VASCO Reports Results for First Quarter 2018

Vasco Data Security International Inc (NASDAQ:VDSI), a global leader in digital identity security, transaction security announced financial results for the first quarter ended March 31, 2018.

The company had a total Q1 revenue of $45.4 million while its adjusted EBITDA was $6.1 million.

As quoted in the press release:

“We reported record non-hardware revenue in the first quarter with strong contributions from software licenses and subscriptions. Our success was underscored by the doubling of our mobile security software and an increase of nearly 50% in our e-signature solutions,” stated VASCO CEO, Scott Clements. “Strong software and services revenue combined with expected Q1 declines in hardware revenue contributed to a higher gross profit margin. Our strategy of developing software and services solutions that address the secure identity and business enablement challenges of our customers is being well received by the market and we anticipate future gains as we prepare to launch our Trusted Identity Platform later this quarter.”

Revenue for the first quarter of 2018 increased 8% to $45.4 million from $42.0 million in the first quarter of 2017.

Adjusted earnings before interest, taxes, depreciation, amortization and long-term incentive compensation (Adjusted EBITDA)¹ for the first quarter of 2018 was $6.1 million, an increase of $1.9 million, or 44% from $4.2 million reported for the first quarter of 2017. Adjusted EBITDA as a percentage of revenue was 13.5% for the first quarter of 2018, and increase of 3.4 percentage points from 10.1% in the first quarter of 2017.

Net income for the first quarter of 2018 was $1.8 million or $0.04 per fully diluted share, an increase of $1.2 million from net income of $0.6 million or $0.01 per fully diluted share for the first quarter of 2017.

Non-GAAP net income¹, which excludes long-term incentive compensation and the amortization of intangible assets, for the first quarter of 2018, was $4.6 million or $0.12 per fully diluted share, an increase of $1.4 million from $3.2 million or $0.08 per fully diluted share, for the first quarter of 2017.

Other Financial Metrics

• Gross profit was $34.7 million or 76% of revenue for the first quarter of 2018. Gross profit was $29.9 million or 71% of revenue for the first quarter of 2017.

• Operating expenses for the first quarter were $33.0 million, an increase of 11.6% from $29.6 million reported for the first quarter of 2017.

• Cash, cash equivalents and short-term investments at March 31, 2018 totaled $166.4 million compared to $158.4 million at December 31, 2017.

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