Technicolor Finishes Year on High Note as Q4 Revenue Jumps 21 Percent

Posted by Joe Zaller
Mar 03 2011

Technicolor announced that its revenue for the fourth quarter of 2010 was €1.15Bn, up 21.4% vs. Q4 2009, and up 27% versus the previous quarter, with improved trends across all activities.  All operating businesses showed strong growth during the quarter, led by Technology which posted revenues 40% higher than in the same period a year ago thanks to increased licensing activities.   The Entertainment Services and Digital Delivery segments grew at 28.5% and 12.5% respectively versus the fourth quarter of 2009.

For the full year, Technicolor posted a net loss of €69m on revenue of €3,6Bn (down 1.2% versus 2009).  The net loss includes items related to the completion of the debt restructuring and of the disposal program, as well as impairments.  Excluding the impact of discontinued operations (primarily Grass Valley) the company posted a net profit of €156m.

Commenting on the results, company CEO Frederic Rose said “Our strong second half 2010 performance provide a good foundation for further organic growth, based on our strength in innovation and by taking advantage of technological disruption. Now that our restructuring phase is over, we will continue our investments in 2011 to ensure that Technicolor remains at the centre of the technological innovation in the migration of the media and entertainment industry to an all-digital world. In parallel, we will continue to focus on our operational performance and profitability to ensure that we drive profitable growth and increase our cash generation.”

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Priorities and objectives for 2011

In its presentation to equity analysts, company management said that they intend to accelerate organic investments in 2011 in the following areas:

  • Technology Licensing – MediaNavi – following a successful service introduction at CES and the announcement of a trial with TalkTalk in the UK, Techncolor is now engaged in discussions with a number of additional customers and partners. In this context, Technicolor expects to accelerate related research investments in 2011.

 

  • Digital Home – Technicolor was recently been awarded its first material order from a tier 1 European operator for a next generation set-top box based on our new software platform. Additional customers are also expected in 2011. The Group has therefore accelerated its software development investments to ensure that it is able to deliver material volumes in 2012.

  

  • Digital Production – The company will accelerate investments in this area in 2011 to both increase capacity and develop new software with the objective to more than double turnover by 2013. Additional physical expansions will occur principally in London, Vancouver, New York and Bangalore.

 

  • Digital Cinema – Technicolor says it now has more than 60% market share in North American Digital Cinema distribution, and that it intends accelerate investments in this area to expand its satellite network with a view to reach over 1,500 sites by end 2012.

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You can read the full Technicolor Q4 and full year 2010 earnings release here.

The company’s presentation to equity analysts is here

Information on the company Q3 2010 results are here.

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