FORM 6-K
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange
Act of 1934
For the month of October, 2005
Commission File Number 0-28584
| CHECK POINT SOFTWARE TECHNOLOGIES LTD. |
| (Translation of registrant’s name into English) |
| 3A Jabotinsky Street, Ramat-Gan 52520, Israel |
| (Address of principal executive offices) |
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F x Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Note: Regulation S-T Rule
101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to
provide an attached annual report to security holders.
Indicate by check mark if the
registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule
101(b)(7): ____
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes o No x
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ________
FOR IMMEDIATE RELEASE
| Media Contact: | Investor Contact: |
| Molly Ford | Anne Marie McCauley |
| Check Point Software Technologies | Check Point Software Technologies |
| 650.628.2022 | 650.628.2040 |
| press@us.checkpoint.com | ir@us.checkpoint.com |
CHECK POINT SOFTWARE REPORTS FINANCIAL RESULTS FOR THE THIRD
QUARTER OF 2005
Third Quarter EPS Increased 22% Year Over Year
REDWOOD CITY, Calif., – October 28, 2005 – Check Point® Software Technologies Ltd. (NASDAQ: CHKP), the worldwide leader in securing the Internet, today announced its financial results for the third quarter ended September 30, 2005.
| Financial Highlights for the Third Quarter of 2005: | |
| — | Revenues: $141.1 million, an increase of 9% compared to $129.3 million in the third quarter of 2004. |
| — | Net Income: $78.7 million, an increase of 18% compared to $66.8 million in the third quarter of 2004. Net income excluding acquisition related charges1 was $80.5 million, an increase of 16% compared to $69.1 million in the third quarter of 2004. |
| — | Earnings per Diluted Share: $0.31, an increase of 22% compared to $0.26 in the third quarter of 2004. EPS excluding net acquisition related charges was $0.32, an increase of 20% compared to $0.27 in the third quarter of 2004. |
| — | Deferred Revenues: $144.3 million, an increase of $19.6 million or 16% over deferred revenues as of September 30, 2004. |
| — | Share Repurchase Program: During the third quarter of 2005, Check Point purchased 2.6 million shares at a total cost of approximately $57 million. |
“Our third quarter business continued to fuel strong earnings growth,” said Gil Shwed, chairman and chief executive officer of Check Point Software. “We believe our focus on delivering an independent layer of comprehensive security solutions through a unified security architecture is driving our leading position as a provider of network security. During the quarter, we continued to upgrade products as part of the NGX platform launch. We strengthened our consumer presence by unveiling the highly anticipated ZoneAlarm® Internet Security Suite 6.0. Also, we recently announced plans to acquire Sourcefire to further extend the unified security architecture with next generation intrusion prevention solutions.”
1 “Acquisition related charges” refer to the impact of the amortization of intangible assets and stock-based compensation resulting from the acquisition of Zone Labs Inc., in March 2004.
Recent Business Highlights Include:
| — | Business Expansion with Sourcefire Acquisition – Announced an agreement to acquire Sourcefire, Inc., the creator of Snort™, and a leading provider of intrusion prevention and real-time network access solutions for a total consideration of approximately $225 million. Check Point believes the pending acquisition will further enable the company to provide the most comprehensive internal security solutions portfolio and accomplish another milestone in achieving its vision of a unified security architecture. |
| — | Significant Customer Traction for NGX™ Platform Upgrades – As the industry’s only unified security architecture for perimeter, internal, Web and endpoint security, NGX continues to strengthen as we launch new NGX offerings, including VPN-1® VSX. NGX helps enterprises of all sizes reduce the cost and complexity of security management while ensuring their security systems can be easily extend to adapt to new and evolving threats. Since availability, the NGX platform has generated approximately 20,000 new licenses and upgrades. |
Industry Honors Achieved in the Third Quarter:
| — | Check Point’s VPN-1® Pro™ wins award – Windows IT Pro 2005 Readers’ Choice Best Firewall Solution – for the best server/standalone firewall. |
| — | Check Point's ZoneAlarm(R)Internet Security Suite 6.0 wins numerous awards |
| š | CNet Editors’ Choice Award for Desktop Security– for best desktop security value for its firewall, anti-spyware, antivirus, and antispam features; |
| š | PC Magazine’s Editors’ Choice Award for Best Security Suite – for blocking spyware installation and delivering instant real-time protection against Internet threats; |
| š | LAPTOP Magazine Editor’s Choice Award Best Security Suite – for the industry’s best security suite. |
| — | Check Point’s Valued Partner Program wins award – 2005 VARBusiness Magazine “Annual Report Card” Winner – for achieving exceptional partner satisfaction. |
Mr. Shwed continued, “Check Point’s vision for the future of network security is a unified security architecture, functioning in all layers of the network, designed to address the unpredictability of potential threats with unified management and enforcement. We are offering customers a single architecture that serves as the framework for their security solutions.”
Conference Call and
Webcast Information
Check Point will host a conference
call with the investment community on October 28, 2005 at 8:30 AM ET/5:30 AM PT. To listen
to the live webcast, please visit Check Point’s website at
http://www.checkpoint.com/ir. A replay of the conference call will be available
through November 11, 2005 at the Company’s website
http://www.checkpoint.com/ir or by telephone at (973) 341-3080, pass code 6558970.
Safe Harbor Statement
Certain statements in this press
release are forward-looking statements. Forward-looking statements include statements
regarding factors driving Check Point’s position as a provider of network security
and position for long-term success, and Check Point’s beliefs regarding the benefits
of the pending acquisition of Sourcefire. Because such statements deal with future events,
they are subject to various risks and uncertainties and actual results could differ
materially from Check Point’s current expectations. Factors that could cause or
contribute to such differences include, but are not limited to: the impact on revenues of
economic and political uncertainties and weaknesses in various regions of the world,
including the commencement or escalation of hostilities or acts of terrorism; the
inclusion of network security functionality in third-party hardware or system software;
any unforeseen developmental or technological difficulties with regard to Check
Point’s products; changes in the competitive landscape, including new competitors or
the impact of competitive pricing and products; a shift in demand for products such as
Check Point’s; unknown factors affecting third parties with which Check Point has
formed business alliances; timely availability and customer acceptance of Check
Point’s new and existing products; the parties’ ability to consummate the
Sourcefire transaction; the conditions to the completion of the Sourcefire transaction may
not be satisfied, or the regulatory approvals required for the transaction may not be
obtained on the terms expected or on the anticipated schedule; unanticipated expenses
associated with the merger; the possibility that the parties may be unable to achieve all
of the benefits of the merger within the expected time-frames or at all and to
successfully integrate Sourcefire’s operations and technology into those of Check
Point; operating costs, customer loss and business disruption (including, without
limitation, difficulties in maintaining relationships with employees, customers, clients
or suppliers) may be greater than expected following the transaction; and other factors
and risks discussed in Check Point’s Annual Report on Form 20-F for the year ended
December 31, 2004, which is on file with the Securities and Exchange Commission. Check
Point assumes no obligation to update information concerning its expectations.
About Check Point
Software Technologies Ltd.
Check Point Software Technologies
Ltd. (www.checkpoint.com) is a leader in securing the Internet. It is a market
leader in the worldwide enterprise firewall, personal firewall and VPN markets. Through
its NGX platform, the company delivers a unified security architecture for a broad range
of perimeter, internal, Web, and endpoint security solutions that protect business
communications and resources for corporate networks and applications, remote employees,
branch offices and partner extranets. The company’s ZoneAlarm product line is the
highest rated personal computer security suite, comprised of award-winning endpoint
security solutions that protect millions of PCs from hackers, spyware and data theft.
Extending the power of the Check Point solution is its Open Platform for Security (OPSEC),
the industry’s framework and alliance for integration and interoperability with
“best-of-breed” solutions from over 350 leading companies. Check Point solutions
are sold, integrated and serviced by a network of more than 2,200 Check Point partners in
88 countries and its customers include 100% of Fortune 100 companies and tens of thousands
of businesses and organizations of all sizes.
©2003-2005 Check Point Software
Technologies Ltd. All rights reserved.
Check Point, Application
Intelligence, Check Point Express, the Check Point logo, AlertAdvisor, ClusterXL,
Cooperative Enforcement, ConnectControl, Connectra, CoSa, Cooperative Security Alliance,
Eventia, Eventia Analyzer, Eventia Reporter, FireWall-1, FireWall-1 GX, FireWall-1
SecureServer, FloodGate-1, Hacker ID, IMsecure, INSPECT, INSPECT XL, Integrity,
InterSpect, IQ Engine, NGX, Open Security Extension, OPSEC, Policy Lifecycle Management,
Provider-1, Safe@Home, Safe@Office, SecureClient, SecureKnowledge, SecurePlatform,
SecuRemote, SecureXL Turbocard, SecureServer, SecureUpdate, SecureXL, SiteManager-1,
SmartCenter, SmartCenter Pro, Smarter Security, SmartDashboard, SmartDefense, SmartLSM,
SmartMap, SmartUpdate, SmartView, SmartView Monitor, SmartView Reporter, SmartView Status,
SmartViewTracker, SofaWare, SSL Network Extender, Stateful Clustering, TrueVector,
Turbocard, UAM, User-to-Address Mapping, UserAuthority, VPN-1, VPN-1 Accelerator Card,
VPN-1 Edge, VPN-1 Pro, VPN-1 SecureClient, VPN-1 SecuRemote, VPN-1 SecureServer, VPN-1
VSX, VPN-1 XL, Web Intelligence, ZoneAlarm, ZoneAlarm Pro, Zone Labs, and the Zone Labs
logo, are trademarks or registered trademarks of Check Point Software Technologies Ltd. or
its affiliates. All other product names mentioned herein are trademarks or registered
trademarks of their respective owners. The products described in this document are
protected by U.S. Patent No. 5,606,668, 5,835,726, 6,496,935, 6,873,988 and 6,850,943 and
may be protected by other U.S. Patents, foreign patents, or pending applications.
CHECK POINT SOFTWARE
TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2005 |
2004 |
2005 |
2004 | |||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||
| Revenues: | ||||||||||||||
| Products and licenses | $ | 65,616 | $ | 67,627 | $ | 202,386 | $ | 198,535 | ||||||
| Software subscriptions | 60,395 | 50,365 | 177,734 | 143,059 | ||||||||||
| Total product and license revenues | 126,011 | 117,992 | 380,120 | 341,594 | ||||||||||
| Services | 15,057 | 11,338 | 43,172 | 30,717 | ||||||||||
| Total revenues | 141,068 | 129,330 | 423,292 | 372,311 | ||||||||||
| Operating expenses: | ||||||||||||||
| Cost of revenues | 6,317 | 6,187 | 18,374 | 17,564 | ||||||||||
| Research and development | 12,441 | 11,665 | 37,097 | 31,171 | ||||||||||
| Selling and marketing | 33,046 | 33,294 | 104,012 | 96,309 | ||||||||||
| General and administrative | 5,951 | 6,283 | 18,212 | 17,607 | ||||||||||
| Amortization of intangible assets and | ||||||||||||||
| deferred stock compensation | 2,248 | 2,925 | 7,226 | 6,069 | ||||||||||
| Acquisition related in-process R&D | - | - | - | 23,098 | ||||||||||
| Total operating expenses | 60,003 | 60,354 | 184,921 | 191,818 | ||||||||||
| Operating income | 81,065 | 68,976 | 238,371 | 180,493 | ||||||||||
| Financial income, net | 14,321 | 11,459 | 40,190 | 32,807 | ||||||||||
| Income before income taxes | 95,386 | 80,435 | 278,561 | 213,300 | ||||||||||
| Income taxes | 16,642 | 13,677 | 48,114 | 41,351 | ||||||||||
| Net income | $ | 78,744 | $ | 66,758 | $ | 230,447 | $ | 171,949 | ||||||
| Net income excluding in-process R&D and amortization | ||||||||||||||
| of intangible assets and deferred stock compensation | $ | 80,450 | $ | 69,141 | $ | 236,048 | $ | 200,032 | ||||||
| Earnings per share (basic) | $ | 0.32 | $ | 0.27 | $ | 0.94 | $ | 0.68 | ||||||
| Number of shares used in computing earnings per share | ||||||||||||||
| (basic) | 244,261 | 251,423 | 245,820 | 252,130 | ||||||||||
| Earnings per share (fully diluted) | $ | 0.31 | $ | 0.26 | $ | 0.91 | $ | 0.66 | ||||||
| Earnings per share (fully diluted) excluding | ||||||||||||||
| in-process R&D and amortization of intangible assets | ||||||||||||||
| and deferred stock compensation | $ | 0.32 | $ | 0.27 | $ | 0.93 | $ | 0.76 | ||||||
| Number of shares used in computing earnings per share | ||||||||||||||
| (fully diluted) | 250,075 | 258,341 | 252,801 | 261,657 | ||||||||||
CHECK POINT SOFTWARE TECHNOLOGIES LTD.
SELECTED CONSOLIDATED BALANCE SHEET DATA
(In thousands)
ASSETS
| September 30, 2005 |
December 31, 2004 | |||||||
|---|---|---|---|---|---|---|---|---|
| (unaudited) | (unaudited) | |||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 143,295 | $ | 157,655 | ||||
| Marketable securities and deposits | 917,698 | 796,588 | ||||||
| Trade receivables, net | 78,839 | 96,006 | ||||||
| Other receivables and prepaid expenses | 24,609 | 20,517 | ||||||
| Total current assets | 1,164,441 | 1,070,766 | ||||||
| Long-term assets: | ||||||||
| Long-term investments | 612,662 | 623,912 | ||||||
| Property and equipment, net | 7,644 | 8,144 | ||||||
| Intangible assets | 21,626 | 25,857 | ||||||
| Goodwill | 174,295 | 175,536 | ||||||
| Deferred income taxes, net | 4,862 | 8,439 | ||||||
| Total long-term assets | 821,089 | 841,888 | ||||||
| Total assets | $ | 1,985,530 | $ | 1,912,654 | ||||
LIABILITIES AND
SHAREHOLDERS' EQUITY
| Current liabilities: | ||||||||
| Deferred revenues | $ | 144,333 | $ | 141,114 | ||||
| Trade payables and other accrued liabilities | 134,108 | 137,932 | ||||||
| Total current liabilities | 278,441 | 279,046 | ||||||
| Accrued severance pay, net | 3,233 | 2,784 | ||||||
| Total liabilities | 281,674 | 281,830 | ||||||
| Shareholders' Equity: | ||||||||
| Share capital | 774 | 771 | ||||||
| Additional paid-in capital | 380,978 | 369,452 | ||||||
| Deferred stock based compensation | (3,876 | ) | (10,342 | ) | ||||
| Treasury shares | (375,033 | ) | (244,586 | ) | ||||
| Retained earnings | 1,701,013 | 1,515,529 | ||||||
| Total shareholders' equity | 1,703,856 | 1,630,824 | ||||||
| Total liabilities and shareholders' equity | $ | 1,985,530 | $ | 1,912,654 | ||||
| Total cash and cash equivalents, deposits and | ||||||||
| marketable securities | 1,672,791 | 1,577,291 | ||||||
CHECK POINT SOFTWARE TECHNOLOGIES LTD.
SELECTED CONSOLIDATED CASH FLOW DATA
(In thousands)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2005 |
2004 |
2005 |
2004 | |||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||
| Cash flow from operating activities: | ||||||||||||||
| Net income | $ | 78,744 | $ | 66,758 | $ | 230,447 | $ | 171,949 | ||||||
| Adjustments to reconcile net income to net cash provided by | ||||||||||||||
| operating activities: | ||||||||||||||
| Depreciation and amortization | 1,356 | 1,456 | 3,981 | 4,137 | ||||||||||
| Decrease in trade and other receivables, net | 9,642 | 1,626 | 13,328 | 2,589 | ||||||||||
| Increase (decrease) in trade payables and other accrued | ||||||||||||||
| liabilities | (12,323 | ) | (6,041 | ) | 933 | 3,003 | ||||||||
| Other adjustments | 3,810 | (2,303 | ) | 9,524 | 141 | |||||||||
| Amortization of intangible assets and deferred stock | ||||||||||||||
| compensation | 2,248 | 2,925 | 7,226 | 6,069 | ||||||||||
| Acquisition related in-process R&D | - | - | - | 23,098 | ||||||||||
| Net cash provided by operating activities | 83,477 | 64,421 | 265,439 | 210,986 | ||||||||||
| Cash flow from investing activities: | ||||||||||||||
| Cash paid in conjunction with the acquisition of Zone Labs, net | - | - | - | (95,343 | ) | |||||||||
| Investment in property and equipment | (1,301 | ) | (1,004 | ) | (3,481 | ) | (3,331 | ) | ||||||
| Net cash used in investing activities | (1,301 | ) | (1,004 | ) | (3,481 | ) | (98,674 | ) | ||||||
| Cash flow from financing activities: | ||||||||||||||
| Proceeds from issuance of shares upon exercise of options | 22,908 | 3,692 | 43,005 | 23,489 | ||||||||||
| Purchase of treasury shares | (57,192 | ) | (121,588 | ) | (209,463 | ) | (200,237 | ) | ||||||
| Net cash used in financing activities | (34,284 | ) | (117,896 | ) | (166,458 | ) | (176,748 | ) | ||||||
| Increase (decrease) in cash and cash equivalents, deposits and | ||||||||||||||
| marketable securities | 47,892 | (54,479 | ) | 95,500 | (64,436 | ) | ||||||||
| Cash and cash equivalents, deposits and marketable securities | ||||||||||||||
| at the beginning of the period | 1,624,899 | 1,592,767 | 1,577,291 | 1,602,724 | ||||||||||
| Cash and cash equivalents, deposits and marketable securities | ||||||||||||||
| at the end of the period | 1,672,791 | 1,538,288 | 1,672,791 | 1,538,288 | ||||||||||
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| October 28, 2005 | CHECK POINT SOFTWARE TECHNOLOGIES LTD. BY: /S/ Eyal Desheh —————————————— Eyal Desheh Executive Vice President & Chief Financial Officer |