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VASCO Data Security International Inc. Reports Operating Results (10-Q)

August 07, 2009 | About:
10qk

VASCO Data Security International Inc. (VDSI) filed Quarterly Report for the period ended 2009-06-30.

Vasco Data Security International Inc. design develop market and support security products and services which manage and secure access to computer systems of corporate and government customers. Additionally the company enables secure financial transactions made over private enterprise networks and public networks such as the Internet. The company\'s software and hardware products provide organizations with strong flexible and effective Internet and enterprise security solutions and they compete favorably against those of the competitors. VASCO Data Security International Inc. has a market cap of $282.6 million; its shares were traded at around $7.54 with a P/E ratio of 16.7 and P/S ratio of 2.1. VASCO Data Security International Inc. had an annual average earning growth of 107% over the past 5 years.

Highlight of Business Operations:

The U.S. Dollar strengthened by approximately 16% and 14% against the Euro for the quarter and six months ended June 30, 2009, respectively, as compared to the same periods in 2008. The U.S. Dollar strengthened 28% and 33% against the Australian Dollar for the quarter and six months ended June 30, 2009, respectively, as compared to the same periods in 2008. We estimate that the strengthening of the U.S. Dollar versus these two currencies in 2009 compared to 2008 resulted in a decrease in revenue of approximately $1,830 and $3,700 for the quarter and six months ended June 30, 2009, respectively, compared to the same periods in 2008 and a decrease in operating expenses of approximately $1,946 and $3,384 for the quarter and six months ended June 30, 2009, respectively, compared to the same periods in 2008.

The financial position and results of operations of most of our foreign subsidiaries, with the exception of our subsidiaries in Switzerland and Singapore (in which the functional currency is the U.S. Dollar), are generally measured using the local currency as the functional currency. Accordingly, assets and liabilities are translated into U.S. Dollars using current exchange rates as of the balance sheet date. Translation adjustments arising from differences in exchange rates are included as a separate component of stockholders’ equity. Revenue and expenses are translated at average exchange rates prevailing during the period. Gains and losses resulting from foreign currency transactions are included in the condensed consolidated statements of operations in other non-operating income (expense). Foreign exchange transaction gains aggregating $856 and $335 in the second quarter and first six months of 2009, respectively, compare to losses aggregating $255 in the second quarter of 2008 and transaction gains aggregating $85 for the first six months of 2008.

States was $1,790, or 41%, lower than the same period in 2008, revenue from Asia Pacific was $451, or 8%, lower than the same period in 2008 and revenue generated from other countries was $4,203, or 40%, lower than the same period in 2008.

Revenue for the first six months of 2009 from the banking market decreased $18,440, or 35%, compared to the first six months of 2008 and revenue from the enterprise and application security market increased $1,736, or 15%, in the same period. Changes in the revenue in both markets for the first six months of 2009 compared to the same period in 2008 were attributable to the same factors noted above in the comparison of revenue for the second quarter of 2009 to the revenue for the second quarter of 2008.

Consolidated gross profit for the quarter ended June 30, 2009 was $16,712, a decrease of $8,690, or 34%, from the quarter ended June 30, 2008. Gross profit as a percentage of revenue (gross profit margin) was 68.3% for the quarter ended June 30, 2009, as compared to 71.7% for the quarter ended June 30, 2008. The decrease in gross profit as a percentage of revenue for the second quarter of 2009 compared to 2008 primarily reflects:

Consolidated gross profit for the six months ended June 30, 2009 was $33,409, a decrease of $12,033, or 26%, from the comparable period in 2008. Gross profit as a percentage of revenue was 70.1% for the first six months of 2009, as compared to 70.6% for the comparable period in 2008. The decrease in gross profit as a percentage of revenue is primarily attributable to the same factors noted for the comparison of gross profit percentages for the second quarters of 2009 and 2008.

Read the The complete Report

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