Security management software vendor Sophos Plc has announced 2005 revenue up 19.2% at 66.2m pounds ($117.4m). The Oxford, UK-based company also said growth is projected to increase in 2006 with the release of new products.
Privately held Sophos released details of its revenue in a press release but revealed no details of its bottom line. However, the 2005 accounts are on its web site and show that net income fell from 6.8m pounds ($12m) to $3.19m ($5.67m) in the year to March 31 at a time of buoyant sales.
The reason for the decline in profitability was a 34% increase to 59.1m pounds ($104.9m) in administrative expenses over the year, which saw the company increase its headcount from 583 to 852. Earnings declined as a result of our significant investments during the year in technical development and sales, says the directors’ report.
Sophos is sitting on a 21.2m pound ($37.7m) cash pile, up from 10.3m pounds ($18.3m). The UK remains Sophos’ biggest market with 32.2% of sales closely followed by the US with 32%, continental Europe with 21.9%, and the rest of the world accounting for the remainder.
An IPO appears an obvious step for the company, though its current policy of growing the company at the expense of profitability would make this difficult in the short term. An official said: There are no current plans to float the company, but if the right circumstances presented themselves then it is an option that would be considered. For the time being, the company’s emphasis is on investing in engineering, strengthening management, and growing the business.