CipherTrust Completes 12th Consecutive Cash-Positive Quarter Marked by Strong Revenue Growth, New Customer Acquisition and Continued Technology Innovation; Company Passes 4,000 Deployment Mark and Achieves 99-Percent Maintenance Renewal Rate

Business Wire, Sept 2, 2005

ATLANTA -- CipherTrust, Inc., the global market leader in messaging security, today announced a record second quarter, marked by the Company's 12th consecutive quarter of positive cash flow, strong sales and revenue growth, new customer acquisition, customer renewals and continued product innovation and leadership. In addition, CipherTrust(R) continued its tradition of recognition from leading third-party analysts and reviewers, receiving several highly competitive industry awards and accolades, and further solidifying its global leadership position in the messaging security marketplace.

During the second quarter, CipherTrust continued to see strong demand for its inbound threat protection and outbound policy and compliance offerings as evidenced by key financial and operational highlights, including:

--Increased revenue growth by 30% over the same period last year

--Added more than 125 new customers including AutoTrader.com, Vought Aircraft, Georgia Department of Human Resources, HealthSouth, General Parts, Inc. and Jacksonville University, bringing the Company's impressive total number of IronMail(R) messaging security appliance deployments to more than 4000 worldwide

--Achieved over 85% competitive win rate in head-to-head evaluations

--Experienced 12th consecutive quarter of positive cash flow

--Exceeded customer renewal rates of greater than 99%

--Aggressively expanded international operations to meet the global demands of its customers by establishing a local presence in 40 countries in North and South America, Europe, the Middle East, Africa and the Asia-Pacific region

--Continued to excel in its channel-driven model by converting 20 new resellers from competitors in North and South America, expanding CipherTrust's broad distribution network to more than 120 partners

--Met increased demand for solutions by establishing stock facilities in Europe, appointed new distribution partners in Benelux, Scandinavia, and the Middle East, and increased its channel partner network in the United Kingdom by 500%, with immediate sales from all territories

"In addition to the Company's financial success experienced in the second quarter, CipherTrust attained a number of industry recognitions and achievements, further cementing our leadership position in messaging security," said Jay Chaudhry, CipherTrust CEO, Chairman & Founder. "With record sales, a solid balance sheet and continued global expansion, CipherTrust is well positioned to serve the emerging needs of today's businesses. Our competitive win rate remains strong and our R&D pipeline is full. Customers already are recognizing the benefits of a completely integrated approach to protecting their inbound and outbound messaging needs. It's our continued commitment to providing integrated best-of-breed solutions that drives the growth in our expanding customer base, which includes more than one-third of the Fortune 500."

Technology Innovation

CipherTrust's innovative new offerings keep with the Company's mission to block the bad by protecting against inbound messaging threats, and guard the good by protecting against outbound policy and compliance violations. In July, CipherTrust became the only e-mail security vendor to offer a bundled compliance solution featuring PGP(R) Universal encryption on an appliance. In August, CipherTrust launched two new appliances powered by its TrustedSource(TM) global threat correlation engine: IronMail Gateway 6.0 and IronMail Edge. IronMail Gateway 6.0 includes a number of enhancements to the Company's flagship gateway security offering. CipherTrust's IronMail Edge is a hardened appliance that sits at the network edge to optimize e-mail connection management, handling three million messages per hour and effectively rejecting more than 50 percent of e-mail connections by identifying them as being from a malicious source.

Third-Party Awards & Accolades

CipherTrust's third-party validation of its market strength, product excellence, innovation and leadership continues. In July, Gartner positioned CipherTrust in the leaders quadrant of its "E-mail Security Boundary Magic Quadrant 1H05(1) report, which focused on anti-spam, e-mail anti-virus, and intrusion prevention capabilities to prevent inbound e-mail security threats. Also in July, AlwaysOn honored CipherTrust as one of the Top 100 Private Companies, and Catalyst Magazine honored CipherTrust Chairman & CEO Jay Chaudhry as one of the Top 50 Entrepreneurs for the second year in a row. In August, Network World magazine named CipherTrust its "Clear Choice" in e-mail encryption, topping encryption providers such as PostX Secure E-mail, Entrust Entelligence(TM) and Tumbleweed's MailGate(TM). A complete listing of awards and product review wins are available on the CipherTrust Web site at www.ciphertrust.com/company/press_and_events/awards_and_reviews.php.> Thought Leadership

By investing heavily in its research and development, CipherTrust continues to maintain its status as an industry innovator and authority on e-mail security trends and issues. In July, the Company released findings based on SenderID/SPF records at the Microsoft E-mail Authentication Summit, verifying that SenderID has overtaken SPF in enterprise adoption. Following the successful launch of the Company's ZombieMeter(TM), CipherTrust introduced its TrustedSource Portal(TM) (located at http://www.trustedsource.org), a free online resource that provides precise information about e-mail sender reputation by domain and IP address. The portal allows administrators to troubleshoot, research and analyze various senders that may be sending mail into their environments, and take action depending on the results.