Blue Coat Reports Financial Results for First Quarter Ended July 31, 2007

Achieves Record Net Revenue and 15% Sequential Quarterly Growth

München, (PresseBox) - Blue Coat Systems, Inc. (NASDAQ: BCSI), a leader in WAN Application Delivery and Secure Web Gateway, today reported its financial results for its first quarter of fiscal 2008 ended July 31, 2007. Net revenue for the first fiscal quarter of 2008 was $62.4 million, an increase of 71% compared to net revenue of $36.4 million for the same quarter last year and a 15% increase compared to net revenue of $54.5 million in the prior quarter.

"We attribute delivery of this quarterly record net revenue to our increasing success in the WAN Application Delivery market," said Brian NeSmith, President and Chief Executive Officer. "Clearly our customers see the value in our unique ability to provide security and high speed application delivery in one appliance, our ProxySG® product."

On a GAAP basis, the Company reported net income of $2.6 million, or $0.14 per diluted share, in the first quarter of fiscal 2008, compared to a net loss of $759,000, or $0.05 per diluted share, in the fourth quarter of fiscal 2007. Net income in the first quarter of fiscal 2008 includes $3.3 million in stock-based compensation expense, $1.9 million in expenses associated with the stock option investigation, and $0.4 million in amortization of intangible assets. In the fourth quarter of fiscal 2007, net income includes $2.5 million in legal and accounting expenses associated with the stock option investigation and related restatement of the Company’s consolidated financial statements, $1.9 million in stock-based compensation expense, $1.7 million related to payroll taxes, interest and penalties on stock options, and $0.4 million in amortization of intangible assets.

The Company reported non-GAAP net income of $8.3 million, or $0.43 per diluted share, in the first quarter of fiscal 2008, compared to non-GAAP net income of $5.7 million, or $0.31 per diluted share, in the fourth quarter of fiscal 2007.

Blue Coat ended the quarter on July 31, 2007, with cash, cash equivalents, short-term investments, and restricted investments totaling $118 million, an increase of $19 million from the prior quarter.

The non-GAAP financial measures presented above exclude the amortization of intangible assets, stock-based compensation expense, expenses associated with the stock option investigation and related restatement of the Company’s consolidated financial statements, and payroll taxes, interest and penalties on stock options. Refer to the accompanying tables for a detailed reconciliation of GAAP to non-GAAP net income and earnings per share.

Financial Outlook For the fiscal quarter ending October 31, 2007, the Company currently anticipates net revenue in the range of $67 - $70 million. On a non-GAAP basis, which excludes the amortization of intangible assets, stock-based compensation expense, and expenses associated with the stock option investigation, net income is expected to be between $8.6 - $10.1 million, or $0.43 - $0.50 per diluted share.

Two-for-One Stock Split On August 16, 2007, Blue Coat’s Board of Directors approved a two-for-one forward stock split of the Company’s common stock. The stock split will be effected by the issuance of a stock dividend of one share of BCSI common stock for each share of BCSI common stock issued and outstanding as of the record date of September 13, 2007. The shares of BCSI common stock resulting from the stock split will be issued by BCSI’s transfer agent. Following the stock split, Blue Coat will have approximately 36.3 million shares outstanding, on an as converted basis, based on the number of shares outstanding as of August 21, 2007. BCSI will begin trading on the NASDAQ Global Market on a split-adjusted basis on October 3, 2007.

The financial outlook of $0.43 - $0.50 per diluted share referenced above translates to $0.21 - $0.25 per diluted share, reflecting the effect of the stock split.

About Non-GAAP Financial Measures

Blue Coat uses the non-GAAP financial measures of income discussed above for internal evaluation and to report the results of its business. These non-GAAP financial measures include non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, and non-GAAP net income per share. These measures are not in accordance with, or an alternative to, GAAP. The measures are intended to supplement GAAP financial information, and may be different from non-GAAP financial measures used by other companies. Blue Coat believes that these measures provide useful information to its management, board of directors and investors regarding its ongoing operating activities and business trends related to its financial condition and results of operations. Blue Coat believes that it is useful to provide investors with information to understand how specific line items in the statement of operations are affected by certain items, such as the legal and accounting expenses related to the stock option investigation and restatement of the Company’s consolidated financial statements, stock-based compensation expense, payroll taxes, penalties and interest related to the disqualification of stock options due to revised measurement dates, and amortization of intangible assets. In addition, the Company’s management and board of directors use certain non-GAAP financial measures in developing operating budgets and in reviewing the Company’s financial results of operations since items such as the legal and accounting expenses related to the stock option investigation and related restatement of the Company’s consolidated financial statements, stock-based compensation expense, payroll taxes, penalties and interest related to the disqualification of stock options due to revised measurement dates, and amortization of intangible assets are not considered to impact current resource allocation decisions. The Company believes that inclusion of these non-GAAP financial measures provides consistency and comparability with past reports of financial results. However, investors should be aware that non-GAAP measures have inherent limitations and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP.

Press releases you might also be interested in

Subscribe for news

The subscribtion service of the PresseBox informs you about press information of a certain topic by your choice at a choosen time. Please enter your email address to receive the email with the press releases.

An error occurred!

Thank you! You will receive a confirmation email within a few minutes.


I want to subscribe to the gratis press mail and have read and accepted the conditions.