AVG Reports Third Quarter 2012 Financial Results

Revenue Grows 34 Percent in Q3 Year Over Year; Reports Q3 GAAP EPS of $0.35 and Non-GAAP EPS of $0.43; Raises Fiscal Year 2012 Outlook

31 Oct, 2012, 16:15 ET from AVG Technologies N.V.

AMSTERDAM, Oct. 31, 2012 /PRNewswire/ -- AVG Technologies N.V. (NYSE: AVG) today reported results for the third quarter ended September 30, 2012.

"AVG's financial results well exceeded our expectations for the third quarter, driven by strong growth in both our subscription and platform derived businesses," stated J.R. Smith, chief executive officer of AVG. "During the quarter, we enhanced our portfolio of products and services with the launch of AVG 2013. Our latest line of products and services focuses on protection, performance and privacy as well as the introduction of free phone support for even our free customers. Also in the quarter, we continued to increase our active user count to 143 million, including 20 million mobile users. Considering our strong execution, we are again raising our outlook for the fiscal year 2012."

Revenue for the third quarter of 2012 was $95.3 million, compared with $71.2 million for the third quarter of 2011, an increase of 34 percent.

Net income for the third quarter of 2012 was $19.0 million, or $0.35 per diluted ordinary share, based on 54.7 million weighted-average diluted shares outstanding.  This compares to net income of $6.7 million, or $0.09 per diluted share, and 39.1 million weighted-average diluted shares outstanding for the third quarter of 2011.

Non-GAAP adjusted net income for the third quarter of 2012 was $23.4 million, or $0.43 per diluted share. This compares to non-GAAP adjusted net income of $10.5 million, or $0.20 per diluted share, for the same period of the prior year[1]. Non-GAAP results for the third quarter of 2012 exclude $2.7 million in share-based compensation expense and $1.9 million in acquisition amortization and reflect a $0.2 million adjustment to normalize to a tax rate of 14 percent.

Deferred revenue as of September 30, 2012 was $162.2 million. Cash and cash equivalents totaled $86.7 million as of September 30, 2012. Net debt[2] was $66.2 million as of September 30, 2012, compared to $73.7 million at June 30, 2012.  

AVG generated $25.3 million in cash from operating activities in the third quarter of 2012, and $27.2 million in non-GAAP unlevered free cash flow. This represents a 29 percent revenue to non-GAAP unlevered free cash flow conversion rate.  

Financial Outlook

Based on information available as of October 31, 2012, AVG is providing the following financial outlook for the fourth quarter of 2012:

  • Revenue is expected to be in the range of $94.0 million to $98.0 million.
  • Net income is expected to be in the range of $9.0 million to $10.0 million; diluted EPS is expected to be in the range of $0.16 to $0.18.
  • Non-GAAP adjusted net income is expected to be in the range of $14.0 million to $15.0 million; non-GAAP diluted EPS is expected to be in the range of $0.25 to $0.27.

AVG's expectation of non-GAAP adjusted net income for the fourth quarter of 2012 excludes share-based compensation expense and acquisition amortization and assumes a tax rate of 14 percent. For the purpose of calculating diluted EPS and non-GAAP diluted EPS in the fourth quarter, the company assumes approximately 55.5 million weighted-average shares outstanding. 

Based on information available as of October 31, 2012, AVG is increasing its financial outlook for fiscal year 2012 as follows:

  • Revenue is expected to be in the range of $354.0 million to $358.0 million.
  • Net income is expected to be in the range of $50.0 million to $51.0 million; diluted EPS is expected to be in the range of $0.91 to $0.93.
  • Non-GAAP adjusted net income is expected to be in the range of $73.0 million to $74.0 million; non-GAAP diluted EPS is expected to be in the range of $1.34 to $1.36.
  • Operating cash flow is expected to be in the range of $110.0 million to $114.0 million; non-GAAP unlevered free cash flow is expected to be in the range of $111.0 million to $115.0 million.

AVG's expectation of non-GAAP adjusted net income for the fiscal year 2012 excludes share-based compensation expense and acquisition amortization and assumes a tax rate of 14 percent. For the purpose of calculating diluted EPS and non-GAAP diluted EPS for 2012, the company assumes approximately 54.5 million weighted-average shares outstanding.

Conference Call Information

AVG will hold its quarterly conference call today at 22:00 CET/5:00 p.m. ET/2:00 p.m. PT to discuss its third quarter financial results, business highlights and outlook. The conference call may be accessed via webcast at http://investors.avg.com or by calling +1 (877) 941-1427 (United States and Canada) or +1 (480) 629-9664 (International).

A replay of the webcast can be accessed via http://investors.avg.com. Additionally, an audio replay of the conference call will be available through November 7, 2012 by calling +1 (800) 406-7325 (United States and Canada) or +1 (303) 590-3030 (International), (conference passcode required: 4568939#).

Use of Non-GAAP Financial Information

This press release contains supplemental non-GAAP financial measures including the following: non-GAAP adjusted net income, non-GAAP adjusted net income per diluted share and non-GAAP unlevered free cash flow. The presentation of this supplemental non-GAAP financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with generally accepted accounting principles in the United States. In particular, adjusted net income, adjusted net income per diluted share and unlevered free cash flow should not be considered as measurements of the company's financial performance or liquidity under U.S. GAAP, as alternatives to income, operating income, cash flow from operation or any other performance measures derived in accordance with U.S. GAAP or as alternatives to cash flow from operating activities as a measure of the company's liquidity.  Adjusted net income, adjusted net income per diluted share and unlevered free cash flow have limitations as analytical tools and should not be considered in isolation from, or as substitutes for, analysis of AVG's results of operations, including its cash flows, as reported under U.S. GAAP.  Some of the limitations of adjusted net income, adjusted net income per diluted share and unlevered free cash flow as financial measures are:

  • they do not reflect the company's future requirements for capital expenditure or contractual commitments, nor, in the case of the income measures, do they reflect the actual cash contributions received from customers;
  • except in the case of free cash flow, they do not reflect changes in, or cash requirements for, the company's working capital needs;
  • they do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on the company's debt;
  • although amortization and share-based compensation are non-cash charges, the assets being amortized will often have to be replaced in the future and such measures do not reflect any cash requirements for such replacements; and
  • other companies in AVG's industry may calculate these measures differently than AVG does, limiting their usefulness as comparative measures.

Because of these limitations, investors should rely on AVG's consolidated financial statements prepared in accordance with U.S. GAAP and treat the company's non-GAAP financial measures as supplemental information only. 

AVG is providing these non-GAAP financial measures because it believes that such measures provide important supplemental information to management and investors about the company's core operating results, primarily because the non-GAAP financial measures exclude certain expenses and other amounts that management does not consider to be indicative of the company's core operating results or business outlook. AVG management uses these non-GAAP financial measures, in addition to the corresponding U.S. GAAP financial measures, in evaluating the company's operating performance, in planning and forecasting future periods, in making decisions regarding business operations and allocation of resources, and in comparing the company's performance against its historical performance.

For a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with U.S. GAAP, please see "Reconciliation of U.S. GAAP to non-GAAP Financial Measures."  All non-GAAP financial measures should be read in conjunction with the comparable information presented in accordance with U.S. GAAP. 

Forward-Looking Statements

This press release contains forward-looking statements within the Private Securities Litigation Reform Act of 1995, including those relating to an expected range of revenue, net income, EPS, operating cash flow,  non-GAAP adjusted net income, non-GAAP EPS and non-GAAP unlevered free cash flow for the three-month period ending December 31, 2012 and/or the fiscal year ending December 31, 2012.  Words such as "expects," "expectation," "intends," "assumes," "believes" and "estimates," variations of such words and similar expressions are also intended to identify forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated herein. Factors that could cause or contribute to such differences include but are not limited to: changes in the company's growth strategies; changes in the company's future prospects, business development, results of operations and financial condition; changes to the online and computer threat environment and the endpoint security industry; competition from local and international companies, new entrants in the market and changes to the competitive landscape; the adoption of new, or changes to existing, laws and regulations; flaws in the assumptions underlying the calculation of the number of the company's active users; the termination of or changes to the company's relationships with its partners and other third parties; changes in the company's and its partners' responses to privacy concerns; the company's plans to launch new products and online services and monetize its full user base; the company's ability to attract and retain active and subscription users; the company's ability to retain key personnel and attract new talent; the company's ability to adequately protect its intellectual property; flaws in the company's internal controls or IT systems; the company's geographic expansion plans; the anticipated costs and benefits of the company's acquisitions; the outcome of ongoing or any future litigation or arbitration, including litigation or arbitration relating to intellectual property rights; the company's legal and regulatory compliance efforts; and worldwide economic conditions and their impact on demand for the company's products and services.  Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements.

Further information on these factors and other risks that may affect the company's business is included in filings AVG makes with the Securities and Exchange Commission (SEC) from time to time, including its Annual Report on Form 20-F, particularly under the heading "Risk Factors".

The financial information contained in this press release should be read in conjunction with the consolidated financial statements and notes thereto to be included in the company's report on Form 6-K.  The company's results of operations for the third quarter ended September 30, 2012 are not necessarily indicative of the company's operating results for any future periods.

These documents are available online from the SEC or in the Investor Relations section of our website at http://investors.avg.com. Information on our website is not part of this release. All forward-looking statements in this press release are based on information currently available to us, and we assume no obligation to update these forward-looking statements in light of new information or future events.

(Logo: http://photos.prnewswire.com/prnh/20120306/SF65434LOGO)

About AVG

AVG's mission is to simplify, optimize and secure the Internet experience, providing peace of mind to a connected world. AVG's powerful yet easy-to-use software and online services put users in control of their Internet experience. By choosing AVG's software and services, users become part of a trusted global community that benefits from inherent network effects, mutual protection and support. AVG has grown its user base to 143 million active users as of September 30, 2012 and offers a product portfolio that targets the consumer and small business markets and includes Internet security, PC performance optimization, online backup, mobile security, identity protection and family safety software.

[1] Non-GAAP adjusted net income per non-GAAP diluted share is calculated based on adjusted net income including earnings attributable to preferred shares in 2011.  For further details, see the reconciliation note at the end of this press release.

[2] Net debt represents current and non-current debt less cash and cash equivalents.

 

AVG Technologies N.V.

Condensed Consolidated Balance Sheets

(In Thousands)

December 31, 2011

September 30, 2012

ASSETS

Current assets:

Cash and cash equivalents

$

60,740

$

86,703

Trade accounts receivable, net

25,363

34,993

Inventories

883

932

Deferred income taxes

18,394

18,394

Prepaid expenses

3,975

4,841

Prepaid share issuance cost

6,820

0

Other current assets

6,363

7,153

Total current assets

122,538

153,016

Property and equipment, net

12,436

12,303

Deferred income taxes

59,750

56,770

Intangible assets, net

35,035

36,850

Goodwill

71,367

72,277

Investment in equity affiliate

511

333

Investments

9,750

9,750

Other assets

248

2,510

Total assets

$

311,635

$

343,809

LIABILITIES, PREFERRED SHARES AND SHAREHOLDERS' DEFICIT

Current liabilities:

Accounts payable

$

11,035

$

9,983

Accrued compensation and benefits

15,941

18,876

Accrued expenses and other current liabilities

30,878

27,298

Current portion of long term debt

41,125

18,700

Income taxes payable

4,161

3,361

Deferred revenue

120,269

131,361

Total current liabilities

223,409

209,579

Long-term debt, less current portion

184,315

134,202

Deferred revenue, less current portion

30,839

30,844

Other non-current liabilities

3,397

3,646

Total liabilities

441,960

378,271

Class D preferred shares

191,954

0

Ordinary shares

476

722

Additional paid-in capital (Distributions in excess of capital)

(388,225)

(136,341)

Treasury shares

0

(3,869)

Accumulated other comprehensive loss

(6,324)

(5,129)

Retained earnings

71,794

110,155

Total shareholders' deficit

(322,279)

(34,462)

Total liabilities, preferred shares and shareholders' deficit

$

311,635

$

343,809

 

AVG Technologies N.V.

Condensed Consolidated Statements of Comprehensive Income

(In thousands, except share data and per share data)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

Revenue:

Subscription

$

43,942

$

49,226

$

130,071

$

143,210

Platform-derived

27,228

46,027

68,022

117,551

Total revenue

71,170

95,253

198,093

260,761

Cost of revenue:

Subscription

5,832

5,794

17,287

19,597

Platform-derived

3,352

9,548

6,517

20,214

Total cost of revenue

9,184

15,342

23,804

39,811

Gross profit

61,986

79,911

174,289

220,950

Operating expenses:

Sales and marketing

19,190

22,298

53,904

63,710

Research and development

8,835

11,833

24,478

38,981

General and administrative

18,332

16,784

35,984

48,588

Total operating expenses

46,357

50,915

114,366

151,279

Operating income

15,629

28,996

59,923

69,671

Other expense, net

(5,535)

(6,383)

(12,278)

(17,732)

Income before income taxes and loss from investment in equity affiliate

10,094

22,613

47,645

51,939

Benefit (Provision) for income taxes

(3,373)

(3,581)

52,212

(10,845)

Loss from investment in equity affiliate

(61)

(69)

(180)

(178)

Net income

6,660

18,963

99,677

40,916

Comprehensive income

$

4,418

$

19,686

$

96,767

$

42,111

Net income

$

6,660

$

18,963

$

99,677

$

40,916

Preferred share dividends

(1,802)

0

(5,406)

(753)

Distributed and undistributed earnings to participating securities

(1,214)

0

(27,513)

0

Net income available to ordinary shareholders

$

3,644

$

18,963

$

66,758

$

40,163

Net income available to ordinary shareholders - basic

$

3,644

$

18,963

$

66,758

$

40,163

Net income available to ordinary shareholders - diluted

$

3,644

$

18,963

$

66,758

$

40,916

Earnings per ordinary share - basic

$

0.10

$

0.35

$

1.85

$

0.77

Earnings per ordinary share - diluted

$

0.09

$

0.35

$

1.72

$

0.75

Weighted-average shares outstanding - basic

36,000,000

54,232,743

36,000,000

51,850,912

Weighted-average shares outstanding - diluted

39,137,695

54,710,323

38,837,773

54,231,072

 

AVG Technologies N.V.

Condensed Consolidated Statements of Cash Flows

(In thousands)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

OPERATING ACTIVITIES:

Net income

$

6,660

$

18,963

$

99,677

$

40,916

Adjustments to reconcile net income to net cash provided by

operating activities:

Depreciation and amortization

2,922

4,279

7,943

12,652

Share-based compensation

1,189

2,727

3,012

10,753

Deferred income taxes

4,545

2,122

(51,997)

3,487

Change in the fair value of contingent consideration liabilities

(576)

(600)

(401)

(332)

Amortization of financing costs and loan discount

659

2,179

1,402

3,512

Dividend income

0

339

0

0

Loss from investment in equity affiliate

61

69

180

178

Loss (gain) on sale of property and equipment

61

(9)

232

(50)

Net change in assets and liabilities, excluding effects of

acquisitions:

Trade accounts receivable, net

1,893

(5,345)

5,496

(8,629)

Inventories

(136)

(271)

(125)

(42)

Accounts payable and accrued liabilities

2,030

1,577

1,377

8,089

Accrued compensation and benefits

919

(1,983)

299

488

Deferred revenue

(5,379)

3,272

3,037

9,540

Income taxes payable

77

(1,850)

949

(803)

Other assets

(5,926)

(257)

(7,907)

(1,468)

Other liabilities

770

54

(458)

(184)

Net cash provided by operating activities

9,769

25,266

62,716

78,107

INVESTING ACTIVITIES:

Purchase of property and equipment and intangible assets

(3,842)

(1,572)

(7,753)

(10,264)

Proceeds from sale of property and equipment

(2)

9

100

83

Dividends received

0

(339)

0

0

Cash payments for acquisitions, net of cash acquired

(31,863)

(500)

(38,899)

(4,447)

Net cash provided by investing activities

(35,707)

(2,402)

(46,552)

(14,628)

FINANCING ACTIVITIES:

Payment of contingent consideration

0

(11,240)

(2,784)

(11,240)

Payment of deferred purchase consideration

0

0

0

(1,900)

Proceeds from long-term debt net of discount

0

0

230,285

0

Debt issuance costs

(75)

0

(6,581)

0

Proceeds from issuance of ordinary shares

0

0

0

64,000

Share issuance costs

0

(262)

0

(8,302)

Proceeds from exercise of share options

0

0

0

347

Excess tax benefit

0

674

0

674

Repayment of principal on long-term borrowings

0

(46,675)

(1,125)

(76,050)

(Increase) decrease in restricted cash

0

34

1,333

(527)

Dividends paid

(1,802)

0

(228,091)

(2,555)

Repurchase of own shares

0

(3,869)

0

(3,869)

Repurchases of share options from employees

0

(114)

0

(1,022)

Net cash provide by financing activities

(1,877)

(61,452)

(6,963)

(40,444)

Effect of exchange rate fluctuations on cash and cash equivalents

(901)

1,566

941

2,928

Change in cash and cash equivalents

(28,716)

(37,022)

10,142

25,963

Beginning cash and cash equivalents

102,004

123,725

63,146

60,740

Ending cash and cash equivalents

$

73,288

$

86,703

$

73,288

$

86,703

Supplemental cash flow disclosures:

Income taxes paid

$

(2,075)

$

(3,440)

$

(4,702)

$

(6,028)

Interest paid

$

(4,512)

$

(3,842)

$

(9,022)

$

(12,715)

Suplemental non-cash disclosures:

Issuance of ordinary shares on conversion of Class D preferred shares

$

0

$

0

$

0

$

191,954

 

AVG Technologies N.V.

Reconciliation of GAAP Measures to Non-GAAP Measures

(In thousands, except revenue per average active user data)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

Net cash provided by operating activities

$

9,769

$

25,266

$

62,716

$

78,107

Less: Payments for property and equipment and intangible assets

(3,842)

(1,572)

(7,753)

(10,264)

Add: Interest expense net (1)

4,673

3,458

10,153

11,444

Unlevered free cash flow, adjusted

$

10,600

$

27,152

$

65,116

$

79,287

(1) The tax adjustment for interest expense is based on an assumed tax rate of approximately 10%, which is a blended rate based on internal estimates of what the Company's effective tax rate will be for the respective periods. Beginning in the quarter ended March 31, 2012, for interest expense the Company is using interest paid from the cash flow statement to calculate unlevered free cash flow. For prior periods, for interest expense the Company has continued to use interest expense from the income statement (which includes amortization of financing costs and loan discount). The Company has not adjusted the presentation for prior periods as this change in presentation of unlevered free cash flow, adjusted would not have had a material impact.

 

Revenue

$

71,170

$

95,253

$

198,093

$

260,761

Unlevered free cash flow, adjusted

10,600

27,152

65,116

79,287

Cash conversion

15%

29%

33%

30%

Total revenue (in thousands)

$

71,170

$

95,253

$

198,093

$

260,761

Active users at period end (in millions)

106

143

106

143

Average active users (in millions) (1)

102

136

103

126

Three/nine months revenue per average active user

$

0.70

$

0.70

$

1.92

$

2.07

Twelve months ended

September 30,

2011

2012

Total revenue (in thousands)

$

255,521

$

335,060

Active users at period end (in millions)

106

143

Average active users (in millions) (1)

102

125

Rolling twelve months revenue per average active user

$

2.51

$

2.68

(1) The number of average active users is calculated as the simple average of active users at the beginning of a period and the end of a period.

 

AVG Technologies N. V.

Reconciliation of GAAP Measures to Non-GAAP Measures

(In thousands except per share data)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

Gross profit

$

61,986

$

79,911

$

174,289

$

220,950

Add back:

- Share based compensation

5

(12)

17

1

- Acquisition amortization

897

1,051

1,588

3,264

Non-GAAP adjusted gross profit

$

62,888

$

80,950

$

175,894

$

224,215

Revenue

$

71,170

$

95,253

$

198,093

$

260,761

Non-GAAP adjusted gross profit margin

88%

85%

89%

86%

Operating expenses

$

46,357

$

50,915

$

114,366

$

151,279

Less:

- Share-based compensation

(1,184)

(2,739)

(2,995)

(10,752)

- Acquisition amortization

(63)

(831)

(972)

(2,666)

Non-GAAP adjusted operating expenses

$

45,110

$

47,345

$

110,399

$

137,861

Operating income

$

15,629

$

28,996

$

59,923

$

69,671

Add back:

- Share based compensation

1,189

2,727

3,012

10,753

- Acquisition amortization

960

1,882

2,560

5,930

Non-GAAP adjusted operating income

$

17,778

$

33,605

$

65,495

$

86,354

Revenue

$

71,170

$

95,253

$

198,093

$

260,761

Non-GAAP adjusted operating income margin

25%

35%

33%

33%

Net income

$

6,660

$

18,963

$

99,677

$

40,916

Add back:

- Share based compensation

1,189

2,727

3,012

10,753

- Acquisition amortization

960

1,882

2,560

5,930

- Benefit (Provision) for income taxes

3,373

3,581

(52,212)

10,845

Adjusted profit before taxes

12,182

27,153

53,037

68,444

Less: Tax effect (1)

(1,705)

(3,786)

(7,425)

(9,582)

Non-GAAP adjusted net income

$

10,477

$

23,367

$

45,612

$

58,862

(1) Adjusted for impact of normalized tax rate of 14%.

Weighted-average shares outstanding - diluted

39,138

54,710

38,838

54,231

Add back: Class D preferred shares

12,000

0

12,000

0

Non-GAAP fully diluted shares

51,138

54,710

50,838

54,231

Non-GAAP adjusted net income

$

10,477

$

23,367

$

45,612

$

58,862

Non-GAAP EPS, diluted

$

0.20

$

0.43

$

0.90

$

1.09

Share-Based Compensation

(In thousands)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

Cost of revenue

$

(5)

$

12

$

(17)

$

(1)

Sales and Marketing

586

(582)

(614)

(1,687)

Research and Development

(222)

(214)

(1,019)

(1,274)

General and Administrative

(1,548)

(1,943)

(1,362)

(7,791)

Share-based compensation

$

(1,189)

$

(2,727)

$

(3,012)

$

(10,753)

Acquisition Amortization

(In thousands)

Three months ended

Nine months ended

September 30,

September 30,

2011

2012

2011

2012

Cost of revenue

$

(897)

$

(1,051)

$

(1,588)

$

(3,264)

Sales and Marketing

(338)

(829)

(917)

(2,660)

Research and Development

275

(2)

(55)

(6)

Acquisition amortization

$

(960)

$

(1,882)

$

(2,560)

$

(5,930)

 

AVG Technologies N.V.

Reconciliation of GAAP Measures to Non-GAAP Measures

Notes to Non-GAAP Adjustments

Tax adjustment 

The Company's profit and loss tax charge varies from period to period and has shown significant variations from its cash tax charge. In particular, the Company's entry into an innovation tax regime in the Netherlands resulted in a significant tax credit in June 2011, which will be reversed in future periods. In order to remove the period to period impact of these variations, the Company has used an estimated normalized tax rate of approximately 14% in its historic financial reporting and future projections to better reflect the core operational changes in the business. The normalized tax rate of approximately 14% is based on an estimate of the Company's future cash tax rate as well as its recent cash and income statement tax charges. The tax rate reflected on the income statement for 2009 and 2010 was on average approximately 12.7% and the tax paid reflected on the cash flow statement in 2011 was approximately 13% with the tax rate reflected on the cash flow statement over the last three full fiscal years being approximately 17%.

Preferred Share Adjustment

During the 2011 fiscal year the Company had 12 million preferred shares which were entitled to a preferred dividend of approximately $1.8 million per calendar quarter, as well as their pro rata amount of net income assuming distribution to each separate class of shareholder. These shares were excluded from calculations of net income available to ordinary shareholders. At the time of the Initial Public Offering these shares converted to ordinary shares on a 1 for 1 basis, and preferred dividends are no longer payable. In order to reflect the underlying income attributable to ordinary shareholders in the non-GAAP calculation of adjusted net income per diluted share, the Company has included net income available to all shareholders, including the holders of preferred shares. The Company believes that these non-GAAP adjustments will allow it to present core financial trends more consistently during the periods before and after conversion of the preferred shares to ordinary shares.

 

 

SOURCE AVG Technologies N.V.



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