Products
PRODUCTS
Technology
LICENSE
Partners
PARTNERS
Company
ABOUT VIRNETX
  • About Us
    VirnetX is an Internet security software and technology company.
  • Press
    Read the latest press releases.
INVESTORS
Press Release

VirnetX Posts Q2 Revenues of $200 Million

Many Financial Milestones Achieved

SCOTTS VALLEY, Calif., August 9, 2010 – VirnetX Holding Corporation (NYSE Amex: VHC), an Internet security software and technology company, today reported financial results for the three and six months ended June 30, 2010.  Financial highlights include:

The Company will file its Quarterly Report on Form 10-Q with the U.S. Securities and Exchange Commission for the quarterly period ended June 30, 2010 today, August 9, 2010.

“During our second quarter 2010, we achieved many new and important milestones,” said Kendall Larsen, VirnetX CEO and President.  “I am particularly pleased with the validation of our patent rights that came out of our first nine figure license with Microsoft.   With that, we had the opportunity to pay a special dividend to our shareholders and provide what we believe to be adequate capital to pursue our business objectives.”

VIRNETX HOLDING CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

Three Months Ended June 30, 2010

Three Months Ended June 30, 2009

Revenue — royalties

$    200,023,392

$             7,207

Operating expense:

Royalty expense

59,239,274

---

Research and development

1,227,688

220,558

General, selling and administrative

24,455,057

3,714,995

Total operating expense

(84,922,019)

(3,935,553)

Income (loss) from operations

115,101,373

(3,928,346)

Interest and other income, net

11,601

1,244

Income (loss) before taxes

115,112,974

(3,927,102)

Income taxes

34,000,000

---

Net Income (loss)

$      81,112,974

$      (3,927,102)

Basic earnings (loss) per share:

$               1.83

$              (0.11)

Diluted earnings (loss) per share:

$               1.72

$              (0.11)

Weighted average shares outstanding basic

44,277,422

37,369,985

Weighted average shares outstanding dilutive

47,266,249

37,369,985

Dividends declared per common share

$0.50

$0.00

Six Months Ended June 30, 2010

Six Months Ended June 30, 2009

Revenue — royalties

$    200,044,161

$            10,361

Operating expense:

Royalty expense

59,239,274

---

Research and development

1,749,923

442,257

General, selling and administrative

28,410,942

6,901,684

Total operating expense

(89,400,139)

(7,343,941)

Income (loss) from operations

110,644,022

(7,333,580)

Interest and other income, net

12,914

3,471

Income (loss) before taxes

110,656,936

(7,330,109)

Income taxes

34,000,000

---

Net Income (loss)

$      76,656,936

$      (7,330,109)

Basic earnings (loss) per share:

$               1.79

$              (0.20)

Diluted earnings (loss) per share:

$               1.69

$              (0.20)

Weighted average shares outstanding basic

42,720,896

36,974,239

Weighted average shares outstanding dilutive

45,248,343

36,974,239

Dividends declared per common share

$0.50

$0.00

VIRNETX HOLDING CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS

June 30, 2010

December 31, 2009

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$ 127,179,912

$    2,011,470

Accounts receivable, net

7,717

6,842

Prepaid expense and other current assets

61,601

43,863

Total current assets

127,249,230

2,062,175

Property and equipment, net

19,240

23,430

Intangible and other assets

132,000

156,000

Total assets

$ 127,400,470

$    2,241,605

Current liabilities:

Accounts payable and accrued liabilities

$        572,115

$   4,478,325

Income tax liability

34,000,000

---

Accrued dividend

23,598,000

---

Current portion of long-term obligation

---

40,000

Total current liabilities

58,170,115

4,518,325

Long-term obligation, net of current portion

---

120,000

Commitments and contingencies

Stockholders’ equity (deficit):

Preferred stock, par value $0.0001 per share

Authorized 10,000,000 shares issued and outstanding:  0 shares at June 30, 2010 and December 31, 2009, respectively

Common stock, par value $0.0001 per share

Authorized 100,000,000 shares, issued and outstanding:  47,195,477 shares at June 30, 2010 and 39,750,927 at December 31, 2009, respectively

4,720

3,975

Additional paid in capital

52,297,611

33,730,217

Retained earnings (Deficit accumulated during the development stage)

16,928,024

(36,130,912)

Total stockholders’ equity (deficit)

69,230,355

(2,396,720)

Total liabilities and stockholders’ equity (deficit)

$  127,400,470

$   2,241,605

VIRNETX HOLDING CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Six Months Ended June 30, 2010

Six Months Ended June 30, 2009

Cash flows from operating activities:

Net (loss)

$      76,656,936

$       (7,330,109)

Adjustments to reconcile net loss to net cash used in operating activities:

Stock‑based compensation

1,565,822

1,434,036

Depreciation and amortization

29,794

19,738

Changes in assets and liabilities:

Receivables and other current assets

(18,612)

(24,574)

Accounts payable and accrued liabilities

30,093,790

2,537,993

Net cash provided (used) by operating activities

108,327,730

(3,362,916)

Cash flows from investing activities:

Purchase of property and equipment

(1,603)

(3,429)

Net cash used in investing activities

(1,603)

(3,429)

Cash flows from financing activities:

Payment of royalty obligation less imputed interest

(160,000)

(44,000)

Proceeds from exercise of options

272,208

---

Proceeds from exercise of warrants

16,730,107

---

Proceeds from sale of common stock

---

3,367,925

Net cash provided by financing activities

16,842,315

3,323,925

Net increase (decrease) in cash and cash equivalents

125,168,442

(42,420)

Cash and cash equivalents, beginning of period

2,011,470

457,155

Cash and cash equivalents, end of period

$     127,179,912

$           414,735

Supplemental disclosure of cash flow information:

Cash paid during the period for taxes

$                  ----

$              2,173

Cash paid during the period for interest

$            10,000

$              6,000

Supplemental disclosure of noncash investing and financing activities:

About VirnetX VirnetX Holding Corporation, an Internet security software and technology company, is engaged in commercializing its patent portfolio by developing a licensing program as well as developing software products designed to create a secure environment for real-time communication applications such as instant messaging,  VoIP, smart phones, eReaders and video conferencing. The Company’s patent portfolio includes over 48 U.S. and international patents and pending applications that were recently declared as essential for 4G security specifications and provide the foundation for the Company’s unique GABRIEL Connection Technology. For more information, please visit www.virnetx.com.

Forward Looking Statements

Statements in this press release that are not statements of historical or current fact constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the actual results of the Company to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms “believes,” “belief,” “expects,” “intends,” “anticipates,” or “plans” to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company’s reports and registration statements filed with the Securities and Exchange Commission, including those under the heading “Risk Factors” in Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2010 and Quarterly Report on Form 10-Q filed on August 9, 2010.

Contact:

Greg Wood VirnetX Holding Corporation 831.438.8200 greg_wood@virnetx.com

Work Together Securely in the Cloud

Get Gabriel to secure your organization

Get Stated