"Sophos generated 28% year-over-year growth in billings, while
also posting impressive deferred revenue and free cashflow
results," said Steve Munford, Sophos CEO. "Sophos continues to gain
market share because its products explicitly address the growing
market demand for a broader, yet simple, integrated solution
equipped to manage the increased security complexity of the
corporate network."
Key Performance Indicators (in USD)
|
|
FY 2008 |
FY 2007 |
Percentage change |
| Billings1 |
$213.9 |
$167.3 |
+28% |
| Free cashflow2 |
$41.8 |
$29.6 |
+41% |
| Deferred revenue |
$226.3 |
$180.6 |
+25% |
According to IDC, Sophos is the largest privately held vendor in
the secure content and threat management market3. Focused on serving the enterprise market exclusively
- which it defines to include small and mid-sized businesses, large
corporations, educational institutions and government agencies -
Sophos protects an estimated 100 million end users and its products
are used by more than 72,000 customers worldwide. Within the fiscal
year, Sophos garnered 259 new customer wins each worth over
$100,000, which were mainly competitive displacements from Symantec
or McAfee.
"Sophos enjoyed robust growth across all geographies, with
excellent performances in North America and Japan demonstrating
Sophos's success in highly strategic and fiercely competitive
markets," said Paul Smolinski, Chief Financial Officer for Sophos.
"Fiscal 2008 billings for North America topped $77 million while
Japan's billings growth grew 45% year-over-year."
In addition to its 20th year of consecutive growth in revenue,
Sophos consistently generates strong levels of free cashflow. Cash
holdings at the year end were at $139.3 million, a rise of nearly
55% year-over-year.
Over the year, Sophos made a number of enhancements to its
overall product line. These included the general availability of
Sophos
Endpoint Security and Control 8 in addition to upgrade releases
of Sophos's Email Security Appliance and Sophos's Web Security and
Control offering. It was also a year where Sophos fully integrated
last year's acquisition of ENDFORCE,
which has led to building NAC functionality into Sophos Endpoint
Security and Control 8, as well as delivering-to-market Sophos's
standalone endpoint NAC offering - Sophos NAC Advanced.
These product line enhancements enabled Sophos to successfully
capitalize on the growing market demand for broader integrated
security solutions, a demand driven by the increased complexity of
both the corporate network and the desire for corporations to
simplify their security solutions. In addition to winning
significant new accounts with a broader product line, Sophos has
been especially successful with driving revenue growth by selling
multiple products into its existing customer base.
Late in 2007, Gartner, Inc. published an updated version of its
Magic Quadrant for Endpoint Protection Platforms, 2007, which ranks
companies on their 'completeness of vision' and their 'ability to
execute,' and categorizes them as either 'niche players,'
'evisionaries,' 'challengers' or 'leaders'. For the first time,
Sophos was placed in the 'leaders' quadrant within the Gartner report. More recently,
Gartner recognized Sophos in its MarketScope for Network Access
Control, 2008 report. Within the report, Sophos received a
'positive' rating, the highest mark given to any vendor by
Gartner.
During the year, Sophos continued to strengthen its Board of
Directors with both Jonathan Brooks and Nanci Caldwell being
appointed as non-executive directors. Jonathan brings with him
extensive experience serving on Boards such as Aveva Group Plc, ARM
Holdings Plc, and E2V Technologies. Nanci has held senior
management positions at PeopleSoft and at Hewlett-Packard
Company.
1
Billings
represents the value of the Sophos products and services invoiced
to customers, following receipt of a purchase order and initial
delivery of the solution. Sophos's policy requires that software
license revenue is recognized rateably over the license term, and
therefore has the effect of deferring a higher proportion of
bookings to future periods. This contributes to a future guaranteed
revenue stream.
2
Net cash
from operations excluding exceptional cash flows plus finance
income less capital expenditure.
3
IDC,
'Worldwide Secure Content and Threat Management 2007-2011 Forecast
and 2006 Vendor Shares,' Brian E. Burke, Charles J. Kolodgy, Jon
Crotty, June 2007.
Sophos is headquartered in Boston, US and Oxford, UK. More information is available at www.sophos.com.