VirtualArmor Reports Fourth Quarter and Year End 2015 Financial Results

-2015 Revenue Growth of 53% Year over Year to over USD $7,000,000 (CAD $10,000,000)

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

VANCOUVER, April 26, 2016 /CNW/ - VirtualArmor International Inc. ("VirtualArmor" or the "Company") (CSE: VAI) today announced fourth quarter (Q4) financial results for the three and twelve-month period ended December 31, 2015. All figures are in USD.  

"2015 was a year of market expansion as we saw our top line grow by 53% over the previous year while continuing to partner with leading cyber security technology providers and increasing our customer base to include leading enterprises," said Todd Kannegieter, CEO of VirtualArmor. "The revenue growth we saw over the past year was driven primarily by an increase in hardware/software sales to new customers as well as existing ones that upsized their orders. In addition, our managed services platform which serves as a source of multi-year recurring revenues saw an increase of 35% in monthly contractual billings at year-end 2015 vs. 2014  as initial product sales turned into three plus year contracts to manage the solutions purchased."

"Looking forward into 2016, our company has a clear focus to continue partnering with leading cyber security technologies and expanding our sales channel to support incremental revenue growth across all of our business lines," continued Todd Kannegieter. "In addition, we will continue scaling our hardware/software sales and increase our high margin managed services to become a larger percentage of overall revenues, and ultimately the main driving force to our bottom line."

"Lastly, during the third quarter of 2015 we began trading on the Canadian Securities Exchange and in doing so incurred a onetime listing expense of $4,166,285 which was the primary contributor to our net loss for the year," said Todd Kannegieter. "In the coming quarters we anticipate this figure to normalize to better reflect our core earnings power as a business."

Fourth Quarter Financial Highlights

  • Total revenue for Q4 2015 increased by 101% to $2,492,695, compared to $1,236,528 in Q4 2014. The increase in revenue was due to an increase in the number of customers served as well as the size of orders from existing customers.
  • Hardware and software sales revenue increased by 137% to $2,077,923 in the quarter ended December 31, 2015, compared to $877,379 for in 2014.
  • Managed and professional services revenue increased by 16% to $413,956 in the quarter ended December 31, 2015, compared to $355,428.
  • Net income and comprehensive income for Q4 2015 was $915,230 as compared to a net loss of $31,433. The increase in net income is due to a gain on the fair value of a warrant derivative liability.
  • As at December 31, 2015, the Company's cash balance was $250,812 compared to $95,978 as at December 31, 2014.

2015 Financial Highlights

  • Total revenue for 2015 increased by 53% to $7,366,309 compared to $4,813,410 in 2014. The increase in revenue was directly related to a significant increase in the number of customers being served.
  • Hardware and software sales revenue increased by 69% to $5,780,084 in 2015, compared to $3,417,928 for in 2014. The increase in revenue was due to an increase in the number of customers served as well as the size of orders from new and existing customers.
  • Managed and professional services revenue increased by 14% to $1,576,965 in 2015, compared to $1,378,386 in 2014.
  • The Company recorded a net loss of $3,403,391 (0.09 per share) for the year ended December 31, 2015 as compared to net income of $122,944 (0.00 per share) for the year ended December 31, 2014. The table below details certain non-cash and other transactions that for the purposes of this discussion have been adjusted out of the reported loss to produce an adjusted loss that forms a better basis for comparing the year-over-year operating results of the Company.


2015

$

2014

$

(Loss) income for the year as reported

(3,403,391)

122,944

Add (deduct):



Listing expense

4,166,285

-

Change in fair value of warrant derivative liabilities

(1,169,751)

-

G&A expense – share-based compensation

399,674

17,914

Adjusted (loss) income for the year (1)

(7,183)

140,858



(1)

Adjusted loss for the year is not a term recognized under IFRS.  Non-IFRS measures do not have a standardized meaning.  Accordingly, non-IFRS measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

 

Operational Highlights:

  • During the quarter, the Company:
    • Commenced trading on the CSE under the symbol VAI.
  • Subsequent to the quarter, the Company:
    • Closed approximately $2,400,000 USD in orders over a 90 day period beginning December 1st, 2015.
    • Reduced shares outstanding with the voluntary escrow of free trading shares and canceled a previously announced private placement due to a favourable exercise of warrants.
    • Added three leading cybersecurity solutions to managed services platform.

About VirtualArmor
VirtualArmor is a cyber security company that delivers solutions to help enterprises build, monitor, maintain and secure their networks from cloud to core. As a managed security services provider, VirtualArmor's services run 24 hours per day, 7 days per week, 365 days per year through its primary security operations center ("SOC") located in Middlesbrough, U.K. and a secondary SOC located in Salt Lake City, Utah. Each member of VirtualArmor's team supports the three main facets of its business: managed services, professional services, and hardware sales, by handling the design, configuration and installation of advanced network and cloud architecture solutions. VirtualArmor uses best-in-breed partnerships to provide solutions for customers that are affordable, highly reliable, scalable, and backed by thorough knowledge of the related technologies, products, and platforms. VirtualArmor has secured partnerships with established technology businesses specializing in network appliances, software, and systems and provides its services to the mid- to large- enterprise and service provider markets. VirtualArmor customers include a 13-location data center provider, a Fortune 100 oil and gas company, multiple service providers with presences throughout the United States, and household name enterprise organizations located primarily in the western United States. Further information about the Company is available under its profile on the SEDAR website, www.sedar.com, on the CSE website, www.thecse.com, and on its website, http://www.virtualarmor.com/.

Forward-Looking Information:

This press release may include forward-looking information within the meaning of Canadian securities legislation. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmor.  Although VirtualArmor believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmor cannot provide any assurance that it will prove to be correct. These forward-looking statements are made as of the date of this press release and VirtualArmor disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

SOURCE Virtual Armor

For further information: Company Contact: Todd Kannegieter, President and CEO, Office: 720-961-3304, todd.kannegieter@virtualarmor.com; Investor Relations Contact: Babak Pedram, Office: 416-644-5081, bpedram@virtusadvisory.com

RELATED LINKS
http://www.virtualarmor.com

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