Network security technology company, Check Point Software Technologies, saw revenue grow in the first quarter of 2004, even as its net income dropped because of charges resulting from the recent acquisition of Zone Labs.
Check Point reported revenue of $US116 million in the quarter ending March 31, compared with revenue of $US104 million in the same quarter last year, an increase of 11 per cent. However, charges related to the purchase of Zone Labs drove net income down more than 30 per cent, to almost $US41 million, compared to $US60 million in the same quarter last year.
Check Point completed its acquisition of Zone Labs for $US205 million in cash and stock on March 26. Consequently, Zone Labs' operating results were not included in Check Point's first quarter. However, Check Point did record a one time charge of $US23.1 million to acquire the company, which makes Internet firewall products that are popular among consumers and VPN (virtual private network) software users.
That charge aside, Check Point said its net income rose 8 per cent for the quarter to $US65 million compared with $US60 million in the first quarter of 2003.
Check Point credited the success of new products, including VPN-1 Edge and Check Point Express, for the growth. The company planned to use the technology acquired with Zone Labs to develop a comprehensive security portfolio that stretches from large enterprises to consumers, Check Point said.
The company also said that it planned to introduce a new line of products that would address Web access and Web security issues.