
63 |
|
|
|
62 |
|
Total other income (expense)
|
|
|
(42 |
) |
|
|
(165 |
) |
Income before income taxes
|
|
|
4,573 |
|
|
|
3,736 |
|
Provision for income taxes
|
|
|
1,547 |
|
|
|
(104 |
) |
Net income
|
|
$ |
3,026 |
|
|
$ |
3,840 |
|
Comprehensive income
|
|
$ |
3,026 |
|
|
$ |
3,840 |
|
|
|
|
|
|
|
|
|
|
Net income per common share - basic
|
|
$ |
0.15 |
|
|
$ |
0.21 |
|
|
|
|
|
|
|
|
|
|
Net income per common share - diluted
|
|
$ |
0.15 |
|
|
$ |
0.20 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
20,163 |
|
|
|
18,626 |
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
20,693 |
|
|
|
19,082 |
|
GlobalSCAPE, Inc.
|
Consolidated Statements of Cash Flows
|
(in thousands)
|
|
|
For the Year Ended December 31,
|
|
|
|
2014
|
|
|
2013
|
|
Operating Activities:
|
|
|
|
|
|
|
Net income (loss)
|
|
$ |
3,026 |
|
|
$ |
3,840 |
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
Bad debt expense
|
|
|
426 |
|
|
|
29 |
|
Depreciation and amortization
|
|
|
883 |
|
|
|
908 |
|
Stock-based compensation
|
|
|
521 |
|
|
|
666 |
|
Deferred taxes
|
|
|
968 |
|
|
|
(948 |
) |
Excess tax deficiency from exercise of share based compensation
|
|
|
227 |
|
|
|
156 |
|
TappIn intangible asset impairment and
earnout liability elimination
|
|
|
- |
|
|
|
(128 |
) |
Other
|
|
|
74 |
|
|
|
- |
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(2,600 |
) |
|
|
(444 |
) |
Prepaid expenses
|
|
|
(139 |
) |
|
|
77 |
|
Federal income taxes
|
|
|
(112 |
) |
|
|
(315 |
) |
Other assets
|
|
|
44 |
|
|
|
(103 |
) |
Accounts payable
|
|
|
456 |
|
|
|
223 |
|
Accrued expenses
|
|
|
693 |
|
|
|
(455 |
) |
Deferred revenues
|
|
|
4,004 |
|
|
|
1,027 |
|
Other long-term liabilities
|
|
|
(8 |
) |
|
|
(2 |
) |
Net cash provided by operating activities
|
|
|
8,463 |
|
|
|
4,531 |
|
Investing Activities:
|
|
|
|
|
|
|
|
|
Software development costs
|
|
|
(2,847 |
) |
|
|
(899 |
) |
Purchase of property and equipment
|
|
|
(252 |
) |
|
|
(139 |
) |
Purchase of TappIn, Inc. and earnout payments
|
|
|
- |
|
|
|
(500 |
) |
Interest on long term investments
|
|
|
(63 |
) |
|
|
(62 |
) |
Net cash provided by (used in) investing activities
|
|
|
(3,162 |
) |
|
|
(1,600 |
) |
Financing Activities:
|
|
|
|
|
|
|
|
|
Proceeds from exercise of stock options
|
|
|
2,243 |
|
|
|
890 |
|
Tax deficiency (benefit) from stock-based compensation
|
|
|
(227 |
) |
|
|
(156 |
) |
Notes payable principle payments
|
|
|
(4,386 |
) |
|
|
(1,338 |
) |
Dividends paid
|
|
|
(1,028 |
) |
|
|
(951 |
) |
Net cash provided by (used in) financing activities
|
|
|
(3,398 |
) |
|
|
(1,555 |
) |
Net increase in cash
|
|
|
1,903 |
|
|
|
1,376 |
|
Cash at beginning of period
|
|
|
9,455 |
|
|
|
8,079 |
|
Cash at end of period
|
|
$ |
11,358 |
|
|
$ |
9,455 |
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
Cash paid during the period for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$ |
117 |
|
|
$ |
234 |
|
Income taxes
|
|
$ |
701 |
|
|
$ |
1,161 |
|
GlobalSCAPE, Inc.
|
Adjusted EBITDA Excluding Infrequent Items
|
(In Thousands)
|
|
|
Year Ended December 31,
|
|
|
|
2014
|
|
|
2013
|
|
Income (loss) from operations (before interest and taxes)
|
|
$ |
4,615 |
|
|
$ |
3,901 |
|
Add (subtract):
|
|
|
|
|
|
|
|
|
Depreciation and amortization:
|
|
|
|
|
|
|
|
|
Total depreciation and amortization
|
|
|
883 |
|
|
|
908 |
|
Amortization of capitalized software development costs
|
|
|
(577 |
) |
|
|
(174 |
) |
Stock-based compensation expense
|
|
|
521 |
|
|
|
666 |
|
Infrequent item:
|
|
|
|
|
|
|
|
|
TappIn intangible asset impairment and earnout liability elimination
|
|
|
- |
|
|
|
(128 |
) |
Adjusted EBITDA Excluding Infrequent Items
|
|
$ |
5,442 |
|
|
$ |
5,173 |
|