Certicom reports first profitable fiscal year

R. A. Hettinga rah at shipwright.com
Fri Jun 11 17:56:15 PDT 2004


<http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_PrintFriendly&c=Article&cid=1086905412521&call_pageid=968350072197>

Toronto Star

Jun. 11, 2004. 01:00 AM
Certicom reports first profitable fiscal year


Certicom Corp., a specialist in security software, is reporting the first
profitable year in its 19-year history, with net income of $17.2 million
(U.S.) due largely to a major contract with the U.S. National Security
Agency.

 The profit was good news for Certicom employees, who shared $1.4 million
in bonuses for helping to get the Mississauga-based company into the black
in the fiscal year ended April 30. But the bonus payouts increased the
company's operating expenses and contributed to a $1.7 million loss in
Certicom's fiscal fourth quarter, which included a $500,000 bonus expense.
The firm reports in U.S. dollars.

 Certicom chief executive Ian McKinnon, who was hired in March, 2002, to
turn around the company, said yesterday the U.S. contract enabled the
company to achieve its first profitable year. That deal alone contributed
$24.9 million of the $34.5 million in revenue Certicom reported in fiscal
2004. In fiscal 2003, revenue totalled $10.4 million.

 McKinnon said there is increased market acceptance of elliptic curve
cryptography (ECC), the technology at the root of Certicom's products.
Following the end of the fourth quarter, Certicom signed major ECC-based
licensing agreements with BlackBerry maker Research In Motion Ltd. of
Waterloo, and Pennsylvania-based Unisys Corp., a global information
technology services company.

 The structure of the RIM deal is a model for what Certicom hopes to do in
other contracts as it seeks to generate an ongoing stream of recurring
revenue rather than "lumpy" revenue from one-time sales, McKinnon told
analysts. With the RIM contract, Certicom is selling a pre-paid block of
licences.

 "We like this model. I would say it's representative of the financial
model for this company going forward," McKinnon said during a conference
call.

 While Certicom's technological strength has long been acknowledged, the
company has struggled to turn that acumen into sales and profits since it
was founded in 1985. It issued an initial public stock offering in June,
1997.

 Certicom rose 27 cents (Canadian) to $3.45 yesterday on the Toronto Stock
Exchange, up 8.5 per cent. But the stock is well below its 52-week high of
$4.99, set in January, and the all-time split-adjusted high of $120.47 set
in March, 2000.

 In the fiscal fourth quarter, Certicom's board approved a new strategy for
licensing the company's intellectual property. McKinnon wouldn't provide
guidance on future revenue.

 Earnings for the financial year ended April 30 amounted to 50 cents (U.S.)
a share and compared with a loss of $4.9 million, or 15 cents per share, a
year earlier.

 In the fourth quarter, Certicom lost $1.7 million, or 4 cents a share,
compared with a loss of $2 million, or 6 cents a share, a year earlier.

 Revenue rose to $2.6 million from $2.4 million.


-- 
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'





More information about the cypherpunks-legacy mailing list