Posts Tagged ‘Grass Valley’

Grass Valley Paid $94.2M for Snell Advanced Media

Analysis, Annual Results, Broadcast Vendor M&A, Conference Sessions, SEC Filings | Posted by Joe Zaller
Feb 13 2018

Last week, Belden / Grass Valley announced it had closed the acquisition of Snell Advanced Media (SAM).

At that time, the company did not disclose the terms of the deal.

Today, Belden said in a filing with securities regulators that it paid $75.8 million plus the assumption of $18.4 million of debt for a company it acquired on February 8, 2018 (the same day it confirmed the SAM acquisition).

This equates to an enterprise value of $94.2 million.

Based on filings with the UK government, SAM’s parent company had revenue of £90.8 million ($123 million USD at 2016 average exchange rate) through December 31, 201, and increase of 20.3% from £75.4 million ($115.2 million USD at 2015 average exchange rate) for the 12 months ending December 31, 2015.

Based on its previous acquisitions in the broadcast industry, Belden typically pays around 8x EBITDA when it buys a company.  If that was the case in the SAM transaction, it would mean that SAM’s EBITDA over the trailing twelve months prior to the acquisition was $11.775 million. However, in its filing with UK regulators, SAM said it had EBITDA of -£1.6 million for the 12 months ending on December 31, 2016.  Performance for the full year 2017 is unknown.

Given SAM’s growth from 2015 to 2016, the company may have achieved positive EBITDA, but the full details won’t be known until Belden provides additional information about the transaction (which it said it will do closer to the 2018 NAB Show).  It’s also possible that the valuation was based on a multiple of SAM’s sales in 2017.

 

Attend the 2018 Devoncroft Executive Summit to hear more about Belden’s strategy

For those wondering about Belden’s plans for SAM, and whether it continues to look for M&A targets in the broadcast industry, join us on April 8, 2018 to find out.

That’s the date of the seventh annual “Devoncroft Executive Summit: The Business of Media Technology,” where Belden CEO John Stroup will be take part in a panel of broadcast technology supplier CEOs.

Registration for the 2018 Executive Summit is available here.

 

The relevant text from Belden’s filing has been pasted in below:

Note 28: Subsequent Events

On February 8, 2018, we acquired a company for a purchase price of $75.8 million, plus we assumed debt of $18.4 million. The acquisition includes a potential earn-out for which we have not yet estimated a fair value. This acquisition was funded with cash on hand.

We are in the preliminary phase of the purchase accounting process, including obtaining third party valuations of certain tangible and intangible assets acquired. As such, the purchase accounting process is incomplete and we cannot provide the required disclosures of the estimated fair value of the assets and liabilities acquired for this business combination.

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Related Content:

2018 Devoncroft Executive Summit: The Business of Media Technology

Belden/Grass Valley Acquires Snell Advanced Media

Grass Valley Q4 2017 Revenue Impacted by Revenue Recognition, Predicts Growth for 2018

Broadcast Vendor M&A: Belden Completes Acquisition of Grass Valley, Will Invest $25 Million in Integration of Combined Business

More Broadcast Vendor M&A: Belden Buys Miranda for $350 Million in All-Cash Deal

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© Devoncroft Partners 2009-2018.  All Rights Reserved.

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Belden/Grass Valley Acquires Snell Advanced Media

Analysis, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A, Broadcaster Financial Results, Conference Sessions | Posted by Joe Zaller
Feb 08 2018

Belden announced it has closed the acquisition of Snell Advanced Media (S-A-M).

Terms of the deal were not disclosed.

The deal makes Grass Valley one of the largest media technology suppliers.

Clearly the company believes there is growth to be had in broadcast.  At the company’s December 2017 investor day, Belden CEO John Stroup said “I think that we have a lot more conviction around what’s happening in the broadcast industry than we did two years ago. And as you recall – or you may recall, our concentration within production, in particular around live, gives us a lot more confidence that we’re going to see growth in that end market than we did, say, in the last two to three years.”

Although at first glance there is substantial product overlap between Grass Valley and S-A-M, there are less similarities between each company’s geographic sales footprint, which will help Grass Valley expand into new customers. A Grass Valley spokesperson said that the deal would help the company extend its reach and provide in-region support to its global customer base.

Additionally, a number of each company’s respective product lines are complementary (in news for example), making the overall Grass Valley proposition more robust.

According to Belden management, S-A-M will be integrated into Grass Valley, and moving forward the S-A-M brand name will be retired, and “Grass Valley, a Belden Brand” will be used as the company name.

Tim Shoulders will be the president of the combined company, which will be headquartered in Montreal.

Belden executives cited multiple strategic reasons for the deal, including gaining market share, and an expanded geographic footprint.

“With this investment Belden again demonstrates our commitment to the broadcast industry. Adding SAM’s employees and products to the Grass Valley family extends Grass Valley’s global reach, makes us more agile and provides even more domain expertise to enhance Grass Valley’s industry-leading solutions in networking, news and live production and content delivery for broadcasters,” said Shoulders. Our customers face competition and uncertainty like never before. This transaction will help them navigate the technology options available to them with fewer concerns around interoperability and deployment complexity while providing them greater access to the innovators developing the solutions of tomorrow.”

Prior to doing this deal, Belden did substantial work to refinance its debt, which provided additional financial leverage for M&A.  Indeed, the company’s CFO often refers to the amount of “dry powder” that the company has available for M&A. At the company’s investor day, Stroup said “We [are] extremely pleased with the execution of our debt refinancing and repayment during the quarter. By issuing €450 million of senior subordinated notes at 3.375% and €300 million at 2.875%, the lowest long-term borrowing rates in the history of the company, we have further lowered our cost of capital and extended our maturities. In total, we expect these actions to be accretive to EPS by $0.47 on a full-year basis.

 

Reminiscent of Previous Industry Roll-ups

The S-A-M deal is Belden’s fifth acquisition in the media and broadcast technology sector.

 

In addition to these transactions, Belden acquired KVM switch vendor Thinklogical in May 2017 for $171.3 million in cash, and added it to the company’s Broadcast Solutions segment for reporting purposes.

Including Thinklogical, Belden has invested $779.4 million in the broadcast industry since 2009.  When the company discloses the price paid for S-A-M, the thoal amouint will be known.

This level of investment is reminiscent of previous industry “roll-ups.”

Between 2000 and 2009, Harris Corporation spent approximately $1 billion on the acquisitions of vendors including Louth, Encoda, and Leitch. In 2012, Harris Corporation divested its broadcast division in a deal valued at up to $225 million.

A decade earlier, Technicolor (then Thomson) spent even more to acquire a slew of media technology supplier including 5 businesses of the Philips Professional Broadcast group (Cameras, Film Imaging, Signal Processing, Media Networking and Control & Systems), Canopus, PRN, ParkerVision, Nexstream, Thales Broadcast & Multimedia, and (coincidentally) Grass Valley.

Starting in 2010, Technicolor divested these businesses in separate transactions:

 

So why does Belden think it will be different for them?

Speaking at the 2017 Devoncroft Media Technology Business Summit, Belden CEO John Stroup said “Of all the industries we’re in, [media and broadcast] is the industry where the economic capabilities of the vendors are the least developed, and that creates a lot of stress for us.

Belden CEO John Stroup at 2017 Devoncroft Media Technology Executive Summit

Belden CEO John Stroup at 2017 Devoncroft Media Technology Executive Summit

“We would obviously prefer that all vendors were making good economic investments, because [today] we’re all investing in everything, and that doesn’t lead to particularly good economic returns. I think we’re all searching for a level of scale, because I think this is a business that requires a lot of scale from a commercial point-of-view. To operate globally, you need to generate the amount of revenue that gives you the scale from an R&D point of view. So, what we’ve been trying to do with our team is teach them different ways to evaluate how much to be spending, where to be spending, and trying to put some rigor and framework around it so we’re not doing anything that’s reckless. Some vendors have gotten themselves into problems…. We’re trying to really careful of where we place our bets.”

With the S-A-M deal, Belden achieves greater scale.

Additionally, the company has previously telegraphed its plan to build a factory in India, in order to lower its cost of production (it is unknown at this time whether the production of Grass Valley or S-A-M products will move to this factory once it opens).

 

Greater Control of the IP Transition?

Belden executives often speak about how industry-wide transition to IP-based infrastructure provides potential growth opportunities for Grass Valley. During Belden’s Q4 2017 earnings call, Stroup said Q4 2017 was Grass Valley’s strongest-ever quarter for sales of IP-based systems, and predicted that IP shipments would accelerate in the future, thanks to the adoption of new standards and increasing custom confidence in IP-based solutions. “We think [the finalization of the SMPTE 2110 standard is] an important development and certainly going to be helpful moving into 2018. We had our strongest quarter ever in IT-based product revenues in the fourth quarter. It was over $5 million. And it was to 36 different customers. So, it’s clear that our customers are getting more confident, more comfortable with the technology. I think they view us as really one of the only solutions that meets the open standard. As we’ve talked about, we have some competitors that have done very well, but their systems and their solutions are far more closed than what we’re offering and what the standard dictates. So, I think that the Grass Valley business, from a product point of view, is very well positioned moving into 2018.”

Indeed, as one of the three founders of AIMS, Grass Valley is a key player in the industry-wide transition to IP-based operations. The acquisition of S-A-M puts Grass Valley in control of more potential IP-related infrastructure refresh projects.

Because the broadcast industry is dwarfed by the broader IT market, the IT “titans” (such as Arista, Cisco, Huawei, and Juniper) tend to use established broadcast suppliers as a route to market.  By acquiring S-A-M, Belden now owns two of the top “traditional broadcast vendors,” making it more likely that they will successfully capture market share as the industry transitions to IP-based operations.

 

 

The Belden M&A Strategy

It shouldn’t be a surprise that Belden made this acquisition, over the past decade, the company has grown substantially through strategic M&A.

As recently as December 2017, Indeed, Belden routinely touts it well-established approach of acquiring underperforming assets, and generating synergies and cost savings through what it calls “The Belden Business System.”

During its December 2017 analyst day, Stroup told analysts “we continue to actively pursue a number of attractive inorganic opportunities. We currently have $475 million available for inorganic opportunities. We estimate that approximately $1.7 billion will be available through 2020. This will come from organic activities and it would be at or below net leverage of 3 times.

 

“Over the last three years, approximately 75% of capital deployment has been allocated towards M&A. Going forward, we expect to allocate approximately 55% towards M&A.

“Our acquisition approach always begins with our strategic plan. Nothing enters our funnel of opportunities, nothing begins cultivation until we identify an opportunity as either allowing us to take advantage of an opportunity or to address a threat.

 

“The companies that we pursue are typically company leaders within their specific area, often niches. They have products that are complementary to ours and typically there are opportunities for significant costs or commercial synergies.

“Typical bolt-on for Belden would be a company with revenue growth that is similar to Belden’s end markets. Gross profit margins are typically greater than Belden. However, EBITDA margins are typically lower than the Belden average.

 

And by applying our Lean enterprise system, we have the opportunity to achieve EBITDA margins at or above Belden average, achieve ROIC of 13% to 15% by year three and purchase the company for a post-synergy multiple of approximately seven times EBITDA.”

 

Related Content:

Grass Valley Q4 2017 Revenue Impacted by Revenue Recognition, Predicts Growth for 2018

Broadcast Vendor M&A: Belden Completes Acquisition of Grass Valley, Will Invest $25 Million in Integration of Combined Business

More Broadcast Vendor M&A: Belden Buys Miranda for $350 Million in All-Cash Deal

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© Devoncroft Partners 2009-2018.  All Rights Reserved.

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Grass Valley Q4 2017 Revenue Impacted by Revenue Recognition, Predicts Growth for 2018

Annual Results, Broadcast technology vendor financials | Posted by Joe Zaller
Feb 06 2018

Belden announced that revenues in its Broadcast Solutions segment were $174.7m, down 16.3% versus the previous year, and down 9.8% compared to the previous quarter.

 

As per the table above from Belden’s investor presentation, the company’s Belden’s Broadcast Solutions segment includes broadcast stalwart Grass Valley, along with PPC, a provider of components used by cable MSO, and KVM switch provider ThinkLogical.

 

Q4 2017 Broadcast Revenues Impacted by Revenue Recognition Issues

The company attributed much of the year-over-year revenue shortfall to the negative impact of revenue recognition issues.

“Most of our businesses performed in line with our expectations during the fourth quarter, with the exception of an isolated situation in our Broadcast Solutions segment,” said Belden CEO John Stroup, shown below speaking at the 2017 Devoncroft Media Technology Business Summit.

Belden CEO John Stroup at 2017 Devoncroft Executive Summit

“We had expected to recognize revenue on $36 million of product that was shipped in 2017, but we were unable to do so as a result of technical U.S. GAAP revenue recognition requirements that our team identified during the year-end closing process. We now expect these 2017 shipments to be recognized as $36 million in revenue and $22 million in EBITDA in 2018.”

On the company’s earnings call, Belden Chief Financial Officer Henk Derksen provided additional detail on the accounting issues that prevented the company from recognizing $36 million of broadcast revenue in the quarter: “We expected to recognize revenue on $36 million of orders in our Broadcast segment that shipped prior to the end of 2017. However, we are unable to do so, as a result of technical U.S. GAAP revenue recognition requirements, said Derksen.

These revenue recognition issues appear to be related to the shipment of IP-based systems, which either include or are sold through third-parties. As the industry transitions to IP-based operations for production, playout, and delivery, more and more products (from all suppliers) are likely to involve some sort of third-party, many vendors may begin to face accounting challenges similar to those encountered by Grass Valley in Q4 2017.

Derksen provided additional detail on the revenue recognition shortfall, saying: “[IIP n] certain transactions, our broadcast IT business shipped products through third-party logistics providers, or 3PLs. On all of these shipments, legal title and the risk of loss transferred to the customers at the time of the shipment, and we were entitled to receive payment. However, we did not meet all of the technical delivery criteria for revenue recognition under U.S. GAAP. Clearly, we’re disappointed with this outcome. That said, we are pleased that we identified this matter as part of our year-end closing process. Ultimately, we view this issue as a delay and have increased our 2018 guidance accordingly to reflect an incremental $36 million in revenue and $22 million in EBITDA.”

According to Derksen, these revenues will be recognized over the first three quarter of 2018. “The $36 million that we couldn’t recognize in the fourth quarter and will recognize in 2018 will layer in $15 million in Q1, $15 million in Q2, and $6 million in the third quarter,” said Derksen. “We have to modify some of our terms and conditions with our customers. That will take a little bit of time. So I don’t want you to expect that all the $36 million to reverse completely in Q1.”

 

Shipments of IP-based Products Accelerate

Despite the accounting issues, the company appears increasingly confident about the transition to IP-based operations.

Stroup said Q4 2017 was Grass Valley’s strongest-ever quarter for sales of IP-based systems, and predicted that IP shipments would accelerate in the future, thanks to the adoption of new standards and increasing custom confidence in IP-based solutions. “We think [the finalization of the SMPTE 2110 standard is] an important development and certainly going to be helpful moving into 2018. We had our strongest quarter ever in IT-based product revenues in the fourth quarter. It was over $5 million. And it was to 36 different customers. So, it’s clear that our customers are getting more confident, more comfortable with the technology. I think they view us as really one of the only solutions that meets the open standard. As we’ve talked about, we have some competitors that have done very well, but their systems and their solutions are far more closed than what we’re offering and what the standard dictates. So, I think that the Grass Valley business, from a product point of view, is very well positioned moving into 2018.”

 

 

Positive Outlook for 2018

Belden provided an upbeat outlook for its broadcast business in 2018. Stroup told analysts “I would expect our Broadcast segment to be in that range [3% – 5% organic growth], maybe towards the higher end, because when we report our organic growth in 2018, we’re going to give it based on what our actual revenues were in 2017 versus our actual revenues in 2018. So obviously our Broadcast segment is going to have a lot of tailwind coming into 2018. So I would expect that all of our platforms are going to be somewhere around 3% to 5%. The Broadcast segment may be on the higher end, maybe 5%, maybe a little bit higher given the fact that they have that $36 million of revenue coming into the year.

 

Full Year 2017 Broadcast Results

For the full year 2017, revenues in the Broadcast Solutions segment was $725.1 million, down 5.8% from $769.6 million in 2016.

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Related Content:

Press Release: Belden Reports Results for Fourth Quarter and Full Year 2017

Press Release: Belden Reports Solid Results for Third Quarter 2017

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© Devoncroft Partners 2009-2018.  All Rights Reserved.

Reminder: 2017 NAB Show Media Technology Business Summit is Sunday April 23rd

Analysis, broadcast industry technology trends, broadcast industry trends, Broadcast technology channel strategy, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A, Broadcaster Financial Results, Conference Sessions, market research, Media Services M&A, Online Video, OTT Video | Posted by Joe Zaller
Apr 21 2017

If you are attending the 2017 NAB Show, and you want to understand the commercial and technical issues that are driving the industry forward, you don’t want to miss the sixth annual Media Technology Summit.

11:00am – 3:00pm, Sunday, April 23, 2017

Las Vegas Convention Center, Room N249

We’ve worked hard to bring together an outstanding line-up of technology and business thought leaders from all parts of the media technology ecosystem, and we are very grateful that this incredible group has agreed to take part in this year’s event and share their experiences with our audience.

The full conference agenda is at the bottom of this post.

This summit is the one place at the NAB Show where C-Level executives from each part of the media ecosystem discuss the commercial issues facing their organizations, and how this has and will impact their technology investment and deployment strategies. Whether you are a media company, technology supplier, finance professional, or industry strategist, if you want to understand the executive perspective on business developments in the media technology sector, we’re sure you will find the conference to be a thought-provoking kickoff to the NAB Show. It’s also a great networking opportunity.

In addition to executive panel discussions, we will also provide an overview of the most up-to-date industry market research and analysis.  This includes preliminary findings from the 2017 Devoncroft Partners Big Broadcast Survey, the industry’s definitive demand-side market study, and the 2017 Global Market Valuation Report (GMVR), which is published by IABM DC, a 50-50 joint-venture between Devoncroft Partners and industry trade association IABM.

If you have not yet participated in the 2017 Big Broadcast Survey, you can register here and join thousands of your colleagues worldwide in the definitive study of media industry trends.

If you’d like to attend the Summit, all you need is an NAB Show badge.  So please bring any colleagues interested in the changing landscape of media technology.

You can also register using code ATT2.

This event has been standing-room-only for the past several years, and we are expecting a large turn-out, so please come early.

 

2017 NAB Show Media Technology Business Summit

Conference Agenda

11:05am – Strategic Industry Analysis: Valuations, M&A, and Equity Finance

Joshua Stinehour, Principal Analyst, Devoncroft

 

11:25am – The Broadcast & Media Technology Industry in 2017

Joe Zaller, President, Devoncroft

 

11:50am – The Vendor C-Suite: Strategies for an Evolving Market

David Ross, CEO, Ross Video

Johan Apel, President & CEO, ChyronHego

John Stroup, President, CEO, Belden, Inc.

Ramki Sankaranarayanan, CEO, Prime Focus Technologies

 

12:30pm – Leveraging Hyperscale IT Infrastructure for Next-Generation Media Workflows

Dave Ward, Senior Vice President, Engineering Chief Technology Officer and Chief Architect, Cisco Systems

Keith McAuliffe, Vice President and Chief Technologist, HPE Servers Global Business Unit Hewlett Packard Enterprise

Peter Guglielmino, Media & Entertainment CTO, IBM

Tom Burns, Media & Entertainment CTO, DELL EMC

Moderator: Al Kovalick, Founder, Media Systems Consulting

 

1:15pm – Service Provider C-Suite: Perspectives on the Future of Media Technology

Barry Tishgart, Vice President, Comcast Technology Solutions

Bill Wheaton, Executive Vice President & Chief Strategy Officer, Akamai

Darcy Antonellis, Chief Executive Officer, Vubiquity

Usman Shakeel, Worldwide Technology Leader Media & Entertainment, Amazon Web Services

Moderator: Janet Gardner, President, Perspective Media Group

 

1:50pm – The Broadcaster C-Suite: Trends Driving Investment Decisions

John Honeycutt, CTO Discovery Communications

Renu Thomas, EVP Media Operations, Engineering & IT Disney/ABC Television Group

Richard Friedel, EVP and GM, Fox Network Engineering and Operations

 

2:30pm – The Broadcaster C-Suite: The Opinion of Financial Decision-Makers

Christine Dorfler, Chief Financial Officer, NBCUniversal Owned Television Stations

Joe Dorrego, EVP/CFO, FOX Television Stations

Lucy Rutishauser, Senior Vice President Chief Financial Officer & Treasurer, Sinclair

Michael Tuvell, Senior Vice President Chief Financial Officer, Tribune Media

 

Related Content:

2017 Media Technology Business Summit Agenda on NAB Show website

 

© Devoncroft Partners 2009 – 2017. All Rights Reserved.

 

2016 Big Broadcast Survey (BBS) Reports Now Available

broadcast technology market research, Broadcast Vendor Brand Research, market research | Posted by Josh Stinehour
Jul 21 2016

The 2016 Big Broadcast Survey (BBS) Reports are now available.

We have been publishing the BBS Reports since 2009.  Each new edition is created through several months of research, including interviews with technology end-users, global surveys of technology decision makers, analysis of the end-user responses, and visualization of the data collected.  Now in its eighth year of publication, the BBS remains the most comprehensive annual study of technology end-users in the global broadcast and media technology industry.  Nearly 10,000 technology professionals in 100+ countries participate in the BBS each year, making it the largest market study of the media technology industry.

Based on feedback from technology vendors, media companies, and investors, we have updated the vendors, product categories, and market trends profiled in the 2016 BBS to better align with recent market developments.

Select updates include the global tracking of IP Standard Adoption, a product level review of the 4K upgrade cycle, and planned usage of programmatic advertising exchanges.

The continual updates over the past eight years have helped the BBS reports remain a critical reference for industry executives to improve strategic decision-making, customer engagement, marketing strategy, product planning, and sales execution.  In addition to technology vendor and service provider strategic planning, BBS reports are also used frequently for M&A and investment activities by both buyers and sellers.

Three types of 2016 BBS reports are available:

  • 2016 BBS Global Brand Reports: provides deep insight into how each more than 100 broadcast technology suppliers (see full list below) are perceived by market participants, along with comprehensive benchmarking of broadcast technology vendors on a wide variety of metrics
  • 2016 BBS Product Reports: provide detailed information from buyers, specifiers, and users of broadcast technology products in 32 separate categories (see full list below)
  • 2016 BBS Global Market Report: provides detailed information about industry trends, major projects being planned, products being evaluated for purchase, current and future plant infrastructure, broadcast technology budgets, and planned deployment of new technologies including 4K, HEVC compression, and IP-based technology infrastructure

 

For additional information on the 2016 BBS report, please call or email me.

As is Devoncroft’s custom, we will publish highlights from this year’s BBS reports on the Devoncroft website.  These articles are posted on a semi-regular basis, so please check back often.

To receive posts when published, please enter register with your email in the box in the upper right-hand corner of the page.

The below table of logos (in alphabetical order) lists the technology vendor brands covered in the 2016 BBS.

2016-BBS-Logos

 

Technology Product Categories & Vendor Brands Covered in the 2016 BBS, by Application Area

 

Acquisition & Production:

ENG Cameras

Canon, Hitachi, Ikegami, JVC, Panasonic, Sony

Large Format Single Sensor Cameras

ARRI, Blackmagic Design, Canon, Red, Sony

Production Switchers

Blackmagic Design, For-A, Grass Valley, NewTek, Panasonic, Ross Video, SAM, Sony

Studio / System Cameras

Grass Valley, Hitachi, Ikegami, JVC, Panasonic, Sony

 

 

Post Production: 

Graphics & Branding

Adobe, Autodesk, Avid/Orad, ChyronHego, Evertz, Grass Valley, Imagine Communications, Ross Video, Vizrt

Video Editing

Adobe, Apple, Avid, Blackmagic Design, EVS, Grass Valley, Imagine Communications, Sony

 

 

Content Communications and Infrastructure:

Bonded Cellular

Dejero, LiveU, Teradek, TVU

Routing Switchers

Blackmagic Design, Evertz, Grass Valley, Imagine Communications, Ross Video, SAM, Utah Scientific

Signal Processing / Interfacing / Modular

Aja Video, Axon, Blackmagic Design, Evertz, For-A, Grass Valley, Imagine Communication, Ross Video, SAM

Video Transport

Aspera, Cisco, Ericsson, Evertz, Harmonic, Imagine Communications, Lawo, Media Links, Net Insight, Nevion, Riedel, Signiant

 

 

Storage:

High Performance Shared Storage:

Avid, Harmonic, Hitachi, HPE, Isilon Systems/EMC, NetApp, Quantum

Playout / Transmission Servers

Avid, EVS, Grass Valley, Harmonic, Imagine Communications, Ross Video

Production Servers

EVS, Grass Valley, Harmonic, Rohde & Schwarz, SAM

 

 

Audio:

Audio Consoles

Avid, Calrec, Lawo, Salzbrenner Stagetec, Solid State Logic (SSL), Soundcraft, Studer, Wheatstone, Yamaha

Audio Processing & Monitoring

Adobe, Avid, Dolby, Linear Acoustic, RTW, TSL, Wohler

Intercom / Talkback

Clear-Com, Riedel, RTS Intercom Systems, Trilogy

Microphones

AKG, Audio-Technica, beyerdynamic, Electro Voice, Marshall Electronics, Neumann, Schoeps, Sennheiser, Shure, Sony

Monitors (speakers)

Adam, Avid, Focal, Genelec, JBL, KRK Systems, Mackie, Neumann, PMC,

 

 

System Automation and Control:

Broadcast Business Management Systems

arvato/S4M, Imagine Communications, MediageniX, MSA Focus, SintecMedia, Wide Orbit

Archive & Archive Management

Masstech, Oracle/Front Porch Digital, Quantum, SGL, XenData

Media Asset Management

arvato/S4M, Avid, Dalet, EVS, Imagine Communications, Prime Focus Technologies, Vizrt, VSN

Playout Automation

Grass Valley, Imagine Communications, Pebble Beach, Playbox, Snell

Workflow Orchestration / BPM

Aspera, Avid, Imagine Communications, IBM, Sony, Telestream

 

 

Playout and Delivery:

Encoding / Transcoding

Arris, ateme, Cisco, Dalet/AmberFin, Elemental Technologies, Ericsson, Harmonic, Imagine Communications, Telestream

Integrated Playout (Channel in a Box)

Evertz, Grass Valley, Harmonic, Imagine Communications, Pebble Beach, Playbox, SAM

On-line / Streaming Video Delivery Platforms

Brightcove, Kaltura, Neulion, Ooyala, Piksel

Transmitters

GatesAir, Hitachi, NEC, Plisch, Rohde & Schwarz, Screen Service, Toshiba

 

 

Test, Quality Control and Monitoring:

Multiviewers

Avitech, Axon, Evertz, For-A, Grass Valley, Imagine Communications

Test & Measurement

Imagine Communications, IneoQuest, Leader, Phabrix, Rohde & Schwarz, Tektronix

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

Grass Valley Grows Double Digits; Ships 20th IP System in Q2

Analysis, Quarterly Results | Posted by Josh Stinehour
Jul 19 2016

Belden announced second quarter 2016 results.  Belden’s largest division in terms of revenue is its Broadcast Solutions division (32% of overall revenue in the quarter).  The division includes the operations of Grass Valley along with Belden’s broadband connectivity businesses.  GrassValley_Logo

Broadcast Solutions revenue for Q2 2016 was $193.5 million, an increase of 10.6% versus the year earlier quarter, and an increase of 13.0% against the preceding quarter, Q1 2016.

Currency translation for Q2 resulted in an unfavorable impact of $1.1 million dollars.  Belden’s acquisition of m2fx in January 2016 contributed $2.1 million to the Broadcast Solutions division in the second quarter.  m2fx is a manufacturer of optical fiber protection tubes and was integrated into Belden’s broadband connectivity business, which is included in the reporting segmentation for Broadcast Solutions.

Grass Valley generated 12% year-over-year growth versus the second quarter of 2015.  On a regional basis, international growth at Grass Valley was 16%, while the United States region grew at 6% during quarter.

Management attributed the double digit performance to a stable US dollar, technology spend associated with the 2016 Summer Olympics in Brazil, and a rise in US advertising expenditures.

Improved year-over-year performance for Grass Valley was anticipated by Belden’s management.  During the Q1 2016 earnings call, Belden’s CEO John Stroup reiterated the softness in Grass Valley’s revenue numbers began in Q2 2015, making the Q1 2016 announcement the last difficult year-over-year comparison for the division.

During this quarter’s earnings call with analysts, Mr. Stroup made several comments on the recent financial results at Grass Valley.  “…the Grass Valley results were very strong and I think that some of that has to do with the Olympics. But I think more of it has to do with the fact that a year ago, we had a number of customers outside of the US that were struggling with exchange rates moving around, our International business was up 16% in Grass Valley in the quarter. And then I’d say the other thing is that as customers are beginning to get more confident in the transition of technology into IP, I think we’re also seeing that improve as well” said Stroup.

EBITDA (Earnings before interest depreciation and amortization) for Broadcast Solutions in the quarter was $29.5 million, a 29% increase versus Q2 2015, and a 27% decrease against Q1 2016.

The EBITDA margin for Q2 2016 was 15.2%, which compares to a 13.1% EBITDA margin in Q2 2015, and a 13.6% EBITDA margin in Q1 2016.  The primary reason for the profitability improvement was revenue growth and improved productivity, though in part offset by a less favorable product mix.

For the second quarter, Belden recognized a $1.3 million charge in its Broadcast Solution division for severance, restructuring, and acquisition integration costs.  This compares to restructuring charges for the division of $3.2 million during Q2 2015 and $4.3 million during Q1 2016.

In the Company’s prepared remarks, management highlighted further momentum with IP based solutions.  Adding to the 11 IP system shipments by Belden in Q4 2015 and Q1 2016, Belden shipped a further nine IP systems during the second quarter of 2016.

Responding to an analyst question Mr. Stroup added further context on the positive developments with Grass Valley’s IP solution portfolio.

“…It’s still a relatively small percentage of our revenue, and for most of our customers this is going to be sort of their first installation, their proof of concept. So I feel like we’re building momentum. I think that the real breakthrough for us was that a year ago in the market there was a lot of confusion with our customers about which way to go, because there were vendors that were sort of battling standards. And I think that partially due to our leadership and collaboration with other vendors in the industry, I think we now have a very good solution that meets customers’ needs and an open standard that they can rely upon and interoperability.”

Later in the call with analysts. Mr. Stroup announced a significant integration of Belden’s recent acquisition of security solution provider Tripwire with Grass Valley’s broadcast solutions.

“… we did have a substantial development in the quarter where we have in fact integrated the Tripwire technology into our iTX Playout system, which is an important part of the Grass Valley product portfolio. This is a software based Playout system that is used by the world’s leading broadcasters and we now have integrated the Tripwire software in to that system.

We made that available this quarter. I think we announced it at NAB…I think it’s an important development and it’s just one of the many ways that our Grass Valley business is differentiating itself from others. We are the only one in the industry that has done anything like that. And I think it’s an important development.”

 

Related Content:

Press Release: Q2 2016 Results:

Presentation: Q2 2016 Results:

Prepared management remarks: Q2 2016 earnings call with analyst

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

Grass Valley Receives $20M Order; Slight Revenue Decline in Q1

Analysis, Broadcast technology vendor financials, Quarterly Results | Posted by Josh Stinehour
May 11 2016

Belden announced first quarter 2016 results.  Belden’s largest division in terms of revenue is its Broadcast Solutions division.  The division includes the operations of Grass Valley along with Belden’s broadband connectivity businesses.

Beginning with Q1 2016 Belden’s has moved its audio-video cable and connector business out of the Broadcast reporting unit and into the Enterprise Connectivity reporting segment.  The reporting change provides improved visibility into Belden’s broadcast revenues.  Prior periods were restated to similarly reflect the reporting modification.

Broadcast Solutions revenue for the first quarter 2016 was $171.3 million, a decrease of 2.9% over the year prior quarter, and a 15.1% decline against the preceding quarter, Q4 2015.

Broadcast Solutions revenue for the quarter was negatively impacted by currency translation, responsible for approximately 58% of the year-over-year decline ($3 million).  Managed attributed the sequential declines to typical seasonal patterns in the industry.

As part of the earnings release management highlighted the largest order in Grass Valley history.  The order was received in April and is in excess of $20 million.  It will ship over the next two to three years.  Managed also indicated a further seven IP systems shipped during Q1 2016.

EBITDA (Earnings before interest depreciation and amortization) for Broadcast Solutions in the quarter was $23.2 million, a 0.7% increase versus Q1 2015, and a 42.2% decrease against Q4 2015.

The EBITDA margin for Q1 2016 was 13.6%, which compares to a 13.1% EBITDA margin in Q1 2015, and a 19.9% EBITDA margin in Q4 2015.

For the quarter, Belden recognized a $4.3 million charge in its Broadcast Solution division for severance, restructuring, and acquisition integration costs.

On Belden’s earnings call with analyst, CEO John Stroup offered commentary on the recent financial results at Grass Valley.  “The Grass Valley business on a year-over-year basis, revenues were down. We expected that. That was sort of the last quarter of a difficult comparison. As you recall, last year, we began to see softness in order rates in Q2 and revenue in Q2.

On a year-over-year basis, I thought the team did a nice job on productivity improvement. On a year-over-year basis within the segment, productivity was about $7 million. So, obviously, with the high margins in that business, it’s difficult to overcome the revenue but I think the fact that they were able to expand margins, EBITDA margins on a year-over-year basis was a good outcome. In terms of order rates, the order rates in the quarter were pretty much as we expected. The book-to-bill at Broadcast was just about 1.0 for the quarter. But as we mentioned, we did make progress on the IP products although that is still a relatively small percentage of the business.” said Stroup.

Business Outlook:

In response to an analyst question, Stroup elaborated on the 2016 expectations for Grass Valley stating, “…I would say that our guidance right now on the full year implies modest growth in Grass Valley on a year-over-year basis. So, we are not incorporating a strong rebound in the Grass Valley business in 2016 to hit the numbers [management guidance for overall business] that we’ve given everybody today.”

 

Related Content:

Press Release: Q1 2016 Results

Presentation: Q1 2016 Earnings Presentation 

Transcript: Prepared management remarks

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

Francisco Partners Acquires SintecMedia

Analysis, Broadcast Vendor M&A | Posted by Josh Stinehour
Apr 27 2016

Sintec and FP logo

Francisco Partners has acquired SintecMedia, a well-known provider of broadcast business management software.

Financial details of the transaction were not made public. However, according to Reuters, the deal was valued at approximately $400 million.

Francisco Partners is a technology-focused private equity firm.  Francisco has existing familiarity with the media technology sector having purchased Grass Valley from Technicolor in January 2011 .  Francisco operated Grass Valley for nearly four years before exiting the investment in 2014 with Grass Valley’s sale to Belden.

SintecMedia had been owned by private equity firm Riverwood Capital.  Riverwood acquired SintecMedia in 2010 from existing venture capital investors including Walden Israel and Sequoia Capital.  Riverwood then supported SintecMedia through a series of acquisitions including Argo Systems , StorerTV , and more recently Broadway Systems.  In early 2014 Riverwood provided almost half the financing to support Sintec’s acquisition of competitor Pilat Media in a transaction valued at $103.5 million.

In the press release announcing the transaction, CEO and co-Founder of SintecMedia Amotz Yarden, stated, “Nothing is changing in SintecMedia’s business operations. We will continue to play a pivotal role in the way advertising is bought, sold and managed in the diverse media industry and our customers will continue to receive future-proof technological continuity combined with our innovative aptitude and deep domain expertise. I look forward to many years of exciting growth.”

Matt Spetzler from Francisco Partners added, “We have followed SintecMedia for over six years and are thrilled to back the company and its management team as they continue to consolidate their leading position in helping media companies monetize their assets. The broadcast and media industries are entering a phase of innovation and change and SintecMedia is uniquely positioned to help customers capitalize on this opportunity with a strong market position and new products.”

 

Related Content:

Press Release: Francisco Partners Acquires SintecMedia

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

After Difficult 2015, Grass Valley Expects Growth in 2016

Analysis, Annual Results, Broadcast technology vendor financials, Quarterly Results | Posted by Josh Stinehour
Feb 22 2016

Belden announced fourth quarter and full year results for 2015.  Belden’s largest division in terms of revenue is its Broadcast Solutions division.  The division includes the operations of Grass Valley along with Belden’s broadcast cable and broadband connectivity businesses. GrassValley_Logo

Broadcast Solutions revenue for the full year 2015 was $900.6 million, a decrease of 1.7% versus 2014 full year results.

EBITDA (Earnings before interest depreciation and amortization) for the division in 2015 was $142.4 million, a 1.4% increase over the 2014 EBITDA of $140.4 million.  EBITDA margin in 2015 was 15.8%, a slight increase against the 15.1% EBITDA margin from 2014.

Q4 2015 Results:

Fourth quarter revenue in 2015 for Broadcast Solutions was $239.5 million, a decrease of 5.4% versus Q4 2014, and a sequential increase of 4.9% versus Q3 2015.  Management cited a stronger U.S. dollar and lower copper prices resulting in a negative impact of approximately $10.2 million on Q4 2015 revenues.  When adjusted for currency, revenues for Broadcast Solutions decreased 1.4% on a year-over-year basis.

On a regional basis, Belden stated Broadcast Solutions revenue in the United States was up 7.4% when compared to Q4 2014. EMEA revenues declined 17% versus Q4 2014.  Management attributed this decline in part to the strong U.S. dollar and lower oil prices.

Belden’s Broadcast Solutions division recorded EBITDA of $46.7 million in Q4 2015, a 5.2% increase versus Q4 2014, and a 33.8% increase against the preceding quarter.

EBITDA margins for the quarter were 19.5%, a 200 basis point increase versus Q4 2015. A weaker Canadian dollar was partly responsible for the increase in profitability.

Belden recognized a $10.5 million restructuring charge for its Broadcast Solution division in the fourth quarter.  For the full year restructuring charges in the Broadcast Solution division were $39.1 million.

 

Outlook:

On Belden’s earnings call with analyst, CEO John Stroup offered commentary on developments at Grass Valley:  “In addition to the Summer Olympics and U.S. presidential elections, we are excited by the progress made with our comprehensive IP solution. During the quarter, we booked 7 new IP projects and shipped 4 of them. Also we entered 2016 with almost $15 million more backlog than 1 year ago.”.  Later when fielding analyst questions Stroup elaborated on the 2016 prospects for Grass Valley stating, “… if you just take the backlog head start compared to the revenues in ’15, you’ve got almost 4% growth rate there. So it feels to me like we’re on track for growth in 2016 with Grass Valley compared to ’15.”

 

 

Related Content:

Press Release: Belden Reports Strong Results for Fourth Quarter and Full Year 2015

Belden Q4 and FY 2015 Investor Presentation

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

2015 Big Broadcast Survey (BBS) Reports Now Available

broadcast technology market research | Posted by Joe Zaller
Aug 04 2015

The 2015 Big Broadcast Survey (BBS) Reports have now been published and are available from Devoncroft Partners.

We have been publishing the BBS Reports since 2009.  Each new edition is created through several months of research, including interviews with technology end-users, global surveys of technology decision makers, analysis of the end-user responses, and visualization of the data collected.  Now in its seventh year of publication, the BBS remains the most comprehensive annual study of technology end-users in the global broadcast and media technology industry.  Nearly 10,000 technology professionals in 100+ countries participated in the 2015 BBS, making it once again the largest market study of the media technology industry.

Based on feedback from technology vendors, media companies, and investors, we have updated the vendors, product categories, and market trends profiled in the 2015 BBS to better align with recent market developments.

These updates help ensure the BBS reports remains a critical reference for industry executives to improve strategic decision-making, customer engagement, marketing strategy, product planning, and sales execution.  In addition to technology vendor and service provider strategic planning, BBS reports are also used frequently for M&A and investment activities by both buyers and sellers.

Three types of 2015 BBS reports are available:

  • 2015 BBS Global Brand Reports: provides deep insight into how each more than 100 broadcast technology suppliers (see full list below) are perceived by market participants, along with comprehensive benchmarking of broadcast technology vendors on a wide variety of metrics

 

  • 2015 BBS Product Reports: provide detailed information from buyers, specifiers, and users of broadcast technology products in 30 separate categories (see full list below)

 

  • 2015 BBS Global Market Report: provides detailed information about industry trends, major projects being planned, products being evaluated for purchase, current and future plant infrastructure, broadcast technology budgets, and planned deployment of new technologies including 4K, HEVC compression, and IP-based technology infrastructure

 

For additional information on the 2015 BBS report, please email us.

As is Devoncroft’s custom, we will publish selected highlights from this year’s BBS reports on the Devoncroft website.  These articles are posted on a semi-regular basis, so please check back often.

To receive posts when published, please enter register with your email in the box in the upper right-hand corner of the page.

The tables below list the  technology vendor brands and product categories covered in the 2015 BBS.

 

All Brands Covered in 2015 Big Broadcast Survey (BBS)


Product Categories Covered in the 2015 Big Broadcast Survey

Technology Products & Vendor Brands Covered in the 2015 BBS, by Application Area

 

Acquisition & Production:

Camera Lenses

Angenieux, Canon, Fujinon

 

ENG Cameras

Canon, Hitachi, Ikegami, JVC, Panasonic, Sony

 

Large Format Single Sensor Cameras

ARRI, Blackmagic Design, Canon, Red Digital Cinema, Sony

 

Production Switchers

Blackmagic Design, Broadcast Pix, For-A, Grass Valley, NewTek, Panasonic, Ross Video, Snell, Sony

 

Studio/System Cameras

Grass Valley, Hitachi, Ikegami, JVC, Panasonic, Sony

 

 

Post Production:

 

Graphics & Branding

Adobe, Autodesk, Avid, ChyronHego, Evertz, Grass Valley, Imagine Communications, Orad, Pixel Power, Ross Video, Vizrt

 

Transcoding / Streaming

Dalet/AmberFin, Elemental Technologies, Envivio, Harmonic, Imagine Communications, Telestream

 

Video Editing

Adobe, Apple, Avid, EVS, Grass Valley, Imagine Communications, Sony

 

Infrastructure:

Bonded Cellular

Dejero, LiveU, Teradek, TVU, Vislink

 

Routing Switchers

Blackmagic Design, Evertz, Grass Valley, Imagine Communications, Nevion, Pesa, Ross Video, Snell, Utah Scientific

 

Signal Processing / Interfacing / Modular

Aja Video, Axon, Blackmagic Design, Evertz, For-A, Grass Valley, Imagine Communication, Ross Video, Snell

 

Video Transport

Arris, Aspera, Cisco, Ericsson, Evertz, Harmonic, Imagine Communications, Media Links, Net Insight, Nevion, Riedel, Signiant

 

 

Audio:

Audio Consoles

Avid, Calrec, Lawo, Salzbrenner Stagetec, Solid State Logic (SSL), Soundcraft, Studer, Wheatstone, Yamaha

 

Audio Processing & Monitoring

Adobe, Avid, Dolby, Linear Acoustic, RTW, TSL, Wohler

 

Intercom / Talkback

Clear-Com, Riedel, RTS Intercom Systems, Trilogy

 

Microphones

AKG, Audio-Technica, beyerdynamic, Electro Voice, Marshall Electronics, Neumann, Schoeps, Sennheiser, Shure, Sony

 

Monitors (speakers)

Adam, Avid, Focal, Genelec, JBL, KRK Systems, Mackie, Neumann, PMC,

 

 

Storage:

High Performance Shared Storage:

Avid, Harmonic, HP, IBM, Isilon Systems/EMC, NetApp, Quantum

 

Playout / Transmission Servers

Avid, EVS, Grass Valley, Harmonic, Imagine Communications, Ross Video

 

Production Servers

Avid, EVS, Grass Valley, Harmonic, Quantel

 

 

System Automation and Control:

Broadcast Business Management Systems

arvato/S4M, Imagine Communications, MediageniX, MSA Focus, SintecMedia/Pilat Media, VSN, Wide Orbit

 

Archive & Archive Management

ASG/Atempo, Masstech, Oracle/Front Porch Digital, Quantum, SGL, XenData

 

Playout Automation

Grass Valley, Imagine Communications, Pebble Beach, Playbox, Snell

 

Workflow / Asset Management

arvato/S4M, Avid, Dalet/Amberfin, EVS, Imagine Communications, Sony, Vizrt, VSN

 

 

Playout and Delivery:

Integrated Playout (Channel in a Box)

Evertz, Grass Valley, Harmonic, Imagine Communications, Pebble Beach, Playbox, Snell, Thomson Video Networks

 

On-line / Streaming Video Delivery Platforms

Brightcove, Kaltura, Ooyala, Piksel

 

Transmission Encoders

Arris, ATEME, Cisco, Elemental Technologies, Envivio, Ericsson, Harmonic, Imagine Communications, Thomson Video Networks

 

Transmitters

GatesAir, Hitachi, NEC, Plisch, Rohde & Schwarz, Screen Service, Toshiba

 

 

Test, Quality Control and Monitoring:

 

Multiviewers

Avitech, Axon, Evertz, For-A, Grass Valley, Imagine Communications

 

Test & Measurement

Imagine Communications, IneoQuest, Leader, Phabrix, Rohde & Schwarz, Tektronix

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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