Archive for the ‘Quarterly Results’ Category

Avid Says its 2009 – 2011 Financial Statements No Longer Reliable

Broadcast technology vendor financials, Quarterly Results, SEC Filings | Posted by Joe Zaller
May 23 2013

Avid Technology, which has been conducting an internal investigation into its current and historical accounting treatment related to software updates, has concluded that its “unaudited interim consolidated financial statements for the quarterly periods ended (i) September 30, 2012 and 2011, (ii) June 30, 2012 and 2011, and (iii) March 31, 2012 and 2011, as well as its audited consolidated financial statements for the years ended December 31, 2011, 2010 and 2009 should no longer be relied upon because of errors in the application of US GAAP.”

The company had previously disclosed that it has been unable to submit Form 10-K and Form 10-Q filings to the SEC because of its investigation the accounting treatment related to bug fixes, upgrades, enhancements and compatibility extensions.

As a result of these delayed filings with regulators, Avid has been notified by the NASDAQ stock exchange that the company does not comply with NASDAQ Listing Rule 5250(c)(1), which requires timely filing of periodic reports with the SEC.

Failure to regain compliance could result in the delisting of Avid’s shares from the NASDAQ Global Select Market.

The company said it has undertaken and initial review of “whether software updates previously made available by the company to certain of its customers at no-charge included upgrades, enhancements or compatibility extensions and if so, whether such upgrades, enhancements or compatibility extensions met the definition of post-contract customer support (PCS) under U.S. Generally Accepted Accounting Principles (“GAAP”).”

Avid says that “during the course of this initial review, the company concluded that certain of these no-charge software updates should have been accounted for as implied PCS when recognizing revenue for the original sale of the related product.”

On May 20, 2013, after evaluating management’s initial assessment of the potential magnitude of the incorrect application of GAAP with respect to certain Software Updates, the Audit Committee of the Company’s Board of Directors concluded, after discussions with the Company’s management that the Company’s unaudited interim consolidated financial statements for the quarterly periods ended (i) September 30, 2012 and 2011, (ii) June 30, 2012 and 2011, and (iii) March 31, 2012 and 2011, as well as its audited consolidated financial statements for the years ended December 31, 2011, 2010 and 2009 should no longer be relied upon because of these errors in the application of GAAP. The Company’s Audit Committee discussed this matter with the Company’s independent registered public accounting firm, Ernst & Young LLP. In addition, any previously issued press release or other publicly issued statement by the Company containing financial information for such periods should not be relied upon.

The company said in a regulatory filing that it intends to correct the errors it has discovered through the filing of its Form 10-K for the year ended December 31, 2012. However, it cautioned that the company “is not currently able to predict when it will file its Form 10-K for the year ended December 31, 2012.”

Avid says it expects that the timing of revenue recognition for the impacted customer arrangements will change from the historical presentation in the company’s financial statements pursuant to which revenue was recognized up front, generally to being recognized ratably over the estimated implied PCS service period. In addition, the timing of recognition of certain costs related to these customer arrangements may also be impacted, along with the timing of related income taxes. The company cannot at this time estimate the full impact of the adjustments of revenue and costs, and the related impact on income taxes, on any previously issued financial statements for any individual reporting period, although it may be significant. However, while the restatement adjustments will impact previously reported revenue and operating results for prior periods, the restatement adjustments are not expected to affect the amount of total revenue ultimately to be earned, or the amount or timing of cash received or to be received, from the sales transactions or the company’s liquidity or cash flow for any prior period.

Avid said it is also reassessing its accounting for certain restructuring expenses related to lease obligations and other exit activities in the quarters ended June 30, 2012 and September 30, 2012. While Avid continues to analyze the accounting treatment of these restructuring expenses, it has concluded that it has improperly accounted for such restructuring expenses and currently estimates that the restructuring expenses may have been cumulatively overstated by approximately $3.5 million on a pre-tax basis at September 30, 2012.

Avid’s management, including its Chief Executive Officer and Chief Financial Officer, has concluded that the company’s disclosure controls and procedures and internal controls over financial reporting were not effective as of December 31, 2012 or March 31, 2013 because of the material weaknesses in the company’s internal controls over financial reporting relating to the matters disclosed in the Company’s Form 10-Q for the quarterly periods ended September 30, 2012, June 30, 2012 and March 31, 2012, and for the treatment of software updates described previously.

Avid said its evaluation of current and historical accounting treatment related to software updates is ongoing, and that it may identify additional issues that could require further adjustments to the company’s prior financial statements for one or more prior fiscal years or periods.

Avid says it is working diligently to complete the review and continues to focus its efforts on completing and filing the delayed periodic reports, including restatements, as soon as possible. During this evaluation, the company plans to continue to invest in its product innovation and execute on its growth strategy.

 

The company also said it “believes it is well positioned to support its customers’ ongoing success.”

Ordinarily, this kind of statement sounds like typical PR spin, but in the case of Avid, our research shows that this is indeed the case.  Despite its widely-reported problems of late, the company continues to enjoy strong loyalty from its broadcast industry customer base.  However, if the market begins to perceive that there is a cloud of uncertainty over Avid’s future, things could deteriorate in the future. Thus far, Avid has done a good job of communicating with the market during its accounting review process. Now the company must resolve its issues, and get back to focusing 100 percent on meeting the needs of its customer base.

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Related Content:

Avid Receives Another Notice of Potential NASDAQ Delisting, Submits Plan to Regain Compliance

Press Release: Avid Announces Receipt of Second Anticipated NASDAQ Letter and Initial Determinations of its Accounting Evaluation

Avid 8-K Filing:

Greenfield Resigns from Avid Board of Directors

Avid Replaces Chief Financial Officer

Avid Receives Notice of Potential Delisting From NASDAQ for Failure to Submit 10-K Filing

Avid Delays Release of Q4 and Full Year 2012 Results, Shares Fall

Greenfield Out as Avid CEO, Replaced by Louis Hernandez

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Avid Receives Another Notice of Potential NASDAQ Delisting, Submits Plan to Regain Compliance

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
May 22 2013

Avid been notified by NASDAQ that, due to the company’s delay in submitting various regulatory filings, it remains non-compliant with NASDAQ’s Listing Rules.

Failure to regain compliance could result in the delisting of Avid’s shares from the NASDAQ Global Select Market.

The company said the latest notification was expected, as it was issued in accordance standard NASDAQ procedures, and that it has no immediate effect on the listing of Avid’s common stock on the NASDAQ Global Market.

Avid’s issues with NASDAQ, which have been going on for several months, stem from an internal investigation into how it historically recognized certain types of service revenues.

In February 2013, Avid announced that it would delay the release of its Q4 and full-year 2012 results in order “to provide additional time for the company to evaluate its current and historical accounting treatment related to bug fixes, upgrades and enhancements to certain products which the company has provided to certain customers.”

In March 2013, Avid delayed the filing of its annual Form 10-K with regulators.  The company also subsequently delayed its annual shareholder meeting.

On May 172013, the company received  notification from NASDAQ that it remains non-compliant with NASDAQ Listing Rule 5250(c)(1) due to Avid’s delay in filing its Form 10-Q for the first quarter ended March 31, 2013.  This requires timely filing of periodic reports with the SEC as a condition of being listed on the NASDAQ Market.

Avid has now submitted to NASDAQ explaining how it expects to regain compliance with NASDAQ’s continued listing requirements.

If the plan is accepted, Avid expects to have up to 180 calendar days from the initial due date for the Form 10-K, or until September 16, 2013, to regain compliance.

If the plan is not accepted, Avid will have the opportunity to appeal that decision to a NASDAQ Hearings Panel.

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Related Content:

Press Release: Avid Announces Receipt of Second Anticipated NASDAQ Letter and Initial Determinations of its Accounting Evaluation

Greenfield Resigns from Avid Board of Directors

Avid Replaces Chief Financial Officer

Avid Receives Notice of Potential Delisting From NASDAQ for Failure to Submit 10-K Filing

Avid Delays Release of Q4 and Full Year 2012 Results, Shares Fall

Greenfield Out as Avid CEO, Replaced by Louis Hernandez

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EVS Revenue up 9.2% in Q1 2013, Driven by Strong Performance in APAC

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
May 21 2013

Production and playout video server specialist EVS reported that its revenue for the first quarter of 2013 was €32.8m, an increase of 9.2% versus the same period last year, and an increase of 28.4% versus the previous quarter.   Excluding impact of exchange rates and large rental contracts, (a large, but lumpy part of EVS’s revenue), the company’s Q1 2012 revenue was up 9.4% versus last year.

Net profit in the quarter was €10m, up 15.8% versus the same period a year ago, and up 128% versus the previous quarter.

EBIT (earnings before interest and tax) in the quarter was €14.5m, up 6.7% compared to the same period last year, and up 179% versus last quarter. The corresponding operating margin for the quarter was 44% down slightly from 45.1% last year, and up from 20.3% last quarter.

Gross margins for the first quarter were 79.6%, up from 77.6% last year slightly versus last year, and up from 67.3% last quarter (Last quarter, EVS company set-up a new provision of €1m for 2-years standard technical warranty. Excluding this provision, gross margins last quarter would have been 71.2%). The company attributed is margin expansion to the leveraging effect of higher sales on fixed operations costs.

Operating expenses increased by 19.2% versus the same period a year ago, due to increased headcount, the acceleration on some strategic R&D projects, and some costs relating to the setup of the company’s new strategy.

R&D expenses in the quarter were €5.8m, or 18% of revenue, up 14% from the same period last year, and down 9% versus last quarter, when the company brought on R&D contractors to accelerate certain R&D projects.

Selling and administrative expenses in the first quarter of 2013 were €5.6m, or 17% of revenue, up 25% versus the same period a year ago, and up 41% versus the previous quarter.

The company ended the quarter with 465 employees, up from 463 at the end of last quarter, and up 9% from 428 employees at the end of Q1 2012.  EVS added 48 full-time employees in 2012, including 25 in the fourth quarter in order to “accelerate some strategic R&D developments.” The still has 20+ open position, however it now says that it plans to reduce OpEx growth compared to previous years.

EVS CFO Jacques Galloy said the results were in line with the company’s expectations, and highlighted the fact that the company’s revenue is growing faster than the overall market. Galloy also said that he expects the second of 2013 to be stronger than the first half of the year as customers prepare for major sporting events in 2014.

 

Order Book:

The order book stood at €42.9m as of May 10, 2013, essentially flat compared to February 15, 2013.  This includes €32.8m worth of orders to be delivered in 2013 and €10.1 worth of orders, to be delivered in 2014 (up from €5.6m last quarter).

The company highlighted the fact that its ENM order book more than doubled in during the first quarter of 2013 to €7m, on the back of significant orders.

 

Segment Revenue:

As of this quarter, EVS has changed the way it reports segment revenue.  The company, which previously reported revenue in the “OB” and “Studio” segments, now breaks out its revenue by market (Sports, ENM and Big Events), by Region (APAC, EMEA and Americas) and by nature (Systems and Services).

Approximately 90% of former OB and 50% of the former studio segments are now allocated to “Sports,” while about 10% of former OB as well as 50% of studio is now allocated to ENM.

  • Revenue from sports-related applications during the first quarter of 2013 were €27.2m, or 82.8% of total group sales, an increase of 19.3% versus last year. The company said revenue from sports-related customers increased due to new OB and sports center projects across many countries.
  • Revenue from Entertainment, News & Media (ENM) during the quarter was €5.6m, or 17.2% of total group sales, down 22.5% compared to last year. The company attributed the decline in ENM to a large project delivered in Q1 2012, which was not repeated.
  • Systems revenue in the quarter was €31.2m, or 95% or total revenue, up 10.5% versus last year.  Services revenue was €1.6m, or 5% of total revenue, down 11.2% versus last year.

 

 

Geographic Revenue:

  • Revenue from EMEA in the first quarter of 2013 was €14.2m, down 19.4% last year, Sales in EMEA accounted for 43% of group revenue, down sharply from 59% last year.  The company said EMEA revenue was in-line with expectations, and that “Eastern Europe, UK and Northern Europe are most dynamic while Mediterranean area remains weak.”
  • Americas revenue for the first quarter of 2013 was €8.4m, up 50.1% versus last year. Americas accounted for 41.2% of group revenue, up significantly from 19% last year. The company attributed the growth in the Americas region to a strong order book rather than new deals.  EVS said it “shall be a challenge to match the record 2Q12 sales numbers of €12.7m as the order intake in the America’s is weaker than expected.”
  • Q1 2013 revenue from the APAC region was €10.2m, up 50.5% versus last year. The company says it is “gaining market share in this buoyant region which is delivering above expectations, in particular in Australia and Japan.” APAC accounted for 31% of total revenue in Q1 2013, up from 23% last year.

 

Outlook:

The company said it is “optimistic about the long term prospects of the group, underpinned by robust long term growth drivers,” and maintained its previously issued guidance.

Management said that sales in the second half of the year should be better than first half as it shall start benefiting from the traction of big sporting events in 2014 (also in emerging countries) as well as the first impacts of the new strategy

However, management cautioned that the company has low visibility in the current state of the economy, and that because the company “targets small niches where the combination of infrastructure reliability, applications agility and service quality are essential success criteria; tt should be clear that risk factors such as economic uncertainties, balance-sheets constraints of clients or major currencies fluctuations do not make short-term forecasting easy.”

EVS also said that its “operating expenses should grow by a low double digit rate, which should normally translate in lower margins.”

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“The first quarter delivered by our company is encouraging,” said EVS CEO Joop Janssen. “In an uncertain macro-economic environment, we posted again a solid performance. While some regions and countries go through challenging times more than others, the global reach and EVS’ strong brand and product position gives us confidence to deliver our ambitious plan. We are in particular proud of our very good progress in APAC where in addition to a strong market development our share in it seems to grow even more rapidly in the quarter. Our new strategy, launched in February of this year is now fully in place and very well received by our markets at the yearly global Media tradeshow (NAB) in mid-April. EVS launched an impressive number of new products in all of our four target markets. The execution of the new organization plans is well on track. As indicated earlier we have brought our headcount growth further under control while concentrating on leveraging our investments in new product innovation.”

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Related Content:

Press Release: EVS Reports First Quarter 2013 Results

EVS Q1 2013 Earnings Presentation

Previous Quarter: EVS Posts Record Revenue in 2012, Unveils New Strategy and Vision for Future

Previous Year: EVS Reports Record Revenue and Order Book in Q1 2012

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Vitec Group Says 2013 Trading In-line with Expectations, Videocom Markets Remain Challenging

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
May 21 2013

The Vitec Group said in an interim management statement that its trading results for the first four months of 2013 have been in-line with its expectations.

However, the company said that the “macroeconomic environment remains challenging and we continue to control our costs accordingly. The streamlining of certain of our operations, outlined in our 2012 full year results announcement, is progressing in line with our plans. Although our order book visibility is limited, the Board’s expectations for the full year remain unchanged.”

Vitec said that its broadcast-focused Videocom division “performed satisfactorily in what continues to be a challenging market.”

Vitec’s broadcast-focused Videocomm division is made up of more than dozen brands that serve various parts of the broadcast industry: Anton/Bauer, Autoscript, Camera Corps, The Camera Store, Haigh-Farr, Litepanels, Microwave Service Company, Nucomm, OConnor, Petrol Bags, RF Central, Sachtler, Vinten and Vinten Radamec.

Broadcast equipment rental and services provider Bexel is also part of Vitec’s Videocom division.

The Vitec Group’s revenue for the full year 2012 was £345.3m, down 1.6% versus last year. The company’s 2012 profit before tax and acquisition-related costs was £36.2m., up 10% versus 2011.

Full year 2012 revenue for Vitec’s division was £146.2m, up 7.3% versus 2011.  Videocom operating profit for the year was £15.8m, up 24.4% versus last year. Videocom operating margin was 10.8%, up 1.5 percentage points versus 2011.

The company said that demand for Videocom products was driven by greater use of video capture, investments by broadcasters and technology drivers, as well as by the 2012 Olympics and the US elections.  However, it cautioned that Videocom order visibility is limited.

As of April 30, 2013, the Vitec Group had net debt of £66m, compared to net debt of £63.7m on December 31, 2012.

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Related Content:

Press Release: Vitec Group – Interim Management Statement

Vitec Group 2012 Annual Report (published March 2013)

Vitec 2012 Results: Videocom Revenue Up 7.3 Percent, Bexel Doubles Operating Profit as Revenue Increases 4.4 Percent

Previous Interim Statement: Vitec Group Says Trading In-line with Expectations Despite Challenging Macroeconomic Environment

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Greenfield Resigns from Avid Board of Directors

Broadcast technology vendor financials, Quarterly Results, SEC Filings | Posted by Joe Zaller
May 20 2013

Former Avid CEO Gary Greenfield has resigned from the company’s board of directors.

Greenfield, who was replaced as CEO and president of Avid by Louis Hernandez in February 2013 remained a board member of the company after stepping down from his executive role.

According to a regulatory filing, Greenfield’s term as director was scheduled to expire at the company’s 2013 annual meeting of stockholders.

However, in February 2013, Avid announced that it would delay the release of its Q4 and full-year 2012 results in order “to provide additional time for the company to evaluate its current and historical accounting treatment related to bug fixes, upgrades and enhancements to certain products which the company has provided to certain customers.”

Avid subsequently postponed its 2013 annual meeting of shareholders.

Avid said that because its annual meeting has been delayed, Greenfield decided to resign from his position as director of the Company so that he could attend to other commitments.  Greenfield submitted his resignation as a director on May 15, 2013, effective immediately.

Avid said that Greenfield’s decision to resign was mutually agreeable and amicable and not a result of any disagreement or dispute with the company or its management.

Greenfield’s departure as CEO was followed in April 2013 by the departure of Ken Sexton, who had served as CFO under Greenfield. At that time, Avid said Sexton would continue on in a consulting capacity, for an initial period ending September 30, 2013, and work closely with Frederick in order to ensure a smooth transition.

Sexton was replaced as CFO by John Frederick, who joined the company in February 2013 as Chief of Staff.  Prior to joining Avid, Frederick was the Corporate EVP and CFO at Open Solutions, where Hernandez was previously CEO.

In addition to postponing its annual shareholder meeting due to its accounting review, Avid also delayed the filing its annual 10-K with securities regulators. As a result, Avid was notified by NASDAQ in March 2013 that the company no longer complies with NASDAQ Marketplace Rule 5250(c)(1), which requires timely filing of periodic reports with the SEC.  Failure to comply with this rule could result in the delisting of Avid’s shares from the NASDAQ Global Select Market.

At that time, Avid said it was “working diligently to complete the review and continues to focus its efforts on completing the Form 10-K filing as soon as possible,” and that it intends to submit a plan to NASDAQ staff as to how it intends to regain compliance with continued listing requirements.

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Related Content:

Avid 8-K Filing: Greenfield Resigns From Avid Board

Avid Replaces Chief Financial Officer

Avid Receives Notice of Potential Delisting From NASDAQ for Failure to Submit 10-K Filing

Avid Delays Release of Q4 and Full Year 2012 Results, Shares Fall

Greenfield Out as Avid CEO, Replaced by Louis Hernandez

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Autodesk Media & Entertainment Revenue Drops 8% in Q1 FY 2014, Readies Cloud-Based Launch

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
May 17 2013

Autodesk reported that its Q4 FY 2013 revenue from its Media and Entertainment segment (M&E) was $47m, a decline of 8% versus the same period a year ago, and flat compared to the previous quarter.

M&E gross margins for the quarter were $37m (79%), down from 82% for the same period a year ago, and flat compared to the previous quarter.

Autodesk’s M&E revenue has been in decline for the past several quarters — something the company has said for the past year that it expects to continue as it incorporates greater functionality into its design suites.

The company also plans to introduce new revenue models for M&E customers, including cloud-based rental.

On the company’s conference call with equity analysts, company CEO Carl Bass said that Autodesk will soon begin rolling out a cloud-based suite of products for applications for various markets including M&E, whose customers company believes is ideally suited for this approach. “I think that’s just the nature of the work within the industry is more project-based. The economic structure of the industry revolves around projects in both of those industries. I think they’re going to be far more attractive in Media and Entertainment than they will in Manufacturing.”

“Starting this summer, we will roll out term-based or rental offerings of some of our suites and select individual products. These rental offerings of our desktop products are designed to give our customers even more flexibility in how they utilize our products and will provide us with new ways to take advantage of new market opportunities. These offerings are based on a significantly different model, and we expect adoption and consumption of our cloud and rental offerings to increase gradually over time.”

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Related Content:

Press Release: Autodesk Reports First Quarter Results

Autodesk Q1 FY 2014 Earnings Call Transcript

Pervious year: Autodesk Media & Entertainment Revenue Slips 5 Percent in Q1 2012

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Chyron Revenue Up 2 Percent in Q1 2013, Gives Update on Merger, Layoffs, and Potential NASDAQ Delisting

Broadcast technology vendor financials, Broadcast Vendor M&A, Quarterly Results, SEC Filings | Posted by Joe Zaller
May 10 2013

Broadcast graphics specialist Chyron reported that its revenue for the first quarter of 2013 was $8.01m, up 2% versus the same period a year ago, and up 8% versus the previous quarter.

The net loss for the quarter was $921,000, or $0.05 per share, compared to a net loss of $951,000, or $0.06 per share last year, and a net loss of $20m, or $1.17 per share, last quarter, when the company took a $19.5m valuation allowance against the company’s deferred tax assets (see below for implications).

The operating loss for the first quarter of 2013 was $810,000, compared to an operating loss of $1.074m last year, and an operating loss of $570,000 last quarter.

The company’s net loss and operating loss were both impacted by transaction costs associated with Chyron’s pending merger with Hego AB, which was announced in March 2013. Excluding Hego transaction costs, net loss would have been $220,000, and the operating loss would have been $110,000.

The company’s service revenue, which includes the sales of its AXIS cloud-based graphics service, maintenance agreements, training and creative services was $2.04m in the quarter, or 25% or total revenue. This is a decrease of 2% versus the same period a year ago, and a decrease of 7% versus the previous quarter.  The company the lower service revenue to lower revenues from training and other professional services offset by increased sales of software and hardware maintenance contracts for broadcast graphics products.

Product revenue in the quarter was $5.97m (75% of total revenue), an increase of 3% versus Q1 2012, and an increase of 15% versus last quarter.  The company said it experienced a slight increase in product revenue as a result of an improvement in market share in Asia and a major program upgrade in our European market. However, sales fell in North America, due to price competition and weak demand. Sales in Latin America also declined during the quarter.

Gross margins for the quarter were 71%, up from 70% last year, and up from 69.1% last quarter.

Operating expenses for the first quarter of 2013 were $6.53, up 1% compared to last year, and up 15% versus the previous quarter. Excluding Hego transaction costs, operating expenses would have been $5.84m, or 12% lower than the same period a year ago.

Last quarter, Chyron combined its reporting of sales and G&A expenses.  This quarter it did not break out its expenses at all, making it difficult to determine the full impact of the cost-cutting exercise that the company embarked upon several quarters ago.  However, the company did say that its expenses in both research and development and sales and marketing, were essentially flat with the previous year when Hego transaction costs are excluded.

The company ended the quarter with $2.3m in cash, versus $2.4m last quarter.

 

Update on Latest Round of Staff Layoffs

Prior to the release of its Q1 2013 earnings, Chyron disclosed that it has cut the size of its workforce by 20 employees as part of a reorganization plan designed to “reduce operating expenses while maintaining its focus on strategic initiatives.”

The company says that it will take a charge of approximately $950,000 in Q2 2013 to cover the cost of the staff reduction, and that these actions will result in savings of approximately $3m on an annualized basis, beginning in the third quarter of 2013.

Chyron has reduced the size of its employee base by more than 30% since the end of Q1 2012.  At that time, the company had 126 employees.  There were 107 employees at the end of Q1 2013; and there are now 86 employees following the latest round of staff cuts.

Chyron CEO Michael Wellesley-Wesley told investors that the layoffs came after “eight weeks of very, very rigorous studying and discussion as to where these changes should be made,” and that the cuts were made “across the board.”

According to Wellesley-Wesley, the only departments not impacted by the layoffs were the company’s customer service department and customer-facing product specialists. Sales, engineering, internal administration, and “quite a layer of mid and senior management figures were affected,” he said.

The company will gain an additional 90 – 100 full-time employees following the completion of its pending merger with Hego AB.

 

Update on Potential Nasdaq Delisting:

In March 2013, Chyron received a letter from The NASDAQ Stock Market notifying the company that it is no longer in compliance with the minimum stockholders’ equity requirement for continued listing on the NASDAQ Global Market because its stockholder’s equity has fallen below the minimum $10m threshold set by NASDAQ Listing Rule 5450(b)(1)(A).

If it does not regain compliance with the Rule, Chyron’s shares could be delisted from Nasdaq.

On the company’s earnings call, Wellesley-Wesley said that the company’s stockholders equity fell below this level at the end of the previous quarter as the result of the company taking a $19.5m valuation allowance against the company’s deferred tax assets (described above).

Wellesley-Wesley said that because this allowance reduced the company’s shareholders’ equity by $19.5m, the company ended the year 2012 with shareholders’ equity of about $1.9m, which put it in violation of Nasdaq’s listing requirement.

Wellesley-Wesley said the company has filed a plan of compliance with Nasdaq, and that a primary element of this plan is the company’s proposed merger with Hego, which the company believes will bring with it enough shareholders’ equity to bring the company’s total about $10m.

However, Wellesley-Wesley cautioned that regaining compliance with Rule 5450(b)(1)(A) was not a certainty because of additional one-time charges will be recorded in the second quarter of 2013.  These include a charge of approximately $950,000 for the headcount reduction that the company enacted at the beginning of May 2013,  and a second charge of approximately $1.3m due to the early vesting of equity awards upon the closing of  the Hego transaction.

Nevertheless, Wellesley-Wesley assured shareholders: “The bottom line is this – these shares are not going to be delisted. There are all kinds of ways that we can get back in compliance. We’ll make sure that we don’t get delisted.”

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Related Content:

Press Release: Chyron Reports Financial Results for the First Quarter 2013

Previous Quarter: Chyron Posts Another Loss in Q4 2012 as Revenue Continues to Decline

Previous Year: Revenue and Losses Up at Chyron in Q1 2012

Chyron Lays Off 20 Employees, Says it will Save $3 Million per Year

Chyron Receives Another Delisting Notice From NASDAQ

More Broadcast Vendor M&A: Chyron to Acquire Hego Group in All-Stock Deal

Chyron – Hego Stock Purchase Agreement

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DTS Q1 2013 Revenue Rises 22 Percent

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
May 09 2013

Audio processing specialist DTS announced that its revenue for the first quarter of 2013 was $32.7m, an increase of 22% versus the same period a year ago, and an increase of 10% versus the previous quarter.

The company said its network-connected business, which includes cone ted TVs, PCs and mobile devices, grew 246% year-over-year, but that sales to DVD and Blu-ray.

The GAAP net loss for the first quarter of 2013 was $1.5m, or $0.08 per share, compared to GAAP net income of $4m, or $0.24 per share, in the first quarter of 2012. Non-GAAP net income in the quarter was $4m, or $0.22 per share net of tax, compared to non-GAAP net income of $6.2m, or $0.37 per share net of tax, in the first quarter of 2012.

The GAAP operating margin in the first quarter of 2013 was 3%, compared to 26% in the first quarter of 2012. The non-GAAP operating margin in the first quarter of 2013 were 21%, down from 38% in the first quarter of 2012.

The results beat the expectations of equity analysts who were looking for revenue of $30.23m and non-GAAP net income of $0.14.

The Company closed the quarter with cash and investments totaling $76.6 million.

“DTS delivered strong revenue growth in the first quarter, consistent with our expectations, driven again by accelerating momentum in the network-connected markets,” said DTS chairman & CEO Jon Kirchner. “The strategic investments we have made in technology, products and content partnerships to expand our network-connected footprint are continuing to translate into meaningful design wins and customer momentum, particularly in mobile. The recent launches of our Headphone:X and DTS Layered Audio technologies continue to generate significant industry excitement. These launches, combined with new product and customer announcements during the quarter from a number of manufacturers, including Toshiba, Asustek, Samsung and Yulong, position us well to continue to drive our network-connected business in 2013 and beyond.”

 

Business Outlook

The Company continues to expect 2013 revenue in the range of $140 to $146 million, including a normal level of royalty recoveries, non-GAAP operating margin in the low- to mid-20s and non-GAAP EPS in the range of $1.05 to $1.20 per diluted share based on a normalized 40% effective tax rate. Stock-based compensation expense is expected to be in the range of $0.44 to $0.47 per diluted share net of tax and amortization of intangibles is expected to be in the range of $0.39 to $0.42 in 2013. On a GAAP basis, the Company expects an operating margin of approximately 3% to 6% and now expects EPS in the range of $(0.05) to $0.00 per diluted share.

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Related Content:

Press Release: DTS Reports First Quarter 2013 Financial Results

Previous Quarter: DTS Reports Fourth Quarter and Fiscal 2012 Financial Results

Previous Year: DTS Reports First Quarter 2012 Results

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Dolby Beats Expectations in Fiscal Q2

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Apr 30 2013

Dolby announced that its revenue for the second quarter of fiscal year (FY) 2013 was $249.3m, down 5% versus the same period a year ago.

Second quarter FY 2013 GAAP net income was $61.9m, or $0.60 per share, down 30% from $88.1m, or $0.81 per share, last year.

Non-GAAP net income in for the quarter was $76.4m, or $0.74 per share, down from $99.2m, or $0.91 per share, last year.

Despite the lower year-over-year revenue and earnings, the company’s performance significantly exceeded the expectations of analysts, and sent its shares higher.

“In the second quarter, we continued to grow our presence in the broadcast and mobile markets,” said Dolby president & CEO Kevin Yeaman. “In addition, key partners endorsed our newest technologies. BT unveiled the first business conferencing service with Dolby Voice, and James Cameron and Vince Pace’s Cameron Pace Group is backing our Dolby glasses-free 3D format.”

 

Financial Outlook

Dolby says it anticipates total FY Q3 revenue to be in the range of $205m to $215m, with gross margins of approximately 89% on a GAAP basis and 90% on a non-GAAP basis.

The company anticipates that FY Q3 operating expenses will be approximately $145m on a GAAP basis and $125m on a non-GAAP basis.

Fiscal Q3 EPS is expected to be between $0.26 and $0.32 on a GAAP basis and between $0.42 and $0.49 on a non-GAAP basis.

For the full year FY 2013 Dolby now anticipates that total revenue will be in the range of $910m to $940m, and that operating expenses will be approximately $572m on a GAAP basis and approximately $500m or less on a non-GAAP basis.

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Related Content:

Press Release: Dolby Laboratories Reports Second Quarter Fiscal 2013 Financial Results

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Dalet Issues Final 2012 Results, Revenue Up 10 Percent

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Apr 12 2013

MAM specialist Dalet announced that its board of directors have approved the company’s consolidated financial statements for the 2012 fiscal year.

Consolidated revenue for the year ended December 31, 2012 was €34.4m m, compared to €31.3 m (+10%) in 2011.

Gross margin for the year was €29.7m, compared to €25.2m in 2011. The gross margin rate for 2012 increased from 81% in 2011 to 86%, due to the strong shift away from the Italian subsidiary’s traditional hardware integration business in its domestic market.

The operating profit before non-recurring items for the year was €1.7m, compared to €1.3m in 2011 (+29%).
After taking into account a depreciation of the goodwill of the Italian subsidiary for €0.2 m, the operating profit was €1.5m.
Consolidated net profit for 2012 was €1.2m, compared to €1.3m in 2011.

The company ended the year with €6.5m in cash, up from €5.1m at the end of 2011, and long term debt increased from €1.1m to €1.6m.

Dalet CEO David Lasry said “In 2012 we continued a steady growth trend in revenue and profitability which has confirmed our strategy to provide MAM-driven solution to key market segments. The growth in North America has been significant, especially as related to the sports segment where we are achieving a recognized presence with several successful project deployments and new contracts.”

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Related Content:

Dalet Press Release: Financial Results for 2012

Dalet Reports 10 Percent Revenue Growth in 2012 Thanks to Strong MAM Sales

Previous Year: Dalet Revenue Jumps 22 Percent in 2011, Reports Strong Backlog for 2012

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