UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended March 31, 2003 |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number 0-20634
SAFENET, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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52-1287752 |
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(State or other jurisdiction of |
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(IRS Employer Identification No.) |
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8029 Corporate Drive, Baltimore, Md. 21236 |
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(Address of principal executive offices) |
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410-931-7500 |
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(Registrant’s telephone number) |
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Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o
Indicate by a check mark whether the registrant is an accelerated filed (as defined in Rule 12b-2 of the Exchange Act). Yes ý No o
APPLICABLE ONLY TO CORPORATE ISSUERS
The number of shares outstanding of the issuer’s Common Stock as of May 14, 2003 was 10,225,469.
TABLE OF CONTENTS
2
SAFENET, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except per share data)
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March 31, |
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December 31, |
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(unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
6,400 |
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$ |
3,399 |
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Held-to-maturity securities |
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25,309 |
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28,763 |
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Accounts receivable, less allowance of $708 and $224, respectively |
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11,759 |
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4,534 |
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Inventories, less reserve of $1,012 and $958, respectively |
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1,569 |
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1,008 |
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Insurance proceeds receivable |
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6,404 |
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— |
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Other current assets |
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1,302 |
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1,002 |
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Current assets of discontinued operations |
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— |
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93 |
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Total current assets |
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52,743 |
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38,799 |
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Property and equipment, less accumulated depreciation of $5,105 and $4,734, respectively |
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2,538 |
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1,246 |
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Computer software development costs, less accumulated amortization of $1,632 and $1,513, respectively |
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471 |
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479 |
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Goodwill |
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39,599 |
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12,826 |
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Other intangible assets, less accumulated amortization of $3,503 and $1,640, respectively |
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19,710 |
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595 |
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Other assets |
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906 |
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1,374 |
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Total assets |
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$ |
115,967 |
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$ |
55,319 |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
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$ |
4,391 |
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$ |
1,456 |
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Accrued salaries and commissions |
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4,797 |
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2,162 |
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Accrued legal settlement |
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6,404 |
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— |
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Other accrued expenses |
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3,960 |
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1,424 |
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Advance payments and deferred revenue |
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4,182 |
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1,393 |
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Current portion of deferred income taxes |
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2,855 |
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— |
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Current liabilities of discontinued operations |
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277 |
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377 |
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Total current liabilities |
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26,866 |
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6,812 |
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Unfavorable lease liability |
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4,887 |
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— |
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Deferred income taxes |
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3,660 |
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129 |
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Total liabilities |
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35,413 |
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6,941 |
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Commitments and contingencies |
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— |
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— |
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Stockholders’ equity: |
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Preferred stock, $.01 par value per share. Authorized 500 shares, no shares issued and outstanding |
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— |
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— |
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Common stock, $.01 par value per share. Authorized 50,000 shares, issued and outstanding shares of 9,990 in 2003 and 7,894 in 2002 |
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100 |
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79 |
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Additional paid-in capital |
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106,785 |
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65,665 |
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Accumulated deficit |
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(29,881 |
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(20,225 |
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Accumulated other comprehensive income |
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3,550 |
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2,859 |
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Total stockholders’ equity |
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80,554 |
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48,378 |
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Total liabilities and stockholders’ equity |
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$ |
115,967 |
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$ |
55,319 |
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See notes to consolidated financial statements.
3
SAFENET, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited - In thousands, except per share amounts)
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Three Months Ended |
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March 31, |
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March 31, |
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Revenues |
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Licenses and royalties |
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$ |
2,403 |
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$ |
1,776 |
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Products |
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10,026 |
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3,521 |
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Service and maintenance |
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1,585 |
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857 |
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Total revenues |
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14,014 |
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6,154 |
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Cost of revenues |
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Licenses and royalties |
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181 |
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147 |
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Products |
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3,954 |
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1,708 |
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Service and maintenance |
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320 |
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98 |
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Total cost of revenues |
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4,455 |
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1,953 |
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Gross profit |
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9,559 |
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4,201 |
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Research and development expenses |
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3,606 |
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2,059 |
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Sales and marketing expenses |
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