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Zix Corporation Exceeds Guidance on First Quarter Earnings

DALLAS, Apr 26, 2016 (BUSINESS WIRE) -- Zix Corporation ZIXI, +0.53% a leader in email data protection, today announced financial results for the first quarter ended Mar. 31, 2016.

First Quarter 2016 Financial Highlights

  • First quarter revenue of $14.3 million, an increase of 9.6% year-over-year
  • Ending backlog of $75.5 million, an increase of 7.4% year-over-year
  • First quarter total orders of $15.7 million, an increase of 9.9% year-over-year
  • First quarter new first year orders of $1.9 million, a decrease of 5.2% year-over-year
  • First quarter GAAP fully diluted earnings per share of $0.03, an increase of 35.4% year-over-year
  • First quarter Non-GAAP fully diluted earnings per share of $0.06, an increase of 47.8% year-over-year [(2)]
  • The Company generated approximately $4.0 million in cash flow from operations, an increase of $1.5 million year-over-year
  • Cash and cash equivalents at quarter-end was $27.1 million, despite $5.2 million spent on share repurchases during the quarter. This $27.1 million is an increase of $2.2 million compared to the Mar. 31, 2015, ending cash balance

“The continued strength of our email encryption business enabled us to achieve increased earnings per share and deliver healthy growth in revenue, backlog and total orders,” said David Wagner, ZixCorp’s Chief Executive Officer. “New First Year Orders were not as strong as expected, but we are confident that our pipeline across go-to-market channels and opportunities created by Cloud email migrations keep us on track to meet our annual revenue and earnings guidance.”

First Quarter 2016 Corporate Financial Summary and Other Operational Metrics

$ in Millions, except per share data Q1 2016 Q1 2015

% or $
Change [(1)]

Revenue $14.3 $13.1 9.6%
GAAP Gross Profit $11.8 $10.9 8.6%
GAAP Net Income $1.6 $1.2 33.5%
GAAP Net Income Per Share – Diluted $0.03 $0.02 35.4%
Non-GAAP Adjusted Gross Profit [(2)] $11.9 $10.9 8.6%
Non-GAAP Adjusted Net Income [(2)] $3.4 $2.4 45.8%
Non-GAAP Adjusted Net Income Per Share – Diluted [(2)] $0.06 $0.04 47.8%
Adjusted EBITDA [(2) (3)] $4.1 $3.0 36.6%
Adjusted EBITDA Margin [(3) (4)] 28.6% 23.0% 5.7 pts
New First Year Orders $1.9 $2.0 (5.2)%
Total Orders $15.7 $14.3 9.9%
Backlog [(4)] $75.5 $70.3 7.4%
[(1)] Changes are based on actuals versus numbers shown in the columns which may reflect rounding
[(2)]

A reconciliation of GAAP to Non-GAAP adjusted results is attached to this press release and available on our investor relations Web page at http://investor.zixcorp.com

[(3)] Adjusted earnings before interest, taxes, depreciation and amortization
[(4)] Service contract commitments that represent future revenue to be recognized as the services are provided

Outlook

For the second quarter 2016, the Company forecasts revenue to be between $14.6 million and $14.8 million and fully diluted adjusted earnings per share to be $0.06. For the full-year 2016, the Company reaffirms previously issued revenue projections of between $59.5 million and $61.0 million. The Company increases guidance of fully diluted Non-GAAP adjusted earnings per share to $0.24.

Conference Call Information

The Company will discuss its financial results and outlook on a conference call on Tuesday, Apr. 26, 2016, at 5 p.m. ET. A live webcast of the conference call will be available on its investor relations Web site at http://investor.zixcorp.com. Alternatively, participants can access the conference call by dialing 1-855-853-6940 (U.S. toll-free) or 1-720-634-2906 (international) at least 15 minutes before the call and entering access code 83041124.

An audio replay of the conference will be available for seven days, by dialing 1-855-859-2056 (U.S. toll-free) or 1-404-537-3406 (international) and entering the access code 83041124. An archive of the webcast will also be available on the ZixCorp investor relations Web site.

About Zix Corporation

ZixCorp is a leader in email data protection. ZixCorp offers industry-leading email encryption, a unique email DLP solution and an innovative email BYOD solution to meet your company’s data protection and compliance needs. ZixCorp is trusted by the nation’s most influential institutions in healthcare, finance and government for easy to use secure email solutions. ZixCorp is publicly traded on the Nasdaq Global Market under the symbol ZIXI, and its headquarters are in Dallas, Texas. For more information, visit www.zixcorp.com.

Statements in this release that are not purely historical facts or that necessarily depend upon future events, including statements about forecasts of sales, revenue or earnings, potential benefits of the Cisco strategic relationship, or other statements about anticipations, beliefs, expectations, hopes, intentions or strategies for the future, may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Readers are cautioned not to place undue reliance on forward-looking statements. All forward-looking statements are based upon information available to ZixCorp on the date this release was issued. ZixCorp undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Any forward-looking statements involve risks and uncertainties that could cause actual events or results to differ materially from the...


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