This Week's IPOs: Sourcefire, Xinhua Finance Media Ltd.

|
Includes: FIRE, XFML
by: Abbi Adest

Companies going public this week include: Network security solutions provider Sourcefire (NASDAQ:FIRE); and Xinhua Finance Media Ltd (XFML), a Chinese diversified media company.

All quotations are from the companies' most recent S-1 filings with links provided for each company.

SOURCEFIRE (FIRE)
Business Overview (from prospectus)

We are a leading provider of intelligence driven, open source network security solutions that enable our customers to protect their computer networks in an effective, efficient and highly automated manner. We sell our security solutions to a diverse customer base that includes more than 25 of the Fortune 100 companies and over half of the 30 largest U.S. government agencies. We also manage one of the security industry’s leading open source initiatives, Snort.

Offering: 5.8 million shares at $12.00 -14.00 per share. Net proceeds of approximately $61.9 million will be used for product development, expansion of international direct sales force and capital expenditures such as "(i) procuring and installing an enterprise resource planning system, (ii) purchasing additional development and testing equipment for our security lab and (iii) acquiring additional security-related technology for further development."

Lead Underwriters: Morgan Stanley, UBS Investment Bank

Financial Highlights:

Our total revenue increased 37% to $44.9 million in the year ended December 31, 2006 from $32.9 million in the year ended December 31, 2005...Our total cost of revenue increased 36% to $11.1 million in the year ended December 31, 2006, compared to $8.1 million in the year ended December 31, 2005...Gross profit increased 36% to $33.9 million in the year ended December 31, 2006, from $24.8 million in the year ended December 31, 2005. Gross profit as a percentage of total revenue was 75% in both the years ended December 31, 2006 and December 31, 2005.

XINHUA FINANCE MEDIA LTD. (XMFL)
Business Overview (from prospectus)

We are a leading diversified media company in China. We have assembled and built a group of media assets and strategic partnerships that we believe will enable us to achieve best in class media and advertising services across various sectors of the media business in China.

We have developed a unique, integrated platform that includes the creation and production of high-quality content that is distributed across nationwide television and print media outlets and radio in Beijing and Shanghai, and where advertising sales are supported by our own advertising agency. These outlets reach an estimated 210 million potential television viewers, a potential listening audience of 33 million people, and the readers of leading magazines and newspapers. In addition, our market research business enables our advertisers to analyze, understand and better reach their targeted consumers.

Offering: 23.1 million shares at $12.00-14.00 per share. Net proceeds of approximately $204 million will be used to repay debt, to execute strategic acquisitions, for working capital and general corporate purposes.

Lead Underwriters: J.P. Morgan, UBS Investment Bank

Financial Highlights:

Our total net revenues for the year ended December 31, 2006 [were] $59.0 million...Our total operating expenses for the year ended December 31, 2006 [were] $18.1 million...We had net income of $3.3 million for the year ended December 31, 2006, while a loss of $4.1 million was attributable to holders of common shares, due to dividends and deemed dividends to Patriarch Partners, the holder of our preferred shares.