REG - Corero Network Sec. - Half Year Trading Update

Corero Network SecurityAnnouncement

24/07/2024 07:00

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RNS Number : 5519X  Corero Network Security PLC  24 July 2024

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

24 July 2024

Corero Network Security plc

("Corero" or the "Company")

 

Half Year Trading Update

 

Strong growth in revenue, ARR and pipeline supports continued momentum into H2
2024

 

Corero (https://www.corero.com/) (AIM: CNS)
(https://www.londonstockexchange.com/stock/CNS/corero-network-security-plc/company-page)
(OTCQB: DDOSF) (https://www.otcmarkets.com/stock/DDOSF/overview) , the
distributed denial of service ("DDoS") protection specialists, provides the
following trading update for the six months ended 30 June 2024(1) ("H1 2024").

 

Financial Highlights

 

·    Revenue growth of 16% to $12.2 million (H1 2022: $10.5 million)

·    Annualised Recurring Revenues(2) ("ARR") grew 12% to $17.2 million
(H1 2023: $15.3 million)

·    Gross margin of 91% (H1 2023: 91%)

·    EBITDA of $0.7 million (H1 2023: loss of $0.2 million)

·    Record cash balance of $7.9 million (H1 2023: $6.2 million)

 

The Group has delivered a strong trading performance across H1 2024,
reflecting significant progress against the accelerated growth go-to-market
strategy announced on 25 April 2024, with continued growth which provides a
solid underpinning for the full year results.

 

The Group achieved revenue growth of 16% to approximately $12.2 million (H1
2023: $10.6 million), underpinned by material customer wins, including
competitive displacements and contract renewals and expansions. With strong
contract momentum across H1 2024, Corero continues to experience high demand
for its SmartWall ONE(TM) DDoS protection solutions and the pipeline is at
record levels.

 

Order intake(3), which reflects revenues recognised over the lifetime of each
of the contracts, increased 10% to $14.2 million for H1 2024 (H1 2023: $13.0
million), demonstrating the positive impact of the Company's targeted
investment in its sales and marketing activities. Strategic regional expansion
saw new deals secured in eight countries across four continents as Corero
further broadened its global footprint, a key pillar of the Group's growth
strategy. In addition to renewing important long-standing customer agreements
and successfully upselling into the Group's existing customer base, Corero
added ten new direct customer wins in H1 2024 in addition to new deals from
alliance partners, driven by the Group's award-winning DDoS protection
software solution and mitigation services.

 

ARR increased 12% to $17.2 million as at 1 July 2024 (ARR at 1 July 2023:
$15.3 million), driven by robust growth in Corero's software
subscription-based products and DDoS Protection-as-a-Service ("DDPaaS")
offering. The Group's ARR importantly underpins higher levels of revenue
predictability for the business going forward.

 

The Company expects to report an EBITDA(4) for H1 2024 of approximately $0.7
million (H1 2023: loss of $0.2 million). There are no adjusting items to
report in 2024 EBITDA.

 

Corero's cash balance as at 30 June 2024 was $7.9 million (31 December 2023:
$5.2 million; H1 2023: $6.2 million) and is at a record level. The Group has
no outstanding debt following the early repayment in full of a bank term loan
facility in H1 2023.

 

The Company expects to report its unaudited interim results for the six months
ended 30 June 2024 in late September 2024.

 

Carl Herberger, Chief Executive Officer at Corero, commented:

 

"I am pleased to report that our enhanced growth strategy has already
delivered results, including several major new customer wins resulting in an
increase in revenue and ARR. These achievements underscore the robustness of
our business model and the sustained demand for our cutting-edge DDoS
protection solutions.

 

"Further, our momentum is building as we enter the second half of the year,
which positions us well to capitalise on new opportunities and drive further
growth. The strong financial performance in H1 2024 and record pipeline
reaffirms our confidence in achieving our full-year targets."

 

(1) All numbers for the six months ending 30 June 2024 disclosed within this
announcement are management estimates based on current information and are
unaudited.

(2) ARR is defined as the normalised annualised recurring revenues and
includes recurring revenues from contract values of annual support, software
subscriptions including terms greater than one year, and from DDoS
Protection-as-a-Service ("DDPaaS") contracts.

(3) Order intake is defined as orders received from customers in the period.

(4) EBITDA is defined as earnings before interest, tax, depreciation, and
amortisation.

 

Enquiries:

 

 Corero Network Security plc                                     Tel: +44(0)20 7390 0230
 Carl Herberger, Chief Executive Officer
 Chris Goulden, Chief Financial Officer

 Canaccord Genuity Limited (Nominated Adviser and Joint Broker)  Tel: +44(0)20 7523 8000
 Simon Bridges / Andrew Potts / Harry Rees

 Zeus Capital (Joint Broker)                                     Tel: +44(0)20 3829 5000

 Stuart Andrews / Alice Lane

 Vigo Consulting                                                 Tel: +44(0)20 7390 0230
 Jeremy Garcia / Kendall Hill
 corero@vigoconsulting.com (mailto:corero@vigoconsulting.com)

 

About Corero Network Security

 

Corero Network Security is a leading provider of DDoS protection solutions,
specialising in automatic detection and protection solutions with network
visibility, analytics, and reporting tools. Corero's technology protects
against external and internal DDoS threats in complex edge and subscriber
environments, ensuring internet service availability. With operational centres
in Marlborough, Massachusetts, USA, and Edinburgh, UK, Corero is headquartered
in London and listed on the London Stock Exchange's AIM market (ticker: CNS)
and the US OTCQB market (OTCQB: DDOSF).

 

For more information, visit www.corero.com (http://www.corero.com/) , and
follow us on LinkedIn (https://www.linkedin.com/company/corero/)  and X
(Twitter (https://twitter.com/Corero) ).

 

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