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Sales up but profits down at Sophos

Investments take bite from cash

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In brief UK-based security firm Sophos announced plans to launch centrally-managed client firewall and adware detection and removal products on Monday as it reported an increase in annual turnover of 19.2 per cent to £66.2 million ($122.6 million USD) for the year ending March 2005.

Although Sophos exceeded its growth expectations its profits slipped from from £6.8m in 2004 to £3.1m this year. The firm says the drop in profits reflects an increase in investment in engineering and its North American operations as well as costs associated with the construction of its new HQ and deferred costs associated with its September 2003 acquisition of Canadian anti-spam firm ActiveState.

Sophos specialises in selling integrated IT security products to defend against threats such as computer viruses and spam. The last fiscal year saw Sophos's global workforce rise to 925 employees - an increase of 26 per cent on the previous year. New recruits include industry veteran Mark Harris who recently left rival McAfee to become global director of SophosLabs. ®

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