PLANO, Texas, Nov. 14, 2011 /PRNewswire/ -- ViewCast
Corporation (OTCBB: VCST), a developer of industry-leading
solutions for the transformation, management and delivery of
digital media over enterprise, broadband, and mobile networks,
today reported results for the 2011 third quarter and nine months
ended September 30, 2011.
The Company reported net sales of $3.6
million in the third quarter 2011 compared to $4.5 million in the prior year period.
While the pipeline for both Osprey® cards and
Niagara® systems remained strong and the order flow from
the Company's principal OEM customer returned to a more normal
volume than in the second quarter, closing rates across the board
were affected by macroeconomic uncertainty. Purchasing
managers in all regions reported that institutional delays in
decisions and investments were seen during the period due to the
fear of recession in Europe and
the general resulting uncertainty in the global and domestic
outlook.
New ViewCast President and Chief Operating Officer John Hammock said, "We are tackling the current
and long term issues head on and in two principal ways.
First, although we do see some improvement in ordering
patterns, it is difficult to predict how trends will continue, so
we are aggressively restructuring our organizational costs to match
our current rates of revenue. Secondly, we are stepping up our
focus and investment in several new product innovations for launch
in early 2012, which will open the door for us to access additional
large customers in the telecom industry and other institutional
customers that are gearing up to deliver content directly to
consumers and their mobile platforms."
Highlights of the Third Quarter and Recent Weeks
Important progress made in the third quarter and subsequent
weeks included:
- Two video industry veterans were appointed to the top sales and
marketing positions. Howard Barouxis was named Vice President
of Sales, and Mike Galli as Vice
President of Marketing.
- In July, the new Niagara 7550 streaming media system for
Web-based delivery of HD video was introduced. The 7550 enables
users to simultaneously leverage multiple adaptive streaming
formats, including Apple HTTP adaptive streaming for
iPad® and iPhone® mobile products and
Adobe® Flash® dynamic streaming, and can meet
the needs of the most demanding professional broadcasting
applications and other professional-level HD video distribution
requirements.
- In September at the IBC in Amsterdam, the Niagara 7550 received TV
Technology Europe's prestigious Star Award as one of the preeminent
technological innovations in the broadcasting industry.
- In October, the Company launched the enhanced Niagara
SCX® 6.4 streaming media management software which
includes a number of advanced features, including support for
adaptive live encoding via Microsoft® Live IIS Smooth
Streaming and PlayReady® DRM support, updates to
Akamai® HD iPhone® and iPad®
streaming, improved MPEG-4 streaming, and presentation and security
enhancements for the entire adaptive streaming portfolio. Full
software functionality will be available on ViewCast's
professional-grade Niagara Pro II, Niagara 7750 and Niagara 4100
streaming media systems, with upgrades available to existing owners
of ViewCast streaming systems.
- Also in October, PrepSpin, the Kentucky-based sports broadcasting company
began successfully using the Osprey video capture cards and Niagara
2100 and 4100 streaming media systems to broadcast youth, middle
school, high school and other sporting events throughout the state.
The Company believes the high school and prep markets for streaming
media are going to grow substantially during the next few years and
that the Osprey and Niagara products are ideal for these
applications.
"Progress with new products and inroads into new customer bases
is our marketing priority," continued Hammock. "I am looking
forward to a series of new product introductions that extend our
proven core technologies and competencies into new arenas, where we
promote our technology advantages. Within a year, we believe
our business will be far more balanced between our expanded target
verticals, and will provide a return to profitable growth."
Third Quarter Financial Results
In the 2011 third quarter, revenues were $3.6 million compared to $4.5 million in the prior year period.
Operating expenses for the third quarter 2011 were
$3.0 million compared to $2.7 million for the prior year period.
Operating loss of $(854,000)
for the third quarter 2011 declined from income of $51,000 for the year-earlier period.
Net loss for the third quarter 2011 was $(916,000) compared to net income of $8,000 in the third quarter 2010.
EBITDA (earnings before interest, taxes, depreciation and
amortization) for the 2011 third quarter was $(0.7) million, compared to $0.2 million in the 2010 third quarter. EBITDA is
a non-GAAP measure that ViewCast management believes can be helpful
in assessing the Company's overall performance and considered as an
indicator of operating efficiency and earnings quality. The Company
suggests that EBITDA be viewed in conjunction with the Company's
reported financial results or other financial information prepared
in accordance with GAAP.
Chief Financial Officer Laurie
Latham commented on the ongoing financial restructuring,
"Our principal goal on the operating and expense side of things is
to pare back expenses to match our Q3 run rate, with the idea that
as we return to growth, stronger bottom line results will be
produced. We have identified and executed on a majority of
the changes already and we feel confident that the organization
will be in a more stable and beneficial position going into the new
year."
Nine-Month Financial Results
Revenues for the nine months ended September 30, 2011 were $11.5 million compared to $12.4 million for the first nine months of 2010.
Operating expenses for the nine-months 2011 were $8.8 million, compared to $8.1 million for nine-months 2010. The
operating loss was $(1.9) million,
compared to an operating loss of $(0.6)
million for nine-months 2010.
Net loss for the nine-months 2011 was $(2.1) million, compared to a net loss of
$(0.7) million for nine-months 2010.
Due to the accounting treatment for the preferred stock redemption
during the period, the net income applicable to common shareholders
benefitted by $5.6 million, which
together with an adjustment of $282,000 for stated preferred stock dividends
resulted in net income applicable to common shareholders of
$3.2 million or $0.07 per share on a fully diluted basis for the
nine months ended September 30, 2011.
This compares, after the stated preferred stock dividends
adjustment of $615,000, to a net loss
applicable to common shareholders of $(1.3)
million or $(0.04) per share
on a fully diluted basis for the prior year period.
EBITDA for nine-months 2011 was $(1.4)
million, compared to $46,000
for nine-months 2010.
About ViewCast Corporation
ViewCast develops industry-leading hardware and software for the
transformation, management and delivery of professional quality
video over broadband, enterprise and mobile networks. ViewCast's
award-winning solutions simplify the complex workflows required for
the Web-based streaming of news, sports, music, and other video
content to computers and mobile devices, empowering broadcasters,
businesses, and governments to easily and effectively reach and
expand their audiences. With more than 400,000 video capture cards
deployed globally, ViewCast sets the standard in the streaming
media industry. ViewCast Niagara® streaming appliances,
Osprey® video capture cards and VMp™ video
and digital asset management software provide the highly reliable
technology required to deliver the multi-platform experiences
driving today's digital media market.
ViewCast (www.viewcast.com) is headquartered in Plano, Texas, USA, with sales and distribution
channels located globally.
ViewCast, VMp, Osprey, Niagara and Niagara SCX are trademarks
or registered trademarks of ViewCast Corporation or its
subsidiaries.
Safe Harbor Statement
Certain statements in this release are forward-looking within
the meaning of the Private Securities Litigation Reform Act of 1995
and reflect the Company's current outlook. Such statements apply to
future events and are therefore subject to risks and uncertainties
that could cause actual results to differ materially. Important
factors that could cause actual results to differ materially from
forward-looking statements include, but are not limited to, changes
in market and business conditions, demand for the Company's
products and services, technological change, the ability of the
Company to develop and market new products, increased competition,
the ability of the Company to obtain and enforce its patent and
avoid infringing other parties' patents, and changes in government
regulations. All written and verbal forward-looking
statements attributable to ViewCast and any person acting on its
behalf are expressly qualified in their entirety by the cautionary
statements set forth herein. ViewCast does not undertake any
obligation to update any forward-looking statement to reflect
circumstances or events that occur after the date on which the
forward-looking statements are made. For a detailed discussion of
these and other cautionary statements and factors that could cause
actual results to differ from the Company's forward-looking
statements, please refer to the company's reports on Form 10-K and
10-Q on file with the U.S. Securities and Exchange
Commission.
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ViewCast Contact:
Laurie L. Latham
Chief Financial
Officer
Tel: +1 (972)
488-7200
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Investor Contact:
Matt Clawson
Allen & Caron
Tel: +1 (949)
474-4300
E-mail: matt@allencaron.com
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Financial
Tables Follow
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VIEWCAST
CORPORATION
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OPERATING
HIGHLIGHTS
|
|
(Unaudited)
|
|
(In
thousands – except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
3,558
|
|
$
4,547
|
|
$
11,521
|
|
$
12,365
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
1,457
|
|
1,814
|
|
4,662
|
|
4,793
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
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|
2,101
|
|
2,733
|
|
6,859
|
|
7,572
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
2,955
|
|
2,682
|
|
8,778
|
|
8,145
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
(854)
|
|
51
|
|
(1,919)
|
|
(573)
|
|
|
|
|
|
|
|
|
|
|
|
Total other expense
|
|
(62)
|
|
(43)
|
|
(166)
|
|
(120)
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
(916)
|
|
$
8
|
|
$
(2,085)
|
|
$
(693)
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock
dividends
|
|
-
|
|
(205)
|
|
(282)
|
|
(615)
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|
|
|
|
|
|
|
|
|
|
|
Preferred stock
redemption
|
|
-
|
|
-
|
|
5,586
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) applicable
to
|
|
|
|
|
|
|
|
|
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common stockholders
|
|
$
(916)
|
|
$
(197)
|
|
$
3,219
|
|
$
(1,308)
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common
share:
|
|
|
|
|
|
|
|
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Basic &
Diluted
|
|
$
(0.02)
|
|
$
(0.01)
|
|
$
0.07
|
|
$
(0.04)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average number
of
|
|
|
|
|
|
|
|
|
|
common shares
outstanding:
|
|
|
|
|
|
|
|
|
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Basic &
Diluted
|
|
55,699
|
|
36,048
|
|
48,121
|
|
36,029
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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RECONCILIATION OF NET INCOME TO
EBITDA
|
|
(Unaudited)
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
(916)
|
|
$
8
|
|
$
(2,085)
|
|
$
(693)
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
164
|
|
190
|
|
509
|
|
619
|
|
|
|
|
|
|
|
|
|
|
|
Total other and income tax
expense
|
|
62
|
|
43
|
|
166
|
|
120
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
(690)
|
|
$
241
|
|
$
(1,410)
|
|
$
46
|
|
|
|
|
|
|
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SOURCE ViewCast Corporation