Corero Network Security plc · LSE:CNS

Corero Network Security — FY2013 Earnings Presentation

27 slides from Corero Network Security's earnings presentation, 2014

1. Slide 1: Results for the year ended 31 December 2013

   Corero Network Security plc Results for the year ended 31 December 2013 Ashley Stephenson, CEO Andrew Miller, CFO and COO © 2014 Corero www.corero.com

2. Slide 2: Contents

   Contents 1. Introduction 2. Financials 3. SmartWall TDS 4. Summary & Outlook

3. Slide 3: Overview – year ended 31-Dec-13

   Overview – year ended 31-Dec-13  Revenue from continuing operations $10.3m (2012: $11.4m)  EBITDA loss $4.5m* (2012: loss $3.1m)  Profit for the year $8.2m (2012: loss $5.9m)  Sold Corero Business Systems: $15.2m profit  Net cash at 31-Dec-13 $9.5m (2012: net debt $1.3m) • Repaid $6.2m debt and

4. Slide 4: Past, present and future

   Past, present and future  Acquired Top Layer in Mar-11: IPS solution with DDoS defence  Corero defined a new security layer “First Line of Defense®” in H2 2012 • Leveraged Corero DDoS defence expertise and technology • Success with customer deployments • High growth (versus mature / flat IPS marke

5. Slide 5: What we do - Stop DDoS attacks & cyber threats

   What we do - Stop DDoS attacks & cyber threats Corero goes to market as a First Line of Defense that stops DDoS Attacks and Cyber Threats from entering the customer network  500+ customers across multiple verticals $ in NA, LATAM, EU, ASIA  Pricing Patented DDoS defense technology SmartWall $  Su

6. Slide 6: Where we fit - Security solution landscape

   Where we fit - Security solution landscape Corero stops more attacks and threats than competitors’ DDoS products Intelligence Cloud Security First Line Firewall IPS/APT Service SIEM Service of Defense® NGFW SLB/WAF Analytics Big Data IPS/APT Internet C o r Router e SLB/ADC r o WAF Webroot Neustar Co

7. Slide 7: Why we do it - Defense-in-depth

   Why we do it - Defense-in-depth Corero stops more attacks and threats than competitors’ DDoS products Intelligence Cloud Security First Line Firewall IPS/APT Service SIEM Service of Defense NGFW SLB/WAF Analytics Big Data IPS/APT Internet C o r Good Traffic Router e Good TrafficSLB/ADC r o WAF Webro

8. Slide 8: How we do it – Always on protection

   How we do it – Always on protection Unwanted Traffic Key Steps of Protection Undesired Allow only EXPECTED traffic Restrict Users & Block malicious IP Addresses & unwanted geolocations Services Allow desired ports & services Access DDoS Attacks Evaluate AMOUNT of traffic & Competitive Limit Limit ex

9. Slide 9: SecureWatch – Supporting security services

   SecureWatch – Supporting security services Corero SOC - Security Operations Center Customer/Provider Security Operations Report Delivery IPS Internet SLB WAF Corero Protected Sites • 24x7 Monitoring via Corero SOC • Liaison with Customer, Partner & Provider 7 © 2014 Corero www.corero.com

10. Slide 10: Our target markets - Service Provider & Enterprise

    Our target markets - Service Provider & Enterprise First Line of Defense® SmartWall™ Threat Defense System DDS DDoS Defense System Internet C o r Router e SP r o Protected Critical Infrastructure and Services Corero In the Cloud On Premises Service Providers, IT hosting Enterprises – Financial Servi

11. Slide 11: Market opportunity for Corero

    Market opportunity for Corero  Challenge: DDoS & Cyber Threats • Online Enterprises, Service Providers and their customers are increasingly being impacted by DDoS attacks and cyber threats  Opportunity: Corero - First Line of Defense • Corero is exclusively focused on delivering products and servi

12. Slide 12: Contents

    Contents 1. Introduction 2. Financials 3. SmartWall TDS 4. Summary & Outlook

13. Slide 13: P&L summary

    P&L summary  Revenue impacted by lower bookings in 2013 of 2013 2012 $9.2m (2012: $10.4m) as a result of: Restated • First Line of Defense repositioning in H2 2012 $’000 $’000 • Sales team changes in 2013 Revenue 10,268 11,378  Gross margins impacted by: Gross profit 6,680 7,971 • Lower revenue vo

14. Slide 14: Order intake

    Order intake  2013 order intake $9.2m (2012: $10.4m) Order intake - 2013 • Transitioned business to First Line of Defense in 2013 New contracts (41%)  New customer material wins: • UK infrastructure provider Support & services (36%) • two US energy utilities • two South American service providers

15. Slide 15: Cash flow summary

    Cash flow summary 2013 2012 2013 2012 $’000 $’000 $’000 $’000 Profit/(loss) before taxation 7,796 (6,260) Cash flows from investing activities Adjustments for: Sale proceeds from disposal of subsidiary 17,225 - Amort'n of acquired intangible assets 1,202 1,157 Purchase of intangible assets (107) (23

16. Slide 16: Net assets summary

    Net assets summary Note: 31-Dec-12 comparatives include CBS business (sold on 1-Aug-13) 31-Dec-13 31-Dec-12 31-Dec-13 31-Dec-12 $’000 $’000 $’000 $’000 Assets Liabilities Non-current assets Current liabilities Goodwill 17,983 18,811 Trade and other payables (2,171) (3,972) Acquired intangible assets

17. Slide 17: Contents

    Contents 1. Introduction 2. Financials 3. SmartWall TDS 4. Summary & Outlook

18. Slide 18: Corero product line evolution

    Corero product line evolution  Problem: Evolving multi-dimensional threat landscape • DDoS++: volume, rate, connections, scans, reflections, protocols, payload threats, botnets, exploits, and more….  Solution: SmartWall Threat Defense System • Service Provider, Hosting/Data Center features New - G

19. Slide 19: SmartWall target market segments

    SmartWall target market segments Internet Service Providers, Multi-Service Operators (MSOs), Cloud based DDoS mitigation providers Example companies: Colt, Virgin Media, Talk Talk Web hosting companies offering managed, dedicated, and co-location based hosting Example companies: Iomart, TeleCity, Ra

20. Slide 20: Enabling managed security services

    Enabling managed security services 16 © 2014 Corero www.corero.com

21. Slide 21: SmartWall – ecosystem of products

    SmartWall – ecosystem of products  Family of Appliances (each 4 x 10G SFP+) • Network Threat Defense (DDoS): - competition Arbor, Radware, F5, A10 • Application Threat Defense (DPI, SSL): - competition Arbor, Radware • Network Forensics (PCAP): - competition Endace (acquired by Emulex), nPulse • Ne

22. Slide 22: What sets us apart?

    What sets us apart?  Corero differentiation • Better Product - Always On vs. On Demand - Block more threats than the competition • Focus on Products for the Enterprise and Service Providers - First Line of Defense (first device to see raw Internet traffic) - Scalability, Performance, Density, Avail

23. Slide 23: Contents

    Contents 1. Introduction 2. Financials 3. SmartWall TDS 4. Summary & Outlook

24. Slide 24: Summary

    Summary Corero goes to market as a First Line of Defense that stops DDoS Attacks and Cyber Threats from entering the customer network  Key markets today = Finance, Gaming, SLED, tomorrow all online businesses  Enterprise and Service Provider solutions, strategy to enable services  Differentiation

25. Slide 25: Strategy

    Strategy Objectives Plan  Market endorsement of First Line  Raise Corero profile of Defense®  Referenceable customers  Establish thought leadership Solution  Expand software functionality  Incremental software features (SDN/NFV)  Leadership scalability  Network Integration with Cisco/Juniper

26. Slide 26: Outlook

    Outlook  Market Drivers - Significant increase in unwanted and malicious traffic • DDoS prevention market forecast to more than double in period 2012 to 2017 - will reach almost $1bn in 2017 (IDC) • Specialised Threat Analysis and Protection market forecast to grow over 40% pa from 2012 to 2017 - w

27. Slide 27: Thank you

    Thank you © 2014 Corero www.corero.com

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