Delaware
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001-33601
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74-2785449
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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GLOBALSCAPE, INC.
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By:
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/s/ James W. Albrecht, Jr.
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James W. Albrecht, Jr., Chief Financial Officer
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Dated: October 27, 2016
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Exhibit Number
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Document Description
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99.1
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Press release dated October 27, 2016 announcing Globalscape’s 2016 third quarter financial results.
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·
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Revenue for the third quarter of 2016 was $8.8 million, an increase of 15 percent when compared with revenue of $7.6 million for the third quarter of 2015. This is the highest revenue quarter in Globalscape’s history.
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·
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License revenue for the third quarter of 2016 was $3.4 million, an increase of 18 percent when compared to license revenue of $2.9 million for the third quarter of 2015.
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·
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Revenue for the first nine months of 2016 was $24.4 million, a nine percent increase over the same time period last year.
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·
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For the third quarter of 2016, the Company’s net income was $1.4 million compared with net income of $1.2 million for the third quarter of 2015.
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·
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Basic earnings per share was $0.07 for the third quarter of 2016 vs. $0.06 for the third quarter of 2015.
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·
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Adjusted EBITDA for the third quarter of 2016 was $2.3 million compared with $2.0 million for the third quarter of 2015. Adjusted EBITDA is not a measure of financial performance under GAAP. It should not be considered as a substitute for net income presented on our condensed consolidated statement of operations and comprehensive income or for cash flow from operating activities presented on our condensed consolidated statement of cash flows.
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·
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The Company had cash, cash equivalents and short-term investments of $20.7 million at September 30, 2016. Other than liabilities for normal trade payables and taxes, the Company has no debt.
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·
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Technology Alliances Activities: As a member of the F5 Networks’ Technology Alliance Program (TAP), Globalscape exhibited and demonstrated its technology at F5 Agility 2016 in Chicago, IL, showcasing EFT Enterprise with High Availability.
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·
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Company Awards: Over the past quarter, Globalscape was certified as a great workplace by the independent analysts at Great Place to Work®.
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Product Awards: Globalscape received a number of product excellence awards by the 2016 Golden Bridge Awards for multiple delivery methods of the Company’s core product in Access Compliance and Risk Management (Gold Winner) for Enhanced File TransferTM (EFTTM) and Managed File Transfer (Gold Winner) for EFT Cloud ServicesSM.
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GlobalSCAPE, Inc.
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Condensed Consolidated Balance Sheets
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(in thousands except share amounts)
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Unaudited
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September 30,
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December 31,
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|||||||
2016
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2015
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|||||||
Assets
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||||||||
Current assets:
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||||||||
Cash and cash equivalents
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$
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17,421
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$
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15,885
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||||
Short term investments
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3,303
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3,254
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||||||
Accounts receivable (net of allowance for doubtful accounts
of $335 and $325 in 2016 and 2015, respectively)
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8,870
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6,081
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||||||
Federal income tax receivable
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104
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290
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||||||
Prepaid and other expenses
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425
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511
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||||||
Total current assets
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30,123
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26,021
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||||||
Fixed assets, net
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463
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498
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||||||
Capitalized software development costs
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3,961
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3,982
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||||||
Goodwill
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12,712
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12,712
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||||||
Deferred tax asset
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976
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940
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||||||
Other assets
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30
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60
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||||||
Total assets
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$
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48,265
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$
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44,213
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Liabilities and Stockholders’ Equity
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||||||||
Current liabilities:
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||||||||
Accounts payable
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$
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622
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$
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839
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||||
Accrued expenses
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1,841
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1,893
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||||||
Deferred revenue
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13,005
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12,000
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||||||
Income taxes payable
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517
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127
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||||||
Total current liabilities
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15,985
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14,859
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||||||
Deferred revenue, non-current portion
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3,688
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3,612
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Other long term liabilities
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34
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44
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||||||
Commitments and contingencies
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||||||||
Stockholders’ equity:
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||||||||
Preferred stock, par value $0.001 per share, 10,000,000
authorized, no shares issued or outstanding
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-
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-
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||||||
Common stock, par value $0.001 per share, 40,000,000
authorized, 21,548,602 and 21,383,467 shares issued
at September 30, 2016, and December 31, 2015, respectively
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21
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21
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||||||
Additional paid-in capital
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20,632
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19,583
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||||||
Treasury stock, 403,581 shares, at cost, at
September 30, 2016 and December 31, 2015
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(1,452
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)
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(1,452
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)
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Retained earnings
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9,357
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7,546
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||||||
Total stockholders’ equity
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28,558
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25,698
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Total liabilities and stockholders’ equity
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$
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48,265
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$
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44,213
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GlobalSCAPE, Inc.
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Condensed Consolidated Statements of Operations and Comprehensive Income
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(In thousands, except per share amounts)
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(Unaudited)
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Three months ended September 30,
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Nine months ended September 30,
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|||||||||||||||
2016
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2015
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2016
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2015
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Operating Revenues:
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||||||||||||||||
Software licenses
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$
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3,373
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$
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2,852
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$
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8,565
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$
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8,590
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||||||||
Maintenance and support
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4,713
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4,142
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13,843
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12,269
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Professional services
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667
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653
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2,013
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1,531
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||||||||||||
Total Revenues
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8,753
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7,647
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24,421
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22,390
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||||||||||||
Cost of revenues
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Software licenses
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873
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562
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2,303
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1,651
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Maintenance and support
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363
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341
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1,145
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1,057
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Professional services
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534
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605
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1,689
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1,257
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Total cost of revenues
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1,770
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1,508
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5,137
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3,965
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||||||||||||
Gross profit
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6,983
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6,139
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19,284
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18,425
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||||||||||||
Operating expenses
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||||||||||||||||
Sales and marketing
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2,759
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2,289
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8,453
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7,060
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||||||||||||
General and administrative
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1,638
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1,449
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5,083
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4,629
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Research and development
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528
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646
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1,727
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1,832
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Total operating expenses
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4,925
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4,384
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15,263
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13,521
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||||||||||||
Income from operations
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2,058
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1,755
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4,021
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4,904
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||||||||||||
Other income (expense), net
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28
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17
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88
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51
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Income before income taxes
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2,086
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1,772
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4,109
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4,955
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Income tax expense
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687
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542
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1,348
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1,585
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Net income
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$
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1,399
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$
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1,230
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$
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2,761
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$
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3,370
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Comprehensive income
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$
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1,399
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$
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1,230
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$
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2,761
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$
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3,370
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Net income per common share -
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Basic
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$
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0.07
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$
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0.06
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$
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0.13
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$
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0.16
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Diluted
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$
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0.06
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$
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0.06
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$
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0.13
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$
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0.16
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Weighted average shares outstanding:
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||||||||||||||||
Basic
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21,122
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20,892
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21,061
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20,782
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Diluted
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21,674
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21,440
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21,640
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21,294
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Cash dividends declared per share
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$
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0.015
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$
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0.015
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$
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0.045
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$
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0.030
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GlobalSCAPE, Inc.
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Condensed Consolidated Statements of Cash Flows
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(in thousands)
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(Unaudited)
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For the Nine Months Ended September 30,
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||||||||
2016
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2015
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|||||||
Operating Activities:
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||||||||
Net income
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$
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2,761
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$
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3,370
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Items not involving cash at the time they are recorded in the statement of operations:
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||||||||
Bad debt expense
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67
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147
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Depreciation and amortization
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1,522
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1,116
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Share-based compensation
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721
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482
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Deferred taxes
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(36
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)
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(320
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)
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Excess tax benefit from share-based compensation
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5
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(49
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)
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Subtotal before changes in operating assets and liabilities
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5,040
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4,746
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||||||
Changes in operating assets and liabilities:
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||||||||
Accounts receivable
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(2,856
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)
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(1,690
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)
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Prepaid expenses
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86
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154
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Deferred revenue
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1,081
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531
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Accounts payable
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(217
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)
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(757
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)
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Accrued expenses
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(52
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)
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10
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Other Assets
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30
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37
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Other long-term liabilities
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(10
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)
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(5
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)
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Income tax receivable and payable
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571
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403
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Net cash provided by operating activities
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3,673
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3,429
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Investing Activities:
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||||||||
Software development costs capitalized
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(1,298
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)
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(1,613
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)
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Purchase of property and equipment
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(168
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)
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(108
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)
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Interest reinvested in short and long term investments
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(49
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)
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(48
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)
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Net cash (used in) investing activities
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(1,515
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)
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(1,769
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)
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Financing Activities:
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||||||||
Proceeds from exercise of stock options
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333
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417
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||||||
Excess tax benefit from share-based compensation
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(5
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)
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49
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Dividends paid
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(950
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)
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(626
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)
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Net cash provided by (used in) financing activities
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(622
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)
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(160
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)
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Net increase in cash
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1,536
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1,500
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||||||
Cash at beginning of period
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15,885
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11,358
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||||||
Cash at end of period
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$
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17,421
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$
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12,858
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||||
Supplemental disclosure of cash flow information:
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||||||||
Cash paid during the period for:
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||||||||
Interest
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$
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-
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$
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-
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Income taxes
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$
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776
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$
|
1,341
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GlobalSCAPE, Inc.
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Adjusted EBITDA
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(in thousands)
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(Unaudited)
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Three Months Ended
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Nine Months Ended
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|||||||||||||||
September 30,
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September 30,
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|||||||||||||||
2016
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2015
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2016
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2015
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|||||||||||||
Net Income
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$
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1,399
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$
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1,230
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$
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2,761
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$
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3,370
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||||||||
Add (subtract) items to determine adjusted EBITDA:
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||||||||||||||||
Income tax expense
|
687
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542
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1,348
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1,585
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||||||||||||
Interest (income) expense, net
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(28
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)
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(17
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)
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(88
|
)
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(51
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)
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||||||||
Depreciation and amortization:
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||||||||||||||||
Total depreciation and amortization
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513
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433
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1,522
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1,116
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||||||||||||
Amortization of capitalized software development costs
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(450
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)
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(366
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)
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(1,319
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)
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(911
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)
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||||||||
Stock-based compensation expense
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221
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167
|
721
|
482
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||||||||||||
Adjusted EBITDA
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$
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2,342
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$
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1,989
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$
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4,945
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$
|
5,591
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