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RSA Security Announces First Quarter Results

  • 28 April, 2005 10:21

<p>RSA Security has announced its financial results for Q1 2005, including a 5% increase in revenue and a 12% increase in net income.</p>
<p>See the press release and a statement from Sebastian Moore, Area Vice President, Asia Pacific, of RSA Security below for full details.
<p>"The Australian and New Zealand markets continued to experience quarter on quarter revenue growth across all market segments," said Sebastian Moore, Area Vice President, Asia Pacific, of RSA Security. "In addition to driving organic growth from the existing customer base, we secured a number of new customers, including:</p>
<p>- Fincorp Investments (investment company)
- George Weston Foods Ltd (food &amp; beverage manufacturer)
- Grocon Constructors Pty Ltd (construction)
- Hills Industries Limited (diversified manufacturer)
- Kiandra Systems Solutions Pty Limited (software development and professional services)
- Sentient Group (private equity investment firm)
- Volkswagen Group Australia (motor vehicle distribution)
- Watermark Patent and Trademark Attorneys (law firm)</p>
<p>"We expect that this growth trend will be further fuelled by the enhanced RSA SecurWorld Partner Program that was announced earlier in the week," he said. "The new SecurWorld program is specifically designed to reward partners who actively invest in RSA Security's products and programs, and in developing new customers and the sales of new products. We are confident that the new program will assist in driving increased revenue and profits for RSA Security and its partners, and also maintain and further develop customer satisfaction as more resources and effort will be invested in promoting and explaining the benefits of RSA Security products."</p>
<p>SYDNEY, April 28, 2005 – RSA Security Inc. (NASDAQ: RSAS) today reported financial results for the first quarter ended March 31, 2005.</p>
<p>Revenue for the first quarter of 2005 increased 5% to $75.6 million from $72.0 million for the first quarter of 2004. Net income for the first quarter of 2005 increased 12% to $7.2 million, or $0.10 per diluted share, from $6.5 million, or $0.10 per diluted share, for the comparable period a year ago.</p>
<p>“While we experienced slower than anticipated uptake rates during the first quarter, we remain confident in our ability to build upon our leadership position in identity management,” said Art Coviello, president and chief executive officer of RSA Security.</p>
<p>First-Quarter Financial Overview
• Revenue: Revenue for the first quarter of 2005 increased 5% to $75.6 million from $72.0 million for the first quarter of 2004. The Company experienced a slower than expected growth rate in software sales in both Europe and the Americas. RSA Security’s book-to-bill ratio for the quarter was approximately 1.0 to 1, and the Company closed the quarter with $59.2 million in combined backlog and deferred revenue. This represents a 19% increase from RSA Security’s $49.9 million in backlog and deferred revenue at March 31, 2004.
• Net Income: Net income for the first quarter of 2005 increased 12% to $7.2 million, or $0.10 per diluted share, from $6.5 million, or $0.10 per diluted share, from the first quarter of 2004.
• Cash Position: Cash, cash equivalents, and marketable securities decreased to $282.3 million at March 31, 2005 from $289.7 million at December 31, 2004. During the quarter, in accordance with the Company’s approved stock buyback plan, RSA Security repurchased 750,000 shares of its common stock for $12.4 million.</p>
<p>Operational Overview
• Customers and Partners: RSA Security shipped product to more than 5,400 customers in the first quarter, including 622 new customers. While the technology, financial services, professional services and manufacturing sectors generated the most revenue for the Company, revenue from the technology vertical market was lower than anticipated. RSA Security sold approximately 77% of its RSA SecurID® products through its indirect channel during the first quarter of 2005, consistent with the first quarter of 2004.</p>
<p>Business Outlook</p>
<p>RSA Security’s financial guidance for the second quarter of 2005 is only current as of today, Wednesday, April 27th, 2005, and the Company undertakes no obligation to update its estimates:</p>
<p>• Total quarterly revenue in the range of $76 million to $80 million.
• Diluted earnings per share in the range of $0.10 to $0.13.

Conference Call Details
In conjunction with this announcement, RSA Security hosted a conference call in the U.S. to discuss the Company's financial results, highlights of the quarter and business strategy. A live webcast of this conference call will be available on the "Investor" page of the Company's website, and a webcast archive will be available for approximately three months. To access this call by telephone, dial (800) 811-0667 or (913) 981-4901. A replay will be available through midnight on Tuesday, May 3, 2005 at 888-203-1112 or 719-457-0820. Both live and replay numbers have a pass code of 2614831.
About RSA Security Inc.</p>
<p>RSA Security Inc. helps organisations confidently protect identities and information access. The company secures more than 15 million user identities, safeguards trillions of business transactions annually, and manages the confidentiality of data in tens of thousands of applications worldwide. RSA Security's portfolio of award-winning solutions – including identity &amp; access management, secure mobile &amp; remote access, secure enterprise access, secure transactions and consumer identity protection – sets the standard in the industry. Our strong reputation is built on a 20-year history of ingenuity, leadership and proven technologies, and our more than 17,000 customers around the globe. Together with more than 1,000 technology and integration partners, RSA Security inspires confidence in everyone to experience the power and promise of the Internet. For more information, please visit</p>
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<p>RSA and SecurID are either registered trademarks or trademarks of RSA Security Inc. in the United States and/or other countries. All other products and services mentioned are trademarks of their respective companies.</p>
<p>This press release contains forward-looking statements regarding RSA Security’s financial guidance for the second quarter of 2005. These statements involve a number of risks and uncertainties. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, including the global economy, changes in our operating expenses, the timing of the introduction or enhancement of our products and our competitors’ and strategic partners’ products, changes in product pricing, including changes in competitors’ pricing policies, development and performance of our direct and indirect distribution channels, delays in product development, competitive pressures, changes in customer and market requirements and standards, market acceptance of new products and technologies, technological changes in the computer industry, and the risk factors detailed from time to time in RSA Security’s periodic reports and registration statements filed with the Securities and Exchange Commission, including, without limitation, RSA Security’s Annual Report on Form 10 K filed on March 14, 2005.</p>
<p>Media Contacts</p>
<p>John Back or Maggie Jacka Melinda Hickin
Kinetics Pty Ltd RSA Security Australia Pty Ltd
(02) 9976-6611 (02) 9463-8407</p>

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