EVS Reports Q2 2011 Results

Posted by Joe Zaller
Aug 26 2011

Production and playout video server specialist EVS reported that its revenue for the second quarter of 2011 was €23.4m, slightly higher than the previous quarter, but 22.4% lower than the same period a year ago. Excluding currency fluctuations and big event rentals, which are a major revenue driver for EVS, the company said its revenue decreased 8.1% versus the same period a year ago.

Gross margins for the quarter were 76.9%, down slightly versus both last year and last quarter. The company attributed the dip in gross margins to lower sales absorbing fixed assembling and support costs.

Operating expenses in the quarter increased by 2.15% versus last year due to higher costs associated with the NAB trade show, and increased investments in R&D and customer support.

Operating margins for the quarter were 35%, down from 52.4% in 2Q10, and 39.8% last quarter.

On a segment basis, studio represented 41% of revenue, with outside broadcast making up the remaining 59%.  Studio revenue was €9.6m, down 44% versus last year, while outside broadcast revenue was €13.8m up 5.6% versus the same period a year ago. The company generated €3.6m of world cup-related rental revenue in the quarter, which was split evenly between the studio and outside broadcast segments.

On a geographic basis:

  • Revenue from the EMEA region was €9.5m (41% of total revenue), down 49.5% versus same period a year ago.  The company said the UK and eastern European markets were particularly strong during the quarter.  For the first half of the year, EMEA revenue declined 17.5% versus the same period last year.

 

  • Revenue from the Americas was €7.9m, up 14.4% versus last year and up 68% versus quarter.  The company said that the US market continues to be driven by upgrades of existing to HD, and the building of new OB vans. For the first of the year, Americas revenue declined 13.1% versus the same period year.

 

  • APAC revenue for the quarter was €6m, an increase of 70.1% versus last year, and and increase of 46% versus the previous quarter.   The company said it had a variety of wins in the region including Malaysian operator Astro.  For first half of the year, APAC revenue increased by 23.4% to €10m.

 

Outlook for 2H 2011

EVS management remains positive about the remainder of the year. Company CFO Jacques Galloy said that the company’s order book “looks promising thanks to very strong May and June months. Hence, the Board remains confident that, for 2011, revenue could equal the record level of 2010, even though this is an odd year, without any major event, which represented more than EUR 10 million of rentals in 2010.”

The company says it’s well positioned to take advantage of key macro trends in the broadcast industry including the worldwide migration from tape-based operations to integrated tapeless workflows, the ongoing transition to HDTV operations, and the increasing number of video distribution channels.

Based on these long term drivers, the company says it expects to be able to continue to grow its business and increase market share over the coming years.

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Related Content:

Press Release: EVS Reports Revenue and Results for 2Q11 and 1H11

EVS Q2 2011 earnings presentation to equity analysts

Previous Quarter: EVS Q1 2011 Revenue Increases 8.7 Percent, Anticipating Strong Second Half of 2011

Previous Year: EVS Reports Strong Q2 2010 Results: Revenue up 61.2%, Operating Margins of 52.4%

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