Online security vendor Vasco is reporting a 15% drop in operating income for the first quarter, amid signs of a slowdown in the approval process from banking clients.
Operating income for the first quarter of 2008 was $5.8 million, a decrease of $1 million, or 15%, from $6.9 million reported for the first quarter of 2007. Ebitda was down 8.5% from $7.6 million in Q1 2007 to $6.9 million this quarter.
Revenue growth slowed to 10% during the quarter to $28.9 million from $26.4 million in 200. Operating expenses were $3.5 million ahead of the year-ago period at $14.2 million, as the vendor re-invested in the business and set aside $1.1 million for stock-based incentives.
T. Kendall Hunt, chairman & CEO, states: "The results of the first quarter reflected a general slowdown in the approval processes within our banking customers and our strategy of continued investment in the infrastructure of the business to ensure that we have the capacity to support strong future growth."
He nonetheless reaffirmed guidance for growth of 25% to 35% for the full-year 2008 over full-year 2007.
Jan Valcke, Vasco's president and COO, says: "While overall revenue growth in this quarter was less than we have experienced in recent quarters, we are continuing to see strong interest in our products and a strong flow of new orders."
He says the firm won 591 new customers in Q1 2008, including 71 banks.
The firm's stock closed on Nasdaq yesterday at $13.83. In extended hours, the stock was trading down at $13.60.
View Vasco share price data.