Aladdin Knowledge Systems Ltd. (Nasdaq: ALDN; TASE: ALDN) has lead an equity investment in Tokyo-based Athena Smartcard Solutions Ltd. together with Athena's current shareholders. Athena was founded in 1998 based on technology licensed from Aladdin. Aladdin did not disclose the size of the financing round, or the amount of its investment, but said that it would "further strengthen the strategic alliance between the two companies".
Athena has developed advanced cryptographic smart card operating systems, smart card middleware, and reading devices, securing its position as an innovator in smart card technology. Its product is designed for the expanding market for secure government and enterprise employee smart identification cards. Aladdin previously licensed elements of Athena's smart card technology for use with its own products.
Aladdin chairman and CEO Yanki Margalit said, "Moving forward into 2008, this investment will allow us to streamline our strong authentication offerings and provide Aladdin eToken customers with increased flexibility and enhanced functionality. This remains an important investment for Aladdin as Athena maintains significant expertise in smart card technology and production, enabling continued innovation for Aladdin's eToken."
Aladdin today published its financial report for the fourth quarter of 2007 and for the year as a whole. The company reported a record $29.1 million revenue for the fourth quarter, 29% more than the $24.3 million for the corresponding quarter of 2006. GAAP-based net profit totaled $2.8 million ($0.20 per share), down from $3.6 million ($0.25 per share). Software DRM revenue rose 8% from the corresponding quarter to $17.1 million and enterprise security revenue rose 20% to $12 million.
The company posted a record $105.9 million for the year, 19% more than the $89 million posted in 2006. GAAP-based net profit was a record $14.9 million ($1.04 per share), compared with $14 million ($0.96 per share) in 2006.
Aladdin predicts GAAP diluted earnings per share of $1.28-1.40 on $123-130 million revenue in 2008.
Margalit noted, "2007 was an exceptional year for Aladdin as we crossed the $100 million mark in annual revenues while driving record levels of operating cash flow and bottom line profitability."
During the fourth quarter, Aladdin deployed its eToken authentication devices with the Thai government, South Korea's online banking community National Agricultural Federation (NongHyup/NH Bank), Continental Airlines, North American Electric Reliability Corporation, and Oregon's Eugene Water & Electric Board. eToken also obtained Federal Processing Standards (FIPS) 140-2 Level 2 and 3 validation certification.
Aladdin closed at $17.98 on Nasdaq yesterday, giving a market cap of $252 million. The share rose 2.7% by mid-afternoon today on the TASE.
Published by Globes [online], Israel business news - www.globes-online.com - on January 24, 2008
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