GlobalSCAPE Inc. Restates 2005 Financial Statements
SAN ANTONIO, TEXAS -- GlobalSCAPE, Inc. (OTCBB:GSCP) announced today that it has restated its 2005 financial statements as a result of an error in calculation of revenue from maintenance and support (net of deferred revenues) for the year ended December 31, 2005. The error was a result of the failure to properly code deferred revenue percentages on new product introductions that went directly to our sales and order entry database. The error has been corrected. GlobalSCAPE had previously recorded $154,433 as current revenue which should have been recorded as deferred revenue. The correction of the error resulted in a decrease of $154,433 in the Company’s revenue as reported on the Company’s income statement and an increase of $154,433 to the previously stated deferred revenue on the Company’s balance sheet at December 31, 2005. Restated net income is $1,446,704, a reduction of $94,478.
Charles R. Poole, the Company’s President and Chief Executive Officer stated, “We will be filing the 10-K/A shortly. Even after the restatement, fiscal year 2005 remains an incredible year for us.”
The Company also announced it was adjusting its first quarter 2006 revenue forecast slightly to just over $2.4m as a result of finding the error, related to revenue recognition subsequent to quarter end, but prior to filing of the Company’s Form 10-Q for the quarter ended March 31, 2006. The Company expects that the 10-Q will be filed on or before May 15, 2006.
GlobalSCAPE (OTCBB: GSCP) provides secure file management software that enables companies to safely send data over the Internet. GlobalSCAPE’s products guarantee the privacy of critical information such as the transfer of financial data, medical records, customer files, intellectual property, and other sensitive documents. GlobalSCAPE’s file management software ensures compliance with government regulations on protecting information and allows enterprises to reduce IT costs, increase efficiency, track and audit transactions, and automate processes. GlobalSCAPE’s products are used by leading technology, banking, healthcare, and public sector organizations and can be customized to fit various customer needs, creating a variety of solutions. In addition, GlobalSCAPE provides content management and website development tools. Founded in 1996, GlobalSCAPE is the developer of CuteFTP, the most popular file transfer protocol application on the market. GlobalSCAPE is headquartered in San Antonio, TX. For more information, please visit http://www.globalscape.com or call GlobalSCAPE toll-free at 800-290-5054 (US) or 210-308-8267 (international).
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements relate to, among other things, the Company’s revenue estimates for the first quarter of 2006. The words “believe,” “expect,” “should,” “intend,” ”estimate,” and "projects," variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. These forward-looking statements are based upon the Company’s current expectations and are subject to a number of risks, uncertainties and assumptions. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ significantly from those expressed or implied by such forward-looking statements are risks that are detailed in the Company’s Annual Report on Form 10-K for the 2005 Calendar year, filed on March 9, 2006 with the Securities and Exchange Commission.