Vizrt Reports H1 and Q2 2010 Results
(Thomson Reuters ONE) -
Strong revenue growth
Improved operating margins
Bergen, Norway, August 12, 2010. Vizrt Ltd. (Oslo Main List: VIZ)
For the first six months of 2010, the Company recorded a 26% revenue growth
compared to 2009. All business areas contributed to the positive revenue
development, with the strongest growth in BG and MAM. Geographically, the
Americas led the growth, followed by a stable growth in Europe. A positive shift
in the product mix sold, including a higher portion of new licenses, led to
improved margins and operational result.
HIGHLIGHTS
* H1 and Q2 2010 Revenues MUSD 48.0 and MUSD 24.2 up 26% and 17% compared to
same periods LY.
* EBIT of MUSD 2.6 in H12010 and MUSD 2.4 in Q2 2010 corresponding to a 10%
and 5% margin, compared to MUSD -1.8 (-5%) and MUSD 0.5 (3%) in the same
periods LY.
* EBITDA of MUSD 3.9 corresponding to a 16% margin compared to MUSD 2.0 (10%)
in Q209.
* The Company posted a net profit of MUSD 0.6 (1%) in H12010 and MUSD 1.1 (4%)
in Q2 2010 compared to MUSD -1.3 (3.5%) and MUSD 0.8 (4%) in the same
periods LY.
* Backlog to date amounts to MUSD 37.8, up 37% compared to the same period LY.
* Subsequent to the quarter's end, the Company acquired the remaining 70% of
Adactus AS on July 12, 2010, complementing Vizrt's workflow solution.
Adactus will be consolidated starting from Q3 2010.
Martin Burkhalter, Vizrt CEO, commented on the results, "Our results for the
second quarter of this year confirm the positive developments we reported
earlier in the year. Even though markets have not fully settled, uncertainty has
reduced markedly and as a result we anticipate business for the remainder of the
year to be solid. Broadcasters are coming back to the table, something that was
especially evident in MAM, where more RFPs were put out. What is more, in MAM we
are witnessing a clear uptake in activity related to long-term strategic
investments, a clear expression that MAM is a must have, a development we have
anticipated for some time and we believe is now becoming reality."
Mr. Burkhalter continues: "The overall improvement of the market conditions and
in our commercial operations also had a clear effect on our gross margin and
bottom line. Especially a change in product mix towards more new licenses in
relation to professional services in the MAM area contributed to the reported
improvements."
"Our top line results for the second quarter could have been even better, bar
for three developments in the market: Firstly, the strong recovery of the US
Dollar compared to other currencies and especially the Euro had a significant
impact on our top line. Secondly, the effects of the Vulcano eruption in Iceland
earlier this year delayed certain sales efforts, affecting our Q2 top line.
Finally, the political instability in Thailand, currently one of our more
important markets in Asia Pacific and also used as a hub for the region, had a
clear negative impact on revenue development in this area."
Vizrt Product Lines and Geographical Overview
Broadcast Graphics (BG)
BG, accounting for 72% of total revenues, led growth in H110 compared to H109.
In both Q1 and Q2 2010, a strong recovery in demand for the Company's core BG
product line was witnessed with revenues up 33% YoY. We believe our structural
changes are starting to yield effect, with regionalization programs further
driving BG sales in traditionally underserved markets.
Media Asset Management (MAM)
MAM continues to show a strong recovery. For H1 2010, MAM revenues came in at
MUSD 9.4, up 31% compared to H1 2009 and up 23% compared Q2 2010 to Q2 2009. The
main reasons for the increase in MAM revenues were the general improvement of
the market conditions, a growth in RFPs related to strategic investments, our
ability to convert a large part of the outstanding RFPs into business for Vizrt
and our improved capacity to deliver projects. Furthermore, our competence in
delivering integrated workflow solutions is paying dividends, especially where
strategic investments are concerned. MAM is the second largest revenue
contributor with a share of 20% in H1 2010.
Online (ONL)
The Online market has overall still not improved much, but we can see some
encouraging signs in Q2. H1 2010 revenue was MUSD 3.8, compared to MUSD 4.6 in
H1 2009, down 18%. However, in Q2 2010 revenues came in at MUSD 2.1, up 8%
compared to Q2 2009 and up 30% compared to Q1 2010. The revenue pickup is
attributed to the integrated offerings from our product lines such as ONL, MAM
and Mobile streaming. ONL contributed 8% to revenue in H1 2010.
Geographical Overview
H1 2010 saw a return to growth for all regions as compared to H1 2009. The
strongest growth was recorded in The Americas, with revenues up 45% to MUSD
11.7 in H1 2010, as compared to MUSD 8.1 in H1 2009. Growth in the EMEA region
was 24%, with revenues up to MUSD 26.8 in H1 2010, as compared to MUSD 21.6 in
H1 2009. Revenues in the APAC region were up 14% to MUSD 9.4 in H1 2010 from
MUSD 8.3 in H1 2009, despite a weak Q2 2010 mainly due to the political unrest
in Thailand.
FINANCIALS
Gross Profit and Gross Margin
The gross margin for H1 2010 was 61% as compared to 59% for the same period LY.
The increase is mainly due to a lower HW portion in the product mix. The gross
profit was affected by a MUSD 1.5 amortization of intangible assets from
acquisitions in H1 2010, compared to MUSD 1.6 in H1 2009. Adjusted for these
amortization effects, the gross margin was 65%, compared to 63% LY.
Operating Expenses
Total operating expenses in H1 2010 were MUSD 26.9, up 12% compared to the same
period LY. The increase is mostly due to the regionalization efforts the Company
has been implementing since late 2009. Both R&D and the Sales Organization are
focused on developing, marketing and selling our integrated workflow solution
offering across the three product lines. Developing and building such competence
in the three global regions carries associated costs, which we expect will start
paying off in the coming years. However, Q210 OPEX is down MUSD 0.4 (-3%)
compared to Q110. This decrease in OPEX is mainly attributed to currency
exchange rates.
Order backlog
The order backlog as of August 9, 2010 was MUSD 37.8, up 37%, compared to LY
MUSD 27.5, and up 5% compared to the Q1 2010 results release date. BG backlog
was at MUSD 19.7, MAM backlog at MUSD 12.7, ONL backlog at MUSD 4.4 and Mobile
streaming, related to Adactus, at MUSD 1.0. For BG and ONL the backlog were
significantly higher than the comparable backlog for the same period LY (100%
and 82% respectively) whereas for MAM the backlog was down 17% comparing to same
period LY.
Balance Sheet, Cash Flow and Liquidity
Cash flow generation from operating activities in H1 2010 was MUSD 3.6 compared
to MUSD 1.5 in H1 2009.
Vizrt has a strong financial position with no interest-bearing debt and a net
cash position of MUSD 51.4 as of June 30, 2010 (including MUSD 0.9 restricted
cash), compared to MUSD 50.0 as of December 31, 2009. Furthermore shareholders'
equity as of June 30, 2010 was MUSD 97.7, which is equivalent to an equity ratio
of 77%.
OUTLOOK
Martin Burkhalter, CEO of Vizrt, stated, "The positive trends we signaled in our
previous results releases continue to hold true. Improvements in the general
market conditions, combined with technology driven change, such as the migration
to HD and to file based workflows, contributed to the strong growth we posted.
Our efforts to strengthen and integrate our operations at the regional level are
also starting to pay dividend. For the remainder of this year we therefore
expect this development to continue, especially in BG and MAM."
"We continue to invest in our technological and organizational development,
which means that in the short term our operating costs vs. revenue will be
slightly higher than in pre-crisis times. However, we are making these
investments with a view of the future where we foresee continuing substantial
changes in the digital media universe that require an innovative and regionally
focused organization. Parts of our investments are in low cost countries where
incredible talent is available to help us remain a step ahead of both market
developments and the competition while at the same time working to improve our
margins."
"In summary, we believe that the recovery in the markets, combined with our
strong product offering, positions us well to continue our growth path towards
the revenue and margin levels we achieved prior to the economic down turn. We
have a strong and very dedicated organization, are financially sound and have an
impressive product portfolio. This allows us to continue to strengthen our
market position and help our customers to meet the challenges and opportunities
in the rapidly changing digital media world."
Please download the full H1 2010 report and management presentation via the
links at the end of this message.
Combined Analyst Conference & Conference Call
A combined Analyst Conference and Conference Call will be held at 09:30 a.m.
(CEST) at DnBNor Head Offices, Stranden 21 in Oslo and via telephone +47
24 159 584 (Norway), +49 69 247 501 891 (Germany), +44 203 147 48 62 (UK). In
order to follow the slide presentation online, please login
athttp://www.meetyoo.de/loginseiten/easyweb.html access code: VizRTGuest
Contacts
Martin Burkhalter
CEO
+41 79 795 24 48
mbu(at)vizrt.com
Ofra Brown
CFO
+47 5351 8040
ofra(at)vizrt.com
SCHWARZ Financial Communication
Frank Schwarz
+49 611 1745 398 11
schwarz(at)schwarzfinancial.com
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)
[HUG#1437307]
H1 and Q2 2010 Report:
http://hugin.info/138784/R/1437307/382084.pdf
Management Presentation:
http://hugin.info/138784/R/1437307/382085.pdf
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All reproduction for further distribution is prohibited.
Source: Vizrt Ltd. via Thomson Reuters ONE
Unternehmensinformation / Kurzprofil:
Datum: 12.08.2010 - 07:30 Uhr
Sprache: Deutsch
News-ID 39469
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