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Story URL: http://software.silicon.com/security/0,39024655,39120291,00.htm

SurfControl hits record revenues
And claims to protect 700,000 in UK public sector

By Ron Coates

Published: Tuesday 27 April 2004

SurfControl hit a record quarterly turnover of £22m, up 19 per cent on last year with a record 20 per cent pre-tax profit.

And the company took the occasion to point out that it currently supplies web and email filtering software for 700,000 public-sector employees.

The company pulled in 1,400 new users in its third quarter, including Sheffield, the Scottish Executive and all of Northern Ireland Civil Service Departments. Private company wins include MGM, ICI, Direct Line and the National Grid.

Despite this apparent success, CEO Steve Purdham would only express "cautious optimism" in a statement on the company's future. When asked about this, he said: "This is the real world. You never fully know in this business what is around the corner."

For the here and now, the company has a cash pile of $89m and deferred revenues of $65.7m – unlike some software companies, the company does not book them until they're earned.

Turnover for the nine months to 31 March was £62.8m, with pre-tax profits of $11.7m. Last month, Surfcontrol took over SecureM, which has a Linux-based email filtering appliance and a presence in China, in a $14.7m deal.

"People buy the software for four reasons: productivity, to stop wasting time; resources, to cut out big music downloads and streaming video; because of legal liability, they don't want to be responsible for illegal content; and security, viruses and so on.

They buy for one reason or a combination, but it does swing – spam one week, porn the next," said Purdham. "We think of it as managing content."

Martin Price, deputy IT security manager at Royal Cornwall Hospitals NHS Trust, said: "Just the reduction in support calls meant the software had paid for itself." Bandwidth availability has doubled and cases of online misuse have disappeared.

The trust has about 5,000 web-enabled users and is expanding this number as it moves users from dumb users to thin clients or other solutions.