000-23593 | 94-3221585 | |
(Commission File Number) | (IRS Employer Identification No.) |
12061 Bluemont Way, Reston, Virginia | 20190 | |
(Address of Principal Executive Offices) | (Zip Code) |
c | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
c | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
c | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
c | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. | Results of Operations and Financial Condition. |
Item 9.01. | Financial Statements and Exhibits. |
Exhibit Number | Description | |
99.1 |
VERISIGN, INC. | ||||
Date: April 25, 2019 | By: | /s/ Thomas C. Indelicarto | ||
Thomas C. Indelicarto | ||||
Executive Vice President, General Counsel and Secretary |
Exhibit No. | Description | |
Exhibit 99.1 |
• | Verisign ended the first quarter of 2019 with cash, cash equivalents and marketable securities of $1.25 billion, a decrease of $17 million from the end of 2018. |
• | During the first quarter of 2019, Verisign repatriated $249 million of cash held by foreign subsidiaries, net of foreign withholding taxes. |
• | Cash flow from operating activities was $187 million for the first quarter of 2019, compared with $90 million for the same quarter in 2018. |
• | Deferred revenues as of March 31, 2019 totaled $1.05 billion, an increase of $29 million from the end of 2018. |
• | During the first quarter of 2019, Verisign repurchased 1.0 million shares of its common stock for an aggregate cost of $175 million. As of March 31, 2019, there was $891 million remaining for future share repurchases under the share repurchase program which has no expiration date. |
• | Verisign ended the first quarter of 2019 with 154.8 million .com and .net domain name registrations in the domain name base, a 4.4 percent increase from the end of the first quarter of 2018, and a net increase of 1.82 million during the first quarter of 2019. |
• | During the first quarter of 2019, Verisign processed 9.8 million new domain name registrations for .com and .net, compared to 9.6 million for the same quarter in 2018. |
• | The final .com and .net renewal rate for the fourth quarter of 2018 was 74.3 percent compared with 72.2 percent for the same quarter in 2017. Renewal rates are not fully measurable until 45 days after the end of the quarter. |
March 31, 2019 | December 31, 2018 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 779,625 | $ | 357,415 | |||
Marketable securities | 473,365 | 912,254 | |||||
Other current assets | 62,277 | 47,365 | |||||
Total current assets | 1,315,267 | 1,317,034 | |||||
Property and equipment, net | 252,237 | 253,905 | |||||
Goodwill | 52,527 | 52,527 | |||||
Deferred tax assets | 120,192 | 104,992 | |||||
Deposits to acquire intangible assets | 145,000 | 145,000 | |||||
Other long-term assets | 34,453 | 41,046 | |||||
Total long-term assets | 604,409 | 597,470 | |||||
Total assets | $ | 1,919,676 | $ | 1,914,504 | |||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | |||||||
Current liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 183,996 | $ | 215,208 | |||
Deferred revenues | 757,284 | 732,382 | |||||
Total current liabilities | 941,280 | 947,590 | |||||
Long-term deferred revenues | 289,730 | 285,720 | |||||
Senior notes | 1,785,676 | 1,785,047 | |||||
Long-term tax and other liabilities | 309,119 | 281,621 | |||||
Total long-term liabilities | 2,384,525 | 2,352,388 | |||||
Total liabilities | 3,325,805 | 3,299,978 | |||||
Commitments and contingencies | |||||||
Stockholders’ deficit: | |||||||
Preferred stock—par value $.001 per share; Authorized shares: 5,000; Issued and outstanding shares: none | — | — | |||||
Common stock—par value $.001 per share; Authorized shares: 1,000,000; Issued shares: 352,872 at March 31, 2019 and 352,325 at December 31, 2018; Outstanding shares: 119,391 at March 31, 2019 and 120,037 at December 31, 2018 | 353 | 352 | |||||
Additional paid-in capital | 15,523,542 | 15,706,774 | |||||
Accumulated deficit | (16,927,262 | ) | (17,089,789 | ) | |||
Accumulated other comprehensive loss | (2,762 | ) | (2,811 | ) | |||
Total stockholders’ deficit | (1,406,129 | ) | (1,385,474 | ) | |||
Total liabilities and stockholders’ deficit | $ | 1,919,676 | $ | 1,914,504 |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Revenues | $ | 306,408 | $ | 299,288 | |||
Costs and expenses: | |||||||
Cost of revenues | 45,504 | 48,152 | |||||
Sales and marketing | 10,519 | 17,275 | |||||
Research and development | 16,132 | 15,375 | |||||
General and administrative | 34,001 | 33,067 | |||||
Total costs and expenses | 106,156 | 113,869 | |||||
Operating income | 200,252 | 185,419 | |||||
Interest expense | (22,631 | ) | (40,788 | ) | |||
Non-operating income, net | 12,203 | 7,804 | |||||
Income before income taxes | 189,824 | 152,435 | |||||
Income tax expense | (27,297 | ) | (18,172 | ) | |||
Net income | 162,527 | 134,263 | |||||
Other comprehensive income | 49 | 243 | |||||
Comprehensive income | $ | 162,576 | $ | 134,506 | |||
Earnings per share: | |||||||
Basic | $ | 1.36 | $ | 1.38 | |||
Diluted | $ | 1.35 | $ | 1.09 | |||
Shares used to compute earnings per share | |||||||
Basic | 119,757 | 97,250 | |||||
Diluted | 120,317 | 123,506 |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 162,527 | $ | 134,263 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation of property and equipment | 11,593 | 12,117 | |||||
Stock-based compensation | 12,462 | 12,978 | |||||
Amortization of discount on investments in debt securities | (3,854 | ) | (4,128 | ) | |||
Other, net | (147 | ) | 4,005 | ||||
Changes in operating assets and liabilities: | |||||||
Other assets | (226 | ) | (987 | ) | |||
Accounts payable and accrued liabilities | (31,609 | ) | (36,271 | ) | |||
Deferred revenues | 29,219 | 27,120 | |||||
Net deferred income taxes and other long-term tax liabilities | 7,365 | (59,108 | ) | ||||
Net cash provided by operating activities | 187,330 | 89,989 | |||||
Cash flows from investing activities: | |||||||
Proceeds from maturities and sales of marketable securities | 939,561 | 1,931,930 | |||||
Purchases of marketable securities | (496,779 | ) | (631,456 | ) | |||
Purchases of property and equipment | (9,133 | ) | (7,662 | ) | |||
Other investing activities | (2,958 | ) | (160 | ) | |||
Net cash provided by investing activities | 430,691 | 1,292,652 | |||||
Cash flows from financing activities: | |||||||
Proceeds from employee stock purchase plan | 8,253 | 7,811 | |||||
Repurchases of common stock | (204,302 | ) | (152,741 | ) | |||
Net cash used in financing activities | (196,049 | ) | (144,930 | ) | |||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 255 | 167 | |||||
Net increase in cash, cash equivalents, and restricted cash | 422,227 | 1,237,878 | |||||
Cash, cash equivalents, and restricted cash at beginning of period | 366,753 | 475,139 | |||||
Cash, cash equivalents, and restricted cash at end of period | $ | 788,980 | $ | 1,713,017 | |||
Supplemental cash flow disclosures: | |||||||
Cash paid for interest | $ | 13,063 | $ | 43,326 | |||
Cash paid for income taxes, net of refunds received | $ | 14,185 | $ | 72,959 |
Three Months Ended March 31, | |||||||||||||||
2019 | 2018 | ||||||||||||||
Operating Income | Net Income | Operating Income | Net Income | ||||||||||||
GAAP as reported | $ | 200,252 | $ | 162,527 | $ | 185,419 | $ | 134,263 | |||||||
Adjustments: | |||||||||||||||
Stock-based compensation | 12,462 | 12,462 | 12,978 | 12,978 | |||||||||||
Non-cash interest expense | — | 3,918 | |||||||||||||
Tax adjustment | (17,206 | ) | (19,081 | ) | |||||||||||
Non-GAAP | $ | 212,714 | $ | 157,783 | $ | 198,397 | $ | 132,078 | |||||||
Revenues | $ | 306,408 | $ | 299,288 | |||||||||||
Non-GAAP operating margin | 69.4 | % | 66.3 | % | |||||||||||
Diluted shares | 120,317 | 123,506 | |||||||||||||
Diluted EPS, non-GAAP | $ | 1.31 | $ | 1.07 |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Cost of revenues | $ | 1,598 | $ | 1,609 | |||
Sales and marketing | 983 | 1,448 | |||||
Research and development | 1,589 | 1,721 | |||||
General and administrative | 8,292 | 8,200 | |||||
Total stock-based compensation expense | $ | 12,462 | $ | 12,978 |
Year Ended March 31, 2019 | |||
Net Income | $ | 610,753 | |
Interest expense | 96,689 | ||
Income tax expense | 156,152 | ||
Depreciation and amortization | 47,844 | ||
Stock-based compensation | 51,988 | ||
Unrealized loss on hedging agreements | 119 | ||
Gain on sale of business | (55,550 | ) | |
Loss on debt extinguishment | 6,554 | ||
Non-GAAP Adjusted EBITDA | $ | 914,549 |
'1) -6/;HYCOWF.
M_P"^_GK13)*?/L_I>=TQY-HWTS#X0
M0"*(L=B\+;]5L2S7'R+*OY+P+!_G#TG(0^J.03IF51YL>NNL^J^=6?T5S'C^
M4',/X>HU1'1.KM[,_P __P Q4PYK,/T_M 83RN$Z\'V6\Y1]3*9!R,QSAW;5
M6&_].QS_ /SVMWIO2.E].(LQ: +A_A[#OL_LV/\ YK_K+:U=JZ)U)Q]]CR
M)T%N[1KW;RWV[]M?]M+
MHG6*.L89RJ6.JVO=6^M\2'-@_F%S? HQDC(,FA Z5E!7?I]7].?P>/\ 7]ZZ]TL**L''/_(_]>]N??NO=*JDJ?\ :C_O
MA_K^_=>Z45-/^+\'^E_S[]U[IYAE_P >;"W^Q_%_S[]U[ISCDU6(_P!B/]]_
M3W[KW4M6M_B#_OO]O[]U[K-[]U[KWOW7NLRFX_Q'U]^Z]UR]^Z]U[W[KW7O?
MNO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U
M[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?N
MO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[
MW[KW7O?NO=>]^Z]U[W[KW7O?NO=?_]/?X]^Z]U[W[KW7O?NO=>]^Z]U[W[KW
M7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^
MZ]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7
MO?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW6%FN?\ ?3W[KW7'W[KW6-V_ _V
M/OW7NH[M8$?[?W[KW3?/+<0?[W_C_K>_=>Z:*B<*+ \G_;W_K[]U[I/U=3
M;B_^(MR?\??NO=)BMJ[7Y/Y/''^M_7W[KW2/KZ[@\_2_)/'_ !//OW7ND1D*
M_P#58W_J?^-?T]^Z]T!.[MUU-?6?W I2
MK>U^/]MQQ]/;@I7/#IAWX@=9@/I[=5?/IDGK*!8>W.FR:]9%4L?IQ_C_ ,:Y
M]V45/RZJ305ZD ?TO;_8/5:^G7*Q)XM[\ //CU6HZR@6]VZH37KE[WUKKL GZ>_=:)IQZR! /
M\3_O'MU$I0GCU4M4= ^*VR'D]09*>$AQ6LC(0T?6J$H_ '^^^OO-U,
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M1Y<>N86_/^'_&K^]UIGJI4^G7,2_BX/^)O?_;^]AR#\752GGUWY/\ @O\
MOO\ 8^[>(?EUK1]O7A)_P7_??[?WXR$\>MZ/EUR#@_CC^M[_ /$>]ZS0TZT5
M_;UR#?T:W^QM_P 4]WU+2M>JZ3UD#D#ZW_WK_BO^\^[ XQP/52/4=9@X_K?_
M _XU]?;@8 '&>JE:C'60-Q];?X?\CO[N*TSTR5(XCKF&!][ZI3KE[]UKKWO
MW7NNC[LK:37RZ]UU:WMX-J..'6^NO=^M]>]^Z]U[W[KW7O?NO=>]Z) %3U[K
MG[3,:DGJO7O>NO=>]^Z]UT3_ $/^Q_'OW6Z>O6(M_4\^ZMPI6AZ<"'R&.L;-
M8?X_["_^\W]MAJ?;TZ$ SY]8BQ/Y/^\?[V /=217YGJW6,L!_C[H6H0*XZV
M?3KB9!_3C_7]T\0^8ZOI_;UQ\G]+?[$W_P"*>]^)\NO:/EU[R_\ !?\ ??['
MW4N:<>MZ:XIUQ:0'ZD ?T%[>ZZJXU=;"D8IUC+C\?7_'\_[8_P!/>CC/5@I\
M^'76MOZ+_O/_ !7WK4.MZ5^?7@[?D#_??['WO4/7KVD>O7%GOQ>UO]\:]U
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M=C /OOR,-]V0 7D?^N/*LLUG"6WVQK+#09=:?JP_:ZC
M4M!5I$C4$ M6>/8OGT\GI9982&-$[
M6[G,:]VZQW\VMO\ \;/ZQ?\ G=M(OIU:@/J![V*5SPZ]UPI\H#8ZO\?J.#^>/QP/>NO=*"FR? ]7X_
M!^GT_P ??NO=/U-D?IZO]B/^1W_/OW7NGVGK[V);\<$$_=>Z>8*P&QU
K5ILWM?-Q0L&--6T\,C):1 T3*YQ'Y@Y;WOE>_;;M\V^2WN.
M*ZAVNM::HV%5=:^:D_.A'68?+_,NQJD
M^?6JGUZ[]Z K@=:Z];W8(?/KW7K>[>'\^M5Z[M[L$ ->O=>]VZ]U[W[KW7O?
MNO=>]^Z]U[W[KW7O?NO=>]^Z]U[W4J#Y=>Z];WK0/7KU>NK>ZE/0]>KU[W4J
M1DCK?77O7#KW7O>]3>O6P2//KWNZN20#2G5@V<]>]W[3Z5ZO4>O7$@_C_>?=
M"E.'#K?7#2;W(7_>?^1>Z]>ZZ*"W%[_T]ZZ]UC]^Z]UW>WO3*&X]>ZX%0;GZ
M'_>/=/#R*<.K!B*>G6,BWO3( ">KUZZ]M];ZQLOY'U]Z_P '5@?(]]?Z^Z
M$4^SJW7$_P")_P!M]/\ 8CW[37AU8?+K$Z![AA]?]]Q[H0#@CIQ7*\.FJ> Q
M_P#!"?J/QS_Q7VC>,I]G1C%*' 'GU$9;
WY3
MW*:FU[C(/")I2.YII7C3_<@!8\5.M8@ S'K>P5K\'ZV_P!O]>1^/I[PK_9_
MAZSA\Z=