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CyberDefender reported that revenues in its second quarter and first half ended June 30, 2009 each grew approximately 400% compared with the same periods last year--from $742,862 to $3,686,644 in the comparative quarters and from $1,217,908 to $6,878,274 in the comparative six month periods. With a 16% gain over the first quarter this year, revenues also continued their quarter over quarter increase.
"What makes these results even more exciting," stated Gary Guseinov, CyberDefender CEO, "is that while they developed largely as a consequence of our increased marketing initiatives -- primarily on the Internet and on radio -- they precede the full roll-out of our planned DRTV marketing campaigns produced by Guthy-Renker and our planned retail distribution campaign with over 195,000 participating U.S. and international retail outlets through our strategic partner Allianex."
Year Over Year Cash Receipts Up 800%; New Licensees (Paying Customers) Grew 61%
CyberDefender noted that in the first six months of 2009 cash receipts from the sales of new licenses, which become deferred income on its books over the 12 to 36 month terms of each license, increased to $11.1 million from $1.2 million in the first six months of 2008. It added that the growth in new licensees has continued and reached 197,155 for the six months ended June 30, 2009, a 61% gain over the first six months of 2008.
Gross Profits Grew As Did Profitability of Marketing Expenditures; Net Loss Declined From First Quarter
Gross profit in the 2009 second quarter grew significantly from $549,633 in the same quarter last year to $2,933,320, indicating the potential for future bottom line profitability. In line with our strategic plans, our decision to invest significantly in marketing generated a loss from operations in the quarter of about $3.76 million, representing an improvement from the first quarter loss. Another indication of the initial push toward future profitability was the decrease in the quarter of advertising expenditures as a percentage of revenues. In the second quarter of 2009 our advertising expenditures constituted 92% of revenues compared with 117% of revenues in the first quarter this year.
$5.6 Million in New Growth Capital
During the first six months of 2009, as CyberDefender aggressively accelerated customer acquisitions, it continued to seek outside financing to rapidly build a critical mass in its customer base.
Mr. Kevin Harris, CFO of CyberDefender, commented, "I am pleased to report that over the past six months we have successfully raised over $5.6M in growth capital, with only a small amount representing unsecured convertible debt. This infusion of capital helped to strengthen CyberDefender's balance sheet with over $5.3M in current assets including $2M+ in cash. In addition, we have reduced our overall net debt by approximately $0.7 million."
Other Developments
During the second quarter and more recently, CyberDefender made several key announcements regarding its progress. These included:
-- Preparing for anticipated growth, CyberDefender added several highly
accomplished executives to its senior management team in marketing and
finance positions;
-- Guthy-Renker Co-CEO Bennet Van de Bunt joined the CyberDefender Board of
Directors;
-- Partnering with industry leader InComm, CyberDefender expanded its
international retail distribution campaign to another 145,000 stores,
bringing total stores in the campaign to 185,000. Planned roll out of
"My Tech Card" prepaid cards in time for "Back to
School";
-- CyberDefender proceeded with several test TV ads ahead of expanded
national launch of its direct response TV campaign.
Outlook
"Looking ahead," Mr. Guseinov said, "we remain confident that the investment of significant resources we are making mainly in wide reaching multichannel marketing initiatives, will increasingly move us closer to our goal of 1 million+ paying customers. Our management is greatly strengthened and we have developed partnerships with media, marketing and retail industry leaders. We believe we are in the earliest stage of moving toward profitability and further believe our focus on customer renewals and expansion of sales will permit us to continue to deliver exciting results."
Conference Call Information
CyberDefender will host a conference call to discuss second quarter 2009 results on Monday, August 17, 2009 at 4:15pm ET.
Interested participants should call (877) 407-8035 at least five minutes before the call is to begin when calling within the United States or 201-689-8035 when calling internationally. Please ask for the CyberDefender conference call. A telephone replay will also be available for one week beginning two hours after the completion of the live call, and can be accessed by dialing 1-877-660-6853 or 201-612-7415 for international callers and entering access number 286 and conference id 330499 when prompted.
The results will also be available via live and a 12 month archived webcast at http://www.investorcalendar.com/IC/CEPage.asp?ID=148643
Southern California Investor Conference
CyberDefender will be presenting at the Southern California Investor Conference on Tuesday, August 18, 2009 at 9am at the Island Hotel, Newport Beach, CA. For those unable to attend, the presentation will be webcast at http://events.powerstream.net/002/00271/20090818SCIC-T3/ .
The conference also will be broadcast live on www.CaliforniaStocks.com.
About CyberDefender Corporation
CyberDefender Corporation, based in Los Angeles, believes that its Internet security technology offers the earliest possible detection and most aggressive defense against Internet security attacks. CyberDefender uses a patent pending secure peer-to-peer collaborative threat protection network (the earlyNETWORK), to combat spyware, viruses and identity theft. Products employing the earlyNETWORK include CyberDefender Early Detection Center and MyIdentityDefender. CyberDefender also offers PC optimization utilities and Live Premium Technical Support services. CyberDefender products are fully compatible with Microsoft's Vista Operating system and available at http://www.cyberdefender.com. To date, more than 15 million consumers have used CyberDefender products.
Forward Looking Statements
Statements in this press release that are not statements of historical or current fact, such as CyberDefender's expectation of future revenue growth and profitability, constitute "forward-looking statements". Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause CyberDefender's actual results to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. Factors that could cause CyberDefender's results to be materially different from the forward-looking statements include whether CyberDefender will be able to find financing when and as it needs it and whether CyberDefender's revenues will eventually exceed its expenses. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in CyberDefender's reports and registration statements filed with the Securities and Exchange Commission, which are available for review at http://www.sec.gov/.
CONTACTS-:
Web Site: http://www.cyberdefender.com/
Kevin Harris
Chief Financial Officer
CyberDefender
Kevin@cyberdefender.com
Tel: 213-689-8631 X127
Fax: 213-689-8640
Ken Donenfeld
DGI Investor Relations
donfgroup@aol.com
Tel: 212-425-5700
Fax: 646-381-9727
SOURCE CyberDefender Corporation
http://www.cyberdefender.com
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