SOURCE: GlobalSCAPE, Inc.

Globalscape

January 28, 2016 16:15 ET

GlobalSCAPE, Inc. Announces Financial Results for Fourth Quarter and Fiscal 2015

Fiscal Year Revenues Increased 15 Percent Over the Prior Year

SAN ANTONIO, TX--(Marketwired - January 28, 2016) - GlobalSCAPE, Inc. (NYSE MKT: GSB), a pioneer and worldwide leader in the secure and reliable exchange of business information, today announced its financial results for the three months and fiscal year ended December 31, 2015.

Revenue for the fourth quarter of 2015 was $8.5 million, which is the highest quarterly revenue in Globalscape's history. This result is an increase of 8 percent when compared with revenue of $7.9 million for the fourth quarter of 2014.

Revenue for the year ended December 31, 2015, was $30.8 million, which is the highest annual revenue in Globalscape's history. This result is an increase of 15 percent when compared with revenue of $26.8 million for the year ended December 31, 2014.

For the fourth quarter of 2015, the Company's net income remained steady at $1.2 million compared with net income of $1.2 million for the fourth quarter of 2014 even as the Company continued its enhanced investments in new product development and expanded sales and marketing initiatives. Earnings per share was $0.06 for the fourth quarter of 2015 compared with $0.06 for the fourth quarter of 2014.

For the year ended December 31, 2015, the Company had net income of $4.6 million compared with net income of $3.0 million for the year ended December 31, 2014. Earnings per share was $0.22 for the year ended December 31, 2015, compared with $0.15 for the year ended December 31, 2014.

Adjusted EBITDA Excluding Infrequent Items was $7.3 million for the year ended December 31, 2015, compared with $5.4 million for the year ended December 31, 2014. Adjusted EBITDA Excluding Infrequent Items is not a measure of financial performance under generally accepting accounting principles, or GAAP, and has limitations as an analytical tool and when assessing the Company's operating performance. This non-GAAP financial measurement should not be considered in isolation from or as a substitute for net income or other income statement data prepared in accordance with GAAP.

The Company's cash, cash equivalents and short-term investments increased 32 percent during 2015 to a balance of $19.1 million at December 31, 2015. Other than liabilities for normal trade payables and taxes, the Company has no debt.

Supporting Quote:

James L. Bindseil, President and Chief Executive Officer at Globalscape

"We are very pleased with the entire Globalscape team for their tireless work in achieving new records in both the fourth quarter and for the year of 2015. Accomplishing these increases in bookings, revenue, net income, and cash places us in an excellent position as we enter 2016. We remain confident that the world-class technology we develop, combined with the efforts of our sales, marketing, support and channel teams, make our products, services, and customer care second to none. Our focused team continues to execute on our strategic plan as we identify all possible paths to accelerate potential growth in the year ahead and beyond. As we approach our 20th anniversary as a company, we believe the best is yet to come."

Conference Call January 28, 2016 at 4:30 p.m. ET

Globalscape management will hold a conference call on January 28, 2016, 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 year 2015. Those wanting to join may call 888-481-2844 or 719-325-2402 and use Conference ID # 971042. A live webcast of the conference call will also be available on the Investor Relations page of the company's website at www.globalscape.com. A webcast replay will be made available on the company's website shortly after the call is completed.

About Globalscape

GlobalSCAPE, Inc. (NYSE MKT: GSB) is a pioneer in the reliable exchange of mission-critical business data and intellectual property. Globalscape's leading enterprise suite of solutions delivers military-proven security for achieving best-in-class control and visibility of data across multiple locations. Founded in 1996, Globalscape's software and services are trusted by tens of thousands of customers worldwide, including global enterprises, governments, and small and medium enterprises. 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 2014 calendar year, filed with the Securities and Exchange Commission on March 30, 2015.

   
   
GlobalSCAPE, Inc.  
Consolidated Balance Sheets  
(in thousands except share amounts)  
   
    December 31,     December 31,  
    2015     2014  
Assets                
Current assets:                
  Cash and cash equivalents   $ 15,885     $ 11,358  
  Short term investments     3,254       -  
  Accounts receivable (net of allowance for doubtful accounts of $325 and $511 in 2015 and 2014, respectively)    
6,081
     
5,938
 
  Federal income tax receivable     290       -  
  Prepaid expenses     511       488  
    Total current assets     26,021       17,784  
                 
  Fixed assets, net     498       616  
  Long term investments     -       3,185  
  Intangible assets, net     3,982       3,298  
  Goodwill     12,712       12,712  
  Deferred tax asset     940       692  
  Other assets     60       100  
    Total assets   $ 44,213     $ 38,387  
                 
Liabilities and Stockholders' Equity                
Current liabilities:                
  Accounts payable   $ 839     $ 1,111  
  Accrued expenses     1,893       1,590  
  Deferred revenue     12,000       11,411  
  Income taxes payable     127       2  
    Total current liabilities     14,859       14,114  
                 
  Deferred revenue, non-current portion     3,612       3,393  
  Other long term liabilities     44       52  
  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, 21,383,467 and 20,989,267 shares issued at December 31, 2015 and December 31, 2014, respectively    

21
     

21
 
  Additional paid-in capital     19,583       18,370  
  Treasury stock, 403,581 shares, at cost, at December 31, 2015 and December 31, 2014    
(1,452
)    
(1,452
)
  Retained earnings     7,546       3,889  
    Total stockholders' equity     25,698       20,828  
    Total liabilities and stockholders' equity   $ 44,213     $ 38,387
 
                 
                 
GlobalSCAPE, Inc.  
Consolidated Statements of Operations and Comprehensive Income  
(in thousands, except per share amounts)  
             
    For the Year Ended December 31,  
    2015     2014  
                 
Operating revenues:                
  Software licenses   $ 12,023     $ 10,292  
  Maintenance and support     16,595       15,033  
  Professional services     2,223       1,445  
    Total revenues     30,841       26,770  
Costs of revenues (See note)                
  Software licenses     2,428       1,508  
  Maintenance and support     1,466       1,491  
  Professional services     1,775       785  
    Total costs of revenues     5,669       3,784  
Gross Profit     25,172       22,986  
Operating expenses (See note)                
  Sales and marketing     10,025       10,012  
  General and administrative     6,168       6,176  
  Research and development     2,562       2,183  
    Total operating expenses     18,755       18,371  
Income from operations     6,417       4,615  
Other income (expense):                
    Interest expense     (4 )     (105 )
    Interest income     82       63  
Total other income (expense)     78       (42 )
Income (loss) before income taxes     6,495       4,573  
Provision for income taxes     1,897       1,547  
Net income (loss)   $ 4,598     $ 3,026  
Comprehensive income (loss)   $ 4,598     $ 3,026  
                 
Net income (loss) per common share - basic   $ 0.22     $ 0.15  
                 
Net income (loss) per common share - diluted   $ 0.22     $ 0.15  
                 
Weighted average shares outstanding:                
Basic     20,824       20,163  
                 
Diluted     21,366       20,693  
                 
Note: Cost of revenues and operating expenses for the year ended December 31, 2014, have been reclassified to conform with the expanded presentation of these items for the year ended December 31, 2015. These reclassifications are between cost of revenues and operating expense items only and resulted in no change to previously reported amounts of total operating expenses, income from operations, income before income taxes, net income, or earnings per share.  
 
 
 
 
   
   
             
GlobalSCAPE, Inc.  
Consolidated Statements of Cash Flows  
(in thousands)  
             
    For the Year Ended December 31,  
    2015     2014  
Operating Activities:                
Net income (loss)   $ 4,598     $ 3,026  
  Adjustments to reconcile net income (loss) to net cash provided by operating activities:                
    Bad debt expense     62       445  
    Depreciation and amortization     1,553       883  
    Stock-based compensation     647       521  
    Deferred taxes     (248 )     968  
    Excess tax deficiency from exercise of share based compensation     (58 )     227  
    Other             74  
  Subtotal before changes in operating assets and liabilities     6,554       6,144  
  Changes in operating assets and liabilities:                
    Accounts receivable     (205 )     (2,619 )
    Prepaid expenses     (23 )     (139 )
    Federal income taxes     (107 )     (112 )
    Other assets     40       44  
    Accounts payable     (272 )     456  
    Accrued expenses     303       693  
    Deferred revenues     808       4,004  
    Other long-term liabilities     (8 )     (8 )
Net cash provided by (used in) operating activities     7,090       8,463  
Investing Activities:                
  Software development costs     (1,967 )     (2,847 )
  Purchase of property and equipment     (152 )     (252 )
  Interest on long term investments     (69 )     (63 )
Net cash provided by (used in) investing activities     (2,188 )     (3,162 )
Financing Activities:                
  Proceeds from exercise of stock options     508       2,243  
  Tax deficiency (benefit) from stock-based compensation     58       (227 )
  Notes payable principal payments             (4,386 )
  Dividends paid     (941 )     (1,028 )
Net cash provided by (used in) financing activities     (375 )     (3,398 )
Net increase (decrease) in cash     4,527       1,903  
Cash at beginning of period     11,358       9,455  
Cash at end of period   $ 15,885     $ 11,358  
                 
Supplemental disclosure of cash flow information:                
Cash paid during the period for:                
Interest   $ -     $ 117  
Income taxes   $ 2,146     $ 565  
   
   
   
   
GlobalSCAPE, Inc.  
Adjusted EBITDA Excluding Infrequent Items  
(in thousands, except per share amounts)  
             
    Year Ended  
    December 31  
    2015     2014  
Income (loss) from operations (before interest and taxes)   $ 6,417     $ 4,615  
Add (subtract):                
  Depreciation and amortization:                
    Total depreciation and amortization     1,553       883  
    Amortization of capitalized software development costs     (1,283 )     (577 )
  Stock-based compensation expense     647       521  
Infrequent items     -       -  
                 
    Adjusted EBITDA Excluding Infrequent Items   $ 7,334     $ 5,442  

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