SOURCE: GlobalSCAPE, Inc.

Globalscape

July 28, 2016 16:15 ET

GlobalSCAPE, Inc. Announces Financial Results for the Second Quarter 2016

Year to Date Revenues Up Over Six Percent Yielding the 15th Consecutive Profitable Quarter

SAN ANTONIO, TX--(Marketwired - July 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 second quarter 2016, which ended June 30, 2016.

Second Quarter 2016 Financial Highlights:

  • Revenue for the second quarter of 2016 was $8.3 million, an increase of five percent when compared with revenue of $7.9 million for the second quarter of 2015.
  • Revenue for the first six months of 2016 was $15.7 million, a six percent increase over the same time period last year.
  • For the second quarter of 2016, the Company's net income was $954,000 compared with net income of $1.3 million for the second quarter of 2015, marking 15 consecutive quarters of profitability.
  • Earnings per share was $0.05 for the second quarter of 2016 compared with $0.06 for the second quarter of 2015.
  • Adjusted EBITDA for the second quarter of 2016 was $1.8 million compared with $2.1 million for the second quarter of 2015.
  • The Company had cash, cash equivalents and short-term investments of $20.3 million at June 30, 2016. Other than liabilities for normal trade payables and taxes, the Company has no debt.

Recent Business Highlights:

Supporting Quote:

Matt Goulet, President and Chief Executive Officer at Globalscape

"The secure management and movement of data is a significant challenge that a number of organizations face on a regular basis. It is also an issue that Globalscape confronts head on, and is a driver for our increasing growth along with the basis for the evolution of our products. As such, we saw a five percent increase in revenue in the second quarter of 2016 and a six percent increase in year to date revenue, compared to the same periods last year. The second quarter was also the first time in company history that we reported $8 million in revenue outside of the fourth quarter. We believe that our re-focused product strategy, which is concentrated on our core technology, our award-winning Enhanced File Transfer technology platform, will ultimately further our continued success and growth."

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

Globalscape management will hold a conference call on July 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 second quarter 2016. Those wanting to join may call 888-539-3696 or 719-325-2495 and use Conference ID # 4393517. 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," "expect," 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 2015 fiscal year, filed with the Securities and Exchange Commission on March 3, 2016.

  
GlobalSCAPE, Inc.  
Condensed Consolidated Balance Sheets  
(in thousands except share amounts)  
Unaudited  
          
          
   June 30,   December 31,  
   2016   2015  
Assets           
Current assets:           
 Cash and cash equivalents  $16,990   $15,885  
 Short term investments   3,287    3,254  
 Accounts receivable (net of allowance for doubtful accounts           
 of $335 and $325 in 2016 and 2015, respectively)   5,673    6,081  
 Federal income tax receivable   55    290  
 Prepaid and other expenses   777    511  
            
  Total current assets   26,782    26,021  
            
Fixed assets, net   473    498  
Capitalized software development costs   3,960    3,982  
Goodwill   12,712    12,712  
Deferred tax asset   893    940  
Other assets   31    60  
            
  Total assets  $44,851   $44,213  
            
Liabilities and Stockholders' Equity           
Current liabilities:           
 Accounts payable  $742   $839  
 Accrued expenses   1,478    1,893  
 Deferred revenue   11,344    12,000  
 Income taxes payable   -    127  
            
  Total current liabilities   13,564    14,859  
            
Deferred revenue, non-current portion   3,825    3,612  
Other long term liabilities   37    44  
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, 21,584,582 and 21,383,467 shares issued at June 30, 2016, and December 31, 2015, respectively   21    21  
Additional paid-in capital   20,580    19,583  
Treasury stock, 403,581 shares, at cost, at           
 June 30, 2016 and December 31, 2015   (1,452 )  (1,452 )
Retained earnings   8,276    7,546  
            
 Total stockholders' equity   27,425    25,698  
 Total liabilities and stockholders' equity  $44,851   $44,213  
         
         
 
GlobalSCAPE, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income
(In thousands, except per share amounts)
(Unaudited)
         
  Three months ended June 30, Six months ended June 30,
  2016 2015 2016 2015
             
Operating Revenues:            
 Software licenses $2,893 $3,280 $5,192 $5,738
 Maintenance and support  4,632  4,093  9,129  8,127
 Professional services  731  490  1,345  878
  Total Revenues  8,256  7,863  15,666  14,743
Cost of revenues            
 Software licenses  800  651  1,430  1,089
 Maintenance and support  387  391  781  716
 Professional services  587  335  1,156  652
  Total cost of revenues  1,774  1,377  3,367  2,457
   Gross profit  6,482  6,486  12,299  12,286
Operating expenses            
 Sales and marketing  2,792  2,476  5,693  4,771
 General and administrative  1,712  1,457  3,445  3,180
 Research and development  572  657  1,199  1,186
  Total operating expenses  5,076  4,590  10,337  9,137
   Income from operations  1,406  1,896  1,962  3,149
Other income (expense), net  27  23  60  34
   Income before income taxes  1,433  1,919  2,022  3,183
Income tax expense  479  594  661  1,043
   Net income $954 $1,325 $1,361 $2,140
   Comprehensive income $954 $1,325 $1,361 $2,140
             
Net income per common share -            
 Basic $0.05 $0.06 $0.07 $0.10
 Diluted $0.04 $0.06 $0.06 $0.10
             
Weighted average shares outstanding:            
 Basic  21,105  20,804  21,056  20,726
 Diluted  21,689  21,324  21,655  21,201
             
Cash dividends declared per share $0.015 $0.015 $0.030 $0.015
             

  
GlobalSCAPE, Inc.  
Condensed Consolidated Statements of Cash Flows  
(in thousands)  
(Unaudited)  
  
   For the Six Months Ended June 30,  
   2016   2015  
Operating Activities:           
Net income  $1,361   $2,140  
Items not involving cash at the time they are recorded in the statement of operations:           
 Bad debt expense   52    127  
 Depreciation and amortization   1,006    682  
 Share-based compensation   500    315  
 Deferred taxes   47    (60 )
 Excess tax benefit from share-based compensation   (12 )  (35 )
            
  Subtotal before changes in operating assets and liabilities   2,954    3,169  
Changes in operating assets and liabilities:           
 Accounts receivable   356    1,130  
 Prepaid expenses   (40 )  190  
 Deferred revenue   (443 )  (1,247 )
 Accounts payable   (108 )  (600 )
 Accrued expenses   (404 )  (292 )
 Other Assets   29    5  
 Other long-term liabilities   (7 )  (1 )
 Income tax receivable and payable   120    340  
            
  Net cash provided by operating activities   2,457    2,694  
Investing Activities:           
 Software development costs capitalized   (846 )  (1,107 )
 Purchase of property and equipment   (113 )  (90 )
 Interest reinvested in long term investments   (33 )  (32 )
            
  Net cash (used in) investing activities   (992 )  (1,229 )
Financing Activities:           
 Proceeds from exercise of stock options   259    307  
 Excess tax benefit from share-based compensation   12    35  
 Dividends paid   (631 )  (312 )
            
  Net cash provided by (used in) financing activities   (360 )  30  
            
Net increase in cash   1,105    1,495  
Cash at beginning of period   15,885    11,358  
            
Cash at end of period  $16,990   $12,853  
            
Supplemental disclosure of cash flow information:           
 Cash paid during the period for:           
  Interest       $-  
  Income taxes  $468   $696  
         
            
            
GlobalSCAPE, Inc.  
Adjusted EBITDA  
(in thousands)  
(Unaudited)  
                  
   Three Months Ended   Six Months Ended  
   June 30,   June 30,  
   2016   2015   2016   2015  
Income from operations  $1,406   $1,896   $1,962   $3,149  
Add (subtract) items to determine adjusted EBITDA:                     
 Depreciation and amortization:                     
  Total depreciation and amortization   511    394    1,006    682  
  Amortization of capitalized software development costs   (438 )  (327 )  (868 )  (545 )
Stock-based compensation expense   278    167    500    315  
                      
  Adjusted EBITDA  $1,757   $2,130   $2,600   $3,601  
                      
                 
                 

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