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home / news releases / CYRN - Cyren Announces Fourth Quarter and Full Year 2020 Financial Results

CYRN - Cyren Announces Fourth Quarter and Full Year 2020 Financial Results

CYREN Ltd.

MCLEAN, VA / ACCESSWIRE / February 22, 2021 / Cyren (NASDAQ:CYRN) today announced its fourth quarter and full year 2020 financial results for the period ending December 31, 2020.

During the fourth quarter, Cyren reported quarterly revenues of $8.4 million, compared to $9.5 million during the fourth quarter of 2019. For the full year ended 2020, revenues were $36.4 million compared to $38.4 million in the prior year. Revenues for the fourth quarter included a one-time reduction of $0.7 million as a result of a multi-year customer contract that was restructured.

The Company's next generation email security product, Cyren Inbox Security, continued to gain traction among enterprises using Microsoft 365, with Q4 revenues increasing 140% over Q3 2020.

"2020 was a year of transition for Cyren as we focused on the execution of a new strategy," said Brett Jackson, CEO of Cyren. "Our teams accomplished our key objectives enhancing our core products, improving customer satisfaction and bringing new product to market. The highlight was the development and launch of our next generation, cloud-based email security product, Cyren Inbox Security. This new product provides Cyren with a significant growth engine into the enterprise market. We plan to continue investing in this opportunity to build market share and grow revenues. We believe that fourth quarter revenue growth is indicative of the potential opportunity we see."

Fourth Quarter and Full Year 2020 Financial Highlights:

  • Revenues for the fourth quarter of 2020 were $8.4 million, compared to $9.5 million during the fourth quarter of 2019. Revenues for the full year were $36.4 million compared to $38.4 million in 2019.
  • GAAP net loss for the fourth quarter of 2020 was $5.0 million, compared to a net loss of $5.3 million in the fourth quarter of 2019. GAAP net loss for the full year ended 2020 was $17.3 million compared to $18.0 million for the full year 2019.
  • GAAP loss per basic and diluted share for the fourth quarter of 2020 was $0.08, compared to a loss of $0.09 per basic and diluted share for the fourth quarter of 2019. GAAP loss per share was $0.29 in 2020 compared to $0.33 in 2019.
  • Non-GAAP net loss for the fourth quarter of 2020 was $4.2 million, compared to a Non-GAAP net loss of $3.3 million for the fourth quarter of 2019. Non-GAAP net loss for the full year 2020 was $13.8 million, a decrease compared to $15.3 million during 2019.
  • Non-GAAP loss per basic and diluted share was $0.07 for the fourth quarter of 2020, compared to a Non-GAAP loss of $0.06 per share in fourth quarter of 2019. Non-GAAP loss per basic and diluted share was $0.23 for 2020 compared to $0.28 per share in 2019.
  • Cash used in operating activities during the fourth quarter of 2020 was $3.0 million, compared to operating cash usage of $4.6 million during the fourth quarter of 2019.
  • Net cash flow for the fourth quarter of 2020 was negative $3.6 million, compared to $2.0 million during the fourth quarter of 2019 when the company raised capital through a rights offering.
  • Cash balance as of December 31, 2020, was $9.3 million, compared to $11.6 million as of December 31, 2019.

For information regarding the non-GAAP financial measures discussed in this release, please see "Use of Non-GAAP Financial Measures" and "Reconciliation of Selected GAAP Measures to Non-GAAP Measures."

Registered Direct Offering:

Subsequent to the end of the quarter, Cyren announced a registered direct offering with a select group of accredited institutional investors for the purchase of 12 million ordinary shares priced at $1.15 per share, generating gross proceeds of $13.8 million and net proceeds of $12.5 million. The transaction was completed on February 16, 2021 and therefore the proceeds of the transaction are not included in the cash balance on the balance sheet as of December 31, 2020.

Financial Results Conference Call:

The company will host a conference call at 4:30 p.m. Eastern Time on Monday, February 22, 2021 to discuss fourth quarter and full year 2020 results.

U.S. Dial-in Number: 1-877-407-0312
Israel Dial-in Number: 1-80-940-6247
International Dial-in Number: 1-201-389-0899

The call will be simultaneously webcast live on the investor relations section of Cyren's website at https://ir.cyren.com, or by using the link: https://www.webcast-eqs.com/cyren20210222/en.

For those unable to participate in the live conference call, a replay will be available until March 8, 2021. To access the replay, the U.S. dial in number is 1-877-660-6853 and the non-U.S. dial in number is 1-201-612-7415. Callers will be prompted for replay conference ID number 13716472. An archived version of the webcast will also be available on the investor relations section of the company's website at https://ir.cyren.com/events.

About Cyren:

More than 1.3 billion users around the world rely on Cyren's cloud security solutions to protect them against cyber-attacks every day. Powered by the world's largest security cloud, Cyren (NASDAQ: CYRN) delivers fast time-to-protection with embedded threat detection, threat intelligence and email security solutions. Learn more at www.cyren.com.

Blog: http://blog.cyren.com
LinkedIn: www.linkedin.com/company/cyren
Twitter: www.twitter.com/CyrenInc

Use of Non-GAAP Financial Measures:

Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: stock-based compensation expenses, amortization of acquired intangible assets, and deferred taxes related to acquisitions, adjustments to earn-out obligations, and capitalization of technology. The purpose of such adjustments is to give an indication of the company's performance exclusive of non-cash charges and other items that are considered by management to be outside of the company's core operating results. The company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.

Company management regularly uses supplemental non-GAAP financial measures internally to understand, manage and evaluate the business and make operating decisions.

These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. The company believes this adjustment is useful to investors as a measure of the ongoing performance of the business. The company believes these non-GAAP financial measures provide consistent and comparable measures to help investors understand the company's current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it important to make these non-GAAP adjustments available to investors.

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. For example, statements in the future tense, and statements including words such as "expect," "plan," "estimate," "anticipate," or "believe" are forward-looking statements. These statements are based on information available at the time of the press release and the company assumes no obligation to update any of them. The statements in this press release are not guarantees of future performance and actual results could differ materially from current expectations as a result of numerous factors, including business conditions and growth or deterioration in the internet security market, technological developments, products offered by competitors, availability of qualified staff, and technological difficulties and resource constraints encountered in developing new products, as well as those risks described in the company's publicly filed reports, which are available through www.sec.gov.

Company Contact

Kenneth Tarpey, CFO
Cyren
+1.703.760.3320

CYREN LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of U.S. dollars, except per share amounts)

Three months ended
Twelve months ended
December 31
December 31
2020
2019
2020
2019
Unaudited
Unaudited
Unaudited
Unaudited
Revenues
$
8,444
$
9,529
$
36,388
$
38,391
Cost of revenues
3,618
4,056
14,786
15,557
Gross profit
4,826
5,473
21,602
22,834
Operating expenses:
Research and development, net
3,819
3,811
16,083
15,801
Sales and marketing
2,555
3,352
11,678
13,825
General and administrative
2,591
3,563
9,583
10,877
Total operating expenses
8,965
10,726
37,344
40,503
Operating loss
(4,139
)
(5,253
)
(15,742
)
(17,669
)
Other income (expense), net
(4
)
4
5
266
Financial expenses, net
(890
)
(85
)
(1,647
)
(727
)
Loss before taxes
(5,033
)
(5,334
)
(17,384
)
(18,130
)
Tax benefit (provision)
27
(5
)
121
112
Loss
$
(5,006)
$
(5,339)
$
(17,263)
$
(18,018)
Loss per share - basic and diluted
$
(0.08
)
$
(0.09
)
$
(0.29
)
$
(0.33
)
Weighted average number of shares outstanding:
Basic and Diluted
60,994
57,473
60,327
55,167


CYREN LTD.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands of U.S. dollars, except per share amounts)

Three months ended
Twelve months ended
December 31
December 31
2020
2019
2020
2019
Unaudited
Unaudited
Unaudited
Unaudited
GAAP gross profit
$
4,826
$
5,473
$
21,602
$
22,834
GAAP gross margin
57
%
57
%
59
%
59
%
Plus:
Stock-based compensation expense
20
143
105
241
Amortization of intangible assets
672
888
2,370
3,252
Non-GAAP gross profit
5,518
6,504
24,077
26,327
Non-GAAP gross margin
65
%
68
%
66
%
69
%
GAAP operating loss
(4,139
)
(5,253
)
(15,742
)
(17,669
)
Plus:
Stock-based compensation expense
515
1,358
2,391
2,360
Amortization of intangible assets
752
1,019
2,823
3,755
Expense (Capitalization) of technology
(372
)
(1,230
)
(1,439
)
(3,740
)
Settlement of litigation, net
-
1,078
-
1,078
Non-GAAP operating loss
(3,244
)
(3,028
)
(11,967
)
(14,216
)
GAAP loss
(5,006
)
(5,339
)
(17,263
)
(18,018
)
Plus:
Stock-based compensation expense
515
1,358
2,391
2,360
Amortization of intangible assets
752
1,019
2,823
3,755
Adjustment to earn-out liabilities
-
-
-
-
Amortization of deferred tax assets
(54
)
(129
)
(198
)
(299
)
Gain from an earn-out liability settlement
-
-
-
(256
)
Settlement of litigation, net
-
1,078
-
1,078
Expense (Capitalization) of technology
(380
)
(1,254
)
(1,506
)
(3,881
)
Non-GAAP loss
$
(4,173
)
$
(3,267
)
$
(13,753
)
$
(15,261
)
Numerator for non-GAAP EPS calculation
$
(4,173
)
$
(3,267
)
$
(13,753
)
$
(15,261
)
Non-GAAP loss per share
$
(0.07
)
$
(0.06
)
$
(0.23
)
$
(0.28
)
GAAP weighted-average shares used to
compute loss per share
60,994
57,473
60,327
55,167


CYREN LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)

December 31
December 31
2020
2019
Unaudited
Unaudited
Assets
Current Assets:
Cash and cash equivalents
$
9,296
$
11,551
Trade receivables, net
960
2,187
Deferred commissions
980
948
Prepaid expenses and other receivables
779
819
Total current assets
12,015
15,505
Long-term deferred commissions
1,125
1,580
Long-term lease deposits and prepaids
937
767
Operating lease right-of-use assets
10,900
8,695
Severance pay fund
745
659
Property and equipment, net
3,948
4,410
Intangible assets, net
7,797
8,966
Goodwill
21,476
20,246
Total long-term assets
46,928
45,323
Total assets
$
58,943
$
60,828
Liabilities and Shareholders' Equity
Current Liabilities:
Trade payables
$
799
$
1,184
Convertible notes
10,000
-
Employees and payroll accruals
3,813
3,427
Accrued expenses and other liabilities
1,420
1,145
Operating lease liabilities
1,983
1,946
Deferred revenues
6,934
7,208
Total current liabilities
24,949
14,910
Deferred revenues
644
1,956
Convertible notes
-
10,000
Convertible Debentures
9,248
-
Long-term operating lease liabilities
9,866
7,174
Deferred tax liability, net
655
796
Accrued severance pay
838
811
Other liabilities
706
470
Total long-term liabilities
21,957
21,207
Shareholders' equity
12,037
24,711
Total liabilities and shareholders' equity
$
58,943
$
60,828



CYREN LTD.
CONDENSED CONSOLIDATED CASH FLOW DATA
(in thousands of U.S. dollars)

Three months ended
Twelve months ended
December 31
December 31
2020
2019
2020
2019
Cash flows from operating activities:
Unaudited
Unaudited
Unaudited
Unaudited
Loss
$
(5,006
)
$
(5,339
)
(17,263
)
$
(18,018
)
Adjustments to reconcile loss to net cash provided by (used in) operating activities:
(Gain) / loss on disposal of property and equipment
2
(1
)
14
-
Depreciation
540
526
2,349
1,946
Stock-based compensation
515
1,358
2,391
2,360
Amortization of intangible assets
752
1,019
2,823
3,755
Amortization of deferred commissions
336
2,108
1,517
1,199
Amortization of operating lease right-of-use assets
649
280
2,157
1,331
Interest on convertible notes
139
144
575
568
Interest and amortization of debt issuance costs on Convertible Debentures
201
-
601
-
Other income related to the earn-out consideration
-
-
-
(257
)
Deferred taxes, net
(13
)
(140
)
(184
)
(322
)
Changes in assets and liabilities:
Trade receivables
1,425
1,339
1,299
1,535
Prepaid expenses and other receivables
513
436
57
(171
)
Deferred commissions
(195
)
(2,062
)
(1,095
)
(961
)
Change in long-term lease deposits
(27
)
20
(116
)
45
Trade payables
(110
)
(495
)
(399
)
(759
)
Employees and payroll accruals, accrued expenses and other liabilities
239
(843
)
149
(1,028
)
Deferred revenues
(2,890
)
(3,065
)
(1,856
)
2,932
Accrued severance pay, net
(24
)
(15
)
(60
)
58
Operating lease liabilities
(61
)
(171
)
(1,606
)
(1,246
)
Other long-term liabilities
53
277
237
151
Net cash used in operating activities
(2,962
)
(4,624
)
(8,410
)
(6,882
)
Cash flows from investing activities:
Capitalization of technology
(382
)
(1,234
)
(1,482
)
(3,696
)
Proceeds from sale of property and equipment
-
2
6
3
Purchase of property and equipment
(223
)
(211
)
(1,766
)
(1,470
)
Net cash used in investing activities
(605
)
(1,443
)
(3,242
)
(5,163
)
Cash flows from financing activities:
Proceeds from rights offering, net
-
7,967
9,442
7,967
Proceeds from Convertible Debenture, net of debt issuance costs
-
-
-
-
Payment of earn-out liability
-
-
-
(2,680
)
Proceeds from options exercised
-
-
-
743
Net cash provided by financing activities
-
7,967
9,442
6,030
Effect of exchange rate changes on cash
11
110
(3
)
(14
)
Increase (decrease) in cash, cash equivalents and restricted cash
(3,556)
2,010
(2,213)
(6,029)
Cash, cash equivalents and restricted cash at the beginning of the period
13,470
10,117
12,127
18,156
Cash, cash equivalents and restricted cash at the end of the period
$
9,914
$
12,127
$
9,914
$
12,127
Reconciliation of cash, cash equivalents and restricted cash as shown in the consolidated statements of cash flow:
Cash and cash equivalents
$
9,296
$
11,551
$
9,296
$
11,551
Restricted cash included in long-term restricted lease deposits
618
576
618
576
Total cash, cash equivalents and restricted cash
$
9,914
$
12,127
$
9,914
$
12,127

SOURCE: Cyren



View source version on accesswire.com:
https://www.accesswire.com/631099/Cyren-Announces-Fourth-Quarter-and-Full-Year-2020-Financial-Results
Stock Information
Company Name: CYREN Ltd.
Stock Symbol: CYRN
Market: NASDAQ
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