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CHECK POINT SOFTWARE TECHNOLOGIES LTD — Regulatory Filings 2009
Jul 28, 2009
30257_ffr_2009-07-28_840a22c0-4bcf-4f5f-b9b7-2744f4be69a4.zip
Regulatory Filings
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6-K 1 zk97044.htm Created by EDGAR Ease Plus (EDGAR Ease+) Project: \Backup\edgar filing\Check Point Software Technologies Ltd\97044\a97044.eep Control Number: 97044 Rev Number: 1 Client Name: Check Point Software Technologies Ltd Project Name: 6-K Firm Name: Zadok-Keinan Ltd 6-K MARKER FORMAT-SHEET="Scotch Rule Top-TNR" FSL="Workstation" MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
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FORM 6-K
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Report of Foreign Private Issuer
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Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934
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For the month of July, 2009
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Commission File Number 0-28584
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| CHECK POINT SOFTWARE
TECHNOLOGIES LTD. |
| --- |
| (Translation of
registrants name into English) |
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5 Hasolelim Street, Tel Aviv, Israel (Address of principal executive offices)
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Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F o
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Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
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Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
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Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
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Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrants home country), or under the rules of the home country exchange on which the registrants securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrants security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
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Indicate by check mark whether the registrant by furnishing the information contained in this Form, is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
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Yes o No x
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If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- __
| INVESTOR CONTACT: | MEDIA CONTACT: |
|---|---|
| Kip E. Meintzer | Greg Kunkel |
| Check Point Software Technologies | Check Point Software Technologies |
| +1 650.628.2040 | +1 650.628.2070 |
| [email protected] | [email protected] |
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CHECK POINT SOFTWARE REPORTS RECORD FINANCIAL RESULTS FOR THE SECOND QUARTER 2009
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Revenue: $223.6 Million representing 12 percent growth year over year
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Non-GAAP EPS: $0.48 representing 12 percent growth year over year
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Non-GAAP Operating Income: $116.4 or 52 percent of revenues, 15% growth year over year
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Deferred Revenue: $362.1 Million representing 30 percent growth year over year
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REDWOOD CITY, Calif., July 28, 2009 Check Point® Software Technologies Ltd. (NASDAQ: CHKP), the worldwide leader in securing the Internet, today announced record financial results for the second quarter ended June 30, 2009.
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Im pleased to report record quarterly results. Our quarterly results came in at the high-end of our projections with 12 percent year over year growth in revenues and non-GAAP earnings per share. Revenue growth came from all regions and represented our highest quarterly revenues to date. said Gil Shwed, Chairman and Chief Executive Officer at Check Point, The synergies associated with the successful acquisition of Nokias Security Appliance business contributed to these record results and enabled us to achieve non-GAAP operating margin of 52 percent.
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Financial Highlights for the Second Quarter of 2009
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Total Revenues: $223.6 million, an increase of 12 percent, compared to $199.6 million in the second quarter of 2008, and sequential quarterly growth of 15 percent.
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GAAP Operating Income: $86.7 million, up from $83.6 million a year ago. The GAAP operating income in the second quarter of 2009 included amortization of intangible assets in the amount of $4.6 million and restructuring charges of $9.0 million related to the Nokia security business acquisition.
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Non-GAAP 1 operating income: $116.4 million, an increase of 15 percent compared to $100.9 million a year ago. Non-GAAP operating margin was 52 percent, compared to 51 percent a year ago.
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GAAP Net Income and Earnings per Diluted Share: GAAP net income was $75.6 million compared to $79.2 million in the second quarter of 2008. Earnings per share were $0.36 for both periods. The GAAP net income in the second quarter of 2009 included amortization of intangible assets in the amount of $4.6 million ($0.02 per diluted share) and restructuring charges of $9.0 million ($0.04 per diluted share) related to the Nokia security business acquisition. Net of taxes these charges totaled $11.9 million ($0.06 per diluted share).
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1 For information regarding the non-GAAP financial measures discussed in this release, please see Use of Non-GAAP Financial Information and Reconciliation of Non-GAAP to GAAP Financial Information.
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Non-GAAP 2 Net Income and Earnings per Diluted Share: Non-GAAP net income was $100.9 million, compared to $92.7 million in the second quarter of 2008 and EPS was $0.48, an increase of 12 percent, compared to $0.43 in the second quarter of 2008.
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Deferred Revenues : As of June 30, 2009, we had deferred revenue of $362.1 million, which represented an increase of $82.9 million, or 30 percent compared to deferred revenues as of June 30, 2008.
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Cash Flow: Cash flow from operations was $112.7 million, an increase of 37 percent, compared to $82.6 million in the second quarter of 2008. We had $1.63 billion in cash and investments as of June 30, 2009.
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Share Repurchase Program: During the second quarter of 2009, we repurchased 2.2 million shares at a total cost of $50.0 million.
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Business Highlights Mr. Shwed continued, During the quarter we expanded our product portfolio with the introduction of our Power-1 11000 high end appliance series, the SMART-1 management appliances and the acquisition of the IP series appliance business from Nokia. We also added over 300 people as part of the acquisition, primarily in sales and marketing, R&D and technical services. As a result, we have increased our investment in future product development and have provided further resources to support our customers and partners even given todays economy.
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During the second quarter of 2009 we expanded its security hardware appliance portfolio, giving customers more options to deploy our leading security software. In April, we completed the acquisition of the Nokia Security Appliance Business and delivered the new Check Point IP appliance line that utilizes our revolutionary new software blade architecture. This allows prior Nokia appliance customers the ability to take advantage of integrated Intrusion Prevention System (IPS) for the first time, and was followed by the introduction of the Power-1 11000 series appliances designed for high performance environments, based on our revolutionary Software Blade architecture.
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Also in the second quarter, we introduced the SMART-1 appliances, representing the next step in our efforts to simplify security management for enterprises while providing the highest level of security. SMART-1 utilizes the benefits of Check Points Software Blade architecture and provides flexibility and extensibility to the network administrator by unifying network, IPS and endpoint security policy management.
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Additionally, in July during our Check Point Experience in the Asia Pacific region we introduced our latest management blade, SmartWorkFlow, which enables customers to streamline security operations and achieve higher levels of compliance. We also announced our latest endpoint security solution, Endpoint Security R72, our latest version of the industrys only single agent for endpoint security that utilizes our patent-pending WebCheck browser virtualization security technology to protect enterprise PCs against Web-based threats. Furthermore, to ease the end-user experience, Endpoint Security R72 OneCheck single authentication unlocks all endpoint security subsystems and VPN Auto-Connect simplifies remote access.
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Mr. Shwed concluded: I am proud of the record results we achieved this quarter. During my meetings with customers I encountered a great deal of enthusiasm for our strategy that was primarily focused on our software blade architecture and expanded appliance portfolio. Id like to thank our partners and customers for their continued support of Check Points business.
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2 For information regarding the non-GAAP financial measures discussed in this release, please see Use of Non-GAAP Financial Information and Reconciliation of Non-GAAP to GAAP Financial Information.
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Conference Call and Webcast Information Check Point will host a conference call with the investment community on July 28, 2009 at 8:30 AM ET/5:30 AM PT. To listen to the live webcast, please visit Check Points website at http://www.checkpoint.com/ir. A replay of the conference call will be available through August 12, 2009 at the companys website http://www.checkpoint.com/ir or by telephone at +1 201.612.7415, passcode # 327789, account # 215.
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About Check Point Software Technologies Ltd. Check Point Software Technologies Ltd. (www.checkpoint.com), worldwide leader in securing the Internet, is the only vendor to deliver Total Security for networks, data and endpoints, unified under a single management framework. Check Point provides customers uncompromised protection against all types of threats, reduces security complexity and lowers total cost of ownership. Check Point first pioneered the industry with FireWall-1 and its patented stateful inspection technology. Today, Check Point continues to innovate with the development of the Software Blade architecture. The dynamic Software Blade architecture delivers secure, flexible and simple solutions that can be fully customized to meet the exact security needs of any organization or environment. Check Point customers include tens of thousands of businesses and organizations of all sizes including all Fortune 100 companies. Check Points award-winning ZoneAlarm solutions protect millions of consumers from hackers, spyware and identity theft.
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©2003 2009 Check Point Software Technologies Ltd. All rights reserved.
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Use of Non-GAAP Financial Information In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Check Point uses non-GAAP measures of net income, operating income and earnings per share, which are adjustments from results based on GAAP to exclude non-cash equity-based compensation charges in accordance with SFAS 123R, amortization of acquired intangible assets, restructuring-related charges and the related tax affects. Check Points management believes the non-GAAP financial information provided in this release is useful to investors understanding and assessment of Check Points on-going core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and as such has determined that it is important to provide this information to investors.
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Safe Harbor Regarding Forward Looking Statements 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, including, but not limited to, our beliefs and expectations regarding our product introductions and enhancements. Because these statements pertain to future events they are subject to various risks and uncertainties, actual results could differ materially from Check Points current expectations and beliefs. Factors that could cause or contribute to such differences include, but are not limited to: general market conditions in Check Points industry; economic and political uncertainties; the financial and business conditions affecting our customers; the impact of political changes and weaknesses in various regions of the world, including hostilities or acts of terrorism in Israel, where Check Points international headquarters are based; inclusion of network security functionality in third-party hardware or system software; any foreseen and unforeseen developmental or technological difficulties with regard to Check Points products; changes in the competitive landscape, including new competitors or the impact of competitive pricing and products; rapid technological advances and changes in customer requirements to which Check Point is unable to respond expeditiously, if at all; a shift in demand for products such as Check Points; factors affecting third parties with which Check Point has formed business alliances; and the timely availability and customer acceptance of Check Points new and existing products. The forward-looking statements contained in this press release are subject to other factors and risks, including those discussed in Check Points Annual Report on Form 20-F for the year ended December 31, 2008, which is on file with the Securities and Exchange Commission. The statements made in this press release are based on Check Points expectations or beliefs as of the date hereof, and Check Point assumes no obligation to update information concerning its expectations or beliefs.
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CHECK POINT SOFTWARE TECHNOLOGIES LTD. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
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(In thousands, except per share amounts)
| Three Months Ended — June 30, | Six Months Ended — June 30, | |||
|---|---|---|---|---|
| 2009 | 2008 | 2009 | 2008 | |
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |
| Revenues: | ||||
| Products and licenses | $ 82,801 | $ 84,973 | $ 154,545 | $ 162,352 |
| Software updates, maintenance | ||||
| and services | 140,840 | 114,633 | 264,108 | 228,851 |
| Total revenues | 223,641 | 199,606 | 418,653 | 391,203 |
| Operating expenses: | ||||
| Cost of products and licenses | 16,837 | 9,693 | 26,463 | 18,686 |
| Cost of software updates, | ||||
| maintenance and services | 10,775 | 7,101 | 16,604 | 13,851 |
| Amortization of technology | 7,230 | 5,800 | 13,030 | 12,954 |
| Total cost of revenues | 34,842 | 22,594 | 56,097 | 45,491 |
| Research and development | 23,468 | 23,824 | 43,255 | 46,569 |
| Selling and marketing | 56,939 | 56,588 | 104,011 | 110,248 |
| General and administrative | 12,680 | 13,005 | 27,297 | 26,571 |
| Restructuring | 9,034 | - | 9,034 | - |
| Total operating expenses | 136,963 | 116,011 | 239,694 | 228,879 |
| Operating income | 86,678 | 83,595 | 178,959 | 162,324 |
| Financial income, net | 8,130 | 7,949 | 16,543 | 20,312 |
| Income before income taxes | 94,808 | 91,544 | 195,502 | 182,636 |
| Taxes on income | 19,205 | 12,371 | 38,978 | 25,205 |
| Net income | $ 75,603 | $ 79,173 | $ 156,524 | $ 157,431 |
| Earnings per share (basic) | $ 0.36 | $ 0.37 | $ 0.75 | $ 0.72 |
| Number of shares used in computing | ||||
| earnings per share (basic) | 209,521 | 215,030 | 209,835 | 217,568 |
| Earnings per share (diluted) | $ 0.36 | $ 0.36 | $ 0.74 | $ 0.71 |
| Number of shares used in computing | ||||
| earnings per share (diluted) | 211,615 | 217,951 | 211,847 | 220,192 |
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CHECK POINT SOFTWARE TECHNOLOGIES LTD. RECONCILIATION OF SELCTED GAAP MEASURES TO NON GAAP MEASURES
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(In thousands, except per share amounts)
| Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | |||||||
| 2009 | 2008 | 2009 | 2008 | |||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||
| GAAP operating income | $ 86,678 | $ | 83,595 | $ | 178,959 | $ | 162,324 | |
| Stock-based compensation (1) | 7,271 | 8,385 | 15,074 | 17,456 | ||||
| Amortization of intangible assets (2) | 13,453 | 8,893 | 22,346 | 19,196 | ||||
| Restructuring (3) | 9,034 | - | 9,034 | - | ||||
| Non-GAAP operating income | $ 116,436 | $ | 100,873 | $ | 225,413 | $ | 198,976 | |
| GAAP net income | $ 75,603 | $ | 79,173 | $ | 156,524 | $ | 157,431 | |
| Stock-based compensation (1) | 7,271 | 8,385 | 15,074 | 17,456 | ||||
| Amortization of intangible assets (2) | 13,453 | 8,893 | 22,346 | 19,196 | ||||
| Restructuring (3) | 9,034 | - | 9,034 | - | ||||
| Taxes on stock-based compensation, | ||||||||
| amortization of intangible assets and | ||||||||
| restructuring (4) | (4,499 | ) | (3,753 | ) | (6,622 | ) | (8,017 | ) |
| Non-GAAP net income | $ 100,862 | $ | 92,698 | $ | 196,356 | $ | 186,066 | |
| GAAP Earnings per share (diluted) | $ 0.36 | $ | 0.36 | $ | 0.74 | $ | 0.71 | |
| Stock-based compensation (1) | 0.03 | 0.04 | 0.07 | 0.08 | ||||
| Amortization of intangible assets (2) | 0.07 | 0.05 | 0.11 | 0.10 | ||||
| Restructuring (3) | 0.04 | - | 0.04 | - | ||||
| Taxes on stock-based compensation, | ||||||||
| amortization of intangible assets and | ||||||||
| restructuring (4) | (0.02 | ) | (0.02 | ) | (0.03 | ) | (0.04 | ) |
| Non-GAAP Earnings per share (diluted) | $ 0.48 | $ | 0.43 | $ | 0.93 | $ | 0.85 | |
| Number of shares used in computing | ||||||||
| Non-GAAP earnings per share (diluted) | 211,615 | 217,951 | 211,847 | 220,192 | ||||
| (1) Stock-based compensation: | ||||||||
| Cost of products and licenses | $ 13 | $ | 15 | $ | 21 | $ | 27 | |
| Cost of software updates, | ||||||||
| maintenance and services | 107 | 194 | 300 | 377 | ||||
| Research and development | 1,515 | 1,204 | 2,773 | 2,301 | ||||
| Selling and marketing | 976 | 1,926 | 2,716 | 4,166 | ||||
| General and administrative | 4,660 | 5,046 | 9,264 | 10,585 | ||||
| 7,271 | 8,385 | 15,074 | 17,456 | |||||
| (2) Amortization of intangible assets: | ||||||||
| Cost of products and licenses | 7,230 | 5,800 | 13,030 | 12,954 | ||||
| Selling and marketing | 6,223 | 3,093 | 9,316 | 6,242 | ||||
| 13,453 | 8,893 | 22,346 | 19,196 | |||||
| (3) Restructuring | 9,034 | - | 9,034 | - | ||||
| (4) Taxes on stock-based | ||||||||
| compensation, amortization of | ||||||||
| intangible assets and restructuring | (4,499 | ) | (3,753 | ) | (6,622 | ) | (8,017 | ) |
| Total , net | $ 25,259 | $ | 13,525 | $ | 39,832 | $ | 28,635 |
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CHECK POINT SOFTWARE TECHNOLOGIES LTD. CONDENSED CONSOLIDATED BALANCE SHEET DATA (In thousands) ASSETS
| June 30, 2009 | December 31, 2008 | |
|---|---|---|
| (unaudited) | (audited) | |
| Current assets: | ||
| Cash and cash equivalents | $ 714,094 | $ 543,190 |
| Marketable securities and deposits | 307,291 | 371,197 |
| Trade receivables, net | 187,185 | 251,771 |
| Other current assets | 39,222 | 28,372 |
| Total current assets | 1,247,792 | 1,194,530 |
| Long-term assets: | ||
| Marketable securities | 608,795 | 529,445 |
| Property, plant and equipment, net | 41,104 | 40,248 |
| Severance pay fund | 5,862 | 5,817 |
| Deferred income taxes, net | 17,353 | 19,003 |
| Intangible assets, net | 137,749 | 123,151 |
| Goodwill | 708,458 | 664,602 |
| Other assets | 22,293 | 16,820 |
| Total long-term assets | 1,541,614 | 1,399,086 |
| Total assets | $ 2,789,406 | $ 2,593,616 |
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LIABILITIES AND SHAREHOLDERS EQUITY
| Current liabilities: — Short-term deferred revenues | $ 329,985 | $ | 289,998 | |
|---|---|---|---|---|
| Trade payables and other accrued liabilities | 141,472 | 112,556 | ||
| Total current liabilities | 471,457 | 402,554 | ||
| Long-term deferred revenues | 32,106 | 40,799 | ||
| Income tax accrual | 109,737 | 101,230 | ||
| Deferred tax liability, net | 17,605 | 22,225 | ||
| Accrued severance pay | 10,638 | 10,943 | ||
| Total liabilities | 641,543 | 577,751 | ||
| Shareholders' equity: | ||||
| Share capital | 774 | 774 | ||
| Additional paid-in capital | 513,862 | 503,408 | ||
| Treasury shares at cost | (1,151,758 | ) | (1,105,250 | ) |
| Accumulated other comprehensive income (loss) | 7,717 | (4,673 | ) | |
| Retained earnings | 2,777,268 | 2,621,606 | ||
| Total shareholders' equity | 2,147,863 | 2,015,865 | ||
| Total liabilities and shareholders' equity | $ 2,789,406 | $ | 2,593,616 | |
| Total cash and cash equivalents and marketable | ||||
| securities | $ 1,630,180 | $ | 1,443,832 |
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CHECK POINT SOFTWARE TECHNOLOGIES LTD. SELECTED CONSOLIDATED CASH FLOW DATA (In thousands)
| Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | |||||||
| 2009 | 2008 | 2009 | 2008 | |||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||
| Cash flow from operating activities: | ||||||||
| Net income | $ 75,603 | $ | 79,173 | $ | 156,524 | $ | 157,431 | |
| Adjustments to reconcile net income to net cash provided by | ||||||||
| operating activities: | ||||||||
| Depreciation and amortization of property, plant and equipment | 2,223 | 2,145 | 5,035 | 4,293 | ||||
| Decrease (increase) in trade and other receivables, net | 4,393 | (11,301 | ) | 85,100 | 36,867 | |||
| Increase in deferred revenues, trade payables and other | ||||||||
| accrued liabilities | 16,159 | 1,213 | 9,275 | 4,544 | ||||
| Realized loss on marketable securities | - | - | 1,896 | - | ||||
| Stock-based compensation | 7,271 | 8,385 | 15,074 | 17,456 | ||||
| Amortization of intangible assets | 13,453 | 8,893 | 22,346 | 19,196 | ||||
| Excess tax benefit from stock-based compensation | (2,043 | ) | (2,681 | ) | (4,514 | ) | (6,029 | ) |
| Deferred income taxes, net | (4,352 | ) | (3,268 | ) | (6,242 | ) | (8,323 | ) |
| Net cash provided by operating activities | 112,707 | 82,559 | 284,494 | 225,435 | ||||
| Cash flow from investing activities: | ||||||||
| Cash paid in conjunction with the acquisition | ||||||||
| of Protect Data, net | - | (9,042 | ) | - | (9,042 | ) | ||
| Cash paid in conjunction with the acquisition of Nokia | (57,540 | ) | - | (57,540 | ) | - | ||
| Investment in property, plant and equipment | (1,207 | ) | (2,591 | ) | (2,601 | ) | (4,526 | ) |
| Net cash used in investing activities | (58,747 | ) | (11,633 | ) | (60,141 | ) | (13,568 | ) |
| Cash flow from financing activities: | ||||||||
| Proceeds from issuance of shares upon exercise of options | 18,514 | 9,304 | 42,303 | 15,772 | ||||
| Purchase of treasury shares | (49,998 | ) | (50,000 | ) | (102,286 | ) | (123,000 | ) |
| Excess tax benefit from stock-based compensation | 2,043 | 2,681 | 4,514 | 6,029 | ||||
| Net cash used in financing activities | (29,441 | ) | (38,015 | ) | (55,469 | ) | (101,199 | ) |
| Unrealized gain (loss) on marketable securities, net | 14,842 | (8,844 | ) | 17,464 | (9,404 | ) | ||
| Increase in cash and cash equivalents, deposits and marketable | ||||||||
| securities | 39,361 | 24,067 | 186,348 | 101,264 | ||||
| Cash and cash equivalents, deposits and marketable securities | ||||||||
| at the beginning of the period | 1,590,819 | 1,318,706 | 1,443,832 | 1,241,509 | ||||
| Cash and cash equivalents, deposits and marketable securities | ||||||||
| at the end of the period | $ 1,630,180 | $ | 1,342,773 | $ | 1,630,180 | $ | 1,342,773 |
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Signatures
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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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CHECK POINT SOFTWARE TECHNOLOGIES LTD. By: /s/ Tal Payne Tal Payne Chief Financial Officer
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July 28, 2009