TIDMCNS
RNS Number : 9161Z
Corero Network Security PLC
17 January 2024
17 January 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.
Corero Network Security plc
("Corero" or the "Company")
Year End Trading Update
Strong Close to 2023 Year End
Significant Brazil Contract Win & Akamai Partnership
Progress
Corero Network Security plc (AIM: CNS), a leading provider of
real-time, high-performance, automatic Distributed Denial of
Service ("DDoS") cyber defence solutions , provides the following
trading update for the year ended 31 December 2023(1) ("FY
2023").
Annualised Recurring Revenues (2) ("ARR") increased to $16.9
million as at 1 January 2024, an increase of 17% over the prior
year (ARR at 1 January 2023: $14.4 million), driven by continued
demand for Corero's subscription-based and DDoS Protection
as-a-service ("DDPaaS") products. This strong performance continues
to improve earnings visibility for the Company going forward,
which, when aligned with the Group's new business pipeline built
through 2023, ensures Corero remains well positioned for revenue
growth in 2024 and beyond.
Subject to audit, revenue for FY 2023 is expected to be
approximately $22.3 million, an increase of 11% from the prior year
(FY 2022: $20.1 million), whilst adjusted EBITDA(3) is expected to
be in the range of $1.9 to $2.3 million (FY 2022: $2.6
million).
Order intake (4) , which reflects revenues recognised over the
lifetime of each contract, grew 4% to $24.8 million for FY 2023 (FY
2022: $23.9 million). In addition, the Company delivered a customer
support contract renewal rate of 98% (FY 2022: 98%), further
demonstrating the strength and quality of Corero's market-leading
solutions, supported by the continued focus on product
development.
Cash at 31 December 2023 was $5.2 million, with no outstanding
debt (net cash 31 December 2022: $4.4 million). The Company used
its strong balance sheet position to repay in full its bank term
loan facility early during the year. The total amount of the bank
term loan repaid during 2023 amounted to $1.2 million.
Significant DDoS Protection Service Win in Brazil
During H2 2023, the Company secured a $1 million plus contract
with a new channel partner customer in the Brazilian market, its
largest ever contract in the LATAM region, which will expand
Corero's ability to offer DDoS protection solutions in this new
geographic market (the "Contract"). The Contract, which has a total
value in excess of $1 million over three years, will deliver
SmartWall (R) ONE ultra-low latency DDoS protection across the
channel partner's own network.
In addition, Corero and the customer have entered into a revenue
sharing agreement which will enable this channel partner to sell
Corero DDoS protection services producing an incremental revenue
stream for Corero. This agreement will allow Corero to gain deeper
penetration across the LATAM region with a trusted provider,
opening further opportunities for revenue generation and market
expansion.
Update on Strategic Global Partnership with Akamai
Following the global partnership agreement with Akamai announced
on 20 September 2023, Corero is pleased to report that it has
secured its first two new DDPaaS customer wins through the
partnership. These two material contracts were secured late in the
final quarter of 2023 and therefore had a negligible contribution
to Corero's revenue in 2023 given that DDPaaS contract revenue is
recognised over the contract term.
Corero and Akamai have been closely engaged in the second half
of 2023 on the workstreams to drive the successful commercial
execution of the partnership and drive new customer opportunities.
This close collaboration has resulted in a growing pipeline of
opportunities which will generate incremental revenue for Corero in
2024 and beyond.
CEO Appointment
As announced on 13 November 2023, Carl Herberger became CEO and
joined the Board of Directors on 1 January 2024. Following Carl's
appointment to the Board, Jens Montanana has stepped back from his
role as Executive Chairman of the Company and returned to his role
as Non-Executive Chairman, effective 1 January 2024.
There are no changes to the disclosures made in relation to
Schedule 2(g) and AIM Rule 17 in the 13 November 2023 announcement
in respect of Carl Herberger.
The Company intends to issue its audited FY 2023 results in late
March / early April 2024 and will provide an update on the actual
date in due course.
Carl Herberger, CEO of Corero, said:
"I am delighted to be joining the business at such an exciting
time, with Corero achieving growth across all our key metrics,
alongside the continued expansion of both our customer base and
market reach.
Our new Akamai partnership is already yielding positive contract
momentum and the new Brazilian win highlights the expansion of
Corero's global footprint.
The global demand for DDoS protection remains robust, driven by
the ever-growing activity from threat-actors, with 2023 being
another record year. Corero expects this trend to continue and is
therefore well placed to take advantage of this ever more complex
and growing market.
During 2024, we will continue to build upon the foundations laid
in 2023. Our focus on profitability and positive cash-flow
generation, whilst delivering both ARR and revenue growth, will
allow us to further demonstrate our scalable business model as we
continue to realise the Company's potential."
(1) All numbers for year ending 31 December 2023 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) Adjusted EBITDA is defined as earnings before interest, tax,
depreciation, and amortisation excluding unrealized FX
gains/(losses).
(4) Order intake is d efined as orders received from customers
in the period.
Enquiries:
Corero Network Security plc Tel: +44(0)20 7390
0230
Carl Herberger, Chief Executive Officer
Phil Richards, C hief Financial Officer
C anaccord Genuity Limited (Nominated Adviser Tel: +44(0)20 75
and Broker) 23 8000
S imon Bridges / Andrew Potts / Harry Rees
Vigo Consulting Tel: +44(0)20 7390
0230
Jeremy Garcia / Kendall Hill
corero@vigoconsulting.com
About Corero Network Security
Corero Network Security is a leading provider of DDoS protection
solutions, specializing 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). For more information,
visit: https://www.corero.com .
For more information, visit www.corero.com , and follow us on LinkedIn and Twitter .
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