Business Week – Buys boost Baltimore.

Despite growing losses and a tumbling share price, Baltimore Technologies’ finance chief is optimistic ahead of next week’s publication of full-year results.

Acquisitions and growing revenues have boosted the internet security company, as has the increased public awareness of web security issues.

But whether increased revenues will yield positive results will not be known until next week, when the Irish company announces its results.

‘It’s been a year of significant growth,’ said chartered accountant Paul Sanders, chief financial officer of Baltimore. ‘We are continuing to invest in research and development and that strategy is starting to pay dividends.’

In the third quarter, the company reported revenues of #20.1m, up 215% from 1999, and acquired two internet security specialists, Content Technologies and Nevex Software Technologies.

Total pre-tax losses also grew on a year-on-year basis, amounting to #18.4m compared to #8.5m in the previous year.

The company has also had a rough ride on the stock exchange this year, popping in and out of the FTSE 100, as share prices tumbled over 60%.

Despite this, Baltimore does not seem to be in as much hot water as many other technology companies. The company’s core business has saved it from this fate, according to Sanders.

‘We are an e-security company, the internet is here and here to stay and as e-commerce grows we will continue to grow,’ he said.

The CFO remarked Baltimore is poised to respond to the growing e-security market. ‘We are one of the global leaders of e-security,’ he added. ‘We have leading edge technology and have a global footprint, with a presence with 38 offices in each continent.’

Baltimore’s customer base consists of blue-chip companies, government organisations and other large associations, and is therefore not in the troubled business-to-consumer market.

Impressed with Baltimore’s products, Sanders seized the opportunity of joining the company. ‘It has a compelling story, and a sound strategy,’ he said. ‘It operates in a very interesting sector and it’s in its relative infancy.’

Previously Sanders was an accountant at Arthur Andersen for nine years, an experience which he said helps him in his present job: ‘I think to be a CFO, it’s of fundamental importance to have an accountancy background. Coming from an international firm of accountants you get a wide experience.’

According to Sanders, to be a successful high-tech company, ‘you need adequate controls’.

‘Baltimore, is well funded and has strong financial controls,’ he said, adding that the previous chief financial officer was also an accountant as is the current chief executive.

For more information on the company and internet security visit SNAPSHOT

Unaudited results for nine months to September 2000

Revenue: #45.8m

Operating expenses: #75.5m

Net loss: #38m

Executive directors: Fran Rooney, president & chief executive officer, appointed January 1996, Paul Sanders, chief financial officer, appointed December 2000

Auditor: KPMG

Company profile: e-security infrastructure provider Baltimore Technologies is listed on the NASDAQ and the London Stock Exchange.

Related reading