VIRTUALARMOUR REPORTS 1st QUARTER 2021 RESULTS

VIRTUALARMOUR REPORTS 1st QUARTER 2021 RESULTS

13% Growth in Managed & Professional Services

CENTENNIAL, Colorado, – (May 31, 2021) – VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), a premier cybersecurity managed services provider, reported results for the first quarter ended March 31, 2021. Financial results are in U.S. dollars, with comparisons made to the same year-ago quarter unless otherwise noted. For complete details, please refer to our financial statements and discussion found here: https://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00037617 

Q1 2021 Financial Highlights

  • Managed and professional services revenue for the period increased to $1.58 million, increasing by 13% year-over-year. 
  • Overall revenue for the period increased to $2.6 million, increasing by 4.9% year-over-year due to an offset to the revenue increase by a 5.4% reduction in product sales.
  • Gross profit margins for managed and professional services came in at 51% with overall gross profit margin, including lower margin resale revenue, of 38%. 
  • The company lost $21,300 from operations in the period ending March 31, 2021 compared to an operating loss of $312,000 for the period in 2020.
  • Adjusted EBITDA was $27,000 for the period ending March 31, 2021. See Supplemental Non-GAAP Financial Measures below.
  • Annual recurring revenue (ARR) totaled $5.3 million at March 31, 2021, representing an increase of 4% from $5.1 million at March 31, 2020. ARR is defined as the value of VirtualArmour’s service contracts normalized to a one-year period.

Q1 2021 Operational Highlights 

  • First sales of expanded offering in Essential Core Services to include Managed SIEM, Managed Infrastructure and Firewall, and SOCaaS show validation of the market and GTM strategy success.
  • Implemented and operationalized Phase 2 of the VirtualArmour Automation project, which has resulted in savings of approximately 100 hours per month in engineering man-hours and an increase in quality of investigations to the customer.
  • Created integrations with advanced threat intelligence sources, improving reliability, threat detection and quality of the investigations.
  • Investment in engaging lead generation company, Google Ads and webinar events have led to 2-3 regular in-bound leads per week.
  • Revamped standard customer reporting and interaction with Technical Business Reviews that will continuously improve awareness and guide customers to strengthen their security practice.


Q1 2021 Financial Summary

  • Revenue totaled $2.6 million for the three months ending March 31, 2021. Managed and professional services revenue totaled $1.6 million in the first quarter reflecting a 13% increase in managed and professional services revenue year-over-year. Product revenue for the first quarter decreased from $1.07 million in 2020 to $1.02 in 2021.
  • Cost of sales totaled $1.6 million in the 2021 period, down from $1.7 million in 2020.
  • Gross profit was $987,000 for the first quarter of 2021 as compared to $730,000 million in 2020. The change in gross profit was due to higher margin revenues from managed services.
  • Total operating expenses were $1.01 million for the period in 2020 as compared to $1.04 million in the prior year. 
  • Operating loss was $21,300 for the period in 2021 compared to an operating loss of $312,000 in 2020. Net loss was $370,000 or $(0.00) per share for the first quarter 2021 as compared to a net loss of $890,000 or $(0.01) per share in the prior year. 
  • Cash totaled $27,311 at March 31, 2021, compared to $179,335 at December 31, 2020.

Management Commentary 

“Having the right staff in the right place was crucial to VirtualArmour SOC operations at the beginning of the new year. It was a top priority that we not only have the right service offerings in place, but the right people. We conducted an in-depth review of operations to ensure we have necessary efficiencies in place to drive the company forward, our people and processes are major factors to our USP” said VirtualArmour CTO, Andrew Douthwaite. 

“In the first quarter of 2021, VirtualArmour continued their focus on providing services that were easily adoptable for new online businesses. We simplified our portfolio to offer what truly matters to the vast majority of business in this new online environment.” added Tianyi Lu, VirtualArmour VP Product Strategy. 

Chad Schamberger, VirtualArmour VP Operations comments, “I have become more involved in each department, as the business continues to grow, we are working hard to ensure that there is cross-department communication happening. When we work together, this enables innovation.”  

VirtualArmour Outlook 2021

As the COVID-19 pandemic continued to grip the globe throughout 2020 and many businesses went completely online, the uptick for cybersecurity services continued to increase.  Our focus from hardware/software resale to offering primarily managed cybersecurity services in 2020 lead to the safeguarding of our margins from the widespread freezes on capital spending in all industries. Tapping into a new section of the market that was previously overlooked by competitors, the VirtualArmour addition of new Essential Core Services offering has opened up entry and mid-level markets for the company. As we continue to experience growth in all areas of our business, the company formed an internal dedicated product team leading to increased efficiencies, quality and more value add to the customer.  

As the world slowly emerges from the pandemic in 2021, VirtualArmour predicts we will continue to see interest and expansion in our new service offerings. With the growth of our company, we have experienced a need for process that has lead to increased internal efficiencies and automation. Shifting our focus in 2020 has benefited the company greatly, and enabled us to finish the year with strong performance.

About VirtualArmour 

VirtualArmour International is a global cybersecurity and managed services provider that delivers customized solutions to help businesses build, monitor, maintain and secure their networks. 

The company maintains 24/7 client monitoring and service management with specialist teams located in its U.S. and UK-based security operation centers. Through partnerships with best-in-class technology providers, VirtualArmour delivers leading hardware and software solutions for customers that are both sophisticated and scalable, and backed by industry-leading customer service and experience. The company’s proprietary CloudCastr client portal and prevention platform provides clients with unparalleled access to real-time reporting on threat levels, breach prevention and overall network security. VirtualArmour services a wide range of clients, which include Fortune 500 companies and several industry sectors in over 30 countries across five continents. For further information, visit www.virtualarmour.com.

Supplemental Non-GAAP Financial Measures

In addition to GAAP financial measures, management uses non-GAAP financial measures to assess the company’s operational performance. It is likely that the non- GAAP financial measures used by the company will not be comparable to similar measures reported by other issuers or those used by financial analysts as their measures may have different definitions.  Generally, a non-GAAP financial measure is a numerical measure of an entity’s historical or future financial performance, financial position or cash flows that is neither calculated nor recognized under GAAP. Management believes that such non-GAAP financial measures can be important as they provide users of the financial statements with a better understanding of the results of the company’s recurring operations and their related trends, while increasing transparency and clarity into its operating results. Management also believes these measures can be useful in assessing the company’s capacity to discharge its financial obligations.

Management assesses adjusted EBITDA as the net gain (loss) for the period as reported excluding depreciation and amortization, change in fair value of warrant derivative liabilities, share-based compensation and interest expense. Adjusted EBITDA is not a term recognized under GAAP and non-GAAP measures do not have standardized meaning. Accordingly, non-GAAP measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. 

The table below provides a reconciliation of net gain (loss) for the period as reported to non-GAAP adjusted EBITDA for the three months ended March 31, 2021 and 2020:

Important Cautions Regarding Forward Looking Statements

This press release may include forward-looking information within the meaning of Canadian securities legislation and U.S. securities laws. This press release includes certain forward-looking statements concerning a service contract VirtualArmour has entered into with a current client, VirtualArmour’s continued relationship with various suppliers, the future performance of our business, its operations and its financial performance and condition, as well as management’s objectives, strategies, beliefs and intentions. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmour. Although VirtualArmour believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmour cannot provide any assurance that it will prove to be correct.

Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the success of the Company in performing the IT implementation and migration, performance under the contract by all parties, the ability of VirtualArmour to meet timelines, the continued availability of necessary hardware, the absence of any trade war or tariffs affecting VirtualArmour’s ability to perform, competitive risks and the availability of financing. These forward-looking statements are made as of the date of this press release and VirtualArmour disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.


March 31,          March 31,
2021$2020$
Revenue2,596,4502,476,393
Cost of sales(1,609,731)(1,746,429)
Gross Profit986,719729,964
  
Expenses
General and administrative 429,253 510,801
Research and development99,91590,219
Sales and marketing478,848440,962
Total Expenses1,008,016 1,041,982
Loss Before Other Income (Expense)(21,297) (312,018)
Other Income (Expense)
Change in fair value of warrant derivative liabilities(294,075)
Interest expense(55,050)(577,915)
Total Other Income (Expense)(349,125)(577,915)
Net Loss and Comprehensive Loss(370,422)(889,933)
Loss per share – basic and diluted(0.00)(0.01)
Weighted average number of shares outstanding – basic and diluted106,509,37873,973,142
March 31,           2021$December 31,   2020$
ASSETS 
Current Assets
Cash 27,311179,335
Accounts receivable1,163,357945,558
Other receivables20,000
Prepaid expenses1,054,081 1,345,684 
Total Current Assets2,244,749 2,490,577 
Operating lease right-of-use assets47,160 62,880 
Property and equipment203,679256,310
Intangible assets64,16529,708
Total Assets 2,559,753 2,839,475 
  
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities787,671819,905
Factoring payable182,703258,624
Deferred revenue1,583,941 1,963,203 
Loans payable479,788 424,843 
Current portion of operating lease liabilities46,933 61,671 
Current portion of finance lease liabilities29,32861,840
Due to related parties
Total Current Liabilities3,110,364 3,590,086 
Deferred revenue769,312 913,558 
Loans payable 1,024,411 593,431 
Finance lease liabilities
Warrant derivative liabilities1,757,5601,463,485
Total Liabilities 6,661,647 6,560,560 
STOCKHOLDERS’ DEFICIT
Common stock, no par value, 300,000,000 shares authorized Issued and outstanding: 106,533,822 (2020 – 106,508,822) shares8,562,5588,561,758
Additional paid-in capital2,119,0502,130,237
Deficit(14,783,502)(14,413,080)
Total Stockholders’ Deficit (4,101,894) (3,721,085) 
Total Liabilities and Stockholders’ Deficit 2,559,753 2,839,475 

Company Contact

Russ Armbrust, CEO

VirtualArmour International Inc.

Tel (720) 644-0913

Email Contact

VIRTUALARMOUR REPORTS 1st QUARTER 2021 RESULTS

VirtualArmour Reports 2020 Results

21% Growth in Managed & Professional Services

CENTENNIAL, Colorado, – (April 30, 2021) – VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), a premier cybersecurity managed services provider, reported results for the fourth quarter and full year ended December 31, 2020. Financial results are in U.S. dollars, with comparisons made to the same year-ago quarter unless otherwise noted. For complete details, please refer to our financial statements and discussion found here: https://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00037617 

2020 Financial Highlights

  • Managed and professional services revenue for the year increased to $6.5 million, increasing by 21% year-over-year. 
  • Overall revenue for the year decreased to $10.25 million, decreasing by 25% year-over-year due to a 54% reduction in product sales.
  • Gross profit margins for managed and professional services came in at 50.5% with overall gross profit margin, including lower margin resale revenue, of 38.2%. 
  • The company lost $189,000 from operations in the year ending December 31, 2020 compared to an operating loss of $1.53 million for the year in 2019.
  • Adjusted EBITDA was $264,000 for the year ending December 31, 2020. See Supplemental Non-GAAP Financial Measures below.
  • Annual recurring revenue (ARR) totaled $5.3 million at December 31, 2020, representing an increase of  15.2% from $4.6 million at December 31, 2019. ARR is defined as the value of VirtualArmour’s service contracts normalized to a one-year period.

2020 Operational Highlights 

  • Expanded offerings in Essential Core Services to include Managed SIEM, Managed Infrastructure and Firewall, and SOCaaS.
  • Launched Premium level service offering for SOCaaS.
  • Completed Phase 2 of the VirtualArmour Automation initiative, which will result in an expected savings of approximately 100 hours per month in engineering man-hours.
  • Engaged with lead generation company, investment into Google Ads, and increased webinar events.
  • Revamped regular customer reporting and interaction with Technical Business Reviews that will continuously improve awareness and guide customers to strengthen their security practice.

2020 Financial Summary

  • Revenue totaled $2.35 million for the three months ending December 31, 2020 and $10.25 million for the year 2020. Managed and professional services revenue totaled $1.7 million in the fourth quarter reflecting a 34% increase in managed and professional services revenue year-over-year and Product revenue for the fourth quarter decreased from $3.67 million in 2019 to $618,000 in 2020.
  • 2020 Cost of sales totaled $6.3 million, down from $10.4 million in 2019.
  • Gross profit was $3.9 million for the year 2020 as compared to $3.2 million in 2019. The change in gross profit was due to higher margin revenues from managed services and higher utilization of professional services resources in 2020.
  • Total operating expenses were $4.1 million in the year 2020 as compared to $4.76 million in the prior year. 
  • Operating loss was $189,000 for the year 2020 compared to an operating loss of $1.53 million in 2019. Net loss was $1.4 million or $(0.01) per share in the year 2020 as compared to a net loss of $2.23 million or $(0.04) per share in the prior year. 
  • Cash totaled $179,355 at December 31, 2020, compared to $145,268 at December 31, 2019.

Management Commentary

“In the year 2020 we saw great results from the continued expansion of our Essential Core Service offerings, which now include entry to mid-level offerings around Managed SIEM, Managed Infrastructure & Firewall, and SOCaaS. These tiered service offerings are intended for businesses that have a low number of devices, require less IPMs, or EPS, but still need managed cybersecurity services.” Tianyi Lu, VirtualArmour VP Product Strategy.

 “With so many businesses that have shifted their infrastructure online, we continue to see an increased need for protection in this new online environment. It’s almost like the wild west out there, and our clients look to us for one-time consultation or to manage their cybersecurity needs through our service offerings.” VirtualArmour CEO, Russ Armbrust.

VirtualArmour Outlook 2021

As the COVID-19 pandemic continued to grip the globe throughout 2020 and many businesses went completely online, the uptick for cybersecurity services continued to increase.  Our focus from hardware/software resale to offering primarily managed cybersecurity services in 2020 lead to the safeguarding of our margins from the widespread freezes on capital spending in all industries. Tapping into a new section of the market that was previously overlooked by competitors, the VirtualArmour addition of new Essential Core Services offering has opened up entry and mid-level markets for the company. As we continue to experience growth in all areas of our business, the company formed an internal dedicated product team leading to increased efficiencies, quality and more value add to the customer.  

As the world slowly emerges from the pandemic in 2021, VirtualArmour predicts we will continue to see interest and expansion in our new service offerings. With the growth of our company, we have experienced a need for process that has lead to increased internal efficiencies and automation. Shifting our focus in 2020 has benefited the company greatly, and enabled us to finish the year with strong performance.

About VirtualArmour 

VirtualArmour International is a global cybersecurity and managed services provider that delivers customized solutions to help businesses build, monitor, maintain and secure their networks. 

The company maintains 24/7 client monitoring and service management with specialist teams located in its U.S. and UK-based security operation centers. Through partnerships with best-in-class technology providers, VirtualArmour delivers leading hardware and software solutions for customers that are both sophisticated and scalable, and backed by industry-leading customer service and experience. The company’s proprietary CloudCastr client portal and prevention platform provides clients with unparalleled access to real-time reporting on threat levels, breach prevention and overall network security. VirtualArmour services a wide range of clients, which include Fortune 500 companies and several industry sectors in over 30 countries across five continents. For further information, visit www.virtualarmour.com.

Supplemental Non-GAAP Financial Measures

In addition to GAAP financial measures, management uses non-GAAP financial measures to assess the company’s operational performance. It is likely that the non- GAAP financial measures used by the company will not be comparable to similar measures reported by other issuers or those used by financial analysts as their measures may have different definitions.  Generally, a non-GAAP financial measure is a numerical measure of an entity’s historical or future financial performance, financial position or cash flows that is neither calculated nor recognized under GAAP. Management believes that such non-GAAP financial measures can be important as they provide users of the financial statements with a better understanding of the results of the company’s recurring operations and their related trends, while increasing transparency and clarity into its operating results. Management also believes these measures can be useful in assessing the company’s capacity to discharge its financial obligations.

Management assesses adjusted EBITDA as the net gain (loss) for the period as reported excluding depreciation and amortization, change in fair value of warrant derivative liabilities, share-based compensation and interest expense. Adjusted EBITDA is not a term recognized under GAAP and non-GAAP measures do not have standardized meaning. Accordingly, non-GAAP measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. 

The table below provides a reconciliation of net gain (loss) for the period as reported to non-GAAP adjusted EBITDA for the years ended December 31, 2020 and 2019:

Important Cautions Regarding Forward Looking Statements

This press release may include forward-looking information within the meaning of Canadian securities legislation and U.S. securities laws. This press release includes certain forward-looking statements concerning a service contract VirtualArmour has entered into with a current client, VirtualArmour’s continued relationship with various suppliers, the future performance of our business, its operations and its financial performance and condition, as well as management’s objectives, strategies, beliefs and intentions. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmour. Although VirtualArmour believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmour cannot provide any assurance that it will prove to be correct.

Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the success of the Company in performing the IT implementation and migration, performance under the contract by all parties, the ability of VirtualArmour to meet timelines, the continued availability of necessary hardware, the absence of any trade war or tariffs affecting VirtualArmour’s ability to perform, competitive risks and the availability of financing. These forward-looking statements are made as of the date of this press release and VirtualArmour disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

December 31    December 31
2020

$

2019

$

Revenue 10,246,882 13,644,902
Cost of sales (6,331,143) (10,411,459)
Gross Profit 3,915,739 3,233,443
  
Expenses
General and administrative  2,065,640  2,229,753
Research and development 397,757 222,668
Sales and marketing 1,641,292 2,310,727
Total Expenses 4,104,689  4,763,148
Gain (Loss) from Operations (188,950)  (1,529,705)
Other Income (Expenses)
Change in fair value of warrant derivative liabilities (854,268)
Interest expense (931,519) (701,303)
Gain on forgiveness of PPP loan 594,100
Net and Comprehensive Gain (Loss) for the year (1,380,637) (2,231,008)
Gain (Loss) per share – basic and diluted (0.01) (0.04)
Weighted average number of shares outstanding – basic and diluted 98,302,111  61,678,669
December 31,           2020

$

December 31,   2019

$

ASSETS 
Current Assets
Cash  179,335 145,268
Accounts receivable 945,558 3,776,520
Other receivables 20,000 47,513
Prepaid expenses 1,345,684  1,543,698
Total Current Assets 2,490,577  5,512,999
Operating lease right-of-use assets 62,880  88,242
Property and equipment 256,310 555,860
Intangible assets 29,708 45,519
Total Assets  2,839,475  6,202,620
  
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities 819,905 5,305,786
Factoring payable 258,624 377,740
Deferred revenue 1,963,203  1,099,387
Loans payable 424,843  1,206,468
Current portion of operating lease liabilities 61,671  100,772
Current portion of finance lease liabilities 61,840 138,441
Due to related parties 401,699
Total Current Liabilities 3,590,086  8,630,293
Deferred revenue 913,558  626,178
Loans payable  593,431  281,984
Finance lease liabilities 12,188
Warrant derivative liabilities 1,463,485
Total Liabilities  6,560,560  9,550,643
STOCKHOLDERS’ DEFICIT
Common stock, no par value, 300,000,000 shares authorized Issued and outstanding: 106,508,822 (2019 – 63,599,447) shares 8,561,758 7,670,975
Additional paid-in capital 2,130,237 2,013,445
Deficit (14,413,080) (13,032,443)
Total Stockholders’ Deficit  (3,721,085)  (3,348,023)
Total Liabilities and Stockholders’ Deficit  2,839,475  6,202,620

Company Contact

Russ Armbrust, CEO
VirtualArmour International Inc.
Tel (720) 644-0913
Email Contact

VIRTUALARMOUR REPORTS 1st QUARTER 2021 RESULTS

VirtualArmour Reports Q3 2020 Results

16% Growth in Managed & Professional Services

CENTENNIAL, Colorado, – (November 30, 2020) – VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), a premier cybersecurity managed services provider, reported results for the third quarter ended September 30, 2020. Financial results are in U.S. dollars, with comparisons made to the same year-ago quarter unless otherwise noted. For complete details, please refer to our financial statements and discussion found here: https://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00037617 

2020-Q3 Financial Highlights

  • Managed and professional services revenue for the quarter increased to $1.6 million, increasing by 15.6% year-over-year. 
  • Gross profit margins for managed and professional services exceeded 52% with overall gross profit margin, including lower margin resale revenue, of 38.2%. 
  • The company realized $130,000 in operating income in the quarter ending September 30, 2020.
  • Adjusted EBITDA was $218,000 for the quarter ending September 30, 2020. See Supplemental Non-GAAP Financial Measures below.
  • Annual recurring revenue (ARR) totaled $5.1 million at September 30, 2020, representing an increase of  8% from $4.7 million at September 30, 2019. ARR is defined as the value of VirtualArmour’s service contracts normalized to a one-year period.

2020-Q3 Operational Highlights 

  • Launch of new Essential Core Managed SOCaaS service offering and initial customer activated to the service. These economical service offerings enable current and new clients to extend, renew, or establish contracts with VirtualArmour given the current market conditions. 
  • Won 595k Managed SIEM, Endpoint Detection & Response contract win with high-tech manufacturing client.
  • VirtualArmour & Dynamic Funding Partnership enables financial options for clients to defer payments on managed service costs. Locks in for the term – hardware, software, and managed services for reduced upfront cashflow expenditure.
  • Strengthened relationship within the IBM Partner program, as well as new relationship expansion to Forescout Technologies, driving additional leads into the business. 
  • Digital marketing tactics expanded to Colorado region podcast audio advertisements and The Guardian UK online digital advertisements.
  • Memorandum of Understanding signed with Teesside University; strengthening the ties with Local University to UK SOC. Allowing VirtualArmour to conduct advanced research and development projects which lead to cutting edge solutions that would solve real life VirtualArmour problems, enriched access to hiring and module input.


2020-Q3 Financial Summary

  • Revenue totaled $2.76 million for the three months ending September 30, 2020. Managed and professional services revenue totaled $1.6 million in the third quarter reflecting a 15.6% increase in managed and professional services revenue year-over-year and Product revenue increased year-over-year by 11.0% to $1,128,000.
  • Q3 2020 Cost of sales totaled $1.7 million, same as 2019.
  • Gross profit was $1.06 million for the third quarter 2020 as compared to $723,000 in 2019. The change in gross profit was due to higher margin revenues from managed services and higher utilization of professional services resources in the third quarter 2020.
  • Total operating expenses were $926,000 in the third quarter 2020 as compared to $1.07 million in the prior year. 
  • Operating income was $130,000 for the third quarter 2020 compared to an operating loss of $342,000 in 2019. Net income was $185,500 or $(0.00) per share in the third quarter as compared to a net loss of $492,000 or $(0.01) per share in the prior year. 
  • Cash totaled $16,262 at September 30, 2020, compared to $72,358 at September 30, 2019.

Management Commentary

Tianyi Lu, VirtualArmour VP Product Strategy, highlights, “We have had great results from the launch of our new Essential Core Service offerings, so we have expanded these offerings to include SOCaaS. This new offering is intended for businesses that are less complex, but still require management of their SIEM while being mindful of their budgets.”

VirtualArmour CEO, Russ Armbrust, gives an overview of market conditions, “We are seeing an increase in the market for managed and professional security services when working with new clients that are looking to out-source their IT needs.”

VirtualArmour Outlook 2020

COVID-19 pandemic has forced a rapid shift in business to a remote workforce, something most companies were not prepared to do. With employees working from home for the first time, many IT departments are overwhelmed in regard to their cybersecurity posture and the expansion of their Remote Access VPNs. While having employees work from home reduces the risk of spreading and contracting the virus, this also puts business data at risk of malicious security threats. An unprotected remote workforce increases a company’s chance of security threats and can lead to detrimental consequences for a business – some even being forced into bankruptcy. In order to protect the remote workforce and prevent data loss, businesses will need to keep a close eye on security or hire an outside Managed Security Services Provider (MSSP) to ensure their information is secure. Due to its focus and go-to market on Managed Services, VirtualArmour is better prepared operationally and strategically to address these rapidly evolving needs compared to others that may have a narrower focus on just hardware/software resale.

Due to this rapidly evolving environment, VirtualArmour’s customers have approached the Company for needed expertise on filling their ever-changing needs. Companies are laying off IT staff to cut costs which results in an increased reliance on MSPs. Customers are relying on VirtualArmour as their strategic partner to help them with not only the planning and design, but also on-going managed services post COVID. VirtualArmour is well-positioned to capitalize on this growth opportunity and continues to deepen its penetration into the healthcare, financial, retail and service provider industries. VirtualArmour has seen an uptick in professional services around SSL VPN migrations and implementations due to a shifting workforce to all remote employees. The Company’s ability to provide Network Managed Services has been emphasized due to client base having to work fully remote with a reliance on digital communications’ uptime/availability critical to their success.

In order to increase managed services gross margin and further internal operational efficiency, VirtualArmour has enhanced its roadmap for automation. Based on existing KPI’s, it is expected that the productivity of our SOC analysts will drastically increase due to automating more of their typical workload, allowing us to accomplish more with less. SOC automation will allow VirtualArmour to resolve current and future threats quickly with automated proprietary playbooks, as attackers are becoming more sophisticated in their tactics and techniques. This differentiator keeps VirtualArmour at the forefront of stopping cybersecurity threats and increasing our clients’ security postures. The SOC Automation project in conjunction with Teesside University is due to commence in early September and the expectation is that we will start to see results by the end of 2020 – setting the foundations for expansion at scale in 2021.

About VirtualArmour 

VirtualArmour International is a global cybersecurity and managed services provider that delivers customized solutions to help businesses build, monitor, maintain and secure their networks. 

The company maintains 24/7 client monitoring and service management with specialist teams located in its U.S. and UK-based security operation centers. Through partnerships with best-in-class technology providers, VirtualArmour delivers leading hardware and software solutions for customers that are both sophisticated and scalable, and backed by industry-leading customer service and experience. The company’s proprietary CloudCastr client portal and prevention platform provides clients with unparalleled access to real-time reporting on threat levels, breach prevention and overall network security. VirtualArmour services a wide range of clients, which include Fortune 500 companies and several industry sectors in over 30 countries across five continents. For further information, visit www.virtualarmour.com.

Supplemental Non-GAAP Financial Measures

In addition to GAAP financial measures, management uses non-GAAP financial measures to assess the company’s operational performance. It is likely that the non- GAAP financial measures used by the company will not be comparable to similar measures reported by other issuers or those used by financial analysts as their measures may have different definitions.  Generally, a non-GAAP financial measure is a numerical measure of an entity’s historical or future financial performance, financial position or cash flows that is neither calculated nor recognized under GAAP. Management believes that such non-GAAP financial measures can be important as they provide users of the financial statements with a better understanding of the results of the company’s recurring operations and their related trends, while increasing transparency and clarity into its operating results. Management also believes these measures can be useful in assessing the company’s capacity to discharge its financial obligations.

Management assesses adjusted EBITDA as the net gain (loss) for the period as reported excluding depreciation and amortization, change in fair value of warrant derivative liabilities, share-based compensation and interest expense. Adjusted EBITDA is not a term recognized under GAAP and non-GAAP measures do not have standardized meaning. Accordingly, non-GAAP measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. 

The table below provides a reconciliation of net gain (loss) for the period as reported to non-GAAP adjusted EBITDA for the three months and nine months ended September 30, 2020 and 2019:

Important Cautions Regarding Forward Looking Statements

This press release may include forward-looking information within the meaning of Canadian securities legislation and U.S. securities laws. This press release includes certain forward-looking statements concerning a service contract VirtualArmour has entered into with a current client, VirtualArmour’s continued relationship with various suppliers, the future performance of our business, its operations and its financial performance and condition, as well as management’s objectives, strategies, beliefs and intentions. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmour. Although VirtualArmour believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmour cannot provide any assurance that it will prove to be correct.

Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the success of the Company in performing the IT implementation and migration, performance under the contract by all parties, the ability of VirtualArmour to meet timelines, the continued availability of necessary hardware, the absence of any trade war or tariffs affecting VirtualArmour’s ability to perform, competitive risks and the availability of financing. These forward-looking statements are made as of the date of this press release and VirtualArmour disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

 

Three months ended 

September 30

Nine months ended 

September 30

Notes 2020

$

2019

$

2020

$

2019

$

Revenue 11 2,762,208 2,429,105 7,891,313 8,679,594
Cost of sales 12 (1,706,870) (1,705,750) (4,956,277) (6,207,712)
Gross Profit 1,055,338 723,355 2,935,036 2,471,882
  
Expenses
General and administrative  12 466,727 452,492 1,466,969 1,742,458
Research and development 12 97,647 53,034 279,749 154,986
Sales and marketing 12 361,412 559,770 1,231,862 1,815,814
Total Expenses 925,786 1,065,296 2,978,580 3,713,258
Gain (Loss) from Operations 129,552 (341,941) (43,544) (1,241,376)
Other Income (Expenses)
Change in fair value of warrant derivative liabilities 131,485 20,376
Interest expense (75,678) (150,096) (808,851) (299,362)
Net and Comprehensive Gain (Loss) for the period 185,359 (492,037) (832,019) (1,540,738)
Gain (Loss) per share – basic and diluted 0.00 (0.01) (0.01) (0.02)
Weighted average number of shares outstanding – basic and diluted 106,508,822 63,599,447 95,546,573 63,599,447

 

Notes September 30,           2020

$

December 31,   2019

$

ASSETS 
Current Assets
Cash  16,262 145,268
Accounts receivable 3 1,720,878 3,776,520
Other receivables 47,513
Prepaid expenses 222,853 279,003
Contract assets  1,010,710 722,683
Total Current Assets 2,970,703 4,970,987
Operating lease right-of-use assets 9 19,860 88,242
Property and equipment 4 331,223 555,860
Intangible assets 5 33,648 45,519
Contract assets  139,937 542,012
Total Assets  3,495,371 6,202,620
  
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities 6 1,459,139 5,305,786
Factoring payable 3 501,295 377,740
Deferred revenue 11 2,699,910 1,099,387
Loans payable 7 838,536 1,206,468
Current portion of operating lease liabilities 9 22,578 100,772
Current portion of finance lease liabilities 9 27,632 138,441
Due to related parties 8 401,699
Total Current Liabilities 5,549,090 8,630,293
Deferred revenue 11 215,820 626,178
Loans payable  7 429,082 281,984
Warrant liabilities 571,945
Finance lease liabilities 9 12,188
Total Liabilities  6,765,937 9,550,643
STOCKHOLDERS’ DEFICIT
Common stock, no par value, 300,000,000 shares authorized Issued and outstanding: 106,508,822 (2019 – 63,599,447) shares 8,578,654 7,670,975
Additional paid-in capital 2,015,242 2,013,445
Deficit (13,864,462) (13,032,443)
Total Stockholders’ Deficit  (3,270,566) (3,348,023)
Total Liabilities and Stockholders’ Deficit  3,495,371 6,202,620

Company Contact

Russ Armbrust, CEO

VirtualArmour International Inc.

Tel (720) 644-0913

Email Contact

VIRTUALARMOUR REPORTS 1st QUARTER 2021 RESULTS

VirtualArmour Wins $595k Managed SIEM, Endpoint Detection & Response Contract with High-tech Manufacturing Client

FOR IMMEDIATE RELEASE
October 12, 2020

Contact: Elise Silagy
Marketing Coordinator
[email protected]

VirtualArmour Wins $595k Managed SIEM, Endpoint Detection & Response Contract with High-tech Manufacturing Client

Denver, CO, October 2020: VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), cybersecurity managed services provider, has won the contract to manage a new manufacturing client’s SIEM and Endpoint  Detection & Response. This contract will include managed cybersecurity services and a major QRadar Cloud &  Crowdstrike hardware/software refresh to the manufacturing client’s network. The total contract value is $595,000 over a 1-year period.  

Tianyi Lu, VirtualArmour VP of Product, is excited to announce, “We are greatly looking forward to this new partnership with a client in the high-tech manufacturing industry. As 2020 comes to a close, we continue to see  new business and a need for our services across many growing industries.”  

VirtualArmour CEO, Russ Armbrust explains, “Remote work has forever changed how IT departments and cybersecurity teams need to approach endpoints, with consideration of how organizations are allowing employees to use their own personal devices. Securing these endpoints is critical, especially when they have access to sensitive customer or company data. In the high-tech manufacturing industry, it is more important  than ever to protect data, we feel that this new client came to us because our team of expert cybersecurity  engineers can ensure a safe online environment and the protection they need.” Managed service contracts to  be covered include: 

Endpoint Detection & Response 

Our next-generation endpoint protection solutions provide continuous breach protection. We provide constant prevention, detection, visibility, and intelligence, so our clients can be protected before, during and even after a  breach. 

Managed SIEM 

Creation and management of all rules and policies in the SIEM environment based on the needs of our client.  Full incident detection and remediation/recommendations will be provided, as well as asset detection and monitoring as assets enter and leave the network.  

VirtualArmour offers end-to-end project management and support for the duration of these projects led by professionals with experience in Managed SIEM and Endpoint Detection & Response projects of equal or greater size. VirtualArmour also ensures a consistent review, knowledge transfer, handover and operational success of the new network architecture to the client.  

About VirtualArmour 

VirtualArmour is a global Managed Security Services Provider (MSSP) that delivers custom security services tailored to meet the needs of our clients. VirtualArmour manages the entire security lifecycle, from initial  alerting to the investigation phase to resolution. Visit us at www.virtualarmour.com

VirtualArmour Wins $1.7M Managed SIEM & Vulnerability Scanning Contract with Healthcare Client

[cs_content][cs_element_section _id=”1″ ][cs_element_layout_row _id=”2″ ][cs_element_layout_column _id=”3″ ][cs_text]

FOR IMMEDIATE RELEASE
July 17, 2020
Download as PDF

Contact: Elise Silagy
Marketing Coordinator
[email protected]

VirtualArmour Wins $1.7M Managed SIEM & Vulnerability Scanning Contract with Healthcare Client

Denver, CO, June 2020: VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), cybersecurity managed services provider, has won (2) contracts to manage a healthcare client’s SIEM and Vulnerability Scanning. The contracts will include professional and managed cybersecurity services as well as a major hardware/software refresh to the healthcare client’s network. VirtualArmour was able to provide a special financing option to defer payments on managed service costs until 2021. The total contract value is $1,700,000 over a 3-year period. 

Chad Schamberger, VirtualArmour VP of Operations, mentions, “Through our Managed SIEM offering, the client will be provided healthcare specific use cases that address security compliance standards from HIPAA. Our Vulnerability Scanning offering will provide the client with greater visibility into surface attacks, enhanced patch management and threat detection.” Managed service contracts to be covered include: 

Vulnerability Scanning Vulnerability reports generated from this offering will be utilized to gauge risk associated with known vulnerabilities and threats, which will help the client prioritize a patching schedule and/or emergency patches. 

Managed SIEM Creation and management of all rules and policies in the SIEM environment based on the needs of our client. Full incident detection and remediation/recommendations will be provided, as well as asset detection and monitoring as assets enter and leave the network. 

VirtualArmour offers end-to-end project management and support for the duration of these projects led by professionals with experience in Managed SIEM and Vulnerability Scanning projects of equal or greater size. VirtualArmour also ensures a consistent review, knowledge transfer, handover and operational success of the new network architecture to the client. VirtualArmour CEO, Russ Armbrust states, “As with many industries, the healthcare industry is highly driven by compliance from HIPAA to receive funding. VirtualArmour has become the trusted advisor when it comes to security compliance.” 

About VirtualArmour VirtualArmour is a global Managed Security Services Provider (MSSP) that delivers custom security services tailored to meet the needs of our clients. VirtualArmour manages the entire security lifecycle, from initial alerting, to the investigation phase to resolution. Visit us at www.virtualarmour.com 

[/cs_text][/cs_element_layout_column][/cs_element_layout_row][/cs_element_section][/cs_content][cs_content_seo]FOR IMMEDIATE RELEASE
July 17, 2020
Download as PDF
Contact: Elise Silagy
Marketing Coordinator
[email protected]
VirtualArmour Wins $1.7M Managed SIEM & Vulnerability Scanning Contract with Healthcare Client
Denver, CO, June 2020: VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), cybersecurity managed services provider, has won (2) contracts to manage a healthcare client’s SIEM and Vulnerability Scanning. The contracts will include professional and managed cybersecurity services as well as a major hardware/software refresh to the healthcare client’s network. VirtualArmour was able to provide a special financing option to defer payments on managed service costs until 2021. The total contract value is $1,700,000 over a 3-year period. 
Chad Schamberger, VirtualArmour VP of Operations, mentions, “Through our Managed SIEM offering, the client will be provided healthcare specific use cases that address security compliance standards from HIPAA. Our Vulnerability Scanning offering will provide the client with greater visibility into surface attacks, enhanced patch management and threat detection.” Managed service contracts to be covered include: 
Vulnerability Scanning Vulnerability reports generated from this offering will be utilized to gauge risk associated with known vulnerabilities and threats, which will help the client prioritize a patching schedule and/or emergency patches. 
Managed SIEM Creation and management of all rules and policies in the SIEM environment based on the needs of our client. Full incident detection and remediation/recommendations will be provided, as well as asset detection and monitoring as assets enter and leave the network. 
VirtualArmour offers end-to-end project management and support for the duration of these projects led by professionals with experience in Managed SIEM and Vulnerability Scanning projects of equal or greater size. VirtualArmour also ensures a consistent review, knowledge transfer, handover and operational success of the new network architecture to the client. VirtualArmour CEO, Russ Armbrust states, “As with many industries, the healthcare industry is highly driven by compliance from HIPAA to receive funding. VirtualArmour has become the trusted advisor when it comes to security compliance.” 
About VirtualArmour VirtualArmour is a global Managed Security Services Provider (MSSP) that delivers custom security services tailored to meet the needs of our clients. VirtualArmour manages the entire security lifecycle, from initial alerting, to the investigation phase to resolution. Visit us at www.virtualarmour.com [/cs_content_seo]

VirtualArmour Wins $4.1M Managed Services Contracts with Data Center Client

[cs_content][cs_element_section _id=”1″ ][cs_element_layout_row _id=”2″ ][cs_element_layout_column _id=”3″ ][cs_text]

FOR IMMEDIATE RELEASE
April 14, 2020
Download as PDF

Contact: Elise Silagy
Marketing Coordinator
[email protected]

VirtualArmour Wins $4.1M Managed Services Contracts with Data Center Client

Denver, CO, April 2020: VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), a cybersecurity managed services provider, has won (3) contracts to manage a client’s network architecture and engineering, tier 1 operations center support, and data center optimization. The total contract value is $4,139,500 over a 3 year period.

Andrew Douthwaite, VirtualArmour CTO, highlights, “We are really pleased that this new contract extends our service offerings with one of our longest standing clients. As we manage and operate this client’s infrastructure, provisioning new customers and keeping client office locations operational through growth, we are hopeful our client sees the value of multiple VirtualArmour service offerings, building a lasting relationship where both companies can grow together successfully.” Managed service contracts to be covered include:

Network Architecture & Engineering

Audit existing network infrastructure, topology and design, identify inefficiencies and/or bottlenecks, and implementation of network architecture and site migrations.

Operation Center Support

Provide first line operations support 24/7 at a reduced cost and higher technical value for a major international data center provider. Customized to how the client wants their support delivered, seamless experience to thousands of client’s end customers operating under the guise of the client look and feel.

Data Center Optimization

Newly built and acquired data center locations to be combined into one logical, functional datacenter to provide the client with optimized traffic flow and a scalable architecture of the new next-generation network platform.

VirtualArmour offers end-to-end project management and support for the duration of these projects led by professionals with previous experience in network migration projects of equal or greater size. VirtualArmour also ensures a consistent review, knowledge transfer, handover and operational success of the new network architecture to the client. Client President & Chief Revenue Officer states, “VirtualArmour has become our trusted advisor when it comes to the build out of our security network and infrastructure. Working closely with us as we grow through acquisition to ensure a smooth transition on to our network is invaluable. The high-touch managed support that we rely on 24/7/365 from VirtualArmour allows us to continue our growth while ensuring the security of our company and our clients.”

About VirtualArmour

VirtualArmour is a global Managed Security Services Provider (MSSP) that delivers custom security services tailored to meet the needs of our clients. VirtualArmour manages the entire security lifecycle, from initial alerting, to the investigation phase to resolution. Visit us at www.virtualarmour.com

[/cs_text][cs_text style=”font-size: 12px;”]

Important Cautions Regarding Forward Looking Statements

This press release may include forward-looking information within the meaning of Canadian securities legislation and U.S. securities laws. This press release includes certain forward-looking statements concerning the future performance of our business, its operations and its financial performance and condition, as well as management’s objectives, strategies, beliefs and intentions. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmour. Although VirtualArmour believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmour cannot provide any assurance that it will prove to be correct.

Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the success of this partnership, the future deal potential from this partnership, future interest in such partnerships, competitive risks and the availability of financing. These forward-looking statements are made as of the date of this press release and VirtualArmour disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

[/cs_text][/cs_element_layout_column][/cs_element_layout_row][/cs_element_section][/cs_content][cs_content_seo]FOR IMMEDIATE RELEASE
April 14, 2020
Download as PDF
Contact: Elise Silagy
Marketing Coordinator
[email protected]
VirtualArmour Wins $4.1M Managed Services Contracts with Data Center Client
Denver, CO, April 2020: VirtualArmour International Inc. (CSE:VAI) (OTCQB:VTLR), a cybersecurity managed services provider, has won (3) contracts to manage a client’s network architecture and engineering, tier 1 operations center support, and data center optimization. The total contract value is $4,139,500 over a 3 year period.
Andrew Douthwaite, VirtualArmour CTO, highlights, “We are really pleased that this new contract extends our service offerings with one of our longest standing clients. As we manage and operate this client’s infrastructure, provisioning new customers and keeping client office locations operational through growth, we are hopeful our client sees the value of multiple VirtualArmour service offerings, building a lasting relationship where both companies can grow together successfully.” Managed service contracts to be covered include:
Network Architecture & Engineering
Audit existing network infrastructure, topology and design, identify inefficiencies and/or bottlenecks, and implementation of network architecture and site migrations.
Operation Center Support
Provide first line operations support 24/7 at a reduced cost and higher technical value for a major international data center provider. Customized to how the client wants their support delivered, seamless experience to thousands of client’s end customers operating under the guise of the client look and feel.
Data Center Optimization
Newly built and acquired data center locations to be combined into one logical, functional datacenter to provide the client with optimized traffic flow and a scalable architecture of the new next-generation network platform.
VirtualArmour offers end-to-end project management and support for the duration of these projects led by professionals with previous experience in network migration projects of equal or greater size. VirtualArmour also ensures a consistent review, knowledge transfer, handover and operational success of the new network architecture to the client. Client President & Chief Revenue Officer states, “VirtualArmour has become our trusted advisor when it comes to the build out of our security network and infrastructure. Working closely with us as we grow through acquisition to ensure a smooth transition on to our network is invaluable. The high-touch managed support that we rely on 24/7/365 from VirtualArmour allows us to continue our growth while ensuring the security of our company and our clients.”
About VirtualArmour
VirtualArmour is a global Managed Security Services Provider (MSSP) that delivers custom security services tailored to meet the needs of our clients. VirtualArmour manages the entire security lifecycle, from initial alerting, to the investigation phase to resolution. Visit us at www.virtualarmour.com
Important Cautions Regarding Forward Looking Statements
This press release may include forward-looking information within the meaning of Canadian securities legislation and U.S. securities laws. This press release includes certain forward-looking statements concerning the future performance of our business, its operations and its financial performance and condition, as well as management’s objectives, strategies, beliefs and intentions. The forward-looking information is based on certain key expectations and assumptions made by the management of VirtualArmour. Although VirtualArmour believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information as VirtualArmour cannot provide any assurance that it will prove to be correct.
Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the success of this partnership, the future deal potential from this partnership, future interest in such partnerships, competitive risks and the availability of financing. These forward-looking statements are made as of the date of this press release and VirtualArmour disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.[/cs_content_seo]