Digital security software maker Entrust Inc. continued to see red in the fourth quarter, with a net loss of US$1.6 million, or three cents a share, despite a 13-per-cent gain in revenues.

The Dallas-based company, which has operations in Ottawa, saw total revenues rise to US$28 million from $24.8 million in the fourth quarter a year before, driven by a 40.2-per-cent jump in product revenues to US$12.7 million.

Entrust said its net losses were mostly as a result of employee stock option and acquisition expenses.

"In the quarter, both Entrust IdentityGuard and our Boundary Messaging solutions attained their highest quarter product revenue and both were up well over 100 per cent from last year," said Entrust chief executive officer Bill Conner. "This achievement helped us exit the fourth quarter with 31 per cent of our product revenue growing at nearly 300 per cent year-over-year."

The company said it is expecting net losses in accordance with GAAP of between two cents and four cents per share in the first half of fiscal 2007, and forecasts a full-year 2007 net income of between break-even and four cents per share.

It also targeted total revenues of between US$54 million and $56 million for the first half of 2007, and between US$115 million and $120 million for all of fiscal 2007.

Analysts are expecting earnings of 10 cents per share on sales of US$117.4 million.

Shares of Entrust fell 30 cents to $3.80 in after-hours trading.