Posts Tagged ‘Anthony Gridley’

International Sales and IP Adoption Drive Evertz Quarterly Growth

Analysis, Broadcast technology vendor financials, Quarterly Results | Posted by Josh Stinehour
Mar 09 2016

Evertz announced revenue for the third quarter of its 2016 fiscal year was C$99.8 million, up 10% versus the same period a year ago, and down 1.0% versus the previous quarter.evertz-logo

Net earnings for the quarter were C$24.4 million (C$0.32 per share), up 15.1% versus the same quarter last year, and up 24% versus the previous quarter. The company generated C$49.6 million cash from operations in the quarter, up from C$27.5 million cash used last year, and C$23.6 million generated last quarter.

The revenue result (second highest in Evertz history) was slightly above the consensus estimates of equity analysts, who were looking for revenue of $C97.5m.  Consensus earnings expectations for the quarter were C$0.24 per share.

Evertz EVP Brian Campbell attributed the strong performance to ongoing industry technical transition to IP networking and file-based workflow.  Brian Campbell also highlighted the growing adoption of Evertz’s IP-based software-defined networking solutions, compression solutions, and DreamCatcher IP-based replay and production suite.

Revenue in the US/Canada region was C$53.5 million, flat versus the same period a year ago, and down 12.4% versus the previous quarter. US/Canada sales were 53.7% of total revenue during the quarter, down from 59% of revenue during the same period a year ago, and 60.8% of revenue last quarter.

International revenue was C$46.2 million, an increase of 24% versus the same period last year, and up 17.5% versus the previous quarter. International sales were 46.3% of total revenue, up from 41% last year, and 39.2% last quarter.

The top ten customers in the quarter accounted for 36% of revenue (C$35.9 million), and the no customer in the quarter accounted for more than 11% of revenue (C$10.9 million). Altogether Evertz had 78 orders in the quarter that were greater than C$200,000 (the same as last year, and down from 82 last quarter).

Gross margins in the quarter were 57.1%, up from 57.6% last year and up from 57.2% last quarter. Evertz CFO Anthony Gridley reiterated the gross margin performance in the quarter was within the company’s target range of 56% to 60%.

R&D expenses in the second quarter were C$17.2 million, an increase of 8.8% versus the same period last year, and up 6.8% versus the previous quarter.  R&D expenses were approximately 17.2% of revenue in the quarter, higher on a percentage basis than last year (16.1%) and last quarter (16%).

Selling and administrative expenses for the quarter were C$15.1 million, an increase of 2.0% versus last year, and a decrease of 7.9% versus the previous quarter. Selling and administrative expenses represented approximately 15.2% of revenue in the quarter versus 16.3% of revenue during the same period last year, and 16.3% of revenue last quarter.

The company said that its shipments in February 2015 were C$28m, and that its purchase order backlog at the end of the third quarter were in excess of C$60 million, down slightly from the C$66 million figure in the second quarter.  Combination of the shipments and backlog (C$88 million) represents a 5% increase versus the same period last year.

The company ended the quarter with $129.9 million of cash and short term investments up from C$97.5 million at the end of last quarter, a difference of C$32.4m.  Cash generation in the quarter benefited from a C$18.7 million positive impact from changes in non-cash working capital accounts.

Management’s exchange with equity analyst Robert Young from Canaccord Genuity on the earnings call was worth highlighting for its commentary on the current competitive dynamic in the market:

Robert Young (Canaccord): … they (a competitor) also called out the number of IP projects that they booked and the number that they shipped. I was wondering, would you be willing to share a similar metric?

Brian Campbell (Evertz): Thanks, Robert. So in terms of the metric, what is more important for us would be to showcase the on-air installs. We’re quite familiar with the ESPN DC-2 that really launched the industry’s move to IP-based solutions for live production and workflow. And if we just even look to the recent Super Bowl 50, there’s been several industry articles highlighting the fact that the CBS Super truck was there as part of the coverage, or actually, the centerpiece of the coverage. That’s an industry pioneering, one of several that incorporates Evertz Software Defined Video Networking. In fact, it’s an EXE hyperscale, 23-terabit switch in that truck. And in addition, the Levi’s Stadium is a state-of-the-art stadium. It includes Evertz solutions, and for Super Bowl 50, there was an overlay of our Software Defined Video Networking helping to provide the coverage that folks saw at the Super Bowl and also the 4K replay for the in-stadium venue experiences.

 

 

Related Content:

Evertz Q3 2016 MD&A

Evertz Q3 2016 Financial Statements

 

 

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Evertz Revenue Declines 3 Percent in Q3 FY 2015, Cites New Wins in Tough Market

Broadcaster Financial Results, Quarterly Results | Posted by Joe Zaller
Mar 05 2015

evertz-logo

Evertz announced that revenue for the third quarter of its 2015 fiscal year was C$90.7m, down 3% versus the same period a year ago, and up 9.5% versus the previous quarter.

Net earnings for the third quarter were C$21.2m (C$0.28 per share), down approximately 1% versus the same quarter last year, and up 47.9% versus the previous quarter.

The company generated C$27.5m cash from operations in the quarter, up from C$24.4m, last year, and C$17.5m last quarter.

The results (which were the fourth highest sales quarter in the history of the company), were in line with the consensus estimates of equity analysts.

Evertz EVP Brian Campbell said that the company’s revenue in the quarter was well-diversified, with the top 10 customers accounting for approximately 38% of sales.  The company had 72 orders of more than C$200,000 during the quarter (versus 78 last year, and 71 last quarter), and no single customer represented more than 7% (C$6.35m) of revenue.

According to Campbell, the company’s product mix profile during the quarter was “very consistent with the last few quarters,” specifically citing success with its EXE and IPX IP routing products, the DreamCatcher replay system, video compression products, and IRDs.  Campbell said that these new product families pull through traditional processing and infrastructure equipment with them.”

As evidence of this pull-through effect, Campbell highlighted how the “recent adoption of Evertz new Integrated Receiver/Decoder technology by a leading US national broadcast network customer, resulted in the purchase order of over C$10m” for Evertz IRDs, compression products, infrastructure products, and monitoring & control solutions.

Looking specifically at IP routers, Campbell said that although Evertz has not announced many wins for its EXE IP-based router (which it also calls SDVN), the company continues to have very good success with the EXE at its 46 terabit size, and has recently started to gain traction in the mobile production community with a newly introduced half-rack version of the EXE, which has a throughput capacity of 23 terabit per seconds.  Campbell added that the company currently has “in excess of 30 customers” for the EXE and IPX IP-based router products, and customer demand for these products remains “very good,” particularly with sports trucks, where the company is winning new business.

Revenue in the US/Canada region was C$53.6m, down 2.5% versus the same period a year ago, and up 18.1% versus the previous quarter. US/Canada sales were 59.1% of total revenue during the quarter, flat with the same period a year ago, and up from 54.7% of revenue last quarter. Evertz does not provide details of currency adjusted trading, but one analyst estimated that revenue in the US/Canada region was likely down 10% on a constant currency basis.

International revenue was C$37.2m, down 2.5% versus the same period a year ago, and down 1% versus the previous quarter. International sales were 41% of total revenue, flat with last year and down from C$45.2m last quarter.

Commenting on the US versus international results, Campbell said Evertz was “seeing good strength in the Canada/US region,” but internationally “there is a fair bit of geopolitical and economic instability,  so whether that’s Russian, Ukraine, parts of the Middle East or elsewhere, we are in a fairly challenging global economic market.”

Gross margins in the quarter were 56.2%, down from 57.6% last year and flat with the previous quarter. Evertz executives said that the gross margin performance in the quarter were within the company’s target range of 56% to 60%.

On the earnings call, RBC Capital analyst Steve Arthur asked why the company’s gross margins are “stubbornly at the lower end of your traditional range,” and what it will take to move gross margins “up towards the middle part of the 56 to 60 kind of range.” Evertz CFO Anthony Gridley said that gross margins in the quarter were driven by product mix, and that gross margins vary between geographies.  Gridley also said that “some of the larger scale projects can sometimes have lower margins, and this this quarter, we had some positives from currency, but they were offset by some few lower margin deals,” resulting in the 56% level.

R&D expenses in the third quarter were C$15.8m, an increase of 4.8% versus the same period last year, and up 4.3% versus the previous quarter.  R&D expenses were approximately 17.4% of revenue in the quarter, up from 16.1% last year, down from 18.2% last quarter when revenue was slightly lower.

Selling, general and administrative expenses for the quarter were C$16.4m, down 5.3% versus the same quarter last year, and essentially flat with the previous quarter. SG&A expenses represented approximately 18.1% of revenue in the quarter versus 18.6% of revenue during the same period last year, and 19.8% of revenue last quarter.

The company said that its shipments in February 2015 were C$19m, and that its purchase order backlog at the end of the third quarter of fiscal 2014 was in excess of C$65m. The combined C$84m total backlog in shipments represents a 24% year-over-year increase.

Evertz ended the quarter with C$103.3m of cash and short term investments, up from C$90.4 at the end of last quarter.

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Related Content:

Press Release: Evertz Technologies Reports Results for the Third Quarter Ended January 31, 2015

Previous Year: Evertz Q3 FY 2014 Revenue Jumps 30 Percent on Big Deals in North America

Previous Quarter: Evertz Revenue Increases 2 Percent in Q2 FY 2015, Misses Analyst Estimates

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Evertz Misses Expectations as Revenue Dip 14 Percent in Q4 FY 2013, Still Delivers Record Full-Year Performance

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

Evertz announced that its revenue for the fourth quarter of its 2013 fiscal year was C$65.4m, down 14% versus the same period a year ago, and down 9% versus the previous quarter.

Net earnings for the quarter were C$10.52m (C$0.11 per share), down 40% versus the same quarter last year, and down 20% versus the previous quarter.

The results were well below the consensus expectations of equity analysts who were expecting revenue of C$73.2m and EPS of C$0.17. Analysts called the results “disappointing,” and noted that this was the company’s weakest quarter since Q4 2008.

Evertz EVP Brian Campbell said the company’s performance in the quarter had been impacted by the same type of macroeconomic issues seen across the technology sector in the first quarter of 2013, “where it’s pretty much in the first quarter sales have been off ten percent.” He also said that the European market had been weaker and is an area of concern for the company.

However, Campbell noted that the company does not necessarily see this as a long term trend, saying “I think it’s more a delay of spending as customers determine what they’re going to do in 2013.”

Revenue in the US/Canada region was C$33.3m, down 9.1% versus the same period a year ago, and down 1% versus the previous quarter.  US/Canada sales were 51% of total revenue during the quarter, up from 48% of revenue during the same period a year ago, and up from 47% of revenue last quarter.

International revenue was C$32.1m, down 19% versus the same period last year, and down 16% versus the previous quarter. International sales were 49% of total revenue, down from 52% last year, and down from 55% last quarter.

The company had 52 orders in the quarter that were greater than C$200,000 (down from 57 last quarter), and no single customer accounted for more than 5% of the company’s total revenue in the quarter.

Gross margins for the fourth quarter were 56.7%, up from 56% last year and up from 56.1% last quarter. Evertz CFO Anthony Gridley said that gross margins in the quarter were within the company’s historical range.

R&D expenses in the quarter were C$15.3m, an increase of 20.1% versus the same period last year, and up 17% versus the previous quarter.   R&D expenses were approximately 23.5% of revenue in the quarter, versus 15% last year, and 17% last quarter. Gridley attributed the sharp rise in R&D expenditure in the quarter to accelerated the purchase of materials and prototypes before the end of its fiscal year.  Gridley added that the company, which sees strong R&D as one of its differentiators, added engineers in the quarter and intends to continue adding engineers every quarter.

Selling and administrative expenses for the quarter were C$14m, an increase of 14% versus last year, and an increase of 2% versus the previous quarter. Selling and administrative expenses represented approximately 21% of revenue in the quarter versus 16% of revenue during the same period last year, and 19% of revenue last quarter.

The company’s purchase order backlog at the end of the third quarter of 2012 was in excess of C$35m, down from C$45m last quarter, and shipments during the month of May 2013 were $19 million.

 

Record Results for the Full Fiscal Year 2013

Revenue for the full year FY 2012 was C$316.3, up 8% versus the previous year, and a record result for the company.

The company’s top 10 customers accounted for approximately 25% of sales (C$79.1m) during the year, with no single customer representing over 5% (C$15.8m) of total annual revenue.

Full year fiscal 2013 net earnings were C$65.2m (C$0.88 per share), up 9% compared to net earnings of C$60m (C$0.81) in fiscal 2012.

During the year, the company had 246 orders of more than C$200,000, down from 282 in the previous year.

Full year revenue from the US and Canada revenue was $C173.2m, up 15.6% versus the full fiscal year 2012.  US/Canada revenue accounted for 55% of total revenue in fiscal 2013, up from 51% in fiscal 2012.

Full year revenue from the international region was $C143.1m, essentially flat with the previous year. International revenue accounted for 45% of total revenue in fiscal 2013, down from 49% in fiscal 2012.

Cash provided by operations was C$89.6 m for the 2013 fiscal year, up from C$66.6m in fiscal 2012. Before taking into account taxes and the changes in non-cash working capital, Evertz generated C$78.6m from operations for fiscal 2013, compared to C$73.0m for fiscal 2012.

Gross margins for the full year fiscal 2013 were 57.5%, up from 57% last year and within what company’s targeted range.

Full year R&D expenses were C$52.85m, an increase of 20% versus the previous year.   R&D expenses were approximately

Selling and administrative expenses for the fiscal year were C$53.1m, an increase of 13% versus fiscal 2012.  Selling and administrative expenses represented approximately 17% of full year revenue, up from 16% of full year revenue in fiscal 2012.

For the year ended April 30, 2013, the company used cash in financing activities of C$40.1m as a result of the payment of dividends of C$42.9m, repurchase of capital stock costing C$4.2m offset by the issuance of share capital of C$8m.

Campbell attributed the company’s record revenue to “continued worldwide demand for Evertz’s high-definition 3G and 4K video infrastructure offerings. More specifically, in success of Evertz’s comprehensive solutions delivering compelling value to our customers, and to the ongoing transition to high definition, and the increasing global demand for high-quality video.”

Campbell said the company remains “cautiously optimistic regarding the global economic environment, confident in Evertz’s ability to deliver compelling value and long-term stability to our customers. We’re encouraged by the Company’s continued solid performance in fiscal 2013, its record sales of C$316m, delivering net earnings of 21%, all while investing C$53m in R&D to fuel future growth. We are encouraged by the momentum we carry into fiscal 2014 with a purchase order backlog plus new shipments totaling over C$54m. With Evertz’s significant investments in new award-winning technologies, our comprehensive product offerings and the capabilities of our staff, Evertz is poised to build upon our leadership position.”

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Related Content:

Press Release: Evertz Technologies Reports Record Revenues in Fiscal 2013

Previous Quarter: Evertz Q3 FY 2013 Revenue Flat With Last Year, Down 14 Percent versus Last Quarter

Previous Year: Evertz Q4 FY 2012 Revenue Rises 11 Percent, Order Backlog at Record Level

More Broadcast Vendor M&A: Evertz Makes $5 Million Mystery Buy

Previous Quarter: Evertz Q2 Revenue Up 18 Percent Y/Y, Down 13 Percent Q/Q Following Record Q1 2013

Evertz Discloses Orders Worth More Than $12 Million From Two Mystery US Customers

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© Devoncroft Partners. All Rights Reserved.

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Evertz Q3 FY 2013 Revenue Flat With Last Year, Down 14 Percent Versus Last Quarter

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Mar 07 2013

Evertz announced that its revenue for the third quarter of its 2013 fiscal year was C$71.8m, essentially flat versus the same period a year ago, and down of 14% versus the previous quarter.

Net earnings for the quarter were C$13.2m (C$0.18 per share), up 6% versus the same quarter last year, and down 28% versus the previous quarter.

The results were below the consensus expectations of equity analysts who were looking for revenue of C$81.6m and EPS of C$0.24.

Investors did not like the news and sent the company’s stock down by more than 8% the first trading day after the results were issued.

Evertz EVP Brian Campbell attributed the lower than expected results to competitive pricing pressure and the delay of capital projects by customers.

Revenue in the US/Canada region was C$33.8m, up 6% versus the same period a year ago, and down 28% versus the previous quarter. US/Canada sales were 47% of total revenue during the quarter, up from 45% of revenue during the same period a year ago, and down from 56% of revenue last quarter.

International revenue was C$38m, a decrease of 4% versus the same period last year, and an increase of 4% versus the previous quarter. International sales were 53% of total revenue, down from 55% last year, and up from 44% last quarter.

The company had 57 orders in the quarter that were greater than C$200,000 (down from 70 last year, and 61 last quarter).

Gross margins in the quarter were 56.1%, down slightly from 56.2% last year and down from 59% last quarter. Evertz CFO Anthony Gridley said that gross margins in the quarter were within the company’s historical range.

R&D expenses in the second quarter were C$13.1m, an increase of 18.5% versus the same period last year, and up 4% versus the previous quarter.  R&D expenses were approximately 18% of revenue in the quarter, versus 15% last year, and 15% last quarter when revenue came in at C$96m.

SG&A expenses for the quarter were C$13.7m, an increase of 8% versus last year, and an increase of 5% versus the previous quarter. Selling and administrative expenses represented approximately 19% of revenue in the quarter versus 18% of revenue during the same period last year, and 16% of revenue last quarter.

The company’s purchase order backlog at the end of the third quarter of 2012 was in excess of C$45m, up from C$41m last quarter. Campbell said the bulk of this backlog will be delivered in the company’s fiscal Q4, but indicated that a portion of the backlog would be turned into revenue over multiple future quarters.

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Related Content:

Press Release: Evertz Technologies Third Quarter Fiscal 2013 Earnings Per Share Up 6%

More Broadcast Vendor M&A: Evertz Makes $5 Million Mystery Buy

Previous Quarter: Evertz Q2 Revenue Up 18 Percent Y/Y, Down 13 Percent Q/Q Following Record Q1 2013

Evertz Discloses Orders Worth More Than $12 Million From Two Mystery US Customers

Previous Year: Evertz Revenue and Earnings Decline in Fiscal Q3 2012 Despite Improving International Performance

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Evertz Beats Expectations in Q1 Fiscal 2013 as Profits Jump 41 Percent

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Sep 14 2012

Evertz announced that its revenue for the first quarter of its 2013 fiscal year was C$96m, an increase of 28% versus the same period a year ago, and up 26% versus the previous quarter.

Net earnings for the quarter were C$24.8m (C$0.34 per share), up 41% versus the same quarter last year, and up 87% versus the previous quarter.

The results for the quarter were well above the expectations of equity analysts, who on average were looking for revenue of C$84.9m and EPS of C$0.25.

Revenue in the US/Canada region was C$59.4, or 62% of total revenue, up 31% versus the same period a year ago, and up 62% versus the previous quarter.

International revenue was C$36.6m, an increase of 23% versus the same period last year, and down 8% versus the previous quarter. International sales were 38% of total revenue, down from 40% last year.

Evertz EVP Brian Campbell attributed the revenue growth to the ongoing transition to HD, a growing demand globally for high quality video, traction in the company’s workflow solutions from its purchase of Pharos, and several large projects that were recognized during the quarter.

The company had 76 orders in the quarter that were greater than C$200,000, and the top ten customers provided for 41% of revenue (C$39.4m), so Evertz clearly closed some big deals close during the quarter.

Significantly, one customer accounted for 15% of total revenue, or C$14.4m, during the quarter. C$14.4m is a huge order for any broadcast vendor, and this means that the company’s revenue during the quarter was significantly more concentrated than in the past.  For comparison, during the previous quarter no customer accounted for more than 5% of total revenue, or C$3.82m. In response to questions about the “15% customer” from Canacord Genuity analyst Robert Young, Brian Campbell pointed out that the 15% number relates to all product shipped to a single customer during the quarter, not necessarily a single order for one project.  Campbell also said that although this order was indeed large, the company has had large orders in the past.  What appears to make this order unusual is that it appears to have happened during a single quarter as opposed to delivery over multiple quarters, which Campbell said is more common.  Campbell declined to state who the customer was, or its geographic location, but given the rise in US/Canada sales, and the q/q decline in international revenue, it’s easy to speculate.

The strong results follow on from the previous quarter when Evertz announced that its order backlog had reached a record C$57m, and said that most of this backlog would ship during the current quarter. This appears to have happened, as the company’s order backlog at the end of the first quarter of its 2013 fiscal year was C$40m, or 30% lower than three months ago.

Gross margins in the quarter were 58%, up from 57% last year and up from 56% last quarter.  The company attributed its margin expansion in the quarter to higher revenue and traction in new product areas. Company CFO Anthony Gridley said that gross margins were within the company’s targeted range of 56% to 62%, and that the company is “comfortable” with that range.  Campbell added that this margin range allows Evertz to make money while remaining price-competitive in the market.

R&D expenses in the quarter were C$11.8m, an increase of 14% versus the same period last year, and down 8% versus the previous quarter when the company accelerated the purchase of materials and prototypes in order to take advantage of government tax incentives before the end of its fiscal year.  Gridley said the company is constantly adding R&D staff, so any reported decline in R&D spending is typically the result of an increase in prototypes in previous quarters.  Campbell said that the company will continue to invest in R&D as the company sees its engineering strength as a key market differentiator, and Evertz intends to “continue to extend this lead.”

SG&A expenses for the quarter were C$12.4m, an increase of 19% versus last year, and essentially flat with the previous quarter. Selling and administrative expenses represented approximately 13% of revenue in the quarter versus 14% of revenue during the same period last year, and 16% of revenue last quarter.

The company’s purchase order backlog at the end of August 2012 was in excess of C$40m, up 90% versus the same period last year, and down 30% versus the previous quarter.

Commenting on the recent IBC trade show, Campbell said that Evertz saw increasing awareness of some of its recent large R&D investments.  He specifically cited video transport, IT-based playout, asset management, and compressed domain products as areas where the company is seeing interest.

When asked by an analyst about the pick-up in broadcast technology M&A activity such as the recent purchase of Miranda by Belden, and the decision by Harris to divest its broadcast business, Campbell responded by saying that Grass Valley should be added to this list because it is also has been going through changes since being acquired by Francisco Partners.  Campbell implied that the distractions facing competitors was a net positive for Evertz.  “Customers look to Evertz as a very stable entity with very little disruption, so we’ve been able to capture market share” he said.

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Related Content:

Press Release: Evertz Technologies Reports Results for the First Quarter Ended July 31, 2012

Previous Quarter: Evertz Q4 FY 2012 Revenue Rises 11 Percent, Order Backlog at Record Level

Previous Year: Evertz Beats Expectations in Q1 2012 as Domestic Revenue Increases Six Percent

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© Devoncroft Partners. All Rights Reserved.

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Evertz Q3 Net Income Doubles as Revenue Rises 26 Percent

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Mar 08 2011

Evertz Technologies reported that its revenue for the third quarter ended January 31, 2011, was C$83.2m, an increase of 26% versus the same period a year ago, and an increase of 1% versus the previous quarter.

The results were driven by a strong performance in the US and Canada, where revenue was C$48.5m, an increase of 44% versus the same quarter last year, and an increase of 20% versus the previous quarter.  The US and Canada accounted for 58% of the total revenue in the quarter.

International revenue for the quarter was C$34.7m, an increase of 7% versus the same quarter last year, but down sharply from C$42.8m in the previous quarter.  Company management said that Evertz experienced a “high level of quotation activity” in international markets, but implied that international sales had impacted by the recent unrest in the Middle East.

The company’s top 10 customers accounted for approximately 32% of revenue (C$26.6) during the quarter, with no one customer accounting for more than 9% (C$7.5m).  The company had fifty-seven order of more than C$200,000.

Net income for the quarter was C$23.6m, up 102% versus the same period a year ago, and up 13% versus last quarter.

Gross margins for the quarter were 57.5%, up from the 57% gross margins achieved in the same period a year ago, but down slightly from the previous quarter.  Evertz executive VP Brian Campbell said that although the company’s gross margins were impacted by competitive pricing pressure as well as volume discounts on large orders, they were within the company’s target range of 58%-62%.

Research & development cost for the quarter was C$9.6m, an increase of 21% versus the same period a year ago, and an increase of 17% versus the previous quarter.  On the company’s earnings call with equity analysts, Evertz CFO Anthony Gridley said the increase in R&D was due to recent acquisitions (including the purchase of Pharos) and a general increase in R&D headcount.  Evertz says it intends to continue to increase R&D investment.

SG&A for the quarter was C$10.2m, or was approximately 12% of revenue.

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Year to Date

For the first nine months of the year the company’s sales were C$239.4m, an increase of 13% versus the same period a year ago.  Year-to-date revenue from the US and Canada was C$131.1m, an increase of 11% versus last year, while sales from the international region was C$108.3m, a 17% increase versus last year. Gross margins for the first nine months of the year were 57.8% versus 58.5% last year.  Year-to-date net income was C$65m, up 41% versus the first nine months of fiscal 2010.

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New Server and Integrated Playout Products at NAB

Campbell said that Evertz expects there to be a lot of interest in it new server platform and Overture “channel-in-a-box” product at the NAB show in April.  He also said that visitors to the Evertz NAB booth would see the results of the integration of recently acquired technology from Pharos.

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Related Content:

You can read the full Evertz Q3 FY 2011 earnings release here.

The Evertz Management’s Discussion and Analysis (MD&A) filing with Canadian regulators is here (Catchpa code required)

Information on Evertz’s previous quarter results are here.

Information on the acquisition of Pharos by Evertz is here.

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Evertz Revenue and Earnings Decline in Fiscal Q3 2012 Despite Improving International Performance

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Mar 07 2011

Evertz announced that its revenue for the third quarter of its 2012 fiscal year was C$71.4m, a decline of 15% versus the same period a year ago, and up 1% versus the previous quarter.

The company’s top ten customers provided 27% of revenue during the quarter, with no one customer accounting for more than 6% (C$4.3m), and the company had 70 orders in excess of C$200,000.

Net earnings for the quarter were C$12.7m (C$0.17 per share), down 48% versus the same quarter last year.

The results for the quarter were below the expectations of equity analysts, who on average were looking for revenue of C$78.8m and EPS of C$0.24.

Revenue in the US/Canada region was C$32m, or 45% of total revenue, down 19% versus the same period a year ago, and down 11% versus the previous quarter.

International revenue was C$39.4m, an increase of 11% versus last year, and an increase of 14% versus last quarter.  When asked about the company’s international performance, Evertz EVP Brian Campbell attributed the growth to the increasing demand for the company’s products in international markets as a result of the ongoing worldwide transition to HDTV operations, the rebound in some international markets, and the fact that that Evertz had been able to “refocus its resources” where needed thanks to its flexible sales structure.

Gross margins in the quarter were 56.2%, down from 58% last year and down from 57.3% last quarter.  The company attributed the decline in gross margins to a different geographic and product mix in the quarter, particularly the lower sales performance in the US market where margins for some products are higher.

R&D expenses in the quarter were C$11m, an increase of 15% versus the same period last year.  On its conference call with equity analysts Evertz CFO Anthony Gridley attributed the rise in R&D spending to the timing of expenditure for prototyping materials, which increased during the quarter.  Gridley also said that the company will continue to increase its R&D investment, and that a run-rate of approximately C$11m per quarter should be considered normal.

SG&A expenses for the quarter were C$12.7m, an increase of 27% versus last year. Selling and administrative expenses represented approximately 17.7% of revenue in the quarter.

Capex was up sharply to C$10.9m, due primarily to the purchase of a new airplane for approximately C$9m during the quarter.  The company said it is in the process of retiring the existing airplane that it already owns.

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Year to Date Performance:

Revenue for the first nine months of fiscal 2012 was C$217m, down 10% versus last year.

Year-to-date US and Canada revenue was C$113.2m, down 14% versus the previous year.  Year-to-date revenue in the international region was C$103.9m, down 5% versus the previous year.

Gross margins for the first nine months of the year were 57%, down from 58% last year, but still within what the company’s targeted range.

 

Outlook:

The company said that it expect its revenue for the second half of the current half of the fiscal year to exceed the first half of the year, and that it should grow faster than the overall market over the next several years.

Campbell said that Evertz is entering the fourth quarter and the upconing NAB trade show with strong momentum.  The company’s purchase order backlog at the end of February 2012 was in excess of C$42m and shipments during the month of February 2012 C$26 million.  In the past the company typically turned its PO backlog into sales in 4-6 weeks, but Campbell said that more recently the conversion time between orders and sales had increased, and that some of the company’s current backlog will take longer to convert into sales.

 

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Related Content:

Press Release: Evertz Technologies Reports Results for the Third Quarter Ended January 31, 2012

Previous Year: Evertz Q3 2010 Net Income Doubles as Revenue Rises 26 Percent

Previous Quarter Press Release: Evertz Technologies Reports Results for the Second Quarter Ended October 31, 2011

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