Certicom Reports Year-End Results for Fiscal 2007



    Increasing Number of Design Wins Provides Evidence of Widespread
    Adoption of ECC

    
    Highlights for the Year:

    -   GE's security business licensed Certicom's Elliptic Curve
        Cryptography (ECC) technology

    -   Nokia licensed Certicom's cryptographic technology in multi-year
        contract as foundation for security in Intellisync Mobile Suite and
        other messaging and file synchronization products

    -   Visto Corporation licensed Certicom's technology and ECC cryptography
        for mobile push email and messaging applications in multi-year
        agreement

    -   Cybertrust licensed Certicom's Suite B Power Bundle products to offer
        commercially available ECC certificates

    -   NTT and Certicom will conduct joint research on ECC digital signature
        technology

    -   WORLDSPACE Satellite Radio, a global leader in satellite-based
        digital radio services, licensed Certicom's Conditional Access System

    -   Secured recurring revenue contracts with top-tier multinationals in
        broad range of sectors during fourth quarter of fiscal 2007

    Subsequent to Year End:

    -   Appointed Dr. Matthew Campagna as director of research, who brings
        extensive experience in ECC implementation to the role

    -   Initiated litigation against Sony for patent infringement
    

    MISSISSAUGA, ON, June 6 /CNW/ - Certicom Corp. (TSX: CIC) (the "Company")
today reported results for the fiscal year and fourth quarter ended April 30,
2007. All figures are in U.S. dollars and in accordance with Canadian
Generally Accepted Accounting Principles (GAAP) except where otherwise noted.
    Revenue for the year was $21.4 million compared to $15.1 million for
fiscal 2006. For the fourth quarter of fiscal 2007, revenue was $6.5 million,
compared to $5.1 million in the same period in fiscal 2006.
    "Certicom's fourth quarter revenue reflects the timing of contract
closings for several large, multi-year contracts, which we alluded to in our
third quarter release," said Bernard Crotty, Certicom's President and Chief
Executive Officer. "Management is very pleased that our annual results are
consistent with the objectives set out in our business plan."
    "In fiscal 2007, we had a substantial increase in the number of design
wins, with multinationals such as GE, Nokia and WORLDSPACE committing to
Certicom's ECC-enabled solutions. This provides strong evidence of the
increasing market adoption of ECC," continued Mr. Crotty. "We look forward to
building on our momentum in fiscal 2008."
    "The patent infringement litigation against Sony Corporation is an
example of a situation where we will defend our patent portfolio when
necessary. We are confident that we have adequate patent rights and resources
to successfully pursue this suit," Mr. Crotty added.

    Full Year Financial Review

    Operating expenses(1) for the year were $20.1 million, compared to
$15.2 million in fiscal 2006. The increase in year-over-year operating
expenses was mainly due to a planned increase in product development
resources, higher sales commissions related to increased revenue and legal
expenses related to intellectual property protection. For the year, the
Company posted a net loss on a GAAP basis of $3.1 million or $0.08 per basic
and diluted share, compared to a net loss of $3.2 million, or $0.08 per basic
and diluted share in fiscal 2006.
    Certicom had $43.2 million in cash(2) at year end, compared to
$44.3 million at the end of the third quarter. The cash position was $24.7
million at April 30, 2006. The Company has no debt.

    Fourth Quarter Financial Review

    Operating expenses(1) for the fourth quarter of fiscal 2007 were
$6.3 million, compared to $4.5 million for the same period last year. The
year-over-year increase was due mainly to the same factors mentioned above in
the full year review. For the fourth quarter of fiscal 2007, the Company
posted a net loss on a GAAP basis of $1.2 million or $0.03 per basic and
diluted share, compared to a net loss of $0.2 million, or $0.00 per basic and
diluted share for the same period last year.

    Fourth Quarter Operational Highlights
    
    -   NTT and Certicom will conduct joint research on ECC digital signature
        technology

    -   WORLDSPACE Satellite Radio, a global leader in satellite-based
        digital radio services, licensed Certicom's Conditional Access System

    -   Certicom to provide Suite B Power Bundle products for nCipher
        hardware security modules

    -   MobileAware licensed Certicom technology to meet encryption security
        requirements

    -   Secured recurring revenue contracts with top-tier multinationals in
        broad range of sectors
    

    Outlook

    Management intends to continue its focus on leveraging Certicom's
position as a global leader in ECC in order to build recurring revenue and
sustainable profits. This will involve defending Certicom's patent portfolio
where necessary.
    Operating expenses(1) for the first quarter of fiscal 2008 excluding cost
of revenues, depreciation and amortization, and stock-based compensation, are
expected to range from $6.7 to $7.1 million, including estimated legal
expenses ranging from $0.8 to $1.3 million associated with intellectual
property protection. This is consistent with Certicom's fiscal 2008 business
plan.

    Conference Call

    Management will host a conference call to discuss Certicom's performance
for the fiscal year and fourth quarter of 2007 at 10 a.m. ET (7 a.m. PT) on
Thursday, June 7, 2007. The call may be accessed at 416-644-3415 or
1-800-733-7571. It will also be webcast with supporting slides and
subsequently archived at www.certicom.com. To listen to the webcast,
participants will require Windows Media Player(TM) which can be downloaded via
Certicom's website prior to the event. An archived recording will be available
from 12 p.m. (ET) on June 7 until 12 a.m. (ET) on June 14, 2007. To access it,
call 416-640-1917 or 1-877-289-8525 and enter passcode 21233392 followed by
the number sign.

    Annual General Meeting of Shareholders

    Certicom will hold its Annual General Meeting of shareholders on
Thursday, September 20, 2007 at 10 a.m. ET at The Gallery of the TSX Broadcast
& Conference Centre located at The Exhange Tower, 130 King Street West in
Toronto. The meeting will also be simulcast live at Certicom's web site at
www.certicom.com.

    About Certicom

    Certicom protects the value of content, applications and devices with
government-approved security. Adopted by the National Security Agency (NSA)
for classified and sensitive but unclassified government communications,
Elliptic Curve Cryptography (ECC) provides the most security per bit of any
known public-key scheme. As the global leader in ECC, Certicom security
offerings are currently licensed to more than 300 customers including General
Dynamics, Motorola, Oracle, Research In Motion and Unisys. Founded in 1985,
Certicom's corporate offices are in Mississauga, Ontario, Canada with
worldwide sales and marketing headquarters in Reston, Virginia and offices in
the U.S., Canada and Europe.

    Certicom, Certicom Security Architecture, Certicom Trust Infrastructure,
    Certicom CodeSign, Certicom KeyInject, Security Builder, Security Builder
    API, Security Builder BSP, Security Builder Crypto, Security Builder ETS,
    Security Builder GSE, Security Builder IPSec, Security Builder NSE,
    Security Builder PKI and Security Builder SSL are trademarks or
    registered trademarks of Certicom Corp. All other companies and products
    listed herein are trademarks or registered trademarks of their respective
    holders. Information subject to change.

    ENDNOTES:
    ---------
    (1) This news release contains references to operating expenses. Certicom
    defines operating expenses as total operating expenses excluding cost
    of revenues, depreciation and amortization and stock-based
    compensation. It also excludes interest income, other income
    (expense) and withholding tax expense.

    
                                     ----------------------------------------
                                           Three months        Twelve months
                                               ended               ended
                                             April 30,           April 30,
                                          2007      2006      2007      2006
                                     ----------------------------------------
        Sales and marketing           $  2,635  $  1,965  $  9,211  $  7,017
        Product development and
         engineering                     1,878     1,515     6,213     4,873
        General and administrative       1,813     1,017     4,686     3,315
                                     ---------- --------- --------- ---------
        Total operating expenses      $  6,326  $  4,497  $ 20,110  $ 15,205
                                     ---------- --------- --------- ---------
                                     ---------- --------- --------- ---------

    (2) This news release contains references to cash, which is defined as
        cash and cash equivalents, short term and long term marketable
        securities and restricted cash.

        Cash and cash equivalents     $  3,397  $  2,044
        Marketable securities           26,752    22,703
        Long-term marketable
         securities                     13,013         -
                                     --------------------
        Total Cash                    $ 43,162  $ 24,747
                                     --------------------
    

    Except for historical information contained herein, this news release
contains forward-looking statements that involve risks and uncertainties.
Forward-looking information includes information concerning the Company's
future financial performance, business strategy, plans, goals and objectives.
When used in such documents, the words "plans", "expects", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates", "will",
"believes" or variations of such words and phrases often, but not always,
identify forward-looking statements. Factors which could cause actual results
or events to differ materially from current expectations include, among other
things: the ability of the Company to successfully implement its strategic
initiatives and whether such strategic initiatives will yield the expected
benefits; the ability of the Company to develop, promote and protect its
proprietary technology security breaches or defects in the Company's products;
competitive conditions in the businesses in which the Company participates;
changes in consumer spending; the outcome of legal proceedings as they arise;
general economic conditions and normal business uncertainty; consolidation in
the Company's industry and by its customers; customer preferences towards
product offerings; the risk that customers may cancel their contracts with the
Company; reliance on a limited number of customers; demand for ECC-based
technology; performance of the Company's management team and the Company's
ability to attract and retain skilled employees; operating the Company's
business profitably; fluctuations in revenue and foreign currency exchange
rates; interest rate fluctuations and other changes in borrowing costs; the
ability to develop and maintain strategic relationships; and other factors
identified under the heading "Risk Factors" in the Company's annual
information form dated July 26, 2006 and filed on SEDAR at www.sedar.com.
    While the Company believes that its forecasts and assumptions are
reasonable, results or events predicted in this forward-looking information
may differ materially from actual results or events.

    
                               CERTICOM CORP.
                         CONSOLIDATED BALANCE SHEETS
                       (In thousands of U.S. dollars)
    CANADIAN GAAP                                              April 30,
                                                             2007      2006
                                                          --------- ---------
                                                        (unaudited)
    ASSETS

    Current assets:
      Cash and cash equivalents ......................... $  3,397  $  2,044
      Marketable securities .............................   26,752    22,703
      Accounts receivable, net ..........................    6,008     2,729
      Unbilled receivables ..............................      559       287
      Prepaid expenses and other current assets .........      758       657
                                                          --------- ---------
        Total current assets ............................   37,474    28,420

    Long-term marketable securities .....................   13,013         -

    Property and equipment, net .........................    1,250     1,079

    Patents, net ........................................    2,222     1,888

    Other assets ........................................       24       176
                                                          --------- ---------
          Total assets .................................. $ 53,983  $ 31,563
                                                          --------- ---------
                                                          --------- ---------
    LIABILITIES

    Current liabilities:
      Accounts payable .................................. $  2,170  $  1,118
      Accrued liabilities ...............................    2,878     2,253
      Deferred revenue ..................................    3,378     3,599
      Current portion of lease inducements ..............       52        52
                                                          --------- ---------
        Total current liabilities .......................    8,478     7,022

    Other long-term payables ............................      491       503
    Lease inducements, net of current portion ...........       87       139
                                                          --------- ---------
        Total liabilities ...............................    9,056     7,664

    SHAREHOLDERS' EQUITY

      Share capital .....................................   36,514    14,031
      Contributed surplus ...............................    7,044     5,366
      Retained earnings .................................    1,369     4,502
                                                          --------- ---------
        Total shareholders' equity ......................   44,927    23,899
                                                          --------- ---------
        Total liabilities and shareholders' equity ...... $ 53,983  $ 31,563
                                                          --------- ---------
                                                          --------- ---------



                               CERTICOM CORP.
         CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
         -----------------------------------------------------------
         (In thousands of U.S. dollars, except number of shares and
                               per share data)

    CANADIAN GAAP                                  Years ended April 30,
                                                -----------------------------
                                                   2007      2006      2005
                                                --------- --------- ---------
                                              (unaudited)

    Revenues .................................. $ 21,353  $ 15,135  $ 11,550
                                                --------- --------- ---------
    Costs and expenses:
      Cost of product sales ...................      207       126        70
      Cost of services ........................    2,614     1,648     1,269
      Sales and marketing .....................    9,211     7,017     6,466
      Product development and engineering .....    6,213     4,873     3,772
      General and administrative ..............    4,686     3,315     2,711
      Depreciation of property and equipment ..      703       570       476
      Amortization of patents .................      428       400       275
      Stock-based compensation ................    1,742     1,030       611
                                                --------- --------- ---------
        Total costs and expenses ..............   25,804    18,979    15,650
                                                --------- --------- ---------

    Loss from operations ......................   (4,451)   (3,844)   (4,100)

    Other income (expense) ....................    1,792       690      (174)
                                                --------- --------- ---------
    Loss before income taxes ..................   (2,659)   (3,154)   (4,274)

    Income tax expense ........................      474         -         -
                                                --------- --------- ---------
    Net loss for the year .....................   (3,133)   (3,154)   (4,274)

    Retained earnings, beginning of year ......    4,502     7,656    11,930
                                                --------- --------- ---------
    Retained earnings, end of year ............ $  1,369  $  4,502  $  7,656
                                                --------- --------- ---------
                                                --------- --------- ---------

    Basic and diluted net loss per
     common share ............................. $  (0.08) $  (0.08) $  (0.11)
                                                --------- --------- ---------
                                                --------- --------- ---------

    Weighted average shares used in computing
     basic and diluted  net loss per common
     share (000's) ............................   41,453    38,162    37,774
                                                --------- --------- ---------
                                                --------- --------- ---------



                               CERTICOM CORP.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                       (In thousands of U.S. dollars)


    CANADIAN GAAP                                    Years ended April 30,
                                                -----------------------------
                                                   2007      2006      2005
                                                --------- --------- ---------
    Cash provided by (used in):               (unaudited)

    Operating activities:
      Net income (loss) for the year .......... $ (3,133) $ (3,154) $ (4,274)
      Items not affecting cash:
        Depreciation of property and
         equipment ............................      703       570       476
        Amortization of patents ...............      428       400       275
        Stock-based compensation ..............    1,742     1,030       611
        Non-cash interest expense .............        -         -       483
        Foreign exchange loss on convertible
         debentures ...........................        -         -       391
        Amortization of lease inducements .....      (52)      (63)      (20)
      Net change in non-cash operating
       working capital ........................   (2,056)      365     2,441
                                                --------- --------- ---------
        Net cash provided by (used in)
         operating activities .................   (2,368)     (852)      383

    Investing activities:
      Purchase of property and equipment ......     (874)     (475)     (642)
      Purchase of patents and other
       long-term assets .......................     (762)     (660)     (712)
      Maturity (purchase) of marketable
       securities, net ........................  (17,062)     (154)    8,341
      Decrease in restricted cash .............        -       617        51
                                                --------- --------- ---------
      Net cash provided by (used in)
       investing activities ...................  (18,698)     (672)    7,038

    Financing activities:
      Proceeds on the issuance of common
       shares, net ............................   22,419       872       337
      Repayment of convertible debenture ......        -         -   (10,005)
                                                --------- --------- ---------
        Net cash provided by (used in)
         financing activities .................   22,419       872    (9,668)

    Effect of exchange rate on cash and cash
     equivalents ..............................        -         9       (12)
                                                --------- --------- ---------

    Increase (decrease) in cash and cash
     equivalents ..............................    1,353      (643)   (2,259)

    Cash and cash equivalents, beginning
     of year ..................................    2,044     2,687     4,946
                                                --------- --------- ---------
    Cash and cash equivalents, end of year .... $  3,397  $  2,044  $  2,687
                                                --------- --------- ---------
                                                --------- --------- ---------



                               CERTICOM CORP.
         CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
         -----------------------------------------------------------
         (In thousands of U.S. dollars, except number of shares and
                               per share data)
                                 (Unaudited)

    CANADIAN GAAP                     Three months ended  Twelve months ended
                                           April 30,           April 30,
                                         2007      2006      2007      2006
                                      --------- --------- --------- ---------
    Revenues:
      Product and intellectual
       property ..................... $  4,475  $  3,609  $ 14,630  $ 10,870
      Services ......................    2,035     1,501     6,723     4,265
                                      --------- --------- --------- ---------
        Total revenues ..............    6,510     5,110    21,353    15,135

    Cost of revenues:
      Product and intellectual
       property .....................       66       (91)      207       126
      Services ......................    1,066       511     2,614     1,648
                                      --------- --------- --------- ---------
        Total cost of revenues ......    1,132       420     2,821     1,774

                                      --------- --------- --------- ---------
    Gross margin ....................    5,378     4,690    18,532    13,361

    Operating expenses:
      Sales and marketing ...........    2,635     1,965     9,211     7,017
      Product development and
       engineering ..................    1,878     1,515     6,213     4,873
      General and administrative ....    1,813     1,017     4,686     3,315
      Depreciation and
       amortization .................      279       265     1,131       970
      Stock-based compensation ......      470       291     1,742     1,030
                                      --------- --------- --------- ---------
        Total operating expenses ....    7,075     5,053    22,983    17,205

                                      --------- --------- --------- ---------
    Loss from operations ............   (1,697)     (363)   (4,451)   (3,844)

    Other income (expense):
      Interest income ...............      469       199     1,814       766
      Interest expense and other,
       net ..........................        7        (3)      (22)      (76)
                                      --------- --------- --------- ---------
        Total other income ..........      476       196     1,792       690

                                      --------- --------- --------- ---------
    Income (loss) before provision
     for income taxes ...............   (1,221)     (167)   (2,659)   (3,154)
      Provision for income taxes ....      (12)        -       474         -
                                      --------- --------- --------- ---------
    Net income (loss) for the
     period ......................... $ (1,209) $   (167) $ (3,133) $ (3,154)
    Retained earnings, beginning
     of period ......................    2,578     4,669     4,502     7,656
                                      --------- --------- --------- ---------
    Retained earnings, end of
     period ........                  $  1,369  $  4,502  $  1,369  $  4,502
                                      --------- --------- --------- ---------
                                      --------- --------- --------- ---------
    Basic and diluted net loss
     per share ...................... $  (0.03) $  (0.00) $  (0.08) $  (0.08)
                                      --------- --------- --------- ---------
                                      --------- --------- --------- ---------
    Shares used in basic and
     diluted net loss per share
     calculations ...................   42,649    38,376    41,453    38,162
                                      --------- --------- --------- ---------
                                      --------- --------- --------- ---------

    





For further information:

For further information: Investors and Financial Analysts: Hervé Séguin,
Chief Financial Officer, Certicom Corp., (905) 501-3827, hseguin@certicom.com;
Media: John Callahan, Director, Public Relations & Marketing Communications,
Certicom Corp., (703) 234-2357, jcallahan@certicom.com; www.certicom.com

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