Cybersecurity co Kape's revenue nearly doubled in 2020

Ido Erlichman Photo: Sharon Deri

The company's revenue totaled $122.2 million, up 85% from 2019, and in line with the upper limit of management forecasts.

Israeli cybersecurity software company Kape Technologies (LSE: KAPE), controlled by Teddy Sagi, published preliminary figures for its 2020 financial results today. The company's revenue totaled $122.2 million, up 85% from 2019, and in line with the upper limit of management forecasts. 89% of the revenue is revenue from returning customers, which reflects the company's switch to the SaaS business model.

EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization) is expected to be higher than management forecasts at about $39 million - up from $14.6 million in 2019. In addition, the rate of operational profitability has increased significantly to 31.9% from 22% in 2019.

Last October, Kape raised $115.5 million at a share price of £1.50. Today the share price has risen to £2.10 - an increase of 40% since the offering.

In December 2019, Kape acquired US company PIA, which specializes in providing encrypted solutions for digital data, mainly for privacy protection on the Internet. PIA was acquired for $127.6 million in cash and shares and represented a major jump in operations for Kape. The merged company has become a large player in the US and is one of the world's three leading players in its field and in particular this comes amidst the consistent rise in cyber attacks worldwide and enforcement of the GDP protection regulations, which are designed to protect user privacy.

The merger of the two companies last year delivered a 31% saving in operating expenses and increased revenue from the private Internet access sector by 16%- both on a pro forma basis. Kape is scheduled to report its full financial results for 2020 on March 17.

In addition to exploiting the synergy between the two companies, Kape continues to increase its investment in R&D for new security solutions as well as in marketing efforts and the company will continue to do so in the current year. As a result of all this, the company now has a customer base of 2.5 million paying subscribers in the main markets in which it operates in North America and Europe.

Kape CEO Ido Erlichman said, "2020 was an excellent year for the company. While the Covid-19 pandemic created global uncertainty, which significantly reinforced the need for quality cyber security solutions. In addition to the fact that we succeeded in meeting our growth targets for 2020, we launched new security solutions and important technological initiatives, which supported the expansion of our customer base. After we successfully completed the integration of PIA into Kape, we will continue to grow organically and implement additional acquisitions."

Kape operates in 160 countries and has 350 employees. The company operates an R&D Center in Israel in the Azrieli Sarona Tower in Tel Aviv.

Published by Globes, Israel business news - en.globes.co.il - on January 19, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Ido Erlichman Photo: Sharon Deri
Ido Erlichman Photo: Sharon Deri
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