26th Mar 2015 11:31
LONDON (Alliance News) - Corero Network Security PLC Thursday posted a swing to a loss in 2014 due to lower revenues, and after a one-off gain from the sale of part of its business had boosted its 2013 results. However it cited customer wins as showing market demand for its SmartWall Threat Defence System.
The network security systems provider posted a pretax loss of USD10.0 million, swung from a pretax profit of USD8.2 million, as revenue declined to USD7.5 million from USD10.3 million, and in the previous year the company was boosted by a USD15.2 million exceptional gain from the sale of Corero Business Systems.
The company underwent a transition in 2013, opting to focus on its First Line of Defence software, and put the proceeds from the sale of Corero Business Systems into its Smartwall Threat Defence System product and repaying its outstanding debt.
Corero said its order intake during the year had been lower than in 2013, citing fewer customer wins for its previous generation product due to "changing market dynamics."
The lower volume of new customer sales also hit Corero's gross margin, it said, which reduced to 55% from 65% a year before. The company said that the decline in sales of its previous generation product had occurred faster than it expected, and in order to address this it accelerated the launch of the new generation of the product.
This new generation product saw customer wins of USD1.5 million during the year, which the company said validates its addressable markets.
"Following on from a series of successful initial deployments, we enter 2015 with a clear mission to grow SmartWall TDS sales to service providers, hosting providers and online enterprises that are regularly impacted by distributed denial-of-service attacks. The customer wins to date illustrate the market demand and we are confident that the new focus on SmartWall TDS will drive our success in 2015 and beyond," Chief Executive Officer Ashley Stephenson said in a statement.
Shares in Corero are trading down 10% at 11.20 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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