Trading update and Proposed Fundraising

RNS Number : 5067U

Corero Network Security PLC

30 July 2015

 

30 July 2015

Corero Network Security plc

("Corero" or the "Company")

Trading update and Proposed Fundraising to raise up to £5.0 million

Corero Network Security plc (AIM: CNS), the AIM listed network security company, is pleased to provide an update on trading for the six months ended 30 June 2015 and announce a proposed fundraising to raise up to £5.0 million (before expenses).

Trading update

The growing number of service provider trials for the SmartWall Threat Defense System ("SmartWall TDS") product support the outlook for a strengthening second half performance. This outlook is dependent on a number of material opportunities with market leading corporations. The longer sales cycles for these large opportunities will impact the results for the year ending 31 December 2015. 

The first half of 2015 is the first full six month reporting period following Corero's decision in Q4 2014 to transition the business focus to the SmartWall TDS product.

First half highlights:

·      Flagship SmartWall TDS order (with a value of over $500,000) from a US service provider

·      Customer wins across the multiple SmartWall TDS target markets: service providers, hosting
providers and on-line enterprises

·      SmartWall TDS trials in progress with three of the top 10 US Internet service providers

·      Key sales team appointments in North America adding significant service provider sales experience

·      Partnership with Verisign to deliver hybrid DDoS protection solutions

·      New development facility in Edinburgh, Scotland which adds significant security, virtualization and software-defined networking (SDN expertise                                                                                      

As set out in the results for the year ended 31 December 2014, announced on 26 March 2015, having made the investment to refresh and refocus its product line to address the growing DDoS threat, Corero remains well positioned for scalable returns from a significant target market.

Corero is continuing to see a shift in enterprises looking to their service providers for delivery of protection against distributed denial of service attacks ("DDoS").  The Company's SmartWall TDS products enable it to address the growing service provider market demand for DDoS protection solutions.

Despite longer sales cycles in the large service provider market, the opportunity in this segment is larger than Corero had originally anticipated. Demand is being driven by the immediate need for next generation technology solutions to deliver DDoS and cyber threat protection services to service provider customer bases and also to protect the growing Cloud services infrastructure from the impact of DDoS and cyber threats. Corero believes traction in this market segment would be transformational for the success of the Company.

Based upon the growing level of interest and number of significant proof of concept trials, Corero is confident in the outlook for the SmartWall TDS product offering in the provider segment and is focusing its efforts on SmartWall TDS sales in these markets.

The Company expects to announce interim results for the six months ended 30 June 2015 on 30 September 2015 at which time the Company will have greater clarity on the expected performance for the year ending 31 December 2015.

Proposed Fundraising to raise up to £5.0 million

Corero is proposing to raise up £5.0 million at 10p per share by way of a subscription.

The net proceeds of the proposed fundraising will be deployed to support SmartWall TDS sales and marketing activities in the US and Europe, and the further development of the SmartWall TDS product.  It is anticipated that the fund raise will enable the Company to achieve positive cash flows from trading in the second half of 2016.

A further announcement regarding the completion of the Subscription will be announced later today.

AIM Listing

The Directors have, in response to discussions with the some of the Company's shareholders, considered the appropriateness of the Company's AIM listing.  The Directors believe that it is in the best interests of the Company and its shareholders as a whole to remain listed on the AIM market at the present time but will continue to assess, on a periodic basis, whether an AIM listing remains appropriate.  Shareholders will be notified of any future developments in this regard.

Enquiries:

Corero Network Security plc
Andrew Miller, CFO and Chief Operating Officer		Tel: [phone]
FinnCap
Stuart Andrews/Carl Holmes (corporate finance)		Tel: [phone]
Stephen Norcross (corporate broking)
Redleaf Communications		Tel: [phone]
Rebecca Sanders-Hewett/David Ison/Susie Hudson		[e-mail]

About Corero Network Security

Corero Network Security, an organization's First Line of Defense^® against Distributed Denial of Service (DDoS) attacks and cyber threats, provide enterprises and service providers with an additional layer of security capable of inspecting and analyzing Internet traffic and mitigating attacks. Corero products and services enhance existing security architecture with a scalable, flexible and responsive defence against DDoS attacks and cyber threats before they reach the targeted IT infrastructure, allowing online services to perform as intended. The latest addition to Corero First Line of Defense® product family includes the Corero SmartWall® Threat Defense System (TDS) allowing for modular, highly scalable network visibility and DDoS defence for the Large Enterprise, Datacentre and Hosting Provider, as well as the Internet Service Provider.

For more information about how Corero solutions are protecting over 500 businesses across the globe, visit www.corero.com.

 

END

 

 

TSTWGUQUMUPAUUU