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Cyren Ltd. (CYRN) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

SEC Filings

Cyren Ltd.

CIK: 1084577 Ticker: CYRN

Exhibit 99.1

 

PRESS RELEASE    

  

 

Cyren Announces Second Quarter 2021 Financial Results

- - -

 

Cyren Inbox Security, Anti-Phishing for the Enterprise, Achieves Record ARR Growth

 

McLean, Va. – August 16, 2021 – Cyren (NASDAQ: CYRN) today announced its second quarter 2021 financial results for the period ending June 30, 2021.

 

During the second quarter, Cyren reported quarterly revenues of $7.6 million, compared to $9.2 million during the second quarter of 2020. GAAP net loss for the quarter was $5.6 million, compared to the $4.6 million net loss reported during the second quarter of 2020, due to lower revenues, partially offset by lower operating expenses compared to the prior year.

 

“While overall revenues declined year-over-year, this decline was predominantly within our legacy threat intelligence services OEM business. Churn in the quarter was very low and customer satisfaction has never been higher. However, we had some anticipated customer contract reductions, with some occurring in 2020, that impacted the year-over-year comparison”, said Brett Jackson, CEO of Cyren.

“In our opinion, the key Q2 highlight for shareholders, however, is the significant acceleration of our new enterprise anti-phishing business, led by our Cyren Inbox Security offering. This acceleration was driven by an increase in customer order volume which resulted in new and expansion ARR growth of approximately 240% from Q1 2021. We believe this acceleration is likely to continue in Q3 based on the strength of our pipeline and the number of customer orders closed quarter-to-date.”

“As we have mentioned in prior calls, Cyren’s biggest growth opportunity is helping enterprise customers effectively deal with the constant stream of phishing attacks and business email compromise attempts. We believe our Q2 results and exceptional win rate validate the effectiveness and competitive differentiation of Cyren Inbox Security and its ability to quickly solve enterprise customers’ phishing problems. Management will continue to focus on investing in and developing this new, high-growth revenue stream and its potential to drive shareholder value.”

 

Second Quarter 2021 Financial Highlights:

 

·Revenues for the second quarter of 2021 were $7.6 million, compared to $9.2 million during the second quarter of 2020.
·GAAP net loss for the second quarter of 2020 was $5.6 million, compared to a net loss of $4.6 million in the second quarter of 2020.
·GAAP loss per basic and diluted share for the second quarter of 2021 was $0.07, compared to a loss of $0.08 per basic and diluted share for the second quarter of 2020.
·Non-GAAP net loss for the second quarter of 2021 was $4.5 million, compared to a Non-GAAP net loss of $3.8 million for the second quarter of 2020.
·Non-GAAP loss per basic and diluted share was $0.06 for the Q2 2021, compared to a Non-GAAP loss of $0.06 per share in Q2 2020.
·Cash used in operating activities during the second quarter of 2021 was $2.3 million, compared to cash provided by operating activities of $2.5 million during the second quarter of 2020, largely driven by an increase in net loss, a decline in deferred revenue driven by the receipt of a multi-year, multi-million dollar prepayment from one of our largest customers in the first quarter of 2019 and a decline in deferred revenue due to downsells on various customer renewals.
·Net cash flow for the second quarter of 2021 was negative $2.5 million, compared to positive $1.1 million during the second quarter of 2020.
·Cash and cash equivalents balance as of June 30, 2021, was $13.9 million, compared to $9.3 million as of December 31, 2020.

 

For information regarding the non-GAAP financial measures discussed in this release, please see “Use of Non-GAAP Financial Measures” and “Reconciliation of Selected GAAP Measures to Non-GAAP Measures.”

 



Financial Results Conference Call:

The company will host a conference call at 4:30 p.m. a.m. Eastern Time (11:30 p.m. Israel Time) on Monday, August 16, 2021 to discuss second quarter results.

 

U.S. Dial-in Number: 1-877-407-0312
Israel Dial-in Number: 1-80-940-6247
International Dial-in Number: 1-201-389-0899

 

The call will be simultaneously webcast live on the investor relations section of Cyren’s website at https://ir.cyren.com, or by using the following link:https://www.webcast-eqs.com/cyren_08162021/en.

 

For those unable to participate in the live conference call, a replay will be available until August 30, 2021. To access the replay, the U.S. dial in number is 1-877-660-6853 and the non-U.S. dial in number is 1-201-612-7415. Callers will be prompted for replay conference ID number 13722129. An archived version of the webcast will also be available on the investor relations section of the company's website at https://ir.cyren.com/events.

 

About Cyren:

 

More than 1.3 billion users around the world rely on Cyren's cloud security solutions to protect them against cyber attacks and data loss every day. Powered by GlobalView, Cyren’s global security cloud that identifies emerging threats on a global basis in real-time, Cyren (NASDAQ: CYRN) delivers fast time-to-protection with threat detection services, threat intelligence and enterprise email security products for leading email providers, cybersecurity vendors, service providers and enterprises. Learn more at www.cyren.com.

 

Blog: http://blog.cyren.com

LinkedIn: www.linkedin.com/company/cyren

Twitter: www.twitter.com/CyrenInc

 

Use of Non-GAAP Financial Measures:

Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: stock-based compensation expenses, amortization of acquired intangible assets, and deferred taxes related to acquisitions, adjustments to earn-out obligations, and capitalization of technology. The purpose of such adjustments is to give an indication of the company's performance exclusive of non-cash charges and other items that are considered by management to be outside of the company's core operating results. The company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.

 

Company management regularly uses supplemental non-GAAP financial measures internally to understand, manage and evaluate the business and make operating decisions.

 

These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. The company believes this adjustment is useful to investors as a measure of the ongoing performance of the business. The company believes these non-GAAP financial measures provide consistent and comparable measures to help investors understand the company's current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it important to make these non-GAAP adjustments available to investors.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For example, statements in the future tense, and statements including words such as "expect," "plan," "estimate," "anticipate," or "believe" are forward-looking statements. These statements are based on information available at the time of the press release and the company assumes no obligation to update any of them. The statements in this press release are not guarantees of future performance and actual results could differ materially from current expectations as a result of numerous factors, including business conditions and growth or deterioration in the internet security market, technological developments, products offered by competitors, availability of qualified staff, and technological difficulties and resource constraints encountered in developing new products, as well as those risks described in the company's publicly filed reports, which are available through www.sec.gov.

 

Company Contact
Kenneth Tarpey, CFO
Cyren
+1.703.760.3435
kenneth.tarpey@cyren.com

 

2

 

   CYREN LTD. 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

  (in thousands of U.S. dollars, except per share amounts)

                 

    Three months ended     Six months ended  
    June 30     June 30  
    2021     2020     2021     2020  
    Unaudited     Unaudited     Unaudited     Unaudited  
 Revenues   $ 7,609     $ 9,181     $ 16,366     $ 18,830  
   Cost of revenues     3,805       3,778       7,600       7,376  
Gross profit     3,804       5,403       8,766       11,454  
Operating expenses:                                
   Research and development, net     4,110       4,151       8,360       7,495  
   Sales and marketing     2,731       3,146       5,369       6,182  
   General and administrative     2,305       2,476       4,465       4,690  
Total operating expenses     9,146       9,773       18,194       18,367  
Operating loss     (5,342 )     (4,370 )     (9,428 )     (6,913 )
  Other income, net     1       2       (17 )     8  
   Financial expenses, net     (287 )     (290 )     (501 )     (521 )
Loss before taxes     (5,628 )     (4,658 )     (9,946 )     (7,426 )
   Tax benefit     40       44       161       61  
Net loss   $ (5,588 )   $ (4,614 )   $ (9,785 )   $ (7,365 )
Loss per share - basic and diluted   $ (0.07 )   $ (0.08 )   $ (0.14 )   $ (0.12 )
Weighted average number of shares outstanding:                                
Basic and Diluted     75,484       60,041       71,996       59,862  

 

3

 

 

CYREN LTD.

RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES 

(in thousands of U.S. dollars, except per share amounts)

 

   Three months ended   Six months ended 
   June 30   June 30 
   2021   2020   2021   2020 
   Unaudited   Unaudited   Unaudited   Unaudited 
                 
GAAP gross profit  $3,804   $5,403   $8,766   $11,454 
GAAP gross margin   50%   59%   54%   61%
Plus:                    
Stock-based compensation expense   83    20    104    64 
Amortization of intangible assets   658    593    1,325    1,024 
Non-GAAP gross profit   4,545    6,016    10,195    12,542 
Non-GAAP gross margin   60%   66%   62%   67%
                     
GAAP operating loss   (5,342)   (4,370)   (9,428)   (6,913)
Plus:                    
Stock-based compensation expense   548    507    1,005    1,152 
Amortization of intangible assets   734    723    1,476    1,283 
Capitalization of technology   (88)   (389)   (239)   (1,602)
Non-GAAP operating loss   (4,148)   (3,529)   (7,186)   (6,080)
                     
GAAP net loss   (5,588)   (4,614)   (9,785)   (7,365)
Plus:                    
Stock-based compensation expense   548    507    1,005    1,152 
Amortization of intangible assets   734    723    1,476    1,283 
Amortization of deferred tax assets   (55)   (48)   (109)   (96)
Capitalization of technology   (99)   (414)   (262)   (1,657)
Non-GAAP net loss  $(4,460)  $(3,846)  $(7,675)  $(6,683)
                     
Numerator for non-GAAP EPS calculation  $(4,460)  $(3,846)  $(7,675)  $(6,683)
Non-GAAP net loss per share  $(0.06)  $(0.06)  $(0.11)  $(0.11)
                     
GAAP weighted-average shares used to                    
compute net loss per share   75,484    60,041    71,996    59,862 

4

 

 

CYREN LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands of U.S. dollars)

       

         
   June 30   December 31 
   2021   2020 
    Unaudited      
                 Assets          
Current Assets:          
Cash and cash equivalents  $13,885   $9,296 
Trade receivables, net   1,410    960 
Deferred commissions   989    980 
Prepaid expenses and other receivables   1,615    779 
 Total current assets   17,899    12,015 
           
Long-term deferred commissions   938    1,125 
Long-term lease deposits and prepaids   870    937 
Operating lease right-of-use assets   9,852    10,900 
Severance pay fund   808    745 
Property and equipment, net   3,248    3,948 
Intangible assets, net   6,536    7,797 
Goodwill   21,022    21,476 
 Total long-term assets   43,274    46,928 
Total assets  $61,173   $58,943 
           
                 Liabilities and Shareholders’ Equity          
Current Liabilities:          
Trade payables  $1,361   $799 
Convertible notes   10,000    10,000 
Employees and payroll accruals   3,898    3,813 
Accrued expenses and other liabilities   907    1,420 
Operating lease liabilities   1,782    1,983 
Deferred revenues   6,791    6,934 
 Total current liabilities   24,739    24,949 
           
Deferred revenues   524    644 
Convertible debentures   8,497    9,248 
Long-term operating lease liabilities   8,894    9,866 
Deferred tax liability   472    655 
Accrued severance pay   902    838 
Other liabilities   527    706 
Total long-term liabilities   19,816    21,957 
           
Shareholders’ equity   16,618    12,037 
Total liabilities and shareholders’ equity  $61,173   $58,943 

 

 

5

 

 

CYREN LTD.

CONDENSED CONSOLIDATED CASH FLOW DATA

(in thousands of U.S. dollars)

               

 

                 
   Three months ended   Six months ended 
   June 30   June 30 
   2021   2020   2021   2020 
Cash flows from operating activities:  Unaudited   Unaudited   Unaudited   Unaudited 
                 
Net loss  $(5,588)  $(4,614)   (9,785)  $(7,365)
                     
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                    
(Gain) / loss on disposal of property and equipment   (1)   26    17    13 
Depreciation   528    597    1,091    1,215 
Stock-based compensation   548    507    1,005    1,152 
Amortization of intangible assets   733    723    1,475    1,283 
Amortization of deferred commissions   328    452    653    803 
Non-cash operating lease expense   464    534    930    922 
Interest on convertible notes   143    142    285    283 
Interest and amortization of debt issuance costs on Convertible Debentures   167    187    343    211 
Deferred taxes, net   (44)   (54)   (168)   (118)
                     
Changes in assets and liabilities:                    
Trade receivables   (682)   490    (471)   (162)
Prepaid expenses and other receivables   (794)   (57)   (792)   (383)
Deferred commissions   (266)   (276)   (474)   (664)
Change in long-term lease deposits and prepaids   18    28    20    (86)
Trade payables   185    (159)   247    (114)
Employees and payroll accruals, accrued expenses and other liabilities   (372)   444    (548)   (47)
Deferred revenues   2,592    4,062    (182)   1,989 
Accrued severance pay, net   23    24    2    1 
Operating lease liabilities   (333)   (534)   (1,064)   (954)
Other long-term liabilities   6    10    (180)   163 
Net cash provided by (used in) operating activities   (2,345)   2,532    (7,596)   (1,858)
                     
Cash flows from investing activities:                    
                     
Proceeds from sale of property and equipment   3    2    5    4 
Capitalization of technology   (100)   (588)   (252)   (1,589)
Purchase of property and equipment   (115)   (880)   (133)   (1,438)
Net cash used in investing activities   (212)   (1,466)   (380)   (3,023)
                     
Cash flows from financing activities:                    
                     
Proceeds from Convertible Debenture, net of debt issuance costs   -      -      -      9,442 
Proceeds from stock issuance, net of costs   -      -      12,588    -   
Net cash provided by financing activities   -      -      12,588    9,442 
Effect of exchange rate changes on cash   8    (7)   (22)   (13)
Increase (decrease) in cash, cash equivalents and restricted cash   (2,549)   1,059    4,590    4,548 
Cash, cash equivalents and restricted cash at the beginning of the period   17,053    15,616    9,914    12,127 
Cash, cash equivalents and restricted cash at the end of the period  $14,504   $16,675   $14,504   $16,675 
                     
Reconciliation of cash, cash equivalents and restricted cash as shown in the consolidated statements of cash flow:                    
Cash and cash equivalents  $13,885   $16,103   $13,885   $16,103 
Restricted cash included in long-term restricted lease deposits   619    572    619    572 
                     
Total cash, cash equivalents and restricted cash  $14,504   $16,675   $14,504   $16,675 

 

6

 


The following information was filed by Cyren Ltd. (CYRN) on Monday, August 16, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Cyren Ltd.'s 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Document And Entity Information
Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets (Parentheticals)
Condensed Consolidated Statements Of Cash Flows (Unaudited)
Condensed Consolidated Statements Of Changes In Shareholders??? Equity (Unaudited)
Condensed Consolidated Statements Of Comprehensive Loss (Unaudited)
Condensed Consolidated Statements Of Operations (Unaudited)
Accounting Policies, By Policy (Policies)
Commitments And Contingencies
Commitments And Contingencies (Details)
Financial Expense, Net
Financial Expense, Net (Details) - Schedule Of Financial Expense, Net
Financial Expense, Net (Tables)
General
Leases
Leases (Details)
Leases (Details) - Schedule Of Future Minimum Lease Payments
Leases (Details) - Schedule Of Operating Right-Of-Use Assets And Operating Lease Liabilities
Leases (Details) - Schedule Of Weighted Average Remaining Lease Terms And Discount Rates For All Of Operating Leases
Leases (Tables)
Related Parties
Related Parties (Details) - Schedule Of Related Party Balances
Related Parties (Details) - Schedule Of Related Party Transactions
Related Parties (Tables)
Segment And Geographic Information
Segment And Geographic Information (Details)
Segment And Geographic Information (Details) - Schedule Of Net Amount Of Long-Lived Tangible Assets
Segment And Geographic Information (Details) - Schedule Of Revenue Generated By Customer Type
Segment And Geographic Information (Details) - Schedule Of Total Revenue By Solutions Offered By Geographic Area
Segment And Geographic Information (Tables)
Shareholders' Equity
Shareholders' Equity (Details)
Shareholders' Equity (Details) - Schedule Of Employee And Director Options Outstanding
Shareholders' Equity (Details) - Schedule Of Employees And Directors' Stock Option Activity
Shareholders' Equity (Details) - Schedule Of Options To Non-Employees
Shareholders' Equity (Details) - Schedule Of Rsus Activity
Shareholders' Equity (Details) - Schedule Of Stock-Based Compensation Expense
Shareholders' Equity (Tables)
Significant Accounting Policies
Significant Accounting Policies (Details)

Material Contracts, Statements, Certifications & more

Cyren Ltd. provided additional information to their SEC Filing as exhibits

Ticker: CYRN
CIK: 1084577
Form Type: 10-Q Quarterly Report
Accession Number: 0001213900-21-059378
Submitted to the SEC: Mon Nov 15 2021 4:16:10 PM EST
Accepted by the SEC: Mon Nov 15 2021
Period: Thursday, September 30, 2021
Industry: Prepackaged Software

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