TEL AVIV - HUB Cyber Security Ltd. (NASDAQ: HUBC), a company specializing in cybersecurity and advanced data fabric solutions, with a current market capitalization of $13.09 million and total debt of $30.9 million, has reached a settlement agreement with United Mizrahi Tefahot (TASE:MZTF) Bank (UMTB) to restructure $7 million of its secured debt. This agreement, signed on December 19, 2024, defers principal payments until mid-2025 and covers more than 60% of the company’s secured debt through its subsidiary Comsec Ltd.
The restructuring is part of HUB’s broader strategy to address financial obligations and improve its liquidity, allowing the company to concentrate on scaling operations and enhancing shareholder value. According to InvestingPro data, HUB’s current ratio of 0.21 and weak Financial Health Score indicate significant liquidity challenges, with short-term obligations exceeding liquid assets. CEO Noah Hershcoviz expressed confidence in the company’s stability and growth potential, stating that this financial move aligns with HUB’s business goals and operational expansion plans.
HUB is also in advanced negotiations to refinance the remaining portion of its secured debt, with an expected completion in the first quarter of 2025. InvestingPro subscribers have access to 12 additional key insights about HUB’s financial position and market performance, essential for monitoring this developing situation. These efforts underscore the company’s commitment to achieving financial stability and are seen as foundational steps towards sustainable growth and long-term profitability.
Established in 2017 by veterans of the Israeli Defense Forces’ elite intelligence units, HUB operates in over 30 countries, offering encrypted computing technologies and data theft prevention solutions to a diverse client base.
The press release also contains forward-looking statements regarding the company’s financial condition and earnings outlook, including its debt refinancing plans. Recent financial data shows revenue of $33.36 million with an 11.27% year-over-year decline, highlighting the importance of successful debt restructuring for the company’s future. However, these statements are subject to uncertainties and changes in circumstances that could affect the company’s actual results.
Investors are reminded that the information provided is based on HUB Security’s press release statement and that forward-looking statements involve risks and uncertainties, including the company’s ability to manage growth, the impact of geopolitical risks, and the adequacy of liquidity to meet obligations.
In other recent news, HUB Cyber Security Ltd., an Israeli cybersecurity firm, is contesting a delisting notice from the Nasdaq Stock Market due to non-compliance with the Nasdaq Global Market’s minimum financial requirements. The company’s total assets and total revenue for the most recently completed fiscal year and two of the last three fiscal years were each below the required $50 million threshold. Despite these challenges, the company has taken significant strides to improve its financial health, including a 70% reduction in its convertible note obligations and an additional $1 million investment from a private investor.
In board changes, HUB Cyber Security has appointed Ms. Renah Persofsky as an independent director, a move expected to contribute significantly to the company’s growth and corporate governance. Amid its financial challenges, HUB Cyber Security has secured multiple contracts, including a $2 million deal with the Israel Airports Authority, and entered into an $8 million straight debt arrangement to support growth initiatives.
HUB Cyber Security has also partnered with Blackswan Technologies to develop Secured Data Fabric solutions. These recent developments highlight the company’s strategic decisions to navigate its financial challenges and improve its position for continued listing on the Nasdaq Global Market.
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